Avnet, a prominent distributor of electronic components, has recently secured a major victory in a lawsuit against Nippon Chemi-Con Corp and its subsidiary, United Chemi-Con Inc.

After two days of deliberation, Reuters reports that a San Francisco federal court jury reached a verdict, granting Avnet an impressive $268 million in damages. 

The lawsuit accused the defendants of participating in a global price-fixing conspiracy, artificially inflating prices for capacitor components from 2001 to 2014.

Avnet's Conspiracy Claims

Based in Phoenix, Avnet is renowned for its distribution of connectors and semiconductors. The company contended that overcharging had a far-reaching impact on various electronic devices, including household appliances, mobile phones, and personal computers. 

Capacitors, vital for storing electrical energy and regulating current flow, have become indispensable components in various consumer products.

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This extensive antitrust litigation, spanning almost a decade, has witnessed multiple civil cases and criminal investigations related to capacitor price-fixing. These legal actions have resulted in significant class-action settlements and penalties imposed by the U.S. government. 

However, Avnet chose to chart an independent legal course and refrained from participating in the class action settlements involving other direct purchasers of capacitors.

The jury's decision to award $89,244,000 in damages will be tripled under U.S. antitrust law, resulting in a total of $267.7 million. Scott Wagner, an attorney for Avnet at Bilzin Sumberg Baena Price & Axelrod, stated that the company had initially sought $274 million, as stated in its pretrial brief.

Spotting History's Biggest Illegal Business Scheme

In court filings, Avnet's legal team argued that the capacitor price-fixing conspiracy was one of recent history's most organized, well-documented, and long-lasting schemes. 

In response, defense lawyers representing Nippon Chemi-Con and United Chemi-Con refuted the liability allegations, claiming that only a tiny portion of Avnet's claimed damages, approximately $1.5 million, could be attributed to purchases from the defendants.

Reuters reports that representatives for Nippon Chemi-Con and United Chemi-Con, from the law firm Paul, Weiss, Rifkind, Wharton & Garrison have yet to comment on the verdict. Similarly, Avnet's spokesperson expressed gratitude to the jury and judge but refrained from providing further remarks on the case's outcome.

With a remarkable $26.3 billion in revenue recorded last year, Avnet undeniably celebrates a significant legal triumph with this ruling. The case, titled Avnet Inc v Hitachi Chemical Co Ltd et al., was heard in the U.S. District Court for the Northern District of California, bearing case number 3:17-cv-07046-JD.

More from Avent

Avnet has recently declared its regular quarterly cash dividend for the second quarter of 2023. The Board of Directors of Avnet approved the dividend, which amounts to $0.29 per share. Shareholders will be pleased to receive this dividend, a distribution of profits made by the company.

The dividend payment will be disbursed on June 21. However, shareholders must be registered as of June 7, 2023, to be eligible for the dividend. This means individuals who own Avnet shares on or before June 7 will receive the dividend payment.

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