Another Guilty Plea in DRAM Price Fixing Scandal

The U.S. Department of Justice (DoJ) announced today that a former executive of
Elpida Memory, a large Japanese manufacturer of DRAM chips, agreed to plead guilty for his participation in a global conspiracy to fix prices.

The DoJ said that D. James Sogas will pay a $250,000 criminal fine and serve prison time in the United States.

This latest guilty plea adds to significant progress the DoJ said it’s made in pursuing price fixing cases in the DRAM market. Including today’s agreement, the DoJ said it has charged four companies and 17 individuals and has secured fines totaling more than $731 million.

The criminal fines are the second-highest in a criminal antitrust investigation involving a specific industry.

As part of the plea agreement, which must still be approved by the court, Sogas agreed to assist the DOJ in its continuing investigation of the DRAM industry.

The DoJ first targeted
Elpida earlier this year when it fined the company $84 million for price fixing.

The two-count felony charge said that from April 1, 1999, to June 15,
2002, Elpida conspired with unnamed DRAM manufacturers to fix the prices of
DRAM sold to certain computer and server manufacturers.

The customers directly affected by the price-fixing conspiracy were Dell, Compaq, HP, Apple Computer, IBM, and Gateway. In addition, the DoJ said Elpida conspired with an unnamed DRAM manufacturer to rig a bid for a lot sold to Sun Microsystems in March 2002.

Other companies snared by the DoJ include German manufacturer Infineon
Technologies AG which, in October 2004, pleaded guilty and received a $160 million criminal fine. In 2005, Korean manufacturers Hynix Semiconductor pleaded guilty and received a $185 million fine.

Fellow Korean manufacturer Samsung Semiconductor and its parent company Samsung Electronics Company Ltd. also pleaded guilty and agreed to a $300 million fine.

In September, Samsung executive Thomas Quinn, agreed to serve eight months in prison and pay a fine of $250,000 in the case.

“Price fixing will not be tolerated, and we will continue our efforts to bring to justice both domestic and foreign-based executives involved in the conspiracy to fix DRAM prices,” Scott D. Hammond, the DoJ’s Antitrust Division’s deputy assistant attorney general, said in a statement.

Case filings can be viewed on the Antitrust Division’s Web site

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