Nokia has filed lawsuits in the U.S. District Court of Northern California and the United Kingdom that accuse the world’s top mobile-display vendors of price-fixing. Nokia alleges its suppliers conspired to artificially raise their prices for the Thin Film Transistor-Liquid Crystal Display (TFT-LCD) panels the company deployed in its mobile handsets and other electronic devices during 2006.
The companies named in Nokia’s lawsuits include AU Optronics, Chungwa Picture Tubes, Hitachi Displays, LG Display, Philips Electronics, Samsung SDI, Seiko Epson, Sharp, Tatung and Toshiba. Nokia is seeking triple damages, together with a court injunction that would prohibit its display suppliers from engaging in similar actions in the future.
Even if Nokia wins, however, DisplaySearch Vice President Paul Semenza believes the lawsuits will have a minimal financial impact on mobile-display makers. “This tends to be a one-time accounting loss that they can just write off in a really bad quarter and move on from there,” Semenza said.
The bigger impact will come in how the lawsuits affect vendors’ future behavior, Semenza observed. “The panel makers are going to be more careful about how they approach the business and how they approach pricing,” he explained.
TFT-LCD Conspiracies
Nokia believes it has a strong case in light of a joint investigation of LCD price-fixing allegations conducted by the U.S. Department of Justice and the FBI. Hitachi, LG Display, Sharp, Seiko Epson, and Chungwa Picture Tubes have already pleaded guilty to price-fixing charges involving their display sales to Apple, Dell and Motorola.
Moreover, the five display makers have agreed to pay substantial fines, more than $640 million in total. “Practically every American consumer has been impacted by the TFT-LCD conspiracies,” said Scott Hammond, acting assistant attorney general in charge of the Justice Department’s Antitrust Division.
Mobile-display makers are also being investigated by antitrust authorities in Europe….