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$860 Million In Fines Handed Out For LCD Price-Fixing
eldavojohn writes "Six companies have pleaded guilty to worldwide price fixing of Thin-Film Transistor Liquid Crystal Displays from Sept. 14, 2001, to Dec. 1, 2006. For violating the Sherman Act, the companies have agreed to pay criminal fines of over $860 Million. In addition, nine executives have been charged in the scandal. The pricing scam affected some of the largest companies at the time, including Apple, HP and Dell. (If you bought a TFT-LCD from them in that time frame, you may be one of the victimized consumers.) From the DOJ release, 'According to the charge, Chi Mei carried out the conspiracy by agreeing during meetings, conversations and communications to charge prices of TFT-LCD panels at certain pre-determined levels and issuing price quotations in accordance with the agreements reached. As a part of the conspiracy, Chi Mei exchanged information on sales of TFT-LCD panels for the purpose of monitoring and enforcing adherence to the agreed-upon prices.'"
so what exactly happened? the article is long on confusion and short on explanations.
Someone got really greedy. Someone else caught them and is now going to use that fact to advance their political career. Some stockholders will suffer and a handful of executives will spend a few years in white collar resort prison.
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
You forgot the part where the wronged consumers get justice in the form of a $2 class action settlement check.
A little addendum: the final fine may vary from the stated amount. According to the document, the maximum fine may be increased to twice the amount illegally gained by the company or twice the amount of loss suffered by the victims. While 860 million USD seems a bit low, I expect the final number to be higher. (Or the given number could be a sort of "plea bargain" amount. I'm not sure.)
(((dB)))
You forgot the part where the wronged consumers get justice in the form of a $2 class action settlement check.
YOU forgot the part where the wronged consumers get a coupon worth $2 off on their next purchase as their settlement.
You're misreading the summary. They weren't involved in the price fixing, they were affected by it. Apple has to pay component manufacturers just like everyone else.
Dislike the Electoral College? Lobby your state to join the National Popular Vote Interstate Compact.
> By being involved with the price fixing...
Apple was one of the _victims_. The conspirators were some (all?) of the manufacurers who supply displays to Apple, Dell, and HP.
Warning: this article may contain humor, sarcasm, parody, and perhaps even irony. Read at your own risk.
Well let's see. The Taiwanese LCD producer Chi Mei Optoelectronics (CMO) agreed to pay $220 million for violations over 5 years (2001-2006) which comes up to $44 million per year of violations.
CMO is a publicly traded company, for 2009 their net sales up to November has been almost $30 billion dollars.
CMO's market cap is $150 billion dollars.
I think it's safe to say that $44 million dollars a year is a drop in the bucket for them.
The other $640 million is divided across 5 other companies so far, which sets them about $128 million dollars each, or $25.6 million dollars a year.
Justice is served!
If you can't mod them join them.
Guess who is going to pay the $860 million. Don't look forward to cheaper LCD prices anytime soon.
Only the State obtains its revenue by coercion. - Murray Rothbard
This is what real conspiracies look like. Note the distinct lack of "CIA", "Masons", "NSA" or other such favorites.
This article is of course for the criminal action and not any civil suits. Naturally, there is a proposed class action in the US for those who were victimized:
http://www.lieffcabraser.com/antitrust/lcd-antitrust.htm
The suit is for:
All persons and entities who, between January 1, 1996 and December 11, 2006, directly purchased a TFT-LCD Product in the United States from any defendant or any subsidiary or affiliate thereof, or any co-conspirator. Excluded from the Class are defendants, their parent companies, subsidiaries and affiliates, any co-conspirators, all governmental entities, and any judges or justices assigned to hear any aspect of this action.
From what it says the motion to dismiss based on lack of evidence has been thrown out. Will they settle? Will their lawyers eventually be able to squish it like a little bug? What will the payout be? That's anybody's guess. Might be worth getting on board if you were a firm that bought a ton of LCDs in that time though... I would imagine that if there was a payout, it would be per infraction rather than per customer, right? I admit that this is well outside my area of expertise.
Well, let's see, in the US, officially-government-sanctioned price-fixing oligopolies include oranges, almonds, cranberries, and raisins. Then of course there is anything covered by a patent. Or any resource that is mined from government leases. And then there's other industries that supply the military, such as airplanes, car companies, steel and weapons manufacturers, which are all protected and subsidized. Then you have licensed trades, electricians, plumbers, construction workers, truck-drivers and hair-stylists. And of course finally there are licensed professionals such as doctors, lawyers, nurses, and engineers. I probably missed somebody.
"I assumed blithely that there were no elves out there in the darkness"
Going out on a limb... DRAM chips, SSDs, Flash memory.
I for one find it odd that old 1gb PC2700 modules are still over $30. And the price seems to be the same no matter which manufacturer you look at.
Meanwhile 8gb compact flash cards, which are oh so more expensive to manufacture than SDRAM, are $30, that is unless you want "true" compact flash which faithfully implements the true IDE standard (I.E. to use them with an IDE-CF adapter, instead of in a digital camera)... those got rebadged as "Industrial CF" and cost like $200.
You mean one with conjugal visits?
Conjugal visits? Mmmm. Not that I know of. Y'know, minimum-security prison is no picnic. I have a client in there right now. He says the trick is: kick someone's ass the first day, or become someone's bitch. Then everything will be all right. W-Why do you ask, anyway?
*150 billion new Taiwan dollards equals about 4 billion dollars
http://en.wikipedia.org/wiki/New_Taiwan_dollar
However, you can definitely be charged and found guilty of conspiring, even if 'other alleged parties' to the conspiracy have not yet been charged, or are still under investigation.
The companies involved will most likely all be overseas companies you don't care much about. Most of the manufacturers of the TFT screens are overseas.
The companies the average US person has heard of (such as Dell, HP, etc) who sell monitors, are OEMs. That is, the manufacturers (such as the ones who do the price fixing) supply the screen. OEMs design and build an actual monitor using the OEM'd TFT, other OEM'd parts (and parts designed by the OEM), and ship the final product.
The TFT is just one of many components required to build an LCD monitor. Another manufacturer (very possibly) makes the backlight. And yet another company might make the plastic body.
From TFA, however:
It's interesting who Chi-Mei conspired WITH. Chi-Mei is not the best LCD manufacturer and they agreed to cooperate with DOJ. There must be other companies who Chi-Mei will bust and who will pay more. Certain Koreans, perhaps?
Yes, we were victimized. There's the cost of continuing to use CRTs, which was considerable. I bought my first LCD, a 1280x1024, several years ago, for $99 after a $70 rebate. And I waited for prices to go down like they do with every other consumer electronic item, and they didn't. I was baffled, but I kept waiting, knowing it had to give some time. That there was price fixing explains much. Was 2 years before I begin to see deals equivalent to the one I got.
Meantime, I paid for owning CRTs. They use more power. They took way more room in my car, forcing me to ship more of my possessions whenever I moved. I regret having paid UPS $85 to ship a 17" CRT back in 2003. I've learned a few things about moving. Best to sell your bulky possessions cheap if you can, or even abandon them if you can't. CRTs are definitely bulky. Had there been cheap LCDs in 2003, I could have saved quite a bit of money.
Intellectual Property is a monopolistic, selfish, and defective concept. It is "tyranny over the mind of man"