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HP seeks $1 billion damages over claimed LCD screen price fixing

Hewlett-Packard (HP) has claimed that a Chinese telecoms firm and its subsidiary engaged in a decade-long price fixing conspiracy that caused HP to overpay for display screens.06 Dec 2012

An HP spokesperson told that it had "suffered significant damages" stemming from the activity that Chungwha Picture Tubes and subsidiary Tatung Company of America allegedly participated in from 1996-2006. HP has filed a lawsuit in a district court in California against the companies.

A report by Bloomberg news agency said that HP is seeking $1 billion in damages from the case.

"HP has filed suit against Chungwha Picture Tubes, Ltd. and its subsidiary Tatung Company of America, Inc., in a California court to recover damages the company suffered as a result of the defendant’s admitted participation in a TFT-LCD price fixing scheme from 1996-2006," the HP spokesperson said in a statement.

"HP has suffered significant damages as a result of the price-fixing conspiracy in which Chungwha has admitted it participated. While HP had hoped to settle this matter out of court, negotiations have not been successful, leaving HP no choice but to bring this matter before the courts so that it may be made whole," the spokesperson added.

Chunghwa Picture Tubes did not respond to's request for comment.

TFT-LCD is an abbreviation for 'thin film transistor liquid crystal display' and refers to technology used to enhance the quality of images displayed on flat panel televisions, computer monitors and laptop screens.

In 2009 Chunghwa Picture Tubes agreed to pay a $65 million fine as part of a guilty plea made in conjunction with the US Justice Department after the Department had conducted a criminal investigation into TFT-LCD price fixing.

As part of its plea agreement, the Taiwan-based company acknowledged that it had participated "in a conspiracy to suppress and eliminate competition by fixing the prices of thin-film transistor liquid crystal display panels sold in the United States and elsewhere, from on or about September 14, 2001, to on or about December 1, 2006, in violation of the Sherman Antitrust Act".

In 2010 the European Commission also fined Chunghwa Picture Tubes and four other makers of flat panel screens €649 million for participating in a price-fixing cartel. The other companies involved in the cartel were LG Display, AU Optronics, Chimei InnoLux Corporation and HannStar Display Corporation. Samsung Electronics did not receive a fine because it alerted the Commission to the activity.

At the time the Commission said that the companies operated a price-fixing ring for LCD screens between October 2001 and February 2006.

"During the four years, the companies agreed prices, including price ranges and minimum prices, exchanged information on future production planning, capacity utilisation, pricing and other commercial conditions," said a Commission statement. "The cartel members held monthly multilateral meetings and further bilateral meetings. In total they met around 60 times mainly in hotels in Taiwan for what they called 'the Crystal meetings'."

"These agreements had a direct impact on customers in the European Economic Area because the vast majority of televisions, computer monitors and notebooks incorporating those LCD panels and sold in the EEA comes from Asia," it said.

The Commission added that the companies knew that what they were doing was wrong because documents urged readers to keep them secret and to keep written communication about the discussions to a minimum.