Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

This was attempted before in 2022 but fell apart because plaintiff couldn't show an agreement took place https://cdn.ca9.uscourts.gov/datastore/opinions/2022/03/07/2...

HBM is also DRAM. I also think it's kind of a weak argument to say that them discontinuing ddr3 (which while in use still today in industrial/embedded was on the way out for consumers 10 years ago) and ddr4 which last had consumer CPUs for it 3 years ago is meaningful. What we need now is ddr5. Turning off the old fabs and moving those resources including people to ddr5 is a good thing. That's not price fixing. It's possible price fixing is in play, but discontinuing products people objectively don't use as much anymore isn't it.

What happens if Samsung and SK Hynix simply stop selling to US at all? Micron is in US but are the rest still in the US jurisdiction?

They are selling the hottest commodity of the day. It’s made outside of the US using non-American tooling.

Everybody in our industry loves fat margins. But god forbid if someone else captures the margins and squeeze them out of easy profits.

I also feel like there should be FTC or other antitrust actions against OpenAI and other hyperscalers, with nvidia being complicit, if they are cornering the market that badly on consumer RAM, SSD and other components, especially if these volume purchases are for projected datacenter that haven't even broken ground (or have been paid for) for many months.

Furthermore, I think there should be a tax on algorithmic inefficiency, in that if a LLM, frontier or not, consumes more than a certain amount of KWH per token, it should be taxed such as to put emphasis on models than can run locally, on a normal PC

I don't see how this can really go anywhere, but it'd be nice if it does.

Not like it'd be the first time someone shook a stick at them.

At this point the only hope for change is if China finally decides to get in the game rather than just threatening to.

Maybe software people can get around this issue by not making every app a electron bloat? This is now more than doable now you got AI right? And it will save your job

Honestly, the knock on effects of this cartel behavior should concern all countries, and be remediated with expediency.

From consumer electronics to the data-center, the rising real mfg costs and lack of supply is putting huge pressure on pricing, and may just drive anyone who cant negotiate with these suppliers out of business.

Once the dominoes start, I fail to see how things recover in less than 3-5 years, not counting all the businesses wiped out in the meanwhile.

I mean there was an attempt before, and maybe I'm wrong but I'm sure they were fined in 2010 at least in the EU, this seems to be round 2 of their 'Memory Cartel' after learning some lessons, realising all they need to do is keep supply as low as they want and allow the AI companies to spend hand over fist.

https://ec.europa.eu/commission/presscorner/detail/en/ip_10_...

Anyone know what will lawfirms cut if they win from the lawsuit?

How many millions are we talking.

Just a reminder that anyone can file a lawsuit over anything, and the initial complaint is written by lawyers and reads with tabloid levels of sensationalism and allegation. The goal being to maximize the appearance of harm as much as possible so the suit has the greatest chance of sticking.

It is not in any way, shape, or form a ruling much less even a piece of well researched work. It's "my side of the story that makes me look perfect, with lawyers turning the heat up to 11"

everything is political

Price fixing is legal as long as your are doing it in the open. In the UK it is called "price match" and eg. if supermarket says they keep prices matched to their competitor. No regulator raises an eyebrow.

So here Samsung and SK Hynix could say they price match to Micron and they are in the clear.

I think the only solution to this issue is China. If CXMT can supply, it will put all these monopolies in check.

I think it's incredibly unlikely to be deliberate price fixing this time. Demand is too high.

,,The plaintiffs claimed the three companies reduced D-RAM supply under the pretext of transitioning to high-bandwidth memory (HBM). "The D-RAM oligopoly companies systematically coordinated the shift to HBM and the discontinuation of DDR3 and DDR4," they said. They added that Apple's recent sweeping product price increases were the trigger for the lawsuit.''

How can they do price fixing and discontinuing a product at the same time? It just looks like some companies are angry that AI / VC industry is outpricing them.

Looking forward to getting my $10 settlement 15 years from now like what happened with the DVD drive price fixing lawsuit (paid as a digital Visa gift card code so it can't actually be spent anywhere).

This was attempted before in 2022 but fell apart because plaintiff couldn't show an agreement took place https://cdn.ca9.uscourts.gov/datastore/opinions/2022/03/07/2...

https://ec.europa.eu/commission/presscorner/detail/en/ip_10_...

Anyone know what will lawfirms cut if they win from the lawsuit?

How many millions are we talking.

everything is political

It's been happening once every decade or so. I'm not surprised that they are being sued again.

I thought the title missed the year (in parenthesis)

Switching off DDR3 manufacturing I can understand, but DDR4 machines are still quite relevant and usable… Ryzen 5000 series boxes for example don’t feel meaningfully weaker than they did when new. My 5950X tower certainly doesn’t, and it’d really be nice to be able to upgrade its RAM should I need to because it will continue to be useful for quite some time.

AMD just re-released their 5800X3D for AM4 board users who wish to upgrade which is further evidence that shutting off DDR4 production is premature.

Dropping DDR-4 is anything but meaningful. It'll easily last 10 more years, machines from this gen are still much more affordable and quite powerful. In fact for most dev and gaming workflows the difference between the DDR-4 and DDR-5 generation of hardware is more or less negligible. I am exaggerating a bit -- but really, not too much.

Of course it might be a ploy to sheep-herd consumers and companies towards the expensive DDR-5. I would not put that below the ring of RAM producers.

What happens if Samsung and SK Hynix simply stop selling to US at all? Micron is in US but are the rest still in the US jurisdiction?

They are selling the hottest commodity of the day. It’s made outside of the US using non-American tooling.

>It’s made outside of the US using non-American tooling.

Depends if US can demand ASML which uses plenty of US tech inside. In reality even the DRAM and NAND supply chain has plenty of US technologies.

And you say Micron are US but they have lots of Fabs in Japan as well since they acquired Elpida.

> What happens if Samsung and SK Hynix simply stop selling to US at all? Micron is in US but are the rest still in the US jurisdiction?

They would lose access to their largest market, I'm sure shareholders would havesomething to say about that ?

US is the vast majority of their market - Apple, hyper-scalers, AI labs

memory is a commodity is laughable. Then software engineering is even more a commodity, the amount of engineering going into making memory chips the vast majority of people don't understand. There are a lot of software engineers getting this field after leetcoding and copy from hellointerview. Claude can write you an app in 30 minutes. Try build a lpddr5 dram chip in 30 minutes. Manufacturing know how itself is a specialty and barrier to entry.

Everybody in our industry loves fat margins. But god forbid if someone else captures the margins and squeeze them out of easy profits.

There's "fat margins" and then there's the kind of margins that tech industry shareholders expect.

OpenAI's original corporate agreements capped its returns at 100x, which is seen as too paltry for its current holders, so they scrapped those to prepare for an IPO [0]

That is, in a word, insane.

[0] https://abhs.in/blog/openai-for-profit-conversion-ipo-develo...

>But god forbid if someone else captures the margins and squeeze them out of easy profits.

Yeah that's how law works. Everyone likes money, but that doesn't mean it's fine to steal money. Yes, even from maligned entities like "big tech" or "private equity"

It is not in any way, shape, or form a ruling much less even a piece of well researched work. It's "my side of the story that makes me look perfect, with lawyers turning the heat up to 11"

In reality a lawsuit needs to have some basis. The bar might be low but judges frown on having their time wasted with a truly frivolous claim or a claim with no clear damages or harm shown.

Honestly a lot of lawsuits feel like they just want the other party to pay them (settle) to make the lawsuit go away, even if there is no case; what are the repercussions for a frivolous lawsuit?

So here Samsung and SK Hynix could say they price match to Micron and they are in the clear.

Price match creates downward pressure, nobody is gonna sue over lower prices.

This is like if you showed a supermarket that their competitor's oranges were more expensive, and they "matched" by raising their prices for everyone.

> Price fixing is legal as long as your are doing it in the open.

In the U.S., competitors are allowed to act in similar ways in response to economic realities, as long as they each arrive at that decision independently. But publicly anchoring your price to a competitor’s is potentially illegal.

> Price fixing is an agreement (written, verbal, orinferred from conduct) among competitors to raise, lower, maintain, or stabilize prices or price levels.

[Emphasis added]

https://www.ftc.gov/advice-guidance/competition-guidance/gui...

>Price fixing is legal as long as your are doing it in the open. In the UK it is called "price match" and eg. if supermarket says they keep prices matched to their competitor. No regulator raises an eyebrow.

No, the key term is "collusion", which could be done in the open or not. If a competitor told you they were unilaterally raising prices in secret, that would still be legal. Where you get into trouble is if you are cooperating to set prices. And no, this is all determined by a judge so cute workarounds like "I'm telling my competitors that I'm raising prices then gauging his body language" won't work.

That is not what price fixing actually is. In the UK "price matching" is a one-to-many relationship meaning that the price of goods is set to the "lowest available"

Price fixing is a many-to-one all the manufactures agree to the highest prices they all agree on and set it there.

I think the only solution to this issue is China. If CXMT can supply, it will put all these monopolies in check.

That’s a nice short-term solution. How do you envision adding an infinitely-deep-pocketed state-sponsored supplier to the mix over the longer term?

It's been happening once every decade or so. I'm not surprised that they are being sued again.

I thought the title missed the year (in parenthesis)

AMD just re-released their 5800X3D for AM4 board users who wish to upgrade which is further evidence that shutting off DDR4 production is premature.

There's "fat margins" and then there's the kind of margins that tech industry shareholders expect.

OpenAI's original corporate agreements capped its returns at 100x, which is seen as too paltry for its current holders, so they scrapped those to prepare for an IPO [0]

That is, in a word, insane.

[0] https://abhs.in/blog/openai-for-profit-conversion-ipo-develo...

>But god forbid if someone else captures the margins and squeeze them out of easy profits.

Yeah that's how law works. Everyone likes money, but that doesn't mean it's fine to steal money. Yes, even from maligned entities like "big tech" or "private equity"

In reality a lawsuit needs to have some basis. The bar might be low but judges frown on having their time wasted with a truly frivolous claim or a claim with no clear damages or harm shown.

That might have been true at some point in the past and the judiciary might even feel that way still.

However the practical penalty for filling absurd lawsuits is zero unless you do it repeatedly to random people for a decade.

Absolutely nothing bad will happen to the plaintiff or the lawyers representing them in this case.

Western legal systems are broken.

Honestly a lot of lawsuits feel like they just want the other party to pay them (settle) to make the lawsuit go away, even if there is no case; what are the repercussions for a frivolous lawsuit?

Realistically very few. The plaintiff carries the burden of proving the claim, but they are afforded the power of the law to do so via discovery. The defendant then has to spend a large number of legal resources refusing the claims and also providing the evidence required.

If the plaintiff loses the lawsuit a countersuit is pretty unlikely to succeed unless the lawyer participates in gross misconduct. Generally, countersuits are filed more to put the original plaintiff on the defense and don't result in a large judgement.

If you are operating in good faith, then you are pretty insular from kickback as a plaintiff

>what are the repercussions for a frivolous lawsuit?

None, hence the high price of liability baked into basically everything in America. And not just in nominal prices, but in terms of things like restricting access to spaces, restricting access to information, etc.

Price match creates downward pressure, nobody is gonna sue over lower prices.

This is like if you showed a supermarket that their competitor's oranges were more expensive, and they "matched" by raising their prices for everyone.

> Price fixing is legal as long as your are doing it in the open.

> Price fixing is an agreement (written, verbal, orinferred from conduct) among competitors to raise, lower, maintain, or stabilize prices or price levels.

[Emphasis added]

https://www.ftc.gov/advice-guidance/competition-guidance/gui...

Identical prices are often a sign of intense competition. Every gas station on a corner has the same price because it's a highly competitive market not because of collusion. The prices of the much more lucrative chocolate bars inside the gas stations are less likely to be identical.

That is not what price fixing actually is. In the UK "price matching" is a one-to-many relationship meaning that the price of goods is set to the "lowest available"

Price fixing is a many-to-one all the manufactures agree to the highest prices they all agree on and set it there.

That’s a nice short-term solution. How do you envision adding an infinitely-deep-pocketed state-sponsored supplier to the mix over the longer term?

I think it's incredibly unlikely to be deliberate price fixing this time. Demand is too high.

Prices skyrocketing create a perfect opportunity to slip in a little artificial bump and hope everyone blames the market. See also: egg prices in 2024.

There is no reason for there not to be a price fixing. But the OpenAI's announcement from 2025-10-01 about buying 40% of supply, removes any need for collusion. It was a public signal for everyone to rise prices, one that each company could figure on their own. And it will be very hard to prove otherwise.

Two things can be true; they could theoretically make agreements to limit supply, like the OPEC does to exert control over international oil prices. But the OPEC is all above board and there's plenty of international competition on the oil market.

But the challenge is in proving it.

How can they do price fixing and discontinuing a product at the same time? It just looks like some companies are angry that AI / VC industry is outpricing them.

> An agreement to restrict production, sales, or output is just as illegal as direct price fixing, because reducing the supply of a product or service drives up its price. For example, the FTC challenged an agreement among competing oil importers to restrict the supply of lubricants by refusing to import or sell those products in Puerto Rico. The competitors were seeking to pressure the legislature to repeal an environmental deposit fee on lubricants, and warned of lubricant shortages and higher prices.

https://www.ftc.gov/advice-guidance/competition-guidance/gui...

hmm maybe the plaintiff should sue nvidia?

Of course it might be a ploy to sheep-herd consumers and companies towards the expensive DDR-5. I would not put that below the ring of RAM producers.

>Dropping DDR-4 is anything but meaningful. It'll easily last 10 more years, machines from this gen are still much more affordable and quite powerful. In fact for most dev and gaming workflows the difference between the DDR-4 and DDR-5 generation of hardware is more or less negligible. I am exaggerating a bit -- but really, not too much.

How much % of the DRAM market do you think is made from computer enthusiasts upgrading their Zen 1/2 CPUs to Zen 3? Note intel and AMD both switched to DDR5 well before the exit from DDR3/DDR4 ("2024-2025", according to the complaint).

>It’s made outside of the US using non-American tooling.

Depends if US can demand ASML which uses plenty of US tech inside. In reality even the DRAM and NAND supply chain has plenty of US technologies.

And you say Micron are US but they have lots of Fabs in Japan as well since they acquired Elpida.

Everyone is using something from someone, you can even argue that US owes India and Europe huge compensation because pretty much everything US did in the last half century was made using technology or people funded by those people. Johny Ive is British, Steve Jobs is Syrian, Almost all the AI stuff is created by Europeans, Israelis, and Canadians - thus funded by their respective taxpayers.

The thing about the US losing its grip on the world and the collapse of the global world order means that the words on the paper don't mean much. Embargoes on Russia didn't mean much so not Europeans are physically taking over those ships and Ukrainians are physically sinking the rest. In Iran nothing other than physically sinking ships and blowing up places meant anything.

Europeans can ship EUV machines because they are physically building them to people who will use to physically build things with it. US wasn't able to enforce its will to Iran, what if Koreans, Europeans and the Chinese decide that its not into their interest to act according to US courts?

> What happens if Samsung and SK Hynix simply stop selling to US at all? Micron is in US but are the rest still in the US jurisdiction?

They would lose access to their largest market, I'm sure shareholders would havesomething to say about that ?

The market is the AI boom and the US is the host, they can sell the exact same stuff to someone else. What are the capitalists who fund the AI build up do? Invest in SaaS when they can't buy chips? I bet if something like that happens the chip manufacturers wouldn't end up with product they have no one to sell to.

US is the vast majority of their market - Apple, hyper-scalers, AI labs

Why can't they just buy the exact same product and install it in Kazakhstan or somewhere else?

And hyper-scalers, Apple, AI labs all will die if memory makers can't sell to them?

Prices skyrocketing create a perfect opportunity to slip in a little artificial bump and hope everyone blames the market. See also: egg prices in 2024.

https://www.ftc.gov/advice-guidance/competition-guidance/gui...

hmm maybe the plaintiff should sue nvidia?

Why can't they just buy the exact same product and install it in Kazakhstan or somewhere else?

And hyper-scalers, Apple, AI labs all will die if memory makers can't sell to them?

That might have been true at some point in the past and the judiciary might even feel that way still.

However the practical penalty for filling absurd lawsuits is zero unless you do it repeatedly to random people for a decade.

Absolutely nothing bad will happen to the plaintiff or the lawyers representing them in this case.

Western legal systems are broken.

If you are operating in good faith, then you are pretty insular from kickback as a plaintiff

>what are the repercussions for a frivolous lawsuit?

I worked in a small town gas station as a kid. We always phoned our competitor to let them know when we were changing our prices, and they extended us the same courtesy. Usually we followed them, but sometimes we didn't.

Gas prices are posted on massive highly visible signs and are public information. This wasn't collusion, it was a sign of intense but friendly competition.

What would the issue be, in the long term? I'm struggling to see a downside to more manufacturing capacity

But the challenge is in proving it.

It isn't like OPEC and oil where you can turn on and off bumping out from the ground.

The most expensive foundry / fab isn't the leading edge, it is the "empty" ones. You can't have a fab sitting idle.

Note though that for Intel, the first gen of DDR5 CPUs also supported DDR4, and many buyers bought the DDR4 versions of their boards because at that point DDR5 RAM was much more expensive for gains that were marginal at best, which effectively makes Intel’s following generation of DDR5 CPUs the actual transition point.

The mere "enthusiast" word in your question suggests the percent is not too big. But I am not sure I get your point -- elaborate, please?

Maybe software people can get around this issue by not making every app a electron bloat? This is now more than doable now you got AI right? And it will save your job

Honestly, the knock on effects of this cartel behavior should concern all countries, and be remediated with expediency.

Once the dominoes start, I fail to see how things recover in less than 3-5 years, not counting all the businesses wiped out in the meanwhile.

Gas prices are posted on massive highly visible signs and are public information. This wasn't collusion, it was a sign of intense but friendly competition.

What would the issue be, in the long term? I'm struggling to see a downside to more manufacturing capacity

It isn't like OPEC and oil where you can turn on and off bumping out from the ground.

The most expensive foundry / fab isn't the leading edge, it is the "empty" ones. You can't have a fab sitting idle.

And replace all your apps with some horrible Tcl/Tk and .NET interface?

Nobody ever made good native widgets.

How do we know it's cartel behavior, not just free market competition?

I don't see how this can really go anywhere, but it'd be nice if it does.

Not like it'd be the first time someone shook a stick at them.

At this point the only hope for change is if China finally decides to get in the game rather than just threatening to.

And our illustrious leader doesn't tariff Chinese RAM and allows its sale in the US.

The mere "enthusiast" word in your question suggests the percent is not too big. But I am not sure I get your point -- elaborate, please?

The point is that just because there's a handful of people (relatively speaking) looking to buy more RAM to upgrade their last gen systems, doesn't mean there's robust demand for DRAM manufacturers to keep DDR4 manufacturing lines going. It's like arguing Sony shouldn't have exited the CRT business because there's retro enthusiasts on youtube scouring the earth for CRT monitors.

I’m not sure that comparison makes much sense. By the time CRTs were phased out, demand was down to almost nothing and what little existed was confined to the extreme budget market. While I don’t have industry insights or anything I don’t think demand for DDR4 is anywhere near the bottom yet, and the remaining demand is centered on premium product (nobody running cheap DDR4 is upgrading). In a more normal market would be more than enough to justify continued production for several more years.

DDR4 production is likely still quite profitable, just not drowning-in-money AI-bubble profitable. If smaller foundries existed they’d be happy to take up the business.

Maybe really what needs to happen is some busting up of the giants…

And our illustrious leader doesn't tariff Chinese RAM and allows its sale in the US.

DDR4 production is likely still quite profitable, just not drowning-in-money AI-bubble profitable. If smaller foundries existed they’d be happy to take up the business.

Maybe really what needs to happen is some busting up of the giants…

There is a minimum amount of production volume for it to fit the price equation. If the market doesn't have that demand, it is fundamentally no different to CRT.

Otherwise they could continue to make DDR4 at a higher cost and sold at a higher price to which people will complain price fixing again.

And replace all your apps with some horrible Tcl/Tk and .NET interface?

Nobody ever made good native widgets.

There is a minimum amount of production volume for it to fit the price equation. If the market doesn't have that demand, it is fundamentally no different to CRT.

Otherwise they could continue to make DDR4 at a higher cost and sold at a higher price to which people will complain price fixing again.

How do we know it's cartel behavior, not just free market competition?

Reuters/Yonhap News - Seoul Economic Daily International News from South Korea

Reuters/Yonhap News

Samsung Electronics, SK hynix and Micron have been sued by some consumers in the United States over alleged memory price fixing. With "chipflation" intensifying recently—including Apple's product price increases—local consumers and small businesses have taken legal action.

According to US tech outlet Wccftech and legal publication LAW360, 14 individual consumers and three small businesses including PC retailers filed the lawsuit in a California federal court on the 25th. The plaintiffs alleged that the three companies, which produce most of the world's D-RAM, colluded on supply and pricing from 2022, driving prices up by about 700% over the past four years.

The plaintiffs claimed the three companies reduced D-RAM supply under the pretext of transitioning to high-bandwidth memory (HBM). "The D-RAM oligopoly companies systematically coordinated the shift to HBM and the discontinuation of DDR3 and DDR4," they said. They added that Apple's recent sweeping product price increases were the trigger for the lawsuit.

The lawsuit is small in scale so far, but if the court accepts the plaintiffs' claims and formally approves it as a class action, it could expand. Bathaee Dunne, the antitrust law firm representing the plaintiffs, is aiming for a class action representing all general consumers and businesses that purchased products containing D-RAM. The firm previously won a case alleging collusion in Google's digital advertising. If the plaintiffs ultimately prevail in the class action, the defendant companies would have to pay triple the damages.

The fact that Samsung Electronics and SK hynix have previously been found guilty of collusion in the United States is also a concern. Both companies were found to have engaged in price fixing in the US in the early 2000s, resulting in large fines as well as prison sentences for executives. However, industry players including investment bank Jefferies forecast that the lawsuit will not affect memory prices at least until the end of this year.

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Samsung, SK Hynix, Micron Sued in US over Memory Price Fixing

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