DRAM price fixing scandal

File:256MB DDR SO-DIMM.JPG

In 2002, the United States Department of Justice, under the Sherman Antitrust Act, began a probe into the activities of dynamic random-access memory (DRAM) manufacturers in response to claims by US computer makers, including Dell and Gateway, that inflated DRAM pricing was causing lost profits and hindering their effectiveness in the marketplace.{{cite web |last=Gaudin |first=Sharon |date=2006-12-22 |title=Samsung Exec Gets Jail Time For Role In DRAM Price-Fixing Scandal |url=https://www.crn.com/news/components-peripherals/196701646/samsung-exec-gets-jail-time-for-role-in-dram-price-fixing-scandal.htm |work=CRN}}{{cite web |last=Gross |first=Grant |date=2004-09-15 |title=Infineon to pay $160M fine for DRAM price-fixing |url=https://www.computerworld.com/article/2566841/infineon-to-pay--160m-fine-for-dram-price-fixing.html |work=Computerworld}}

To date, five manufacturers have pleaded guilty to their involvement in an international price-fixing conspiracy between July 1, 1998, and June 15, 2002, including Hynix, Infineon, Micron Technology, Samsung, and Elpida.{{cite news |last=Smith |first=Tony |title=Memory makers hit by price-fixing claims |work=The Register |url=https://www.theregister.co.uk/2004/02/27/memory_makers_hit_by_pricefixing/ |access-date=2007-08-01 |archive-date=2008-07-25 |archive-url=https://web.archive.org/web/20080725111436/http://www.theregister.co.uk/2004/02/27/memory_makers_hit_by_pricefixing/ |url-status=live }}

2002–2005

"In December 2003, the Department charged Alfred P. Censullo, a Regional Sales Manager for Micron Technology Inc., with obstruction of justice in violation of 18 U.S.C. § 1503. Censullo pleaded guilty to the charge and admitted to having withheld and altered documents responsive to a grand jury subpoena served on Micron in June 2002."{{Ref|micron}}

On 20 October 2004, Infineon also pleaded guilty. The company was fined US$160M for its involvement, then the third largest antitrust fine in US history. In April 2005, Hynix Semiconductor was fined US$185M after they also admitted guilt. In October 2005, Samsung entered a guilty plea in connection with the cartel.{{Cite press release|title=SAMSUNG AGREES TO PLEAD GUILTY AND TO PAY $300 MILLION CRIMINAL FINE FOR ROLE IN PRICE FIXING CONSPIRACY|publisher=US Department of Justice|date=13 October 2005|url=https://www.justice.gov/atr/public/press_releases/2005/212002.htm|access-date=30 June 2010|url-status=dead|archive-url=https://web.archive.org/web/20051112051337/http://www.justice.gov/atr/public/press_releases/2005/212002.htm|archive-date=November 12, 2005}}

On 5 April 2006, Sun Woo Lee, Senior Manager of DRAM at Samsung Electronics, entered into a plea bargain with the US Government for his involvement in the price fixing conspiracy.{{cite court |litigants=UNITED STATES OF AMERICA v. SUN WOO LEE |court=D.C. Cir. |date=2006 |url=https://www.justice.gov/atr/case-document/file/501201/download}} Following the plea agreement he was sentenced to 8 months in prison and fined US$250,000.{{cite news | title=Samsung men 'admit' price fixing | date=2006-02-22 | url=http://news.bbc.co.uk/1/hi/business/4834978.stm | work=BBC News | access-date=2016-04-08 | archive-date=2007-10-08 | archive-url=https://web.archive.org/web/20071008183628/http://news.bbc.co.uk/1/hi/business/4834978.stm | url-status=live }} Lee was subsequently promoted to President of Samsung Germany in 2009, and then President of Samsung Europe in 2014.

On 19 May, 2010, European antitrust regulators also fined nine semiconductor manufacturers more than €331 million for the cartel that operated back in 2002. The companies fined are Samsung Electronics, Infineon, Hynix Semiconductor, Elpida Memory, NEC Electronics, Hitachi, Toshiba, Mitsubishi Electric and Nanya Technology. Micron Technology received immunity for blowing the whistle on the cartel and will not be fined for its involvement. {{Cite web|url=https://ec.europa.eu/commission/presscorner/detail/en/ip_10_586|title=Antitrust: Commission fines DRAM producers € 331 million for price cartel; reaches first settlement in a cartel case|website=Europa.eu|date=2010-05-19|access-date=2023-10-30|archive-date=2023-10-20|archive-url=https://web.archive.org/web/20231020184357/https://ec.europa.eu/commission/presscorner/detail/en/IP_10_586|url-status=live}}

2017–2018

On 27 April 2018, Hagens Berman filed a class-action lawsuit against Samsung, Hynix, and Micron in U.S. District Court alleging the trio engaged in DRAM price fixing causing prices to skyrocket through 2016 and 2017.{{cite web |title=DRAM Price Fixing |url=https://www.hbsslaw.com/cases/dram-price-fixing |website=Hagens Berman Lawfirm |access-date=2018-10-29 |archive-date=2018-10-30 |archive-url=https://web.archive.org/web/20181030035425/https://www.hbsslaw.com/cases/dram-price-fixing |url-status=live }} Between June 2016 and January 2018, the price of DRAM nearly tripled.{{cite web|title=Samsung, Hynix, Micron sued for DRAM price fixing that could have raised PC prices|url=https://www.techrepublic.com/article/samsung-hynix-micron-sued-for-dram-price-fixing-that-could-have-raised-pc-prices/|url-status=dead|website=TechRepublic|archive-url=https://web.archive.org/web/20180513133803/https://www.techrepublic.com/article/samsung-hynix-micron-sued-for-dram-price-fixing-that-could-have-raised-pc-prices/ |archive-date=2018-05-13 }}

References

External links

[https://web.archive.org/web/20051211072509/http://www.usdoj.gov/atr/public/press_releases/2004/206631.htm Four Infineon Technologies Executives Agree to Plead Guilty in International DRAM Price-Fixing Conspiracy]
[https://web.archive.org/web/20051227103738/http://www.usdoj.gov/atr/public/press_releases/2005/208655.htm Korean Company Hynix Agrees to Plead Guilty to Price Fixing]

Category:Anti-competitive practices

Category:Cartels

Category:Price fixing convictions