California and 33 other U.S. states plan to file a joint antitrust lawsuit against seven DRAM makers over alleged price fixing, adding to industry woes amid an ongoing federal investigation that has already led to $731 million in fines.

The Attorney General for the state of California, Bill Lockyer, will file the lawsuit on Friday in the U.S. District Court for the Northern District of California, he said in a statement.

The multi-state suit alleges the companies violated antitrust laws and harmed consumers by conspiring to fix prices through artificial supply restraints, dividing markets among themselves and rigging bids on DRAM contracts during a four year period between 1998 and 2002.

The alleged price fixing harmed computer makers such as Apple, Dell and HP, causing them to pay more for DRAM than they would have paid in a free and competitive market., according to Florida Attorney General Charlie Crist, in a separate statement. These added costs were then passed on to consumers.

State of New York Attorney General Eliot Spitzer, who filed an antitrust lawsuit in Manhattan, said the alleged conspiracy added at least $1 billion to the cost of the memory chips.

The size of fines resulting from the lawsuit could be substantial. In California alone, Lockyer estimates damages suffered by consumers could reach the tens of millions of dollars. The antitrust complaint asks the court to order defendants to pay three times the amount of damages for which they are found liable.

The California case notably excludes Samsung, the world's largest DRAM maker. But it includes Micron Technology as well as six foreign chip makers; Infineon of Germany, South Korea's Hynix Semiconductor, Japan's Elpida Memory and NEC Electronics America, Taiwan's Mosel Vitelic and Nanya Technology as well as their U.S. subsidiaries.

Samsung, which is named as a defendant in the Manhattan suit, declined to comment. The Manhattan suit is part of the coordinated effort by the group of states.

Nanya Technology has not yet received any information from U.S. authorities regarding the matter, said Pai Pei-Lin, a vice president at Nanya Technology. "We believe that we have not violated any regulations," he said.

The case by the states will likely run as a sideshow to the U.S. Department of Justice investigation, which began in 2002 and has already seen guilty pleas by 12 individuals and four companies, in addition to huge fines. But it will likely mean additional fines above and beyond those already doled out by the Justice Department.

The IDG News Service is a Network World affiliate.

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