(Adds comment from Assistant Attorney General Baer in paragraph 9)
By David Ingram
NEW YORK, July 10 (Reuters) - A U.S. court on Thursday rejected an appeal by Taiwan-based AU Optronics Corp of the $500 million criminal fine the company was ordered to pay in 2012 after a conviction for price-fixing in the market for liquid crystal display panels.
The $500 million fine tied for the largest-ever in a U.S. price-fixing case. AU Optronics appealed it as excessive.
In a unanimous ruling, a three-judge panel of the 9th U.S. Circuit Court of Appeals in San Francisco said the fine was consistent with U.S. law. The panel also said the company and two of its employees were properly convicted.
AU Optronics said the $500 million fine was excessive because it included alleged gains to co-conspirators. Writing for the appeals court panel, Judge Margaret McKeown ruled that the law was unambiguous in allowing a fine based on gross gains to all co-conspirators.
“The jury found $500 million in gross gains from that offense,” she wrote.
AU Optronics and its lawyers did not immediately respond to requests for comment.
AU Optronics argued that the case could not be brought in U.S. courts because much of the alleged conspiracy took place outside the United States and there was no direct effect on U.S. consumers. In affirming the conviction, the appeals court rejected that argument, which legal experts called a significant threat to U.S. antitrust enforcement.
The ruling “demonstrates that price-fixing cartels that involve U.S. imports and cause massive harm to U.S. consumers cannot escape the reach of U.S. antitrust enforcement by operating outside our borders.”Assistant Attorney General Bill Baer, the chief of the U.S. Justice Department’s Antitrust Division, said in a statement.
The appeals court ruled that the volume of finished goods sold to U.S. consumers created enough of a connection, or nexus, to the United States to allow the cases.
In 1999, Roche Holding AG was also fined $500 million in a case about vitamins.
The case is U.S. v. AU Optronics Corp, 9th U.S. Circuit Court of Appeals, No. 12-10492. (Editing by Kevin Drawbaugh, Franklin Paul and David Gregorio)