This posting was written by Jeffrey May, Editor of CCH Trade Regulation Reporter.
The federal district court in San Francisco on September 20 imposed a record-tying $500 million fine on AU Optronics Corporation (AUO), a Taiwan-based liquid crystal display (LCD) producer, for its participation in a five-year conspiracy to fix the prices of thin-film transistor LCD panels.
The company and its U.S. subsidiary also were placed on probation for three years and ordered to implement antitrust compliance programs. Two high-level executives, Hsuan Bin Chen and Hui Hsiung, were sentenced to three-year prison terms and each fined $200,000.
The sentencing follows a jury’s conviction in March 2012 of AU Optronics Corporation, AU Optronics Corporation America, Hsuan Bin Chen, and Hui Hsiung. After the eight-week trial in the matter, the jury also found two lower-level AU Optronics Corporation employees not guilty. A mistrial was declared against a former senior manager within AU Optronics Corporation’s Desktop Display Business Group. The government is preparing for a retrial of that mid-level executive.
Although the Antitrust Division had sought stiffer penalties on the convicted companies and executives than those imposed, the sentences are still significant. The fine against AUO is matched only by a 1999 fine against F. Hoffmann-La Roche, Ltd. for participating in a conspiracy in the vitamins industry. The government had sought a $1 billion fine against AUO and maximum 10-year prison terms for the convicted executives. The Probation Office had recommended a $500 million fine for AUO.
Speaking at Fordham’s 39th Annual International Antitrust Law & Policy Conference in New York City on September 21, Joseph Wayland, Acting Assistant Attorney General in charge of the Department of Justice Antitrust Division, would not comment on the sentences other than to say that the $500 million fine was “substantial” and was something that corporations need to think seriously about. He cautioned that the matter could be appealed.
AUO issued a statement on September 21, noting “regrets on the judgment” and its intention “to lodge an appeal.” The company went on to say that there were “important, yet unresolved, legal questions surrounding this matter.”
Further information regarding United States v. Au Optronics Corp. appears here on the Justice Department Antitrust Division website.