WASHINGTON — Three major display developers - LG Display Co. Ltd., Sharp Corp. and Chunghwa Picture Tubes Ltd. (CPT) - have agreed to plead guilty and pay a total of $585 million in criminal fines for their roles in conspiracies to fix prices in the sale of liquid-crystal-display (LCD) panels, the U.S. Department of Justice announced November 12. Of the $585 million in fines, LG will pay $400 million (payable over five years), the second highest criminal fine ever imposed by the Department's Antitrust Division. Sharp will pay $120 million, and CPT, which was charged with conspiring with LG, will pay $65 million.

According to the Justice Department, the companies have agreed to cooperate with the Department's ongoing antitrust investigation. Companies directly affected by the LCD price-fixing conspiracies are some of the largest computer, television and cellular telephone manufacturers in the world, including Apple, Dell and Motorola.

"These price-fixing conspiracies affected millions of American consumers who use computers, cell phones and numerous other household electronics every day," said Thomas O. Barnett, Assistant Attorney General in charge of the Department's Antitrust Division. "LG Display, Sharp and Chunghwa have agreed to cooperate in the Department's ongoing investigation. In fact, they have already begun to cooperate. The Board of Directors for LG Display, Sharp and Chunghwa deserve credit for making a timely decision to accept responsibility and cooperate. Today's fines would have been significantly higher were it not for their cooperation."

According to iSuppli, LG was the world's second-largest supplier of large-sized LCD panels in the second quarter of 2008, with 20.3% of unit shipments; CPT was the world's fifth largest supplier of large-sized LCD panels in the second quarter of 2008 with a 5.9 % share of unit shipments; and Sharp Corp. tied for the sixth-largest supplier ranking during the same period, with a 3.9% share of unit shipments.

LG Display and Chunghwa are charged with carrying out the conspiracy by:

• Participating in meetings, conversations, and communications in Taiwan, Korea and the United States to discuss the prices of TFT-LCD panels;

• Agreeing during those meetings, conversations and communications to charge prices of TFT-LCD panels at certain pre-determined levels;

• Issuing price quotations in accordance with the agreements reached; and

• Exchanging information on sales of TFT-LCD panels, for the purpose of monitoring and enforcing adherence to the agreed-upon prices.

LG Display Co. Ltd., a South Korean corporation, and its wholly-owned subsidiary, LG Display America Inc., a California company, agreed to plead guilty to participating in a conspiracy from September 2001 to June 2006 to fix the price of TFT-LCD panels sold worldwide. During the conspiracy, LG Display Co. Ltd. was known as LG.Philips LCD Co. Ltd. (a joint venture between LG Electronics and Philips Electronics) and LG Display America Inc. was known as LG.Philips LCD America Inc.

LG did not issue a statement regarding the agreement.

CPT, a Taiwanese TFT-LCD panel manufacturer, has agreed to pay a $65 million fine for its participation with LG and other unnamed co-conspirators in a conspiracy from September 2001 to December 2006 to fix the price of TFT-LCD panels sold worldwide.

CPT issued a brief statement acknowledging the agreement, adding: "CPT also likes to highlight that this fine has been recognized on accounts, and therefore this fine will not cause material impact to the company's finance and sales."

Sharp is charged with participating in three separate conspiracies to fix the price of TFT-LCD panels sold to Dell, Motorola and Apple by:

• Participating in bilateral meetings, conversations, and communications in Japan and the United States to discuss the prices of TFT-LCD panels to be sold to Dell, Apple and Motorola;

• Agreeing during those bilateral meetings, conversations and communications to charge prices of TFT-LCD panels at certain pre-determined levels to Dell, Apple and Motorola;

• Issuing price quotations in accordance with the agreements reached; and

• Exchanging information on sales of TFT-LCD panels to be sold to Dell, Apple and Motorola, for the purpose of monitoring and enforcing adherence to the agreed-upon prices.

Sharp Corp., a Japanese consumer-electronics manufacturer, has agreed to pay a $120 million fine for its participation in separate conspiracies to fix the price of TFT-LCD panels sold to Dell Inc. from April 2001 to December 2006 for use in computer monitors and laptops; to Motorola Inc. from fall 2005 to the middle of 2006 for use in Razr mobile phones; and to Apple Computer Inc. from September 2005 to December 2006 for use in iPod portable music players.

"After carefully taking into consideration the applicable laws and regulations, the facts, and other factors, Sharp has decided that the best possible course of action would be to conclude the aforementioned agreement," the company said in a statement, adding that it has fully cooperated with the DOJ investigation since December 2006. "In consideration of this matter and the fact that similar investigations are being conducted in Japan and Europe, causing inconvenience and/or anxiety to our shareholders and other persons concerned, (the) Sharp Chairman & CEO and some other directors will voluntarily return 10% to 30% of their remuneration for three months starting December 2008. Sharp understands the gravity of this situation and will strengthen and thoroughly implement measures to prevent the recurrence of this kind of problem, and will earnestly work to regain the public's confidence."

— Staff Reports