Leading semiconductor manufacturers SK Hynix, Samsung, and Micron are facing a class action lawsuit that accuses them of engaging in coordinated anti-competitive practices within the DRAM market.
Shares of SanDisk fell 5%; Micron, DRAM fell over 3%.
The legal action, filed in the District Court for the Northern District of California by law firm Bathaee Dunne LLP, alleges the three companies synchronized their exit from producing DDR3 and DDR4 memory to focus on manufacturing high-bandwidth memory (HBM) for data centers. The lawsuit further contends they have been manipulating supplies and prices since 2022.
Legal representatives argue the companies have slashed the supply of consumer-grade DRAM against all sound economic reasoning. They cite Micron's planned 2025 shutdown of its Crucial DRAM business, allegedly at its peak profitability, as an example. Prices for standard DRAM have reportedly surged by approximately 700% over the past four years.
The court filing also references a previous criminal conspiracy from 1998 to 2002, in which the same three firms were found guilty of fixing DRAM prices.
Attorneys note that the enormous capital investment—estimated between $15 and $20 billion—and lengthy development timelines required to build a DRAM fabrication plant create a significant barrier to entry. This makes it difficult for new competitors to enter the market and challenge the established players.
The class action suit represents a group of consumers and physical retail stores.
SK Hynix, Samsung, and Micron have all secured major contracts to supply hardware for AI data centers, shifting their production focus accordingly. This strategic pivot has led to a sharp decline in the availability of consumer DRAM and NAND flash memory, contributing to the dramatic price increases.
The supply crunch has impacted the broader electronics industry. Companies including Sony, Microsoft, Nintendo, and Valve have raised prices on their gaming hardware. Valve specifically noted that its upcoming Steam Machine console is more expensive than desired due to the AI-driven demand for memory chips.