Panasonic, 5 Others Conspired To Fix Prices of Linear Resistors, Says Proposed Class-Action Complaint

Panasonic and five other companies conspired to fix prices of linear resistors sold in the U.S., alleged a complaint filed Thursday in U.S. District Court in San Jose. Almost all electronics products from smartphones to PCs to TVs “contain resistors, often hundreds of them,” and linear resistors are “the workhorse” of the resistor industry, said the complaint by Microsystems Development Technologies, which designs and develops microprocessor-based consumer and industrial products. Named with Panasonic as defendants in the complaint were KOA, Murata, Rohm, Vishay Intertechnology and Yageo. The complaint said the five are among the world's largest manufacturers of resistors. The defendants “used mechanisms designed to conceal their collusion, such as covert meetings, use of code words or terms to refer to competitors and/or customers, use of pretexts to mask the true purpose of collusive communications, use of non-company phones, and instructions to destroy emails evidencing collusive activities,” said the complaint, which seeks class-action status. All had “a common motive to conspire,” it said. “As resistors are commodities, price is the most obvious differentiation among them for purchasers,” it said. “In a market of this nature, with trillions of components being manufactured and sold a year at relatively inexpensive individual prices, there is a huge incentive to fix, stabilize, maintain and raise the prices of the components to supra-competitive levels through illegal conspiratorial agreements. By foregoing competition, each manufacturer could still guarantee themselves massive profits in such a high volume market. This anticompetitive conspiracy causes substantial harm to consumers, to competition, and to United States commerce.” The complaint emanated from reports that the Department of Justice launched a price-fixing probe of the resistors industry in mid-June, it said. Panasonic spokesman Jim Reilly in a Monday email declined to comment. The other companies didn't comment.