US fines 3 LCD manufacturers $585 million for forming cartel

13 November 2008

The $70 billion LCD manufacturing industry got a jolt when three international LCD manufacturers agreed to pay a hefty penalty of $585 million for allegedly forming a cartel, thereby raising global prices of computer monitors and notebooks, TVs, mobile phones and other electronic devices.

The fine was imposed on them by the US Justice Department for for working as a cartel from 2001 to 2006 and conspiring to fix prices of LCD display panels.

The US anti-trust regulators had conducted investigations and raids which culminated in busting an Asian group of LCD manufacturers who held a series of ''crystal meetings and traded sales information to fix prices of LCD display panels.''

In a deal arrived with the US Justice Department, South Korea-based LG's American subsidiary, LG Display America, Taiwan based company Chunghwa  and Japan's Sharp pleaded guilty and agreed to pay a fine of $585 million.

South Korea-based LG's American subsidiary, LG Display America, conspired with Taiwan-based Chunghwa and other companies and individuals in Taiwan, the US and Korea to predetermine prices for thin-film transistor (TFT) LCD panels used in computer monitors and notebooks, TVs, mobile phones, and other electronic devices which were sold globally.

Lawsuits were filed against these three companies in the US District Court in San Francisco under the federal Sherman Act. The federal act holds that businesses that conspire to set prices for its industry, rather than letting the marketplace determine the cost to consumers, violate antitrust provisions.