Lawsuit charges CRT makers with price-fixing

by Agam Shah

November 27, 2007 —

A class-action lawsuit was filed against six monitor manufacturers on Tuesday,
alleging the companies of being a "global cartel" involved in price-fixing
of CRT monitors.

The lawsuit, filed in the U.S. District Court for the Northern District of
California on behalf of Nathan Muchnick Inc., alleges that six manufacturers
-- Chunghwa, LG Electronics, Matsushita, Philips Electronics, Samsung and Toshiba
-- artificially inflated the prices of CRT products to remain stable despite
a rapid decline in demand.

The prices of CRT monitors should have fallen as technologically superior products
were introduced, said Joseph Saveri, a lawyer with Lieff Cabraser Heimann &
Bernstein LLP, which represents Muchnick.

"Instead, for almost a decade, we have seen periods of unnatural and sustained
price stability, as well as inexplicable increases in the prices of CRTs,"
Saveri said.

The complaint alleges collusive behavior by the manufacturers, causing the
plaintiff and direct purchasers to overpay for CRT monitors. The suit seeks
triple damages.

Of the 48 million monitors that will ship this quarter, 9 percent are expected
to be CRTs, down from 13 percent last year, according to projections by DisplaySearch,
a research firm. The average selling price of CRT monitors has increased to
US$32 in the fourth quarter, up from $30.80 last year, said John Jacobs, an
analyst at DisplaySearch.

The price increase could be explained by factory closures. CRT factories have
been closing down because of LCD penetration, and the reduced manufacturing
capacity makes it hard for suppliers to meet demand, Jacobs said.

IDG News Service