Andrew Cuomo sues Intel for using bribes and threats to keep market dominance

 Intel Corp was accused of threatening computer makers and paying billions of dollars in kickbacks to maintain its market dominance. Intel allegedly violated state and federal antitrust law through the methods used to monopolize the market for personal computer chips at the expense of rival Advanced Micro Devices Inc. Now Intel's microprocessors power more than 80 percent of the world's PCs.

A charge was preferred by New York Attorney General Andrew Cuomo. He alleged that Intel for several years bribed or coerced computer makers such as Dell Inc, Hewlett-Packard Co and International Business Machines Corp to use its microprocessors or stop using those of rivals. It is alleged that kickbacks in the form of "rebates" and threats of retaliation for using rival chips were also made. Cuomo stated that Intel has undermined competition, while forcing consumers and businesses to overpay for chips and they will be stopped. 

"Neither customers who have benefited from lower prices and increased innovation nor justice are being served by the decision to file a case now," stated Intel spokesman Chuck Mulloy, talking about the intentions of the company to defend itself against Cuomo's charges.

Possible antitrust violations of Intel caused an interest of the regulators worldwide. In July, the company appealed a 1.06 billion euro ($1.57 billion) fine by the European Union two months earlier. The Federal Trade Commission, meanwhile, opened a formal inquiry into Intel in June 2008, and at least three of four commissioners have backed the filing of a complaint, people familiar with the review have said.

The complaint also includes several emails which demonstrate Intel's illegal activities according to Cuomo’s. They show that in 2005 Dell complained about losing competitive ground. But neither Dell, nor IBM or Hewlett-Packard spokesmen agreed to comment. 

But Cuomo’s accusation is supported in New York. Eric Corngold, a deputy New York attorney general, on the conference call said top executives' involvement shows "this isn't the story of a few rogue employees going too far."