Global computer memory chip makers including Samsung and Micron have been sued by New York Attorney General Eliot Spitzer for allegedly conspiring to raise memory chip prices.

The action will be followed by a similar but separate suit by California and 33 other states in the United States against seven memory chip makers such as Micron, Infineon Technologies AG and Hynix Semiconductor.

Damages sought

The multi-state lawsuit, which seeks damages estimated as high as a billion rand, does not name Samsung, the world's largest memory chip maker, to provide a window to reach a potential settlement, said Tom Dresslar, a spokesman for California Attorney General Bill Lockyer.

South Korea's Samsung expected the lawsuit to be "resolved smoothly", and had provisioned for such lawsuits, according to Chu Woo-sik, the senior vice president of Samsung's IR team.

The suits come at a time when dynamic random access memory (DRAM) chip makers enjoy relatively steady prices and look for firmer demand towards the year-end shopping season and the consumer launch early next year of Microsoft's Vista operating system.

Conspiracy in 2002

Lockyer said on Thursday that he, joined by 33 other state attorneys general, would file the complaint alleging the chip makers violated state and federal antitrust laws during a conspiracy to fix prices for DRAM chips, from 1998 through June 2002, when there was a glut in the market.

The lawsuits follows a US Justice Department probe launched in 2002 that resulted in hundreds of millions of dollars in fines levied against Samsung, Hynix, Infineon, Elpida Memory and other chip makers.

The federal investigation followed a sharp plunge in the prices for memory chips used in computers and other electronics, which forced a wave of industry consolidation and pushed several chip makers near bankruptcy.

"If these suits are completed by the end of the year and the scale of fines are fixed, that would be a substantial blow to each company," said a Tokyo-based analyst at a European brokerage.

"But that is rather unlikely. The more likely scenario is that they would set aside reserves gradually as the suits progress, harming their profit margins."

Costs passed on

The multi-state complaint accuses the companies of fixing DRAM chip prices, artificially restraining supply and rigging bids for contracts.

Those actions caused computer makers such as Dell and Hewlett-Packard to pay more for chips and then pass those costs on to consumers, said Florida Attorney General Charlie Crist, another lead plaintiff in the case.

Micron spokesman Dan Francisco said he could not comment specifically on the lawsuit because the company had not yet seen it. But he noted that the Boise, Idaho-based chip maker has been in talks to resolve the issue.

"We have been involved in discussions with state attorneys general for a long period of time," Francisco said. "As I understand it they wanted to get these cases on file while we discuss the potential for resolution."

Germany's Infineon could not immediately be reached for comment.

The multi-state lawsuit names many of the world's top-ranked memory chip makers including Hynix; Taiwan's Mosel Vitelic and Nanya Technology Corp. Japan's Elpida and NEC Electronics Corp.'s NEC Electronics America.