Posted by: Ihlwan Moon on February 7, 2007
Samsung Electronics, facing legal headaches on a handful of issues, has agreed to pay $90 million to settle price-manipulation charges by about 40 U.S. states and consumers of products using its dynamic random access memory (DRAM) chips. The settlement is in connection with the South Korean company’s admission in 2005 that it took part in a price-fixing scheme with other DRAM makers to keep the prices of the chips artificially high during a period of four years till 2002. “The latest settlement effectively put the DRAM anti-trust matter behind us,” says Chris Goodhart, spokesman of Samsung Semiconductor Inc., Samsung’s U.S. subsidiary.
Following Samsung’s guilty plea to a U.S. probe in the price-fixing among makers of DRAM, widely used for computer memory, the Korean firm was fined $300 million in 2005 by the U.S. federal government. The case also led to guilty pleas from other major DRAM makers, including Hynix Semiconductor, Micron Technology, Infineon Technologies and Elpida Memory, which also paid fines. Last year, Samsung also agreed to pay $67 million to reimburse PC makers, such as Dell, HP and Sun Microsystems, which overpaid for the memory chips.
But the Korean company is still grappling with legal woes. Antitrust regulators in Korea, the U.S., and Japan are probing possible price-fixing in LCD panels. In addition, Seattle-based Washington Research Foundation has filed a lawsuit accusing Samsung of patent infringement in the use of Bluetooth wireless technology in its products. Analysts, nevertheless, point out the legal disputes will only have minor impact on Samsung’s financial results, given that it is expected to post a profit of well over $9 billion this year. (see BusinessWeek.com, 1/3/07, “Legal Woes Should Roll Right Off Samsung”)