34 States Sue Memory Manufacturers

By Nate Mook | Published July 14, 2006, 1:23 PM

New York Attorney General Eliot Spitzer on Thursday sued the world's top memory chip manufacturers, accusing them of colluding in order to artificially raise prices. California and 33 other states will follow with a separate lawsuit on Friday.

Named in the New York case are Micron, Samsung, Infineon, Elpida, Hynix, Mosel-Vitelic, Nanya Technology and NEC. The lawsuit alleges the companies violated state and federal antitrust laws by making secret deals to fix prices of DRAM between 1998 and 2002.

During this time, supply of DRAM far exceeded demand, and memory companies deliberately restrained supply and rigged bidding for memory contracts. In turn, the prices computer makers paid for the RAM chips were higher, and those higher costs were passed along to consumers.

The United States Department of Justice launched an investigation into the matter in 2002, and has fined Samsung, Infineon, Elpida and Hynix over $730 million. Micron received immunity in the case by testifying against its competitors.

California Attorney General Bill Lockyer is being joined by 33 other states in a suit that will be filed in San Francisco Friday. Samsung is not named as a defendant Lockyer said, as the company has indicated its intention to settle the matter out of court. Similar agreements were made with Toshiba, Hitachi and other chip makers.

Both suits will demand compensation for consumers that overpaid for DRAM, and bar the companies from colluding in the future. Spitzer says the conspiracy artificially added at least $1 billion to the cost of memory chips.

Comments

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They raised the prices on speculation. Speculation that someday, a tsunami "might" hit a location where chips are made, or at least hit a farm that raises goats for the milk to feed the children of the factory workers that make ink used for printing serial numbers on the boxes the chips are eventually packaged in. Yeah, that's it. :)

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I remember those days, I worked for CompUSA and RAM was pushing $2.00 a MB. I always thought it was due to some Tsunami hitting a factory in Taiwan.

I GOT YOUR 64 MB STICKS OF PC 100 RAM ON SALE FOR 99.99.

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So much for hands off, no government regulation etc.. and the spirit of free enterprise and competition..... They all eventually collude... look at oil companies.............

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I was wondering why 512MB DDR 3200 went from AUD$45 to $85 for about 6 months back in the day.

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I cant wait to get my 50 cents in the mail.

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request all support services,products,technologies,software,upgrades,updates
add to home page

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Geez... I thought I was the only one that thought a memory stick should be a lot cheaper than it is today. Hopefully, soon we won't have to pay freakin' $200 for a 256mb stick. I need more memory anyways. This is a good thing. Let's all hope that the prices drop fast.

It's time to sell your share of stocks for those companies because they will be dropping...

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It's about freakin' time! Now what is going to be the status quo for the new mram. Yeah, I believe somethings going to happen...Outsourcing and other chip countries will then over take the american dream and leadership? It has its good and bad.

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Maybe the Attorney General needs to advise other countries of this. Having recently come back after nearly 5 years in NZ and seeing what computer and parts prices are there, I can assure you that these prices were highly inflated mainly due to artificialism.

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Oklahoma has a budget surplus of over one billion dollars, largely due to the current gas crisis.

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Surely the MEM makers should do what they like with there product, Thats what you said about the EU & MS case. Or is this double standards ?

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I don't see this as pointless. They should be punished if they are price fixing.

Although I think it wasn't even that long ago though that some of these memory manufacturers were sued for the same thing.

I agree gas price fixing needs to be punished also.

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"Micron received immunity in the case by testifying against its competitors."

ROFLOL!!!

Isn't that unfair practice or anti-competitive? Maybe the other companies should sue Micron :-)

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I don't enjoy paying more for anything than necessary, but I don't feel like I have been gouged for memory in recent years. It has steadily come down in price over the years, and I consider it to be generally affordable today.

Meanwhile, Exxon-Mobile is reporting RECORD profits (not just "good" or "very good" profits which they may be entitled to) and consumers pay RECORD prices. Microsoft is getting slapped silly by antitrust on the basis that their OS has not come down in price like hardware has, but so far the governments have merely "expressed concerns" to the oil companies that citizens are suffering while oil execs are setting RECORDS.

Therefore, I can only conclude that these states' Attorney Generals are seeking publicity for a case which will require little effort, given that the DOJ has already established most of the facts they will rely upon. The memory makers need to hire the kind of lobbyists that the oil companies have. Only problem is that those lobbyists are expensive, and the memory makers aren't charging enough to afford them. Wake me up when the states decide to REALLY protect consumers.

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Blame the gas companies...blah blah blah....

Keep whining and drive your big, huge, gas guzzling, SUV that you (the American consumer) demanded from the car companies when gas was at $1.00 a gallon. We, as Americans, can ONLY BLAME OURSELVES!!!

I had a car that did 50 MPG in 1989 (it was an 82 model BTW), they STOPPED MAKING IT BECAUSE CONSUMERS WOULDN'T BUY IT!!! WHO are the idiots here? We are! Now just keep blaming the oil companies.. this is stupid and pointless. Move to Rusia where the gas prices are controlled. Its all fine and dandy at 1.00, but my goodness raise above that and you can't drive your super duper SUV or extra full sized minivan WITH A SINGLE PERSON IN IT and you act like the WORLD is GONNA END!!!!

*Rant*

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Blame ourselves for price fixing???? Yeah, right... NOT! We have NO control over these prices, only the gas companies do and our Goverments decisions.

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Price fixing ?!?! Oil is a traded commidity in the U.S.

Only a communist (or socialist) government can control that price if they choose (or the Democrats if you believe their utterly senseless rhetoric - of course by voting down any drilling in the U.S. - Hah).

Maybe you should get some facts straight before blaming the oil companies, the Reps have tried to help us here, but the dems and environmentalists (while driving their Hummers) are screwing us as well as the CONSUMERS WHO BOUGHT THESE BIG F*IN CARS!

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Prices are near $3.00 a gallon and I hear people complain every single day. Not a single one of them has changed their life style or done something to aid in helping. Most people just whine about the issue in hopes of some miracle happening to drop the prices down to "normal."

I laugh when there is a price scare and EVERYONE runs to the pumps to fill up....
If we did not buy gas, they wouldn't make any money, simple as that.

However, most lazy people these days will just say something to the effect of, "well I need gas, I have to have gas! The world doesn't turn without GAS dangit!"

**This just in, you're lazy and brainwashed**
stop smoking while you're at it please.

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I agree that people should "put their money where their mouth is" and everyone should start doing their part to conserve energy in whatever ways they can (I use CF lightbulbs, for example).

However, the other side to this picture is that record profits from Oil companies should not increase with increases in oil barrel prices.

Gas companies buy the barrel which they then process and sell you the gasoline and whatever other products out of it. That partially explains why prices at the pump are higher when barrels of oil are more expensive. But assuming that they keep their profit margins the same, they theoretically only pass along the higher cost of the barrel of oil and in the end, they only make the same amount of money regardless of what the barrel of oil costs them.

And yet, last year they didn't. They made MUCH more than that, which means that not only is oil much more expensive than before (partial reason for higher gas prices), but we're also being fleeced by the oil companies who are making higher profit margins and hiding behind "higher oil prices" and yet no one seems to want to do anything about it.

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Noone complained when gas was $1.00 a gallon.

"no one seems to want to do anything about it"

I agree, but its not the oil companies that are the problem, its the auto industry FUELED by CONSUMERS. If we can start to rid ourselves of 10-15 MPG cars, demand 50 MPG cars, and drive a little less, then WE CAN DO SOMETHING! No government required!

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or lets stop going over the fuel discussion and get back to talking about the article...

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what a bunch of divas

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what a bunch of DIVAs

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I doubt the average customer will see much compensation from this. Sony put a root-kit on so many computers and the compensation was 3 free songs or ~$7 (something like that). Will we be offered $10 or a 128 meg stick?

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The United States Department of Justice [...] has fined Samsung, Infineon, Elpida and Hynix over $730 million.

So now the states are suing them? What is next counties and cities?

It is pretty said sign of the state of the world when governments start getting lawsuit happy.

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This is nothing new. Attorney Generals have been suing companies for awhile now.

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I think this suit is pointless, if they sue successful, I think we should file suit again the government for holding back the oil reserve. Or better yet, sue them for implenment too much tax on gas, which lead to higher cost of living.

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I was thinking as I read this "Well I haven't noticed this with memory, but I am starting to wonder when our soldiers in Iraq are gonna start bringing back the oil they were sent out for... cause from here I'm not seeing any."

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As a country, we've brought these gas prices on ourselves. How many people drive vehicles every day that are enourmous and they are the only one's in it?

Just imagine if tomorrow, everyone woke up and their vehicle was replaced with an appropriate vehicle for their usage - I.e. - the H2 used for a 20 mile daily commute could be replaced with a much more fuel efficient sedan.

Can you imagine how much our daily fuel consumption as a country would drop? I'd be willing to be we'd see prices of $100 again!

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Sounds like communism to me. Ever heard of freedom? The gas companies are screwing us and would continue to do so just because they can. No matter how much is being used they are going to continue to make as much money as they can.

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Eliot Spitzer's an idiot, he just loves seeing his name in the press. No one should believe his stupidity.

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Hi my name is tenebrusmke79 and I don't make a whole lot of sense, but I sure do like seeing my worthless comments being posted on the internet.

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LOL (Oh, and please be sure to note my name, everyone!)

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i'd call you a white collar republican (redundant, yes) if i didn't know you were only two years older than me.

perhaps i'll call you a cowboy instead. cowboy means ignorant fool now, right?

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Real witty, dream of it yourself, or did your mommy think of it for you?

"i'd call you a white collar republican (redundant, yes) if i didn't know you were only two years older than me.

perhaps i'll call you a cowboy instead. cowboy means ignorant fool now, right?"
Wrong, which is typical with people like you. I don't like politics.

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Don't we all "like seeing [our] worthless comments being posted on the internet."?

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there is a saying out there, "better silent, than stupid." you should try following it eh?

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