Judge denies motion to dismiss DRAM price-fixing lawsuit against Micron, Samsung, and SK hynix, finds evidence of DRAM collusion plausible after 500% price surge

Judge Noël Wise, who presides over the proposed class-action lawsuit against Micron, Samsung, and SK hynix, has denied the companies’ motion to have the case dismissed. According to the decision, the defendants’ argument that the legal action is just “a rerun” of the same antitrust case filed against the industry in 2018 was rejected as the plaintiffs have established that there’s some new evidence suggesting that there was collusion between the big three memory chip manufacturers.

Micron, Samsung, and SK hynix argued that they watch each other like hawks because of how tight competition is. Judge Wise disagreed with this characterization, though, saying that what they are accused of goes beyond that. “Their contentions are more akin to hawks flying in formation — an activity that hawks ordinarily do not do.”

The plaintiffs, which are made up of 17 individuals and small businesses, allege that the companies made four parallel moves that restricted DRAM supply and led to the current shortage, which saw prices jump by as much as 500% in one year. One of the events they cited included the “simultaneous DRAM production cuts” from October 2022 to April 2023, which was quickly followed by a “coordinated pivot to HBM.” They also said that the three companies announced the winding down of DDR4 production in a span of three months and have failed to expand the production capacity “despite these extraordinary prices — the single most powerful supply signal the DRAM industry has ever produced.”

Other factors that the suing parties brought to the table include the introduction of stringent customer vetting procedures in response to the shortage, the refusal to sign long-term contracts for DRAM customers, Micron’s decision to shut down Crucial (its consumer memory brand), multiple statements projecting the shortage, as well as their involvement in previous price-fixing scandals.

The big three memory chip makers argued that all of these are logical business moves so that they can maximize their revenue during a period of great demand and that they are “consistent with [their own] independent self-interest.” They also said that they appear to have similar behaviors because they’re in a highly concentrated market, and that they’re all “reacting to the same market pressures,” thus it would make sense for them to have a similar response.

Despite their rebuttals, the judge decided that the case is plausible enough to move forward. This isn’t a judgment, though — both sides would still have to show their evidence and speak their arguments before the court before getting a decision. Because of this, the three companies are given until December 7 to respond to the original complaint with the case management conference, which will determine the administrative matters on the case, set for January 2027.

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