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Hitachi Admits to LCD Price Fixing; Screws Buyers

If you bought an LCD panel manufactured by Hitachi, you likely paid more than you were suppose to. According to the U.S. Department of Justice, Hitachi has admitted to fixing the prices of its LCD panels.

In what seems like a new trend among LCD manufacturers, Hitachi confessed that it fixed prices for LCD panels sold to American computer maker Dell, between 2001 and 2004. The DOJ has filed a one count felony against Hitachi, charging the company with "conspiracy to fix the prices of TFT-LCD sold to Dell for use in desktop monitors and notebook computers from April 1, 2001, through March 31, 2004." While no persons have been arrested in relation to the charge, Hitachi will pay a USD $31 million fine in restitution.

"Hitachi joins three other multinational companies who have admitted to their involvement in fixing prices for LCD panels sold to U.S. companies and that have already paid criminal fines totaling more than $585 million," said Scott D. Hammond, an Assistant Attorney General with the DOJ’s Antitrust Division. "This case should send a strong message to multinational companies operating in the United States that when it comes to enforcing the U.S. antitrust laws we mean business."

The conspiracy charge against Hitachi accuses the company of taking meetings with Dell, at which point both companies agreed to buy sell and buy LCD panels at agreed upon levels. Following the sales, Hitachi was given information regarding the panels in order to ensure that its price agreements with Dell were honored.

2008 was a banner year for confessing to LCD price fixing. Sharp, LG Display and Chungwha Picture Tubes all admitted to such practices. Companies on the receiving end included Dell, Apple and Motorola, and the panels in question were for computers, iPods and cell phones. Sharp and Chunghwa paid fines of $120 million and $65 million, respectively, while LG Display was slapped with a massive $400 million fine. Several LG and Chunghwa executives are currently serving jail time stemming from DOJ investigations.

With four major electronics companies admitting to LCD price fixing, one has to wonder whether or not this unsavory trend will continue. The Dept. of Justice has accrued over $580 million in fines against LCD price fixers. What LCD maker will be next?

  • tayb
    $31 million? Wow if this was in the EU it would have been at least $1 billion.
    Reply
  • hellwig
    So Hitachi and Dell agree on a price for LCDs, and Hitachi gets in trouble, but not Dell? Hitachi can sell LCDs at whatever price they want, doesn't there have to be a conspiracy somewhere to make it illegal?

    Plus, that $31mil goes to who, the government? Not the consumers who got screwed over by Hitachi?
    Reply
  • cheepstuff
    Hitachi Admits to LCD Price Fixing; Screws Buyers
    nice title, little confused there...
    Reply
  • Since when can't you sell items with profit?
    If you think the demand is high, and the quality meets the needs, you are allowed as a company to raise your product's price.

    Only, don't go whining when another company rises selling for half the price!
    Reply
  • skine
    The article seems to indicate that Dell did something wrong.

    It fails to state clearly that Sharp, LG Display, Chungwha Picture Tubes and Hitachi all conspired, while Dell, Apple and Motorola were in fact the victims of an illegal agreement between the former four corporations.

    Why they even mention that Dell met with Hitachi to discuss price is beyond my comprehension. I' m sure Dell was glad to join in on the conspiracy of making themselves pay more.
    Reply
  • Claimintru
    I'd be more interested to see how closely those fines relate to the sheer amount of added revenue each company made from said price fixing.

    Also, the DoJ must have loved to rake in half a billion dollars in a matter of months. They're making more revenue than most medium sized businesses and corporations in the US =P
    Reply
  • bin1127
    not really understanding this article. They had a meeting with the US companies. So how can that be price fixing? Unless they meant Hitachi and Dell TOGETHER conspired to screw buyers.
    Reply
  • falchard
    I think price fixing of the LCD market is a moot offense. Despite these companies fixing prices, it does not help their cause considering the massive amount of competition in this particular market. If they did price hike, they would just be giving more money to Samsung.
    Reply
  • tenor77
    Maybe I'm missing the point but this seems like capitalism to me not price fixing. Is it saying Dell got a special price or an unfair advantage or that customers paid more for the monitor than someone buying a monitor seperately?

    I have no love for any of these companies but that's the whole point of competition. Unless you are conspiring to keep prices for the entire market inflated (oil companies, looking at you) if they're selling at too high of a pricepoint people won't buy them.
    Reply
  • jitpublisher
    You can sell your goods to a distributor for whatever price you and they agree on. What you cannot do is tell the distributor, or conspire with them about the price they will sell for. Dell is likely the one who helped get the legal proceedings started, if Hitachi was "black mailing" them, so to speak. Threatenting to halt shipments, break the deal, raise their price, etc. And companies this large once they start the purchasing process with a supplier, it is a lenghtly and very expensive procedure to simply "buy them somewhere else".
    The legal version of this you see everyday, as "Manufacture's Suggested Retail Price" and everyone knows that you never pay this for a product.
    Reply