Transnational Antitrust—Elpida Memory, Inc.

A Japanese manufacturer of Dynamic Random Access Memory [hereinafter DRAM] has pleaded guilty to participating in an international conspiracy to fix prices in the DRAM market.^[1] Elpida Memory, Inc. joins Samsung, Infineon Technologies, and Hynix Semiconductor as foreign companies which have pleaded guilty to violating the antitrust laws of the United States.^[2] In pleading guilty to price-fixing and bid-rigging, Elpida agreed to pay US$84 million in fines, bring the total amount of fines being paid by the members of the conspiracy which have already pleaded guilty to US$730 million.^[3]

According to the government, 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.”^[4] Among those to whom the DRAM was sold are Dell, Compaq, Apple, HP, Gateway, and Sun Microsystems.^[5] Elpida has entered into Cooperation and Non-Prosecution Agreements.
Elpida is charged with carrying out the price-fixing conspiracy by:

• Participating in meetings, conversations, and communications in the United States and elsewhere with competitors to discuss the prices of DRAM to be sold to certain customers;
• Agreeing, during those meetings, conversations, and communications, to charge prices of DRAM at certain levels to be sold to certain customers;
• Issuing price quotations in accordance with the agreements reached; and
• Exchanging information on sales of DRAM to certain customers, for the purpose of monitoring and enforcing adherence to the agreed-upon prices.

Elpida is charged with carrying out the bid-rigging conspiracy by:

• Participating in meetings, conversations, and communications in the United States and elsewhere to discuss allocating (i.e., dividing up) a bid offered by Sun among themselves;
Agreeing, during those meetings, conversations, and communications, to allocate a bid offered by Sun;
• Allocating, in accordance with the agreements reached, a bid offered by Sun among themselves, denying Sun a competitive price;
• Participating in meetings, conversations, and communications to discuss the submission of prospective bids for a bid offered by Sun to purchase one lot of a particular DRAM product;
• Agreeing, during those meetings, conversations, and communications, to submit complementary bids to ensure the success of their agreement; and
• Submitting complementary bids for one lot of a particular DRAM product, denying Sun a competitive price.^[6]

Under the antitrust laws of the United States, every conspiracy to combine or contract in restraint of trade is illegal.^[7] The penalty is US$10,000,000 for every infraction. As we have discussed before, defining what is a restraint of trade can be complicated.

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[1] US DOJ, Japanese Company Agrees to Plead Guilty to Participating in DRAM Price Fixing Conspiracy, Jan. 30, 2006.
[2] Id.
[3] Id.
[4] Id.
[5] Id.
[6] Id.
[7] 15 U.S.C. § 1.