Class Action Reveals Widespread Overpricing Scheme Affecting Purchasers of Smartphones, Computers and Other Electronics

04/27/2018

Attorneys alert consumers to rampant overpricing of smartphones, laptops, desktops, tablets and other devices

SAN FRANCISCO – Consumers today filed a class-action lawsuit against the three largest manufacturers of dynamic random access memory (DRAM), stating they illegally agreed to raise prices of DRAM, a critical component of smartphones, laptops and other electronics, therefore pushing price increases onto consumers who purchased devices containing DRAM, according to Hagens Berman.

Did you purchase a smartphone or computer between July 1, 2016 and Feb. 1, 2018? You may have overpaid for your device. Sign up for the case and learn more.

The lawsuit, filed Apr. 27, 2018, in the U.S. District Court for the Northern District of California, was spurred by a proprietary, independent investigation by the law firm’s antitrust attorneys who determined that DRAM manufacturers Samsung, Micron and Hynix agreed to limit the supply of DRAM, driving up prices for this widely used memory.

Samsung, Micron and Hynix collectively controlled 96 percent of the worldwide DRAM market share as of mid-2017. The price of 4GB DRAM saw a 130 percent jump during the period specified in the lawsuit, and as prices soared, so did defendants’ profits. Between Q1 2016 and Q3 2017, Samsung, Micron and Hynix’s revenues from global DRAM sales more than doubled.

“What we’ve uncovered in the DRAM market is a classic antitrust, price-fixing scheme in which a small number of kingpin corporations hold the lion’s share of the market,” said Steve Berman, managing partner of Hagens Berman. “Instead of playing by the rules, Samsung, Micron and Hynix chose to put consumers in a chokehold, wringing the market for more profit.”

Antitrust violations – or monopolies – essentially entail lowered competition between competitors in a single market, meaning these corporate entities have greater control over fluctuations in supply and therefore pricing, leading to artificial price increases. Antitrust pacts are illegal under the Sherman Act.

“This isn’t the first time we’ve caught the DRAM industry in a scheme to squeeze more money out of consumers,” Berman added. “We achieved a $300 million settlement for DRAM purchasers in a similar case, and we intend to prevail for consumers again.”

Hagens Berman achieved a $300 million settlement for purchasers who had been forced to pay artificially high prices in a suit in 2006 against DRAM manufacturers. In the Department of Justice’s case, defendants were convicted for conspiring to fix prices of DRAM. Samsung and Hynix pleaded guilty to the DOJ’s charges and paid some of the largest criminal fines in history for their illegal conduct.

The new suit accuses Samsung, Micron and Hynix of breaking federal antitrust competition laws and also accuses the DRAM manufacturers of violating state consumer protection laws.

The complaint says the three DRAM manufacturers coordinated their supply decisions in unison, inflating prices: “…Defendants made a near simultaneous decision in 2016 to restrict growth in the supply of DRAM to stop the downward pressure on prices and, indeed, to cause DRAM prices to skyrocket upward.” Throughout 2016 and 2017, the Defendants coordinated with each other, through statements to investors and the industry, on their business plans to ensure that supply of DRAM was artificially constrained.

How Do I Know If I’m Affected?

DRAM is an integral part of all modern computing electronics, and any smartphone, laptop, desktop computer or similar device is likely affected. This includes any devices made by the following major companies: Acer, Apple, Asus, Dell, Lenovo, HP, Samsung and many others.

The class action seeks to represent anyone in the U.S. who purchased a device using DRAM from July 1, 2016 through the Feb. 1, 2018. Find out more about the class-action and sign up.

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About Hagens Berman
Hagens Berman Sobol Shapiro LLP is a consumer-rights class-action law firm with 11 offices nationwide. The firm has been named to the National Law Journal’s Plaintiffs’ Hot List eight times. More about the law firm and its successes can be found at www.hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.

Media Contact
Ashley Klann
ashleyk@hbsslaw.com
206-268-9363


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