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Samsung price-fixing case ends

Takes it on the chin

Samsung Electronics and its US subsidiary Samsung Semiconductor on Wednesday ended a US DoJ (Department of Justice) investigation into its participation in an international DRAM (dynamic RAM) price fixing conspiracy by officially entering in court its guilty plea and agreement to pay a $300m (£174m) penalty.

"There has been no change in the terms of the plea agreement or in the companies' status since the announcement of the plea last October. The plea agreement represents the final resolution of the federal DRAM investigation for Samsung," said Chris Goodhart, director of marketing communications at Samsung Semiconductor, in a prepared statement.

The fine is the second largest criminal antitrust fine in US history and the largest criminal fine since 1999, according to the DoJ. It also caused Samsung to post a lower than expected third quarter net profit since it had set aside only $100m (£58m) for the settlement, the company said in October.

Samsung's agreement to pay the fine brings to $646m (£375m) the total amount levied so far in a US DRAM price-fixing investigation that includes companies and corporate executives in several countries. In May, Hynix agreed to plead guilty and was sentenced to pay a $185m (£107m) fine, while in October 2004, German manufacturer Infineon pleaded guilty and was sentenced to pay a $160m (£93m) fine. Several executives from major DRAM companies, including Micron and Infineon, have served prison sentences or paid fines over the case.

The US government claims the DRAM companies conspired to fix memory chip prices to the detriment of customers including computer and printer makers such as Dell and HP The investigation began in 2002, a year after the worst technology industry downturn so far this decade.

The computer companies and the US government maintain that strong DRAM prices hurt business, despite the fact most DRAM makers posted heavy losses during the year in question, 2001, and DRAM prices remained below or near the cost of production for most of the year.

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