Cash, threats let Intel thrive, suit says

November 05, 2009|Associated Press

NEW YORK - New York’s attorney general hit Intel Corp. with an antitrust lawsuit yesterday, claiming the company used “illegal threats and collusion’’ to dominate the market for computer microprocessors.

Attorney General Andrew Cuomo said the world’s biggest chip maker paid billions of dollars in kickbacks to computer manufacturers and retaliated against those that did too much business with Intel’s competitors, namely Advanced Micro Devices Inc. Intel used its market prowess to “rule with an iron fist,’’ Cuomo said, using bribery and coercion.

An Intel spokesman denied the charges and said the company’s sales practices were legitimate.

The lawsuit is the latest in a string targeting Intel’s practice of paying large annual rebates to big customers. Intel has described the rebates as simple volume discounts, but some regulators have disagreed. The European Union fined the company $1.45 billion in May, a decision Intel is appealing.