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LCD makers settle price-fixing charges, agree to fines
- — 13 November, 2008 11:16
Three electronics manufacturers -- LG Display, Sharp and Chunghwa Picture Tubes -- have agreed to plead guilty and pay a combined US$585 million in criminal fines for conspiring to fix the prices of liquid crystal display (LCD) panels, the U.S. Department of Justice announced Wednesday.
LG will pay US$400 million of the fines, which is the second-highest fine ever imposed by the DOJ's Antitrust Division, the DOJ said.
The DOJ filed the price-fixing charges in U.S. District Court for the Northern District of California in San Francisco Wednesday. The companies, in agreeing to settle the charges, also agreed to cooperate with the DOJ's ongoing antitrust investigation.
Thin-Film Transistor LCD panels are used in computer monitors and laptops, television sets, mobile phones, and other electronic devices. In 2006, the worldwide market for TFT-LCD panels was approximately US$70 billion, the DOJ said.
Companies directly affected by the LCD price-fixing conspiracies are some of the largest computer, television and cellular telephone manufacturers in the world, including Apple, Dell and Motorola, the DOJ said in a press release.
"Today's charges and criminal fines emphasize the commitment of the Department of Justice to crack down on international cartels," U.S. Attorney General Michael Mukasey said in a statement.
Representatives of the three companies didn't immediately respond to requests for comments on the settlements.
LG Display, a South Korean corporation, and its subsidiary, LG Display America, agreed to plead guilty to participating in a conspiracy from September 2001 to June 2006 to fix the price of TFT-LCD panels sold worldwide.
Sharp, a Japanese consumer electronics manufacturer, agreed to pay a US$120 million fine for its participation in separate conspiracies to fix the prices of TFT-LCD panels sold to Dell from April 2001 to December 2006 for use in computer monitors and laptops; to Motorola from fall 2005 to the middle of 2006 for use in Razr mobile phones; and to Apple from September 2005 to December 2006 for use in iPod portable music players.
Chunghwa, a Taiwanese TFT-LCD panel manufacturer, has agreed to pay a $65 million fine for its participation with LG and other unnamed co-conspirators in a conspiracy from September 2001 to December 2006 to fix the prices of TFT-LCD panels sold worldwide.
"These price-fixing conspiracies affected millions of American consumers who use computers, cell phones and numerous other household electronics every day," Thomas Barnett, assistant attorney general in charge of the DOJ's Antitrust Division, said in a statement. "These convictions, and the significant fines they carry, should send a clear message that the Antitrust Division will vigorously investigate and prosecute illegal cartels, regardless of where they are located."
All three companies were charged with carrying out the conspiracy by participating in multiple meetings to discuss TFT-LCD panel prices and by agreeing to charge set prices.
LG, Sharp and Chunghwa were each charged with price fixing in violation of the U.S. Sherman Act. Each violation normally carries a maximum fine of US$100 million for corporations, but the fines can be increased to double the gain derived from the crime or twice the loss suffered by the victims.
LG Display, based in Seoul, South Korea, reported US$15.3 billion in revenue for 2007. Sharp, based in Osaka, Japan, reported US$34.2 billion in revenue for its fiscal year ending March 31, including US$6.8 billion in revenue from LCD sales.
Chunghwa, based in Taoyuan, Taiwan, reported US$4.8 billion in revenue for 2007.