Judge Refuses to Dismiss DRAM Supply Conspiracy Suit Against Samsung, SK Hynix, Micron

Key Points

• Judge Noël Wise denied in full Samsung, SK Hynix and Micron's joint motion to dismiss a proposed class action alleging they conspired to cut supply of conventional DRAM, such as DDR5, and shift capacity to HBM.
• The court held the case was not a rerun of DRAM II, the Ninth Circuit's 2022 affirmance of dismissal of an earlier DRAM conspiracy suit against the same companies.
• The judge found that long-term HBM lock-ups, refusals of long-term conventional DRAM contracts, Micron's Crucial closure, fab delays, the failure to expand despite record prices, near-identical customer vetting and the companies' prior cartel history supported a plausible inference of conspiracy.
• The court gave no weight to three of the plaintiffs' arguments: investor statements about "supply discipline," which it found too similar to statements the Ninth Circuit's DRAM II decision had already held insufficient; executives' meetings at industry conferences, since DRAM II all but forecloses relying on them unless plaintiffs identify what was actually exchanged or agreed there; and the three-company market structure, which it called neutral.
• Answers are due Dec. 7, 2026, and the initial case management conference was reset for Jan. 12, 2027.

A federal judge on Nov. 14 refused to dismiss a proposed class action accusing Samsung, SK Hynix and Micron of conspiring to restrict the supply of conventional dynamic random-access memory, or DRAM, the standardized memory chips used in computers, phones and servers.

U.S. District Judge Noël Wise of the Northern District of California denied the companies' joint motion to dismiss in full, finding the complaint plausibly alleged an agreement in violation of Section 1 of the Sherman Act. The allegations, accepted as true at this stage, have not been proven.

The companies argued the case was a rerun of DRAM II, in which the Ninth Circuit in 2022 affirmed dismissal of claims against the same three companies over a 2016–2018 supply restriction. "The Court finds that it is not," Judge Wise wrote.

The suit was filed June 25, 2026, by 17 consumers and small businesses from five states. It concerns conventional DRAM, which the complaint describes as "standardized memory built to industry specifications and sold for ordinary purposes," including DDR5 generation modules built for computers.

According to the complaint, the three companies controlled more than 91% of global DRAM revenue as of the third quarter of 2025. They allegedly cut production starting in late 2022 and, beginning in 2023, shifted capacity to high bandwidth memory, or HBM, a specialized DRAM product for artificial intelligence accelerators that "requires approximately three to four times the silicon wafer area per gigabyte compared to conventional DDR5 DRAM."

By the third quarter of 2025, conventional DRAM prices had risen 171.8% in one year, according to the complaint, which alleges a 697% increase over 18 months. Yet "not one of the three Defendants expanded or announced plans to meaningfully expand commodity DRAM production capacity," the complaint alleges.

Without direct evidence of an agreement, the plaintiffs needed plus factors, additional facts suggesting a preceding agreement rather than conscious parallelism, in which competitors independently make similar moves.

Judge Wise rejected the companies' argument that timing gaps undercut parallel action. SK Hynix and Micron announced cuts three weeks apart in late 2022, she noted, and Samsung's lag of about four and a half months, until April 7, 2023, was "not such an unreasonably long delay that it defeats an allegation of parallel conduct on a motion to dismiss."

She found the complaint plausibly alleged that the three companies acted in parallel when they cut supply, shifted production from conventional DRAM such as DDR5 to HBM, and wound down DDR4.

Under Ninth Circuit precedent, action against self-interest must be "so perilous in the absence of advance agreement that no reasonable firm would make the challenged move without such an agreement." Judge Wise wrote that a pivot to HBM by itself "might not be sufficient," but that "the related conduct tips this factor over the edge to weigh in Plaintiffs' favor."

According to the complaint, all three signed long-term contracts locking in HBM supply, Samsung and SK Hynix reportedly refused long-term agreements with major conventional DRAM customers, and Micron announced on Dec. 3, 2025, that it would close Crucial, its 30-year-old consumer brand. Those moves, which she called "difficult if not impossible to unwind," plus the failure to expand despite record prices, "are the sort that at the pleading stage, it appears no reasonable firm would make without a prior agreement," she wrote.

She applied similar reasoning to allegations that Samsung and Micron delayed or halted new DRAM plants, citing the Ninth Circuit's 1990 Petroleum Products decision that "Changes in refinery capacity are not readily reversible." "The Court views the commitment to build or not build manufacturing capacity as analogous," she wrote. She also counted the companies' alleged same-quarter 2025 decisions to wind down DDR4 as a plus factor, citing the complaint's allegation that "older, slower DDR4 came to cost more per gigabyte than newer, faster DDR5."

Judge Wise found that near-identical customer-vetting practices all three companies allegedly adopted in January 2026 "strongly support a plausible inference of conspiracy." She rejected the companies' "obvious and non-conspiratorial explanation" of booming AI demand, noting that the vetting began after the AI boom and the HBM pivot were underway.

The court gave no weight to three other arguments. Judge Wise held that investor statements, including Micron's 2022 reference to "supply discipline," did not distinguish the case from DRAM II. Though the conference-meeting allegations went beyond those in DRAM II, she wrote that DRAM II "seemingly all but forecloses a trial court from giving any weight to trade conference meetings" absent specifics, and she called the market's oligopolistic structure "neutral in the analysis."

According to the complaint, the companies and two other manufacturers formed a criminal cartel to fix DRAM prices from 1998 to 2002; Samsung paid a $300 million fine, Hynix paid $185 million, and Micron received immunity for cooperating as a whistleblower. Judge Wise, like the DRAM II court, rejected the argument that the now-20-year-old history should not count.

At the hearing, the companies quoted the late Judge Posner's line that competitors in concentrated markets "watch each other like hawks." Judge Wise wrote: "But Plaintiffs' allegations go beyond hawks watching each other; their contentions are more akin to hawks flying in formation – an activity that hawks ordinarily do not do."

The plaintiffs are represented by Bathaee Dunne LLP. Samsung is represented by O'Melveny & Myers LLP, SK Hynix by Cleary Gottlieb Steen & Hamilton LLP, and Micron by Gibson, Dunn & Crutcher LLP.

Judge Wise ordered the companies to answer by Dec. 7, 2026. Because the court had reset argument by about three weeks, she also granted the companies' unopposed administrative motion to continue early case deadlines and reset the initial case management conference for Jan. 12, 2027, at 9 a.m.