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States Sue Memory Makers for Price Fixing

States Sue Memory Makers for Price Fixing

by , 8:25 AM EDT, July 14th, 2006

Several memory chip manufacturers are being hit by lawsuits from 34 U.S. states on Friday for artificially inflating the price of RAM. The suits allege that the companies conspired to fix DRAM memory prices between 1998 and June 2002, according to CNET News.

Some of the companies that were allegedly involved in the price-fixing include Samsung Electronics, Hynix Semiconductor, Mosel Vitelic, Nanya Technology, Elpida Memory, a joint venture of Hitachi and NEC, and NEC Electronics' NEC Electronics America.

The lawsuits come after the completion of a U.S. Department of Justice investigation into the incident. Hundreds of millions of dollars in fines were imposed on several of the companies as a result of the probe.

The states lawsuits allege that the memory maker's actions forced companies like Apple Computer, Compaq Computer, Dell, and IBM to pay more than they should have for computer RAM, and then pass the costs on to consumers.

Assistant New York Attorney General Richard Schwartz said "I have never seen a price-fixing case where there is so widespread, so continuous an exchange of confidential price information among competitors or over so long a time period."

The lawsuits are looking to have the companies compensate consumers that paid higher prices for memory, and to prohibit them from engaging in any price-fixing actions in the future.

Micron spokesperson Dan Francisco commented "We have been involved in discussions with state attorneys general for a long period of time. As I understand it they wanted to get these cases on file while we discuss the potential for resolution."

According to Forbes, Micron was granted immunity for its cooperation in the Federal investigation.

Samsung is not named in the suits because it is working towards settling with the states. Agreements have already been reached with Winbond Electronics, Toshiba, Hitachi Ltd. and Mitsubishi Electric.

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