It’s not been a year since a certain law firm filed a class action lawsuit against the world’s three largest NAND Flash, seeking damages from consumers on the understanding that RAM memory prices were manipulated and agreed upon. in order to obtain prices more in line with the expected profits. Today, a U.S. District Court judge in California is passing sentence. Guilty or innocent?
The law firm was Hagens Berman and the allegation was clear: conspiring and agreeing on market prices in 2018 to the detriment of consumers:
“Three companies, Samsung Electronics, SK Hynix and Micron, which control 96% of the global DRAM market (as of mid-2017), have colluded to artificially increase the DRAM market”
The reasons they alluded to were quite simple, such as the fact that Samsung said at that time that prices would increase while investment in manufacturing equipment decreased, so it made no sense given the market situation. at the time. Was it enough to charge them? Well, there have been precedents…
Samsung and SK Hynix have already been fined
In the mid-2000s, the two companies were fined $300 million for the first and $185 million for the second after pleading guilty. It went further, since as it was possible to demonstrate said price manipulation, the leaders of the two companies were sentenced to 14 months in prison, so the case was really very serious.
With this as precedent and given the evolution of the price of RAM memory and NAND Flash in general, the firm filed three lawsuits in different years: 2018, 2019 and 2021, where one of them was dismissed by the court for not being reasonable. inferences.
The claim from the 2021 lawsuit was referenced to that of 2018, where the court has now issued final judgment against the three named. Recall that the problem has been going on since 2016, the prosecution is in 2017 and the first trial is in 2018.
Without shame or guilt, the big three are saved
And they don’t do it in the best way, at least that’s what the Court of Appeal suggests, which commented as follows:
“Defendant’s conduct should be viewed as a legitimate business activity in the open market. Even if the circumstances in which he did so were in favor of the plaintiff, it would not be conclusive evidence.”
This sentence refers to the lawsuit filed last year, as the 2018 one was already dismissed at the end of 2020, which gives rise to the big three now launching their movements. And that is that they may continue to exert pressure on the market, which should worsen a price increase that we have already anticipated elsewhere, but there is a palpable difference now and following this resolution: if they are prosecuted again for the same reasons for which they will have to submit additional evidence which has not yet been examined.
This sets a dangerous precedent, because the most logical thing would have been to get to the bottom of things to avoid this situation. Now they’ve proven them right, but tomorrow we might see a similar claim, or so claims a major semiconductor industry leader who remained unnamed:
“Because the DRAM market is dominated by the three oligopolies, prices are constantly challenged”
Undoubtedly now, Samsung and Micron as well as SK Hynix are under close scrutiny and given the insistence of the Hagens-Berman law firm, it doesn’t look like the game is over here.
