Posted in | Semiconductor | Electronics

Arkansas Sues Computer Chip Manufacturers for Price Fixing

Arkansas Attorney General Mike Beebe has announced that Arkansas is one of 34 states suing some of the world’s largest manufacturers of dynamic random access memory (DRAM) chips. The lawsuit alleges that for at least four years, the chip manufacturers conspired to keep prices high, causing consumers and state agencies to pay illegally inflated prices for computers.

DRAM chips are a dense but efficient form of memory used in millions of computers. In the lawsuit, the states allege that the manufacturers coordinated their pricing practices from 1998 to 2002, and limited the supply of DRAM chips to help keep prices artificially high. In 2003, $5 billion worth of DRAM chips were sold in the United States.

“Arkansas consumers and state agencies deserve compensation for the excessively high prices they paid for computers due to this price-fixing conspiracy,” Beebe said. “Not only are we making sure this kind of activity stops, but we are also righting the wrongs these practices have already caused by preventing free enterprise and competition.”

An investigation by the Department of Justice in 2002 resulted in $730 million in fines paid by four DRAM chip manufacturers and their executives, along with 12 guilty pleas for criminal price-fixing.

The defendants named in the states’ lawsuit are Infineon Technologies AG; Hynix Semiconductor, Inc.; Micron Technology, Inc.; Mosel Vitelic, Inc.; Nanya Technology Corp.; Elpida Memory, Inc.; and NEC Electronics America, Inc. Also named in the suit are the manufacturers’ subsidiaries that sold the chips in the U.S.

Beebe noted that Arkansas’ charges in the lawsuit include alleged violations of the Arkansas Deceptive Trade Practice Act and the Arkansas Unfair Practices Act.

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