WASHINGTON--The Justice Department late Tuesday night asked a
federal judge to impose a $1 billion criminal fine against AU
Optronics Corp. (AUO, 2409.TW) for its March conviction for
participating in a scheme to fix prices on liquid-crystal-display
panels.
In a 56-page court filing, the department also said two
convicted company executives should serve 10 years in prison and
pay $1 million in fines.
"These defendants were central figures in the most serious
price-fixing cartel ever prosecuted by the United States," the
department said. "Only these sentences could possibly reflect the
seriousness of this offense or provide adequate deterrence."
The department said the price-fixing scheme, involving several
Asia-based companies, "affected every family, school, business,
charity and government agency that paid more to purchase notebook
computers, computer monitors, and LCD televisions during the
conspiracy."
AU Optronics, in its own court filing Tuesday, argued that the
highest permissible fine it should face is $285 million, adding
that the actual fine should be much lower. The Taiwan company
called the government's position unreasonable and said the Justice
Department wanted "to punish AUO for its temerity in electing to
subject the validity of the government's charge to the test of a
jury trial."
Most companies don't contest government price-fixing charges in
court because the potential criminal fines imposed after a
conviction can be very high. Companies convicted can face fines
that total twice the gains derived from the conspiracy.
AU Optronics is scheduled to be sentenced Sept. 20 by U.S.
District Judge Susan Illston in San Francisco.
Prosecutors alleged that AU Optronics participated in a
world-wide LCD price-fixing conspiracy from 2001 to 2006, by which
time the market for LCD panels was $70 billion.
The department said the conspiracy affected some of the world's
largest computer and television manufacturers, including Apple Inc.
(AAPL), Dell Inc. (DELL) and Hewlett-Packard Co. (HPQ).
Several companies, including LG Display Co. (LPL, 034220.SE),
Sharp Corp. (SHCAY, 6753.TO) and Chunghwa Picture Tubes Ltd.
(2475.TW), have pleaded guilty to related charges.
Write to Brent Kendall at brent.kendall@dowjones.com
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