Oracle Sues Micron for DRAM Price Fixing

By Chris Preimesberger  |  Posted 2010-09-29

Data center software and systems maker Oracle, which has seen its own share of litigation over the past several years--especially involving the acquisition of Sun Microsystems--is seeking legal restitution against solid-state memory maker Micron for alleged price fixing.

Oracle, which now owns the Sun server, storage and workstation franchises, filed legal action Sept. 24 in U.S. District Court in San Jose, Calif., against Boise, Idaho-based Micron, charging the company with price fixing over a span of about five years.

Between 1998 and 2002, Sun Microsystems purchased in excess of $2 billion in DRAM (dynamic random access memory) from Micron and other suppliers, in addition to millions of dollars' worth of DRAM that came installed in already-finished products.

Oracle claimed in the lawsuit that Micron conspired with several other companies, including Samsung, Hynix and Infineon, to control the price of DRAM in its sales to systems makers that included Sun.

Oracle is seeking unspecified damages, as well as restitution for "disgorgement" of revenue and earnings, court costs and interest, according to court documents.

In June, six memory-chip companies--including Micron--agreed to pay $173 million plus interest to 33 states and private class-action plaintiffs to settle similar litigation.

In May, the European Commission got involved, fining these memory companies a total of 331 million Euros. Samsung paid the highest amount, 145.7 million Euros. At the time, a whistle-blower at Micron revealed to regulators the scheme; thus Micron was not fined by the EU.

But the Oracle litigation reinstitutes action against Micron and is a separate spin-off of a U.S. Department of Justice investigation. In 2005, Samsung pled guilty in the United States to price fixing and paid a $300 million fine in a settlement with the DOJ.

DRAM, commonly used in servers of all types for boot-up and other purposes, stores each bit of data in a separate capacitor within an integrated circuit. Since real capacitors leak charge, the information eventually fades unless the capacitor charge is refreshed periodically. Because of this refresh requirement, it is considered a dynamic memory as opposed to SRAM (static random access memory).

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