HP Files Price-Fixing Complaint Against Optical Disk Drive Makers


Hewlett-Packard Company (NYSE:HP) filed a lawsuit against optical disk drive manufacturers for allegedly colluding in fixing the prices of the products it purchased that costs billions of dollars over the past six years, according to report from Bloomberg.

The world’s largest manufacturer of personal computers (PCs) accused LG Electronics Inc (KSE:066570), Samsung Electronics Co. Ltd (KSE:005930) and Toshiba Corporation (TYO:6502) of sharing confidential information and manipulated bids to “fix, maintain, raise, or stabilize that prices” of disk drives from 2004 to 2010. Hewlett Packard Company or HP filed its complaint against the three optical disk drive manufacturers at the U.S. District Court, Southern District of Texas in Houston.

The lawsuits filed by Hewlett Packard Company stipulated that LG Electronics, Samsung Electronics, and Toshiba Corporation collectively controlled 90% of the optical disk drive market and paid over priced for the products. Optical disk drives are storage devices that are used to store or retrieve data on optical discs such CDs, DVD, and BDs or Blu-ray discs.

One of the complaints filed by HP reads, “Many of the defendants and their co-conspirators have a long history of collusion; have been involved in antitrust investigations into other technology-related products; and/or have admitted to participating in anticompetitive cartels involving technology-related or other products.”

HP discovered the price-fixing scheme of the optical drive manufacturers after United States Department of Justice (DOJ) conducted an investigation against Hitachi-LG Data Storage Inc (HLDS), a joint venture of Hitachi and LG Electronics. HLDS pleaded guilty for violating antitrust laws in the optical industry, and agreed to pay a penalty of 21.1 million. The Justice Department identified HP as a victim of bid-rigging and price-fixing.

The defendants are facing multiple price-fixing allegations. Last year, a federal judge in Northern California rejected the petition to dismiss the consolidated antitrust complaints against the optical disk drive manufacturers.

HP is seeking unspecified triple damages and injunctive relief under the Sherman Act, California Cartwright Act, and the California Unfair Competition Law.

Other defendants in the complaints include Sony Corporation (NYSE:SNE) (TYO:6758), NEC Corp (TYO:6701), Hitachi-LG Data Storage, Koninklijke Philips (NYSE:PHG), and Sharp Corporation (OTCMKTS:SHCAY) among others.