Retina display supplier Samsung, others settle price fixing suit for $1.12B

Apple’s key components provider Samsung which supplies, among other items, Retina panels for the new iPad, agreed along with other defendants to settle a price fixing class-action lawsuit for a whopping $1.12 billion.

Samsung has agreed to pay $240 million, AU Optronics will pony up $170 million, Toshiba will pay only $21 million and LG Display will settle for $380 million in damages.

This settlement – the largest consumer class-action price-fixing settlement ever – is in addition to previous settlements from ten manufacturers and prison terms for some executives, The Wall Street Journal reported…

Damaged companies like Apple, Dell and HP will be able to claim their share of the combined $1.12 billion in damages. It was revealed back in 2008 that the aforementioned companies agreed upon a global price-fixing scheme for LCD displays, forcing their customers to pay higher than necessary prices for display panels.

Samsung, as you know, is the primary maker of Retina display panels that go into the new iPad. LG, the maker of panels for previous iPads, is thought to be starting a trial Retina production, in addition to Sharp.

Apple’s partner Foxconn which assembles its products in March acquired a stake in Sharp and its cutting-edge IGZO display plant. Foxconn’s boss Terry Gou made it known that the acquisition is meant to beat Samsung displays on clearness.

Samsung is Foxconn’s arch-rival so no wonder Gou called the Galaxy maker “a company with a track record of snitching on its competitors”, referring to Samsung’s action in 2010 of snitching on four Taiwanese companies in an investigation by the European Commission on price-fixing in the flat panel industry.

Samsung was exempted from the investigation by serving as a “tainted witness”.

Samsung is the world’s leading LCD maker by sales, followed by LG Display.

I think Foxconn’s investment in Sharp is anything but coincidental, paving the way to Apple eventually cutting Samsung LCD orders as soon as Sharp ramps up production and solves yield issues with its display plant in Sakai, Japan.