lcd panel price fixing factory

(Reuters) - Samsung Electronics Co, Sharp Corp and five other makers of liquid crystal displays agreed to pay more than $553 million to settle consumer and state regulatory claims that they conspired to fix prices for LCD panels in televisions, notebook computers and monitors.A worker prepares a display of Sharp flat panel televisions for the 2009 International Consumer Electronics Show (CES) at the Las Vegas Convention Center in Las Vegas, Nevada, January 7, 2009. REUTERS/Steve Marcus

The settlement is the latest arising from lawsuits alleging the creation of an international cartel designed to illegally inflate prices and stifle competition in LCD panels between 1999 and 2006, affecting billions of dollars of U.S. commerce.

In December 2006, authorities in Japan, Korea, the European Union and the United States revealed a probe into alleged anti-competitive activity among LCD panel manufacturers. Many companies and executives have since pleaded guilty to criminal antitrust violations and paid more than $890 million in fines.

The latest payout includes $538.6 million to resolve claims by “indirect” purchasers that bought televisions and computers with thin film transistor LCDs, as well as claims by eight states: Arkansas, California, Florida, Michigan, Missouri, New York, West Virginia and Wisconsin.

“This price-fixing scheme manipulated the playing field for businesses that abide by the rules, and left consumers to pay artificially higher costs for televisions, computers and other electronics,” Schneiderman said in a statement on Tuesday.

Other defendants have yet to settle, including Taiwan-based AU Optronics Corp, one of the largest LCD panel manufacturers; South Korea’s LG Display Co and Toshiba Corp.

The accord follows a settlement this month by eight companies, including Samsung and Sharp, to pay $388 million to settle litigation by direct purchasers of the LCD panels.

WASHINGTON, March 31 (Reuters) - An executive at Hitachi Ltd"sdisplay subsidiary has been charged with involvement in a conspiracy to fix prices of Thin Film Transistor-Liquid Crystal Display (TFT-LCD) panels sold to Dell Inc, the U.S. Department of Justice said.

The scandal at Hitachi Displays is the latest problem for Hitachi, whose flat TV business has been battered by sluggish demand and price competition, becoming one of the contributors for the company’s expected 700 billion yen annual loss. [ID:nT313023]

In the U.S. scandal, Hitachi agreed earlier in March to plead guilty and pay a $31 million fine for its part in the conspiracy to fix the prices of TFT-LCD panels sold to Dell for three years, beginning in April 2001.

The Justice Department said the latest indictment, returned by a federal grand jury in San Francisco, charges executive Sakae Someya with conspiring with unnamed co-conspirators to suppress and eliminate competition by fixing the price of TFT-LCD panels sold to Dellfor use in notebook computers.

LG Display, Sharp, and Chunghwa Picture Tubes agreed to plead guilty to criminal charges for participating in a liquid crystal display price-fixing conspiracy and pay $585 million in fines, the U.S. Department of Justice announced Wednesday.

The three companies worked in concert to set prices on thin-film transistor LCDs, which are used in computer monitors, notebooks, televisions, mobile phones, and various electronics, according to the antitrust unit of the Justice Department.

"The price-fixing conspiracies affected millions of American consumers who use computers, cell phones, and numerous other household electronics every day," Thomas Barnett, assistant attorney general for the Justice Department"s antitrust division, said in a statement.

The three companies, which were charged with violating the Sherman Antitrust Act, allegedly held "crystal" meetings and engaged in communications about setting prices on the TFT-LCD displays. They agreed to charge predetermined prices for the displays, issued price quotes based on those agreements, and exchanged sales information on the display panels, in order to monitor and enforce the agreement, the Justice Department said.

LG Display agreed to pay a $400 million fine, marking the second-highest antitrust fine ever imposed. The company pleaded guilty to setting prices with other unnamed suppliers for the TFT-LCD panels worldwide from September 2001 to June 2006, when the company operated under the name L.G. Philips LCD, a joint venture between LG Electronics and Philips Electronics. LG Display America was known as L.G. Philips LCD America.

Sharp, meanwhile, agreed to pay a $120 million fine and participated in the conspiracy between April 2001 and December 2006 with other unnamed suppliers. The conspiracy involved setting prices in three separate agreements for TFT-LCD panels sold to Dell, which used them in computer monitors and laptops.

And during the period ranging from the fall of 2005 to mid-2006, similar price-fixing schemes were employed in sales to Motorola, which used the panels in its popular Razr mobile phones.

For the LCD industry, problems began in the late 1990s when a surge in demand for notebooks and handheld devices drove up the need for LCD glass. As a result, the TFT-LCD makers built glass plants in Korea and Taiwan during 1998 through 1999.

But as those factories came online and began to pump out LCD glass, a glut took hold. And by the fall of 2000, prices on 15-inch flat panels plummeted to a point that in some cases manufacturers were having to sell their panels at $5 to $10 below cost.

And apparently, it was no coincidence. Five months prior, Sharp had begun fixing prices on TFT-LCD panels sold to PC giant Dell and in September 2001, LG and Chunghwa also began to engage in price fixing, as well.

IDC analyst Bob O"Donnell noted at the time that while PCs tend to only go down in price over time, flat panel prices have occasionally risen. Said O"Donnell at the time:

Although Sharp admits to engaging in price fixing with Apple"s iPod screens in the 2005 to 2006 period, it remains unclear whether other vendors may have engaged in a similar behavior with Apple back in 2002.

That"s when Apple was hit with a component shortage of 15-inch LCD panels for its newly introduced all-in-one flat panel iMacs. As a result, Apple suffered a shortage of iMacs after introducing and touting its sleek iMac.

SAN FRANCISCO (AP) — A Taiwanese company, AU Optronics, was fined $500 million on Thursday and its former president and executive vice president were each sentenced to three years in prison for their roles in a global LCD screen price-fixing conspiracy.

She also said the two executives — Hsuan Bin Chen and Hui Hsiung — did not deserve the lengthy prison sentences demanded by prosecutors because they acted not for personal gain but out of their belief that they were aiding a troubled industry plagued by overproduction and plummeting prices. Both men declined to address the court.

China has punished six companies, including Samsung and LG, for manipulating LCD panel prices in the country, and ordered them to pay a total of US$56 million in fines.

Samsung, LG, and four Taiwanese companies "conspired" in a price fixing scheme facilitated through monthly meetings between 2001 to 2006, said China"s National Development and Reform Commission (NDRC) on Friday. During that period, the six companies held 53 meetings in Taiwan and South Korea to make agreements on LCD panel pricing.

Through the price-fixing scheme, the six companies sold 5.1 million panels in China, the most coming from LG, and Taiwanese LCD supplier Chimei Innolux. This amounted to 208 million yuan (US$33 million) in revenue. NDRC didn"t state which LG or Samsung company was fined.

China"s NDRC investigated the matter after receiving complaints of the price fixing scheme since December 2006. The three other Taiwanese firms involved in the alleged price-fixing include AU Optronics, Chunghwa Picture Tubes, and HannStar Display.

Regulators across the world have also investigated the companies for manipulating LCD panel prices and fined them for breaking anti-competition laws. In Dec. 2010, the European Commission fined Samsung Electronics, LG Display and the four Taiwanese companies for a total of about $850 million, though Samsung received immunity from fines for bringing the cartel to the notice of the commission and providing information.

If you lived in California between 1999 and 2006 and purchased an electronic device with an LCD panel -- such as a computer monitor, laptop or all-in-one PC -- you may be eligible as a claimant on a $500-million price-fixing settlement between hardware makers and California Atty. Gen. Kamala Harris’ office.

The California Department of Justice on Friday said that consumers should check lcdclass.com, call (855) 115-1886 or write to LCD Class, P.O.Box 8025, Faribault, MN 55021, to obtain a copy of the settlement and register to receive a claim form.

“In October 2010, Attorney General Kamala D. Harris filed a lawsuit against 10 companies for engaging in price fixing of LCD panels from 1999 to 2006 that resulted in higher prices for California residents and businesses, as well as government agencies,” the state Justice Department said in a statement.

“As part of the settlements, the companies that engaged in price fixing will provide a fund for consumers and businesses in 25 states, including California.”

It’s the second largest anti-trust fine ever imposed by the US Department of Justice: LG, Sharp and Chunghwa Picture Tubes will pay $585 million in fines after pleading guilty to a massive liquid crystal display price-fixing scam. The price-fix cost consumers and companies that build monitors, laptops and handheld devices.

According to assistant attorney general for the US Dept. of Justice antitrust division Thomas Barnett - "The price-fixing conspiracies affected millions of American consumers who use computers, cell phones and numerous other household electronics every day."

Companies affected by the inflated LCD panel pricing included Apple, Dell and Motorola and basically anyone who bought their products. Sources report that the companies involved in the scam allegedly held "Crystal" meetings. Yes, reports say these clandestine collusion meetings were actually code-named Crystal meetings.

We can see it now… Shadowy figures attend closed-door meetings in darkened, smoky rooms. Competing company’s representatives with colorful code-names like Mr. Big, eL-Tuffy-Dand Crystal Monopolywould gather after-hours. Barely visible through shadows and cigar smoke, C. Monopoly strokes a heavyset Persian cat in a diamond studded collar while orchestrating LCD profitability schemes with the tri-lateral stranglehold he and his distinguished colleaguesenjoy over the LCD market.

The conspiracy mainly involved TFT-LCD panels in the 15-inch range and smaller. These were used in portable devices, computer monitors and notebooks. Consumers shouldn’t expect the bust to result in any immediate price-drops – at least not one that we haven’t already seen. The conspiracy started way back in 2001 and involved specific deals brokered to manufacturers for LCD screens until about 2006.

Many of us have heard rumors that a glut in the LCD market occurred soon after 2000. Despite oversupply of panels through 2001 prices reportedly rose. Although the overall outlook has been a gradual reduction of LCD costs to consumers, the actual prices had inexplicably fluctuated early in the decade. This led many to believe that foul play was afoot in the form of LCD price fixing. Rumors of back-room meetings between Mr. Big and C. Monopoly with his fat Persian abounded. But rest assured dear readers that today - justice is served.

LG Display Co., the world"s No. 2 maker of liquid-crystal display (LCD) panels, said Friday it has agreed to pay US$380 million to settle a U.S. class-action lawsuit over alleged price-fixing in the LCD market.

The South Korean display giant was one of several Asian companies, including Japan"s Toshiba Corp. and Sharp Corp., that were accused of fixing LCD panel prices, which raised prices for consumers that purchased products packed with those panels between 1999 and 2006.

Samsung Electronics Co., which was also accused of taking part in the price-fixing scheme, settled the case by agreeing to pay $240 million late last year.

A unit of LG Electronics, the South Korean-based multinational giant with a major wireless handset business, and other Asian manufacturers agreed to pay $585 million in fines and plead guilty in connection with the Department of Justice and FBI’s probe of price-fixing conspiracies in the sale of liquid crystal display panels for mobile phones and other electronic devices.

The Justice Department said companies like Motorola Inc., Dell Inc. and Apple Inc. were hurt by LCD panel pricing by LG (tagged with a $400 million fine; the second highest ever levied in an antitrust criminal action), Japan’s Sharp Corp. ($120 million) and Taiwan’s Chunghwa ($65 million). Department officials said one of the LCD panel price-fixing conspiracies involved Sharp sales to Motorola Inc. from fall 2005 to mid-2006 for use in Razr mobile phones.

“These price-fixing conspiracies affected millions of American consumers who use computers, cell phones and numerous other household electronics every day,” said Thomas Barnett, assistant attorney general in charge of DoJ’s antitrust division. “These convictions, and the significant fines they carry, should send a clear message that the antitrust division will vigorously investigate and prosecute illegal cartels, regardless of where they are located.”

WASHINGTON — Executives from LG Display Co. Ltd. and Chunghwa Picture Tubes Ltd. have agreed to plead guilty and serve jail time in the United States for participating in a global conspiracy to fix prices in the sale of Thin Film Transistor-Liquid Crystal Display (TFT-LCD) panels, the U.S. Department of Justice announced today.

According to a one-count felony charge filed today in U.S. District Court in San Francisco, Chang Suk "C.S." Chung, a Korean LG executive, conspired with unnamed employees from other panel makers to suppress and eliminate competition by fixing the prices of TFT-LCD panels from on or about Sept. 21, 2001, to on or about June 1, 2006. According to a separate one-count felony charge, also filed today in U.S. District Court in San Francisco, Chieng-Hon "Frank" Lin, a Taiwanese former executive from Chunghwa, and Chih-Chun "C.C." Liu and Hsueh-Lung "Brian" Lee, Taiwanese current employees of Chungwha, are charged with participating in the same conspiracy at various times during the period from Sept. 14, 2001, to on or about Dec. 1, 2006.

Under the plea agreements, which must be approved by the court, all four executives have agreed to serve a term of imprisonment, pay a criminal fine and assist the government in its ongoing TFT-LCD investigation.

TFT-LCD panels are used in computer monitors and notebooks, televisions, mobile phones, and other electronic devices. In 2006, the worldwide market for TFT-LCD panels was approximately $70 billion.

Chih-Chun Liu, a Taiwanese citizen, was Chunghwa’s Vice President of LCD Sales during the charged conspiracy period. Under the plea agreement, Liu has agreed to serve a seven-month prison sentence in the United States and pay a $30,000 criminal fine.

Hsueh-Lung Lee, a Taiwanese citizen, held various sales positions at Chunghwa during the charged conspiracy period, including Vice President of LCD Sales. Under the plea agreement, Lee has agreed to serve a six-month prison sentence in the United States and pay a $20,000 criminal fine.

These four foreign-based executives were charged with participating with co-conspirators in a conspiracy that was accomplished by: Participating in meetings, conversations and communications in Taiwan, South Korea and the United States to discuss the prices of TFT-LCD panels;

"These are the first individuals to plead guilty to a charge of fixing prices in this active investigation into antitrust violations in the TFT-LCD industry," said Scott D. Hammond, the Antitrust Division’s Deputy Assistant Attorney General for Criminal Enforcement. "We will continue in our efforts to bring to justice other domestic and foreign-based executives who were involved with fixing TFT-LCD prices."

On Dec. 16, 2008, Sharp Corp. pleaded guilty to three separate conspiracies to fix the prices of TFT-LCD panels sold to Dell Inc., Apple Computer Inc. and Motorola Inc., and was sentenced to pay a $120 million criminal fine.

The four executives are charged with price fixing in violation of the Sherman Act, which carries a maximum fine of $1 million and up to 10 years in prison for an individual. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Anyone with information concerning illegal conduct in the TFT-LCD industry is urged to call the San Francisco Field Office of the Antitrust Division at 415-436-6660.

South Korean companies Samsung Electronics and LG Display, the world’s top two LCD makers who in combination produce over half of the LCD panels sold worldwide, were among six LCD screen manufacturers rapped by the European Commission today for colluding to fix the price of LCD panels used in flat-screen HDTV displays, computer monitors and laptops between October 2001 and February 2006. Four other Taiwanese firms – AU Optronics (AUO), Chimei Innolux (CMI), Chunghwa Picture Tubes and Hannstar Display – were named as participating members in the LCD price-fixing cartel.

Officials from these companies were found by the European regulator to have met secretly on a monthly basis to agree on LCD pricing issues such as price range and minimum prices. They also shared other commercially sensitive information including factory production capacity, future planned output, and even some technological data. In total, approximately 60 such illegal rendezvous – dubbed “Crystal Meetings” by the perpetrators – were held, mainly in Taiwanese hotels.

Although the majority of these illegal conferences took place outside Europe, the European Commission – the EU’s executing body – were compelled to act because the ensuing increase in prices of LCD-containing products directly affected EU residents. For their involvement in the price-fixing scheme, Chimei, LG, AU Optronics, Chunghwa and Hannstar were fined 300 million, 215 million, 117 million, 9 million and 8 million euros respectively, amounting to a total fine of 649 million euros.

The fine slapped on each of these LCD screen makers was determined by the company’s sales volume in the EU, how long it had been involved in the cartel, and its level of cooperation with investigators. Samsung was exempted from being hit with any fine for its role in whistleblowing on the price-fixing cartel.

Investigations into LCD screen price-fixing allegations are not new to Samsung, LG, AU Optronics and Chi Mei. In August, these Asian LCD panel makers were among the companies sued by the New York Attorney General for operating a decade-long LCD price-fixing cartel which led to US public institutions overpaying for LCD-equipped goods like flat-panel televisions, computer PCs, notebooks and mobile phones.