Ram Memory Information Page 21

Feds Eye Price-Fixing Allegations Against RAM Makers

By Gene J. Koprowski
TechNewsWorld
February 27, 2004

"There are a number of federal and state laws that govern the way companies price their products," Ray Hartwell, an attorney with the Washington D.C. office of Hunton & Williams, LLP, told TechNewsWorld. "Federal and state antitrust statutes make it unlawful for competitors to agree on what they'll charge."

The U.S. federal government is moving forward with civil -- and possibly criminal -- cases against major makers of dynamic random access memory (DRAM) chips.
The cases are being investigated on both coasts.

The Federal Trade Commission (FTC) this week disclosed in court documents released in Washington D.C., that it has information that Micron Technology (NYSE: MU) and others, in tandem, allegedly planned to increase prices charged to computer makers for DRAM.
An e-mail submitted into evidence in a civil case by the FTC, written on November 26, 2001, by an executive at Micron, referred to competitors in the chip-making industry and an alleged, proposed pending price increase. The e-mail stated, "the consensus is that if Micron makes the move, all of them will do the same and make it stick."

The documents come from an antitrust case filed against Rambus (Nasdaq: RMBS) , which was recently dismissed by an administrative law judge in Washington but which has sparked other probes.

"As I have mentioned many times before, Intel (Nasdaq: INTC) does not make DRAMs, we do. And if all of us put our resources together, we do not have to go on this undesirable path -- the path of control and domination by Intel," said another e-mail, produced as evidence in the Rambus case. That e-mail was written in the late 1990s by an executive at Hynix Semiconductor , the South Korean chipmaker formerly known as Hyundai Electronics Industries.
Other federal attorneys are presenting their case to a federal grand jury in San Francisco, seeking possible criminal price-fixing charges against companies in the computer chip business.

A plea agreement was reached last month in that investigation with former Micron sales manager Alfred Censulio. Censulio agreed to cooperate with prosecutors in exchange for the government dropping charges of obstruction of justice against him, alleging that he had tampered with handwritten notes he compiled during sales meetings with other Micron managers. It is alleged by the government that the sales managers discussed the prices of DRAM chips during these sales meetings, as well as competitors' product prices.
The federal government began its grand-jury investigation of the chip industry about 18 months ago, after a dramatic increase in DRAM prices ended a two-year decline in memory chip prices.

From: http://www.technewsworld.com/perl/story/32984.html