DOJ Verdict In Liquid Crystal Display Price Fixing Case Shows Juries Get It

Earlier this week, after an eight week trial, a jury in San Francisco convicted AU Optronics Corporation (“AUO”), a Taiwanese corporation, its U.S. subsidiary, AU Optronics Corporation of America (“AUOA”), and two of their former executives with price fixing under the Sherman Act. United States of America v. AU Optronics Corp., et al., No CR-09-0110 (N.D. Cal.). The jury, while acquitting two other individual defendants, also found that the gross gains derived from the conspiracy, involving AUO, AUOA and other companies in the liquid crystal display market, to exceed $500 million. According to the Department of Justice’s press release, the Department’s investigation of the LFT-LCD market has led to seven other companies in this market previously pleading guilty to price fixing and paying fines in excess of $890 million.

In its superseding indictment in the AUO case, AUO, AUOA and several of their employees, including executives of AUO resident in Taiwan, were charged with conspiring to fix prices for thin-film transistor liquid crystal display panels (“TFT-LCD”) in the United States and elsewhere in violation of Section 1 of the Sherman Act (15 U.S.C. 1). The indictment also charged executives of LG Philips LCD Co., Ltd. and Chunghwa Picture Tubes, Ltd., although not the companies, as being part of the conspiracy. As charged, AUO, AUOA and the other co-conspirators met repeatedly, at so-called “Crystal Meetings”, in Taipei to fix the prices of TFT-LCD. The indictment also charged that senior-level employees of AUO instructed employees of AUOA to similarly contact employees of other TFT-LCD manufacturers in the United States to discuss pricing to major customers in the United States, which they allegedly did. The indictment charged that representatives of AUO and AUOA attempted to keep the “Crystal Meetings” secret, and later, when the Department of Justice began to investigate this conduct, that representatives of AUOA took steps to destroy evidence.

The AUO trial is informative in several respects and should be noted by all companies faced with investigation or indictment for potential price fixing violations. First, trial lawyers often question whether a jury could follow complicated and detailed issues in an antitrust case over a lengthy trial. The answer to that question by the jury in the AUO case seems to be a resounding yes.The verdictvalidates the Department of Justice and its lawyers’ ability to try an antitrust case to a successful conclusion. Second, while the defendants have indicated that they will appeal the verdict, the AUO case also confirms what has been apparent for some time, the Department of Justice’s criminal investigations are reaching far beyond the U.S. border to address antitrust violations that impact significantly the U.S. markets. In the AUO case, much of the alleged conduct occurred in Taiwan. Again, companies should heed this verdict as an indication that they willnot be shielded from investigation or indictment simply because they keep their conspiratorial activities off shore. Of course, AUO should not be interpreted as meaning that the Department of Justice’s jurisdictional reach is limitless. Look tothe appeal of this verdict to provide useful guidance in the future on this jurisdictional issue.

Parker Poe’s Antitrust, Business Torts and White Collar Crime practice group represents clients in antitrust investigations and litigation and routinely counsels clients on antitrust compliance issues. For more information, contact Eric Welsh ((704) 335-9052) or your Parker Poe relationship partner.

- See more at: http://blogs.parkerpoe.com/antitrust-competition/?p=663#sthash.VRtxBvzM.dpuf

Earlier this week, after an eight week trial, a jury in San Francisco convicted AU Optronics Corporation (“AUO”), a Taiwanese corporation, its U.S. subsidiary, AU Optronics Corporation of America (“AUOA”), and two of their former executives with price fixing under the Sherman Act. United States of America v. AU Optronics Corp., et al., No CR-09-0110 (N.D. Cal.). The jury, while acquitting two other individual defendants, also found that the gross gains derived from the conspiracy, involving AUO, AUOA and other companies in the liquid crystal display market, to exceed $500 million. According to the Department of Justice’s press release, the Department’s investigation of the LFT-LCD market has led to seven other companies in this market previously pleading guilty to price fixing and paying fines in excess of $890 million.

In its superseding indictment in the AUO case, AUO, AUOA and several of their employees, including executives of AUO resident in Taiwan, were charged with conspiring to fix prices for thin-film transistor liquid crystal display panels (“TFT-LCD”) in the United States and elsewhere in violation of Section 1 of the Sherman Act (15 U.S.C. 1). The indictment also charged executives of LG Philips LCD Co., Ltd. and Chunghwa Picture Tubes, Ltd., although not the companies, as being part of the conspiracy. As charged, AUO, AUOA and the other co-conspirators met repeatedly, at so-called “Crystal Meetings”, in Taipei to fix the prices of TFT-LCD. The indictment also charged that senior-level employees of AUO instructed employees of AUOA to similarly contact employees of other TFT-LCD manufacturers in the United States to discuss pricing to major customers in the United States, which they allegedly did. The indictment charged that representatives of AUO and AUOA attempted to keep the “Crystal Meetings” secret, and later, when the Department of Justice began to investigate this conduct, that representatives of AUOA took steps to destroy evidence.

The AUO trial is informative in several respects and should be noted by all companies faced with investigation or indictment for potential price fixing violations. First, trial lawyers often question whether a jury could follow complicated and detailed issues in an antitrust case over a lengthy trial. The answer to that question by the jury in the AUO case seems to be a resounding yes.The verdictvalidates the Department of Justice and its lawyers’ ability to try an antitrust case to a successful conclusion. Second, while the defendants have indicated that they will appeal the verdict, the AUO case also confirms what has been apparent for some time, the Department of Justice’s criminal investigations are reaching far beyond the U.S. border to address antitrust violations that impact significantly the U.S. markets. In the AUO case, much of the alleged conduct occurred in Taiwan. Again, companies should heed this verdict as an indication that they willnot be shielded from investigation or indictment simply because they keep their conspiratorial activities off shore. Of course, AUO should not be interpreted as meaning that the Department of Justice’s jurisdictional reach is limitless. Look tothe appeal of this verdict to provide useful guidance in the future on this jurisdictional issue.

Parker Poe’s Antitrust, Business Torts and White Collar Crime practice group represents clients in antitrust investigations and litigation and routinely counsels clients on antitrust compliance issues. For more information, contact Eric Welsh ((704) 335-9052) or your Parker Poe relationship partner.

- See more at: http://blogs.parkerpoe.com/antitrust-competition/?p=663#sthash.VRtxBvzM.dpuf

Earlier this week, after an eight week trial, a jury in San Francisco convicted AU Optronics Corporation (“AUO”), a Taiwanese corporation, its U.S. subsidiary, AU Optronics Corporation of America (“AUOA”), and two of their former executives with price fixing under the Sherman Act. United States of America v. AU Optronics Corp., et al., No CR-09-0110 (N.D. Cal.). The jury, while acquitting two other individual defendants, also found that the gross gains derived from the conspiracy, involving AUO, AUOA and other companies in the liquid crystal display market, to exceed $500 million. According to the Department of Justice’s press release, the Department’s investigation of the LFT-LCD market has led to seven other companies in this market previously pleading guilty to price fixing and paying fines in excess of $890 million.

In its superseding indictment in the AUO case, AUO, AUOA and several of their employees, including executives of AUO resident in Taiwan, were charged with conspiring to fix prices for thin-film transistor liquid crystal display panels (“TFT-LCD”) in the United States and elsewhere in violation of Section 1 of the Sherman Act (15 U.S.C. 1). The indictment also charged executives of LG Philips LCD Co., Ltd. and Chunghwa Picture Tubes, Ltd., although not the companies, as being part of the conspiracy. As charged, AUO, AUOA and the other co-conspirators met repeatedly, at so-called “Crystal Meetings”, in Taipei to fix the prices of TFT-LCD. The indictment also charged that senior-level employees of AUO instructed employees of AUOA to similarly contact employees of other TFT-LCD manufacturers in the United States to discuss pricing to major customers in the United States, which they allegedly did. The indictment charged that representatives of AUO and AUOA attempted to keep the “Crystal Meetings” secret, and later, when the Department of Justice began to investigate this conduct, that representatives of AUOA took steps to destroy evidence.

The AUO trial is informative in several respects and should be noted by all companies faced with investigation or indictment for potential price fixing violations. First, trial lawyers often question whether a jury could follow complicated and detailed issues in an antitrust case over a lengthy trial. The answer to that question by the jury in the AUO case seems to be a resounding yes.The verdictvalidates the Department of Justice and its lawyers’ ability to try an antitrust case to a successful conclusion. Second, while the defendants have indicated that they will appeal the verdict, the AUO case also confirms what has been apparent for some time, the Department of Justice’s criminal investigations are reaching far beyond the U.S. border to address antitrust violations that impact significantly the U.S. markets. In the AUO case, much of the alleged conduct occurred in Taiwan. Again, companies should heed this verdict as an indication that they willnot be shielded from investigation or indictment simply because they keep their conspiratorial activities off shore. Of course, AUO should not be interpreted as meaning that the Department of Justice’s jurisdictional reach is limitless. Look tothe appeal of this verdict to provide useful guidance in the future on this jurisdictional issue.