Japanese, Korean giants sued over alleged optical drive cartel

A class action started in a North California district court against Sony, Sony Optiarc, Toshiba, Samsung, Hitachi and LG Electronics.

Patrick Keyes, on behalf of himself and others, alleged that these defendants engaged in a conspiracy to “fix, raise, maintain and stabilize artificially” the prices of optical disk drives and products containing optical disk drives.

The drives include CD, DVD and Blu-ray drives.

The suit also alleges that other companies including Philips and Lite-On participated in the violations, brought under the Sherman antitrust legislation.

The suit continues: “The market for optical disc drives exhibits numerous characteristics that suggest the price stabilisation beginning in 2005 resulted from an illegal conspiracy. These characteristics include the hihg level of market concentration, the existence of numerous joint ventures among defendants, trade organisations that provide opportunities for the sharing of anticompetitive information, product homogeneity and significant barriers to entry in the optical disk drive market.”

A handful of companies dominate the market for the drives, the suit continues. In 2008, Hitachi-LG, Toshiba Samsung and Sony controlled 67 percent of the market, says the suit.

This class action follows the announcement by the Department of Justice in October last year that it was investigating several companies for alleged antitrust behaviour.