Another LCD company busted for price fixing

The U.S. Department of Justice crackdown on price fixing among LCD companies has hit yet another target, with Taiwan-based Chi Mei Optoelectronics pleading guilty for its involvement in an increasingly complicated antitrust case.

To date, six companies have been fined by the DoJ, with more than $860 million in fines handed out.  Chi Mei has agreed to pay a $220 million criminal fine to the U.S. government.

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Previously, Sharp, LG Display, Chungwa Picture Tubes, Epson Imaging Devices, and Hitachi pleaded guilty, agreeing to pay monetary damages.

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Each company is accused of conspiracy to charge -- and raise prices, if need be -- inflated prices for LCDs used in TVs, mobile phones, computer monitors, and other popular consumer electronics.  Specifically, during meetings and conversations, Chi Mei reportedly agreed to set LCD panel pricing at "pre-determined levels and issuing price quotations in accordance with the agreements reached," according to the DoJ.

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OEMs such as Hewlett-Packard, Dell and Apple, all of which are large LCD buyers, are affected the most, with price increases then passed on to consumers.  Samsung recently filed a lawsuit against several companies accused of price fixing and it's possible other companies may follow suit.

I applaud the DoJ for cracking down on price fixing -- which makes us pay more -- but the fines still aren't enough to deter similar activity in the future.  The global LCD industry is valued at more than $70 billion, which indicates it's possible other companies, along with the ones already caught, have worked together to inflate prices.

However, the nine executives that have been charged could send a strong signal that anyone caught engaging in price fixing could be punished with federal jail time.

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Consumers have already been able to find lower-priced HDTVs and computer monitors this holiday season, and that trend could continue -- especially if a combination of reduced price fixing and legal help from the U.S. government are effective.

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