Nokia Sues LCD Makers over Price-Fixing

The lawsuit was filed in the U.S. District Court for the Northern District of California in San Francisco on Nov. 25.

Nokia in a statement said, "Nokia has filed suits to recover overcharges it paid as a result of cartel activities which are currently under government investigation. When certain companies and management employees have already admitted participating in, or are indicted for, global price-fixing cartels involving components Nokia has purchased, it is reasonable for Nokia to seek redress."

The similar complaint has also been filed in a UK court by the company on the same day.

Charges against the LCD manufacturers and damages Nokia is seeking
Nokia has alleged that the LCD manufacturers conspired to artificially inflate the prices from 1996 to 2006 in the LCD market.

As per Nokia’s claims, the major LCD manufacturer’s reached a contract that allowed them to divide the hardware market, then they kept manufacturing low volumes, increasing prices.

The company claimed in the papers submitted in the California court that the cartel, "artificially inflated the price of liquid crystal displays ultimately incorporated into LCD products purchased by Nokia, causing Nokia to pay higher prices."

These LCD manufacturing companies could be in major trouble as the lawsuit filed against them alleges violation of not only federal law (of the Sherman and Cartwright Acts) but also anti-trust violations, coming under the statues of 21 states.

Nokia is reportedly seeking monetary damages, but the amount has not been disclosed in the media yet. The company is also seeking court injunction so that these manufacturers won’t be able to continue with their conspiracy to rule the market and keep other manufacturers out.

Targeted companies in the Nokia lawsuit
Nokia has slapped a suit against eleven LCD manufacturers. These are: Philips, Samsung, Toshiba, Sharp, LG Display, Tatung Co., AU Optronics, Seiko Epson Corp., Hitachi and Shungwa Picture Tubes.

Some of the companies named by the Nokia in its lawsuit were already found to be guilty of fixing prices by the U.S. Department of Justice in an investigation in the past few years.

LG, Shungwa Picture Tubes and Sharp in November 2008 pled guilty to the charges of fixing LCD prices over a five-year period and agreed to pay $585 million in fine.

In October, AT&T (NYSE:T) had also filed similar anti-trust suit against the LCD makers. Both the companies are claiming that LCD makers conspire in their secret meeting to eliminate competition from the market.

European commission eyeing the LCD market last week officially filed suits against several companies for conspiring to fix prices of computer and television displays.

Nokia has also sued Apple alleging that its iPhones infringes Nokia’s 10 technology patents.