Office of the Attorney General
Attorney General Greg Stumbo Announces $90 Million Nationwide Antitrust Settlement for Consumers Harmed by Alleged Computer Chip Price-Fixing Conspiracy

Press Release Date:  Tuesday, February 06, 2007  
Contact Information:  Vicki Glass, 502-696-5643 Office  

Attorney General Greg Stumbo today announced a $90 million nationwide settlement with Samsung Semiconductor, Inc. and Samsung Electronics Company Ltd., resolving allegations that Samsung and most of the industry’s other leading computer chip manufacturers fixed the prices of Dynamic Random Access Memory (DRAM).  DRAM is a type of computer chip used in all personal computers, servers, workstations and many other electronic devices.

The settlement will provide restitution for consumers and state and local government agencies that paid more for the products because of the price-fixing.   Samsung admits no wrongdoing in the settlement, which is subject to court approval.  Under the settlement’s terms, Samsung has also agreed to strong injunctive relief that will require the company to refrain from conduct that could lead to future price fixing. Samsung will also cooperate with the states in continuing litigation against the other DRAM manufacturers.   Kentucky’s and Kentucky consumers’ share of the settlement has not yet been determined.

Consumers who purchased products containing DRAM between January 1, 1999 and December 31, 2002 are eligible to participate in the settlement.  Consumers will be notified of their eligibility for restitution after the plan for restitution has been approved by the Court.  At that time, the Office of the Attorney General will also issue additional press releases and post information on the Attorney General’s website concerning the settlement and the application process.

“This is a classic case of big business trying to pull the wool over the eyes of ordinary customers,” said Attorney General Stumbo.  “My Office works to protect consumers in these highly complex price fixing cases.   We are now going to determine Kentucky consumer’s share of the settlement so that we can pass that information along to our citizens.”

Kentucky and 38 other states continue to pursue their lawsuit in U.S. District Court in San Francisco, seeking money for consumers and government agencies who paid higher prices for electronics from 1998 to 2002 as a result of alleged price-fixing by at least seven more companies including:  Elpida Memory, Inc.; Hynix Semiconductor, Inc.; Infineon Technologies, AG; Micron Technology, Inc.; Mosel Vitelic, Inc.; Nanya Technology Corporation and NEC Electronics America, Inc.

The states’ lawsuit arose from a multi-state investigation that began in 2004, following a federal criminal investigation that exposed a scheme where DRAM manufacturers profited at the expense of the consumers in the computer and electronics industry.  Samsung, Hynix, Infineon, Elpida and numerous individuals pled guilty to federal criminal price-fixing charges and collectively paid more than $730 million in fines to the U.S. Department of Justice.

The states’ complaint lays out details of the conspiracy, including an agreement by industry leaders to trim production in order to artificially raise prices.  According to the states’ complaint, the defendants violated federal and state antitrust laws by coordinating prices they charged for DRAM. The suit asks for a jury trial, an unspecified amount of damages and an injunction against future illegal conduct.

Besides Kentucky, states participating in the lawsuit include Alaska, Arkansas, Arizona, California, Colorado, Delaware, Florida, Hawaii, Idaho, Illinois, Iowa, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia and Wisconsin.