Seventeen individual plaintiffs, including three small businesses, have launched a class action lawsuit in the Northern District of California against the three largest RAM and chip manufacturers in the world: Samsung, SK Hynix, and Micron Technology. The plaintiffs allege that the three tech companies are colluding to raise the prices of RAM by keeping supplies artificially low, blaming it all on an AI data center-driven “RAMpocalypse” rather than corporate policy.
The Garciaguirre et al v. Samsung Electronics Co., Ltd. et al case was filed earlier this week, on June 25, in the California Northern District Court, and lists three small computer retailers, Troy’s Computers LLC, JB Tech Solutions LLC, and WNTD Fab LLC, among its seventeen plaintiffs.
The plaintiffs claim that Samsung, SK Hynix, and Micron Technology are essentially part of a cartel that is collaborating to inflate DRAM and chip prices by controlling the overwhelming majority of the market. While proving that will obviously be a lot harder than alleging it, it’s no secret that the three companies own roughly 90 percent of the DRAM market.
And it’s no secret that Samsung and SK Hynix have been previously indicted for doing exactly what the plaintiffs are accusing them of doing now. In 2005, two Samsung executives and one Hynix America executive were indicted by a San Francisco jury for DRAM price-fixing and “bid-rigging.”
Bid-rigging can take many forms, but in this example, Samsung and Hynix America were accused of “issuing price quotations in accordance with the agreements reached” during private meetings, and “agreeing during those meetings and telephone conversations to charge prices of DRAM at certain levels to be sold to certain [original equipment manufacturers]” in the United States.
If that sounds awfully familiar to you, that’s because a Valve employee stated that RAM manufacturers essentially blacklisted the company for attempting to negotiate on RAM prices during the Steam Machine’s manufacturing process: “Look, there’s no contracts…There’s nothing. Like, those guys…they are…they give us a price every month or something and they say ‘You can buy that many’ and it’s yes or no. And if we say no, then they never talk to us again.”
However, this time around, instead of using the dot-com crash as a cover for price gouging, the plaintiffs of Garciaguirre et al v. Samsung Electronics Co., Ltd. et argue that the three manufacturing giants are using the ever-growing need to supply AI data centers with DRAM and chips as a cover for their collusion. Hard not to root for the plaintiffs on this one, especially when you take into account the fact that Micron Technology’s stock price has increased by 1,309 percent and SK Hynix’s has increased by 2,045 percent over the past five years.
