More semiconductor execs indicted for price-fixing

Three indicted for alleged roles in a DRAM price-fixing 'global conspiracy'

A US grand jury has indicted three former semiconductor vendor executives, two from Samsung Electronics and one from Hynix Semiconductor America, for their alleged roles in a "global conspiracy" to fix DRAM prices, the US Department of Justice (DOJ) said.

Indicted Wednesday were former vice-president of marketing for Samsung's memory division, Il Ung Kim; former vice-president of sales and market for Samsung's memory division, Young Bae Rha; and former senior vice-president of memory sales and marketing for Hynix America, Gary Swanson.

They are charged with being co-conspirators in a price-fixing scheme involving multiple semiconductor vendors between April 2001 and June 2002. The three attended meetings in which the price of DRAM was discussed, agreed to fix prices and exchanged information with competitors on the prices charged to computer makers, according to the indictment.

The three are each charged with participating in the conspiracy to suppress competition in violation of the US Sherman Antitrust Act. The maximum penalty for the conviction of a Sherman Act violation occurring before June 22, 2004, is three years in prison and a $US350,000 fine.

The maximum fines may be increased in certain situations.

Including Wednesday's charges, four companies and 16 individuals have been charged in the DOJ DRAM price-fixing probe. The investigation has resulted in $US731 million in fines, the second highest total obtained by the DOJ in a criminal antitrust investigation aimed at one industry.

DRAM is the most commonly used semiconductor memory product, used in a variety of devices including PCs, laptops, printers, hard disk drives, PDAs, mobile phones, digital cameras and telecommunication hubs and routers. There were about $US7.7 billion in US DRAM sales in 2004, according to the DOJ.

Three foreign-based Samsung executives pleaded guilty to the DRAM price-fixing conspiracy in March and August. They agreed to serve prison terms of 7-8 months and to each pay a $US250,000 fine. In September, a fourth Samsung executive agreed to plead guilty to the DRAM price-fixing conspiracy.

In addition, four Hynix Semiconductor executives were charged with participating in the DRAM price-fixing conspiracy and agreed to plead guilty and serve jail terms of 5-8 months and to each pay a $250,000 fine. In December 2004, four executives of Infineon Technologies pleaded guilty to the DRAM price-fixing conspiracy. The Infineon employees served jail terms of 4-6 months, and each paid a $US250,000 fine.

Four companies have been charged with price-fixing in the DRAM investigation. Samsung pleaded guilty to the price-fixing conspiracy and was sentenced to pay a $US300 million fine in November 2005. Hynix, the world's second largest DRAM manufacturer, pleaded guilty and was sentenced to pay a $US185 million fine in May 2005. Japanese manufacturer, Elpida Memory, pleaded guilty and was sentenced to pay an $US84 million fine in March. German manufacturer, Infineon, pleaded guilty and was sentenced to pay a $US160 million fine in October 2004.

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More about ACTBillionDepartment of JusticeDOJElpida MemoryHynixHynix SemiconductorInfineonInfineon TechnologiesSamsungSamsung Electronics AustraliaUS Department of Justice

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