Five tool refurbishers take aim at Applied

January 19, 2006 – A group of five US semiconductor equipment refurbishers have jointly filed suit against Applied Materials Inc., alleging the firm has developed a “crippling” monopoly that could cost them $100 million in lost equipment values and revenues.

The companies — Silicon Services Consortium Inc and Semiconductor Support Services Co. in Austin, TX, and Phoenix-based OEM Surplus Inc., Precision Technician Inc., and Semiconductor Equipment Specialist Inc., allege that since Jan. 2005 Applied has initiated policies and conduct to limit availability of replacement parts and service. They also suggest that, “consistent with monopolistic economic principles,” Applied ultimately could terminate equipment refurbishment altogether and raise the cost of new equipment.

“At this point we do not believe that the actual damages have reached $100 million, but by the time of trial they are expected to be pretty close to that figure, and of course those damages are recoverable under the Sherman Act and trebled under the Clayton Act,” stated Mikal Watts, lead counsel for the plaintiffs. He pointed to a similar backlash against Eastman Kodak in the 1990s, which netted $71 million in damages.


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