A lawsuit filed in San Jose, California on Monday claimed that Samsung, Micron, and SK Hynix, three companies that reportedly control nearly 100% of the dynamic random access memory (DRAM) market, collectively cut supply and forewent market share expansion in order to more than double DRAM prices and reap tremendous profits.
Fourteen individual plaintiffs, who bought DRAM memory products and laptops, alleged that they paid artificially inflated prices for those devices and thereby suffered antitrust injury.
The complaint names multiple corporate iterations of Samsung and Hynix, both Korean companies, as well as Micron, their American competitor. The filing explained that in late 2015 the defendants “faced a problem.” Namely, the plaintiffs allege, vigorous competition between them had caused DRAM prices to fall dramatically.
The 147-page filing details how, allegedly, the defendants’ concerted actions reversed this trend, resulting in a 350% increase in DRAM prices during the class period. In particular, the complaint contended that the defendants acted against their own self-interests through DRAM output cuts in 2016 that cost each company tens of millions of dollars, and which would have been irrational absent a collusive agreement.
As evidence of the ostensibly illegal coordination, the complaint pointed to public statements made by the companies’ executives regarding output and pricing figures, including intentionally leaked future price information. Several confidential witnesses referenced in the complaint who are former employees of the defendants reportedly backed up the allegations of collusive activity. Additionally, the filing contends that the defendants used third-party research firms to exchange information in aid of their scheme.
The 20-count complaint claimed that the defendants’ “conspiratorial conduct between 2016 and 2018 violated Section 1 of the Sherman Act and the antitrust, consumer protection, and unfair competition laws of various states.” The lawsuit seeks certification as a class action, a jury trial, multiple types of damages, including treble damages for violation of federal antitrust laws, declaratory and injunctive relief, and the plaintiffs’ attorneys’ fees and litigation costs.
The plaintiffs are represented by Hagens Berman Sobol Shapiro LLP.