AT&T Inc. won reinstatement of its price-fixing lawsuit against AU Optronics Corp, Samsung Electronics and a host of other makers of liquid crystal display panels. The 9th U.S. Circuit Court of Appeals ruled that California antitrust law could be applied to alleged price-fixing violations that occurred outside California.
The ruling overturns a decision by U.S. District Judge Susan Illston, who had dismissed claims for purchases outside California because those claims would violate constitutional due process protection.
“To the extent a defendant’s conspiratorial conduct is sufficiently connected to California, and is not ‘slight and casual,’ the application of California law to that conduct is ‘neither arbitrary nor fundamentally unfair,’” wrote Judge Milan D. Smith for the majority.
LCD panels are used in computer monitors, laptops, TVs and smartphones. AT&T Mobility, BellSouth Telecommunications, Inc. and others sell mobile wireless handsets. Between 1996 and 2006 the purchased billions of dollars worth of the mobile equipment containing the LCD panels made by AUO and the other defendants.
The lawsuit alleged that the prices they paid were artificially inflated because the LCD makers colluded in a global conspiracy to fix prices.
AT&T’s suit is part of a host of cases stemming from claims of global price-fixing in LCD panels.
A Justice Department investigation led to $890 million in fines by a group of companies including LG Display Co., Chunghwa Picture Tubes, Chi Mei Optoelectronics Corp. and Sharp Corp.
So far 17 executives have been charged with crimes related to alleged price-fixing and 10 have pleaded guilty and sent to prison.
The most recent case came with Illston’s January order that former AUO president H.B. Chen and executive vice president Hui Hsiung report to prison by February 12 based on their jury conviction last year.
In December another AUO official, Steven Leung, faced his second trial on conspiracy charges related to price-fixing and was convicted. He has not yet been sentenced.
Two other executives at AUO were acquitted in a trial in March 2012.
The panel sent the AT&T civil case back to Illston for further review in light of the appellate ruling.
Joining Smith were Judges Ronald Gould and visiting Judge Kevin Duffy of the S. District of New York.
Case: AT&T Mobility v. AU Optronics Corp., No. 11-16188