14 DAY TRIAL // In the wake of the joint investigation carried out by the Department of Justice Antitrust Division’s San Francisco Field Office and the FBI in San Francisco, six companies have pleaded guilty so far or agreed to plead guilty when charged with participating in the LCD price-fixing conspiracy, which ran between September 14th, 2001 and December 1st, 2006. Said companies were sentenced or agreed to pay criminal fines that amounted to a total of $860 million. Yesterday, an FBI San Francisco press release revealed yet another company that agreed to plead guilty and that is set to pay a total of $220 million in criminal fines.
This time, the company that pleaded guilty was the Taiwanese Thin-Film Transistor-Liquid Crystal Display (TFT-LCD)-maker Chi Mei Optoelectronics. This company, based in Tainan, Taiwan, had been charged with price-fixing violation of the Sherman Act. Chi Mei admitted to having participated in the conspiracy by agreeing to set the prices of TFT-LCD panels at pre-determined levels and even monitored and enforced the adherence to the prices that had been agreed upon. By the end of the conspiracy period, the total market value of LCD panels was of about $70 billion.
This participation was carried out through meetings, conversations and communications with the other participants, of which no clear or direct mention is made throughout the aforementioned press release. Nevertheless, the release does mention the fact that Chi Mei's plea agreement, which is subject to court approval, included the company's consent to cooperate with the department's ongoing investigation. This means that the investigation might see significant progress if Chi Mei testifies against the other nine executives who are still under investigation.
Each violation of the Sherman Act carries a maximum fine of $100 million for corporations, a fine that can actually increase enough to become the equivalent of double the gain derived from the crime or the loss suffered by the victims. The LCD conspiracy definitely led to serious losses (and illicit gains, for that matter), as LCDs are used in a wide range of products, such as personal computers, both mobile and non-portable, as well as in televisions and consumer electronics, among others. The pricing conspiracy not only affected directly end-users, who bought LCD products, but even impacted on large companies such as Dell, HP and Apple.
The Department of Justice Antitrust Division’s San Francisco Field Office and the FBI in San Francisco will continue to investigate the remaining parties that have been charged with participation in the same felony. The press release may be read on the FBI San Francisco website.