DailyTech - Nokia Sues LCD Manufacturers for Alleged Price Fixing

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Gadgets Nokia Sues LCD Manufacturers for Alleged Price Fixing
Shane McGlaun (Blog) - December 1, 2009 9:22 AM

9 comment(s) - last by bigdawg1988.. on Dec 2 at 4:55 PM

Nokia seeks treble damages

With low profit margins and poor sales, some companies producing LCDs have resorted to illegal tactics to help improve their bottom line. Some of the largest companies in the LCD manufacturing industry were embroiled in an LCD price fixing scheme last year that resulted in massive fines and jail terms for some executives.

The legal battle over LCD price fixing in the computer industry started in earnest in November of 2008 when LCD makers pled guilty to price fixing. The companies that pled guilty included Sharp, LG, and Chunghwa Picture Tubes. At the time, all three firms had agreed to pay fines to the U.S. DOJ totaling $585 million. The largest fine was levied against LG at $400 million.

In January of 2009, executives involved in the price fixing scheme were handed jail terms in America of up to nine months. In February of 2009, individual executives were then indicted in the price fixing scheme for their participation. Hitachi was one of the last participants in the price fixing conspiracy to plead guilty and did so in March of 2009.

The Wall Street Journal reports that Nokia has sued major Asian LCD makers for alleged price fixing of LCDs that were used in mobile handsets. Among the companies named are Samsung, LG, Sharp, Hitachi, and Chunghwa. These are several of the same firms who were involved in the price fixing scandal in the computer industry and are named again by Nokia.

Nokia alleges that the "illegal conspiracy raised the price of LCDs above the price that would have prevailed in a competitive market." Nokia purchased LCDs from the firms and used them in constructing its mobile handsets.

Nokia alleges that it suffered damages and is seeking treble damages and injunctive relief. Interestingly Samsung was not cited in the suit over price fixing of the TFT-LCD market for notebooks last year, but it is named this time.

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Irony is a bliss

By Danish1 on 12/1/2009 10:38:49 AM , Rating: 5

quote:
all three firms had agreed to pay fines to the U.S. DOJ totaling $585 million.

Looksie, it's US goverment stealing money from overseas companies to finance its budget deficit, why isn't this money given to their customers who paid overprices?

Sounds familiar doesn't it?

(In case you don't get it then it's exactly what a lot of americans said about the fine Intel got from EU.....and yes I'm well aware why these fines are paid to the government, I just find the irony hillarious).

RE: Irony is a bliss

By Breathless on 12/1/2009 10:57:25 AM , Rating: 1

That is a good point. WHY IS THAT MONEY NOT GIVEN TO CUSTOMERS WHO OVERPAID?

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RE: Irony is a bliss

By tastyratz on 12/1/2009 1:33:50 PM , Rating: 1

It would be quite interesting to see that actually filtered down to the smaller level as a per user per panel refund. Some people obviously overpaid more than others. I cant imagine THAT nightmare.

Even still: It wasn't a class action suit. The plaintiff was essentially the us government, and the plaintiff was awarded the fine - as it works in any other lawsuit.

The consumers were impacted by the byproduct of an illegal action (price fixing) but were not directly impacted (i.e. bait and switch or surprise credit card bills). Consumers made a voluntary choice to purchase a mostly luxury product at higher prices.
This lawsuit was a legitimate one for a direct impacting price fixing scheme. Exec's eliminated consumer choice of buying a panel at x price by removing the competitively driven low prices of a large market

Comparing that to the actions of the eu were a significant magnitude higher for a shade of gray ludicrous lawsuit. A manufacturer who sells a product fully compatible with its competition was forced to include competitor products with theirs and pay a fine so astronomically high it was blatantly obvious that it was more of a "tax".
If Microsoft was truly anti competitive and infringing on users they would have blocked the use of firefox/opera/etc and killed it in future updates.
If the EU was truly interested in equality amongst the competitors they would have also looked at the next in line, apple... for doing the exact same thing.

The EU lawsuit was obvious and transparent to its true nature for a stretch of a reason.
This lawsuit was for clear and obvious direct conspiracy and lawbreaking.

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RE: Irony is a bliss

By Reclaimer77 on 12/1/2009 6:40:02 PM , Rating: 2

quote:
That is a good point. WHY IS THAT MONEY NOT GIVEN TO CUSTOMERS WHO OVERPAID?

How would you do that ? Honestly, there is just no feasible way to do that without a huge mess on your hands. Proof of purchase would have to be a requirement, but not everyone would have that available. So they all just get screwed ?

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Everyone is sueing!

By The0ne on 12/1/2009 11:24:28 AM , Rating: 2

And Nintendo looking into N900 emulation...can't wait for that to surface :)

RE: Everyone is sueing!

By Denigrate on 12/1/2009 12:07:21 PM , Rating: 2

Nintendo should have made emulation legal long ago for the NES and SNES. They could make a bundle selling the ROMs for these games to a pretty dedicated community.

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The way it looks to me...

By Icehearted on 12/1/2009 4:47:15 PM , Rating: 3

I saw a lot of people talk about the pricing of LCDs for the last few years, using terms like "extremely cheap" and "Absolutely rock bottom" when a 42" screen would cost upwards of $3000. The way I see it, if you figured you were paying a fair amount for these "super cheap" screens, be you manufacturers or consumers, than you were not gypped.

If you thought the prices were unfair, you should have spoken with your wallets and refused to spend on these ridiculous, progress stifling prices. I refused to pay because I didn't think the pricing was fair, no hypocrisy, no whining, they were greedy and didn't get my cash (and a good deal of people I know did likewise).

If you caved and bought their LCDs then you have only yourselves to blame for being ripped off.

memory cartel also?

By majorpain on 12/2/2009 6:49:07 AM , Rating: 2

correct me if i'm wrong, but for the last 5 months pc memory and most of all products that use memory chips like pen drives, suffered a raise of more than 150% and i can't see any decrease in the costs for the next couple of months. Next cartel after lcds price fixing? 5 months ago i imported from US, thousands of 2GB PC DDR2 memory for about USD$17.00, and now the best i get is USD$45.00...

They should have let the market handle this

By bigdawg1988 on 12/2/2009 4:55:09 PM , Rating: 2

I thought the free market guaranteed that things like this didn't happen? Surely all of those free market people couldn't be wrong! We need less regulation, not more regulation. We should have given the market more time to correct the situation, not sued the honest and hard-working companies!

/s