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Hewlett-Packard Sues Chunghwa Alleging Fixed LCD Prices

December 04, 2012

Hewlett-Packard Co. (HPQ:US), the world’s second-largest maker of personal computers, accused Chunghwa Picture Tubes (2475) Ltd. and Tatung Company of America Inc. in a lawsuit of fixing prices of liquid-crystal display screens.

The alleged conspiracy cost Hewlett-Packard more than $1 billion in damages from overcharges for the screens, which the company purchased through its Singapore unit and a Taiwan-based procurement service for use in computers destined for consumers in the U.S. and elsewhere, according to an antitrust complaint filed in federal court in San Francisco.

Hewlett-Packard claimed that Chunghwa, Tatung and other LCD makers conspired to set prices and restrict output for panels from 1998 to 2006. Hewlett-Packard negotiated prices with the companies in the U.S. and paid more as a result of the conspiracy, according to the lawsuit. The company is seeking treble damages, according to the complaint filed Nov. 30.

The Palo Alto, California-based company said Nov. 20 that it’s taking an $8.8 billion writedown related to alleged falsified accounting at Autonomy Corp., the software maker it acquired last year.

Makers of liquid crystal display panels used in computers, notebooks and televisions have faced criminal and civil cases alleging a global conspiracy to fix product prices. A U.S. Justice Department criminal investigation of LCD price fixing led to guilty pleas by LG Display Co., Sharp Corp, and a former Chunghwa Picture chief executive officer. The companies agreed in 2008 and 2009 to pay $585 million in criminal fines. Taoyuan, Taiwan-based Chungwha’s fine was $65 million.

Panel Purchasers

The case led to lawsuits by panel purchasers. At least seven Japanese, Taiwanese and South Korean panel makers settled buyers’ civil claims late last year. Sharp and Samsung Electronics Co. were among those who agreed to pay $927 million in settlements reached in December. Chunghwa’s share of the settlement was $5.3 million, according to court filings.

Hewlett-Packard dropped an LCD price fixing lawsuit against AU Optronics Corp. (2409) last month, according to court filings.

Chunghwa slumped 2.2 percent to NT$0.90 at the close of trading in Taipei, the biggest decline since Nov. 16. The company’s spokesman Chiang Chen-Chi said by phone today it is studying the matter and couldn’t immediately respond.

A voice-mail message left at Tatung’s offices in Long Beach, California, seeking comment on the lawsuit wasn’t immediately returned.

China’s Lenovo Group Ltd. (992) is the largest maker of personal computers, according to market research firm Gartner Inc.

The case is Hewlett-Packard Co. v. Chunghwa Picture Tubes Ltd., 12-06085, U.S. District Court, Northern District of California (San Francisco).

To contact the reporter on this story: Karen Gullo in San Francisco at

To contact the editor responsible for this story: Michael Hytha at

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