DRAM Makers Accused of Price Fixing 177
AdamWeeden writes "According to the EETimes, many of the states in the U.S. have entered into a class-action lawsuit against a group of eight DRAM manufacturers. The companies are accused of price-fixing computer memory for over five years, beginning in the late 1990s." From the article: "Four companies and 12 executives have so far pleaded guilty to participating in the conspiracy and have been assessed more than $730 million in fines. In May, three of the four companies, Samsung Electronics, Hynix Semiconductor Inc. and Infineon Technologies AG agreed to pay a total of $160 million to settle class action suits related to price fixing. Elpida Memory Inc., the fourth company to plead guilty, is still involved in the class-action suits."
Great news! (Score:5, Insightful)
Corporate Charter (Score:3, Insightful)
Was it really that bad? (Score:4, Insightful)
In the end, the consumers will see none of it (who's really going to go through to paper work for a $3 rebate?), the lawyers will see millions, and the government will get the unclaimed payouts.
IOW, a complete waste of time.
-Rick
Re:Corporate Charter (Score:4, Insightful)
Re:Price Fixing (Score:5, Insightful)
This way you are actually helping them by creating a gold rush which will clear their stock inventory in the next 90 days and they can even write it off as a loss as well.
A penalty is supposed to hurt the penalised, not the improve its financial and inventory positions.
This is even better.... (Score:1, Insightful)
Of course, none of this means that the consumers get anything -- even if damages are awarded, you'd have to be able to prove that you purchased DRAM between 1999 and 2002. Hope you kept those receipts, folks.
Re:Was it really that bad? (Score:2, Insightful)
So you're saying Price Fixing was OK then??? (Score:1, Insightful)
First of all, IANAL, but I'd think both the letter of the law and the spirit of the law should matter to some people. You set a *huge* double standard if you only go after companies that succeeded in their plot as opposed to those who ultimately slowed their decline. The law should apply to everyone and every corporation equally, and although it doesn't seem to do so, we should applaud efforts like these which make a statement that it does.
In addition, this is still YOUR government, whether you approve of its spending habits or not, and the lawyers undoubtedly earned their fair share by proving the states' case against the companies. And whether you like it or not, the government came out ahead here of corporations that thumbed their noses at YOU.
Whether it was a little $ or a lot of $$$, you were a victim if you bought a computer, a stick of ram, or anything related to DRAM during that five year period. Judging by that whole dot-com boom and Internet thing, I'd be willing to bet that a whole lot of DRAM-using OEM computers were sold, and a whole-lot of techies were buying DRAM as it became cheaper and more attractive. So in this case, if nothing else, your government stood up for you and its people, stood up for the law, and stood up for itself. It tried to send a message.
While consumers may never see a dime come directly from this case, the money will go to the state coffers, and the money will ultimately benefit society, even if your opinion of the government is of the lowest and most ineffecient kind.
Some good *was* done. The difficulty that you and others have with trusting in this simple thought is that you will never know exactly how it was done. You just have to understand, trust, and hope that this was the case. That, at this point in time, is how our system works.
They weren't very good at it (Score:5, Insightful)
2003 - 256 MB DIMM $160
Spitzer should go after real criminals, and stop using threats and publicity to extort big settlements.
DRM Makers Accused of Price Fixing (Score:2, Insightful)
Insightful?????? (Score:5, Insightful)
A penalty is supposed to hurt the penalised, not the improve its financial and inventory positions.
Huh! If this is going to be good for them, then why don't they do it themselves?
Is anybody going to stop them?
Difficult situation for us anarcho-capitalists (Score:5, Insightful)
Most people believe that memory manufacturing is a VERY expensive business. This is true in terms of overall numbers (billions), but it is false in terms of actual products required on the market. Memory is used in much more than just computers (cars, microwaves, cell phones, digital cameras, DVD players, etc), and it is a huge market, possibly a trillion dollar one coming soon. When you have a big market, a big demand and a low supply of manufacturers, it doesn't take much to raise the billions needed to enter a market where there is obvious collusion. 1 million Americans risking US$3000 in a market that you can prove is selling at a overwhelming profit is not a big risk -- and many people were aware of the over-priced memory market back in the 90s.
Yet I think the debate is won by the free marketeers when you realize that one of the biggest reasons for the cartelization in this case is patent and copyright law. Memory chips are heavily burdened by patents, and many of those patents are cross licensed by those in the cartel. This smacks of government-paternalism and is one reason why patents generally help the cartels and the State rather than the inventor. The cartel:inventor ratio in terms of who is helped by patents is very very high (more cartels are helped than individual inventors).
I believe the government is wrong for starting class-action lawsuits. We all know that few companies are hurt by class-action lawsuits, and even fewer "victims" are helped. The lawyers (who are the biggest supporters of the expanding State) win the most! Why don't we roll back before the cartel-State collusion and see what the real cause of this problem is? The biggest barrier to the market is NOT money -- stop thinking that! No matter what the financial cost is, if there is a profit to be made, people will invest. I don't care if it is quadrillions that are needed, as long as it is profitable (and cartels can always be beaten in price), people will risk money. The real barrier is the State -- no one can raise enough "force" to overcome the force of government patents and copyrights.
Re:They weren't very good at it (Score:3, Insightful)
1993 - 4 MB SIMM $160
2003 - 256 MB DIMM $160
Spitzer should go after real criminals, and stop using threats and publicity to extort big settlements.
That doesn't make much sense.
Suppose I then told you that in the alternate history with no price fixing, the 2003 line looked like this:
2003 - 256 MB DIMM $16
Surely you'd then agree that a >$100 profit per dimm from price fixing wasn't exactly a good situation for the consumer?
Price fixing is bad for the consumer, regardless of other improvements in the technology of memory manufacturing.
err (Score:3, Insightful)
Maybe because American laws against price fixing wouldn't apply to an internation organization of which the US isn't even a member?
What do you think that we can do? We're a large consumer of oil, so we can apply economic pressue. That already happens though, and we already get very good deals. Believe me, gas is much less expensive in the US than in just about any other country.
Re:Corporate Charter (Score:2, Insightful)
As a shareholder in a limited-liability corporation, should the government decide to dissolve the corporation, they'd be out their stock, and that's it. This was the risk they signed up for when they invested in the company.
My personal belief is that we should stop using the "corporate veil" to protect everyone in the company. Take Merck for instance, if I went out and gave people pills that I knew could kill them and they do, I'd probably be looking at first degree (premeditated) murder. The people there who chose money over not killing people (starting with the author of the memo regarding the millions that they could save by not letting people know that it can cause heart problems, the person who acted on the memo to supress the information, then moving on to everyone who read that report inbetween as an accomplice) should be ripped out of the corporate veil and prosecuted.
Until this starts happening, our corporations will continue to be led and staffed with sociopaths who can and will destroy everything they touch for personal gain, and then get hired at another company to repeat. When the companies' employees recognize that they will be personally accountable for dumping the barrels of waste in the river, they will balk at their superiors' orders, who in turn will hopefully recognize that they will be personally responsible, and balk at their superiors' orders, on up the chain until finally whoever is deciding to break the law is either ignored or removed. And yes, that means that if any particular shareholders orders the company to break the law, they are as responsible for that as if someone hired a hitman to kill their wife.
Re-Occuring Theme (Score:3, Insightful)