Samsung Admission Could Aid Rambus

A plea agreement made public last week between Samsung and the U.S. government could help Rambus' antitrust case.
SAN FRANCISCO — Samsung Electronics Co. Ltd. admitted that it conspired with other companies to fix the price of Rambus DRAM (RDRAM) between Jan. 1, 2001 and June 15, 2002, according to the U.S. Department of Justice (DOJ) plea agreement that company representatives signed last month.

Samsung admitted that it conspired with other companies to control the price of double data rate DRAM and synchronous DRAM during "at least certain periods" from April 1, 1999 to June 15, 2002, according to the text of the agreement.

As first reported by the Wall Street Journal, the plea agreement, made public last week, could work in favor of memory interface licensor Rambus Inc., which is currently suing Samsung and other DRAM manufacturers for antitrust violations. The time period covered in the plea agreement corresponds with allegations brought by Rambus against Samsung, Micron Technology Inc. and Hynix Semiconductor.

In June, Rambus added Samsung as a defendant to the pending antitrust suit against Hynix and Micron. Rambus and Germany's Infineon Technologies AG reached a settlement on antitrust claims in March.

Rambus has charged that a group of companies, including Samsung, Hynix and Micron, colluded in a "concerted and unlawful effort to eliminate competition and stifle innovation in the market for computer memory technology and computer memory chips." The original Rambus suit also claimed that the defendants limited the marketplace in terms of DRAM technologies, especially for the adoption of the RDRAM memory interface.

Though Samsung "invested in, promoted and marketed RDRAM" during the period relevant period, the company conspired to fix the price of RDRAM at times between in 2001 and 2002, according to the plea agreement.

Samsung plead guilty Oct. 13 to a one-count felony charge of conspiring with other DRAM manufacturers to fix the price of memory chips sold in the U.S. The company agreed to pay a $300 million fine — the second largest criminal antitrust fine in U.S. history.

Details of the plea agreement remained sealed until Nov. 23. The plea agreement remains tentative pending a Wednesday (Nov. 30) plea hearing in U.S. District Court here.

Seven current and former Samsung executives are specifically excluded from the plea agreement, meaning that they could still be implicated and potentially charged with wrongdoing by the DOJ. The excluded executives include Young Hwan Park, CEO of Samsung's U.S. subsidiary, Samsung Semiconductor Inc.

Earlier this year, Hynix agreed to pay a $185 million fine in connection with the U.S. antitrust probe. Last year, Infineon agreed to pay a $160 million fine.

A Micron executive in New York state was charged last year in connection with the federal DRAM probe. Micron accepted the executive's resignation, and has said it is cooperating in the probe.

According to the plea agreement, the conspiracy between Samsung and other DRAM manufacturers directly affected Dell Inc., Hewlett-Packard Co., Compaq Computer Corp., IBM Corp., Apple Computer Inc. and Gateway Inc.