Samsung Semi Prez Heads to Slammer

By Colleen Taylor -- Electronic News, 12/22/2006

Yet another executive with South Korea-based Samsung Electronics Ltd. will plead guilty, serve time in prison and pay a $250,000 fine for conspiring to fix DRAM prices, according to a Reuters report of a ruling from the Department of Justice.

According to the report, Young-hwan Park, who will serve 10 months, participated in the conspiracy while he was VP of sales at Samsung. Park is currently president of Samsung Semiconductor, the company's subsidiary in the United States. He has reportedly agreed to assist the Justice Department in its continuing investigation into the DRAM market.

Not including this charge, the Department of Justice has so far charged four companies and 17 individuals, and has secured fines totaling more that $731 million, as a result of its ongoing antitrust investigation into price fixing in the DRAM industry. The $731 million in criminal fines is the second highest total obtained by the Department of Justice in a criminal antitrust investigation into a specific industry, the department has said.

In November, a former executive of Japan-based DRAM maker Elpida Memory agreed to plead guilty, pay a $250,000 criminal fine and serve prison time in the U.S. for DRAM price-fixing charges. Three foreign-based Samsung Electronics executives, Sun Woo Lee, Yeongho Kang and Young Woo Lee, pleaded guilty to the DRAM price-fixing conspiracy in March and August. The Samsung employees agreed to serve prison terms ranging from seven to eight months and to each pay a $250,000 criminal fine. Then, Thomas Quinn, a fourth Samsung executive, pleaded guilty and was sentenced to serve eight months in prison and to pay a $250,000 criminal fine for his role in the DRAM price-fixing conspiracy.

In addition, four Hynix Semiconductor Inc. executives, Dae Soo Kim, Chae Kyun Chung, Kun Chul Suh, and Choon Yub Choi, were charged with participating in the DRAM price-fixing conspiracy and agreed to plead guilty and serve jail terms ranging from five to eight months and to each pay a $250,000 criminal fine. In December 2004, four Infineon executives, T. Rudd Corwin, Peter Schaefer, Gunter Hefner and Heinrich Florian, pleaded guilty to the DRAM price-fixing conspiracy. The Infineon employees served jail terms ranging from four to six months and each paid a $250,000 criminal fine.

Also, in December 2003, the Department charged Alfred Censullo, a regional sales manager for Micron Technology Inc., with obstruction of justice. Censullo pleaded guilty and admitted to having withheld and altered documents responsive to a grand jury subpoena served on Micron. Censullo was sentenced to serve six months of home detention.

In October, an indictment was returned against Il Ung Kim and Young Bae Rha, two executives from Samsung and Gary Swanson, an executive from Hynix America, the U.S.-based subsidiary of Hynix, charging them with participating in a global conspiracy to fix the price of DRAM from on or about April1, 2001, until on or about June 15, 2002.

In total, four companies have been charged with price fixing in the DRAM investigation. In October 2004, German manufacturer Infineon pleaded guilty and was sentenced to pay a $160 million criminal fine.
Samsung pleaded guilty to the price-fixing conspiracy and was sentenced to pay a $300 million criminal fine in November 2005. Hynix also pleaded guilty and was sentenced to pay a $185 million criminal fine in May 2005. And in January, Elpida agreed to plead guilty and pay an $84 million fine.