The MoginRubin blog offers informative analysis and insightful commentary on timely issues related to competition and antitrust actions, mergers, acquisitions and associated regulatory and legislative activity.
— Written by Jonathan Rubin, Partner and Co-Founder, MoginRubin LLP — Knocking another dent in the shield of Google’s multi-market dominance, U.S. Judge James Donato has ordered the company to open its Android app store, Google Play, to competition for at least three years. The injunction was handed down on Monday (Oct. 7) in the antitrust suit brought by Epic Games, developer of the popular video game Fortnite (Epic v. Google, Case No. 3:20-CV-05671-JD, N.D. Calif.). A San Francisco jury in December 2023 found that Google’s app store ...
Written by Jonathan Rubin, Partner and Co-Founder of MoginRubin LLP -- The government’s antitrust case against Google’s Search business passed another milestone with the government’s proposal of a remedies “framework” to loosen Google’s monopoly grip on the general search services and search text advertising markets. The DOJ’s filing maintained that Google’s conduct resulted in “interlocking and pernicious harms” for which fashioning a remedy “present[ed] unprecedented complexities in a highly evolving set of markets.” “[T]he importance of ...
Written by Jonathan Rubin, Partner and Co-Founder of MoginRubin LLP | Private antitrust plaintiffs are increasingly bringing cases alleging that the use of a common, commercially available pricing algorithm by multiple competitors constitutes price fixing in violation of Section 1 of the Sherman Act. The Antitrust Division of the Department of Justice has filed a Statement of Interest in three such cases, supporting the plaintiffs’ claims.[i] After the third one, I wrote that algorithmic price fixing was emerging as a new DOJ enforcement ...
Continuing to make good on President Biden’s pledge to root out and challenge anticompetitive mergers, the Antitrust Division of the Justice Department and the Federal Trade Commission have asked the public to join the hunt. On May 23, the agencies publicly asked companies for information they may have on any serial acquisitions and “roll-up strategies” being undertaken across the U.S. economy. These would be smaller “stealth acquisitions” consummated under the radar in critical industry sectors that can, although gradually, harm competition, ...
Written by Jonathan Rubin, Partner and Co-Founder of MoginRubin LLP The Federal Trade Commission (FTC) on April 22, 2024, filed an administrative complaint to block Tapestry, Inc.'s acquisition of Capri Holdings Limited, a deal valued at $8.5 billion. The proposed merger would combine three major fashion brands: Coach and Kate Spade from Tapestry, and Michael Kors from Capri. The FTC alleges that the deal would stifle competition in the "accessible luxury" handbag market, a term coined by Tapestry to describe high-quality leather handbags at ...
Written by Jonathan Rubin, Partner and Co-Founder of MoginRubin LLP For the third time in as many months, the U.S. federal antitrust enforcement authorities -- the Federal Trade Commission and the Antitrust Division of the Department of Justice -- have filed a statement of interest in an antitrust case alleging that the use of a common algorithmic pricing program by multiple competitors constitutes price fixing in violation of Section 1 of the Sherman Act. The government’s statement in Cornish-Adebiyi v. Caesars Entertainment, D. N.J., No. ...
Written by Jonathan Rubin, Partner and Co-Founder of MoginRubin LLP The Second Circuit U.S. Court of Appeals has reinstated an antitrust complaint brought by pharma firm, Regeneron Pharmaceuticals, Inc., against the Swiss pharmaceutical giant, Novartis Pharma AG, and outside fulfillment firm, Vetter Pharma International GmbH. The appeals court held that it was error for the district court to reject Regeneron’s antitrust claims. The district court should have credited the plaintiff’s product market definition and the complaint should not have ...
Editor's Note: This article will appear in the spring issue of the Journal on Emerging Issues in Litigation, published by Fastcase Full Court Press. Download a pre-publication copy now. Thanks to California Sports Lawyer Jeremy Evans for his valuable contributions to this article. Alston Opinion Changed Everything In NCAA v. Alston, 141 S. Ct. 2141 (2021), the Supreme Court upheld a district court and subsequent affirmation by the Ninth Circuit Court of Appeals in favor of players. The National Collegiate Athletic Association (NCAA) rules ...
By Jonathan Rubin, Partner, MoginRubin LLP A San Francisco jury has found that Google monopolized the “Android app distribution” market and “Android in-app billing services” market, and that its Developer Distribution Agreements (“DDAs”) with application developers and its Mobile Application Distribution Agreements and Revenue Sharing Agreements with mobile device manufacturers, were unreasonable restraints of trade in violation of U.S. antitrust laws. The jurors deliberated for just over three hours before returning their verdict on Monday ...
Written by Jonathan Rubin, Partner and Co-Founder of MoginRubin LLP It is an application of artificial intelligence (“AI”) that many businesses, agencies, legislators, lawyers, and antitrust law enforcers around the world are only beginning to confront. It is also among the top concerns of in-house counsel across industries. Competitors are increasingly setting prices through the use of communal, AI-enhanced algorithms that analyze data that are private, public, or a mix of both. Allegations in private and public litigation describe ...
The Federal Trade Commission (“FTC”) and 17 state attorneys general on September 26th filed their long-awaited antitrust complaint against Amazon.com in federal district court in the Western District of Washington. The complaint (a redacted version of which is available here) is a foreseeable ambition of FTC Chair Lina M. Khan, who as a Yale law school student authored an influential law review article titled, “Amazon’s Antitrust Paradox.” The article itemized conduct Ms. Khan characterized as “anticompetitive,” which, when committed by a ...
The Federal Trade Commission and attorneys general from six states – California, Illinois, Minnesota, New York, Washington, and Wisconsin – joined in heralding news of an agreement that gives the green light to drug giant Amgen Inc.’s nearly $29 billion acquisition of Horizon Therapeutics plc. However, the conditions of the settlement do little to safeguard competition in the vitally important pharmaceutical industry. The government enforcers challenged the deal on the grounds that it would give Amgen considerable leverage to use its brawny ...
The Tenth Circuit U.S. Circuit Court of Appeals has revived a 2019 antitrust lawsuit against Berkshire Hathaway’s Johns Manville (JM) by rival calcium silicate producer, Chase Manufacturing, also known as Thermal Pipe Shields (TPS). The court determined that, in light of the evidence, TPS raised a triable issue of fact and the district judge erred in granting summary judgment for JM (Chase Manufacturing Inc. v. Johns Manville Corp., 10th Cir., No. 22-1164). At issue is whether Johns Manville, a unit of billionaire Warren Buffett’s Berkshire ...
Following its ten-month investigation, the United States Department of Justice appears on the verge of filing an antitrust suit against Live Nation, parent of Ticketmaster, for abusing its power in the ticketing and live music markets. According to Politico, which cites three sources familiar with the matter, the DOJ could file suit as soon as this fall and, as part of its relief, will ask the court to unwind the 2010 merger of Live Nation (the event promoter) and Ticketmaster (the ticket seller). If brought, the DOJ’s suit would be met with ...
U.S. Judge Leo T. Sorokin has permanently enjoined American Airlines and JetBlue from continuing their Northeast Alliance (“NEA”), in which the judge said the pair act as one company, replacing “full-throated competition” with “broad coordination” of business in and out of Boston and New York. That coordination includes trading information on which routes to fly, which company will fly them, and the seating capacity needed to accommodate passengers. After presiding over several weeks of trial involving mountains of evidence, the judge ...
Senator Tammy Baldwin (D-WI) and 10 consumer advocacy groups, including the American Economic Liberties Project, Public Citizen, and the Open Markets Institute, are calling on Lina Khan’s Federal Trade Commission to investigate the 2018 Energizer Inc. merger with Spectrum Brands Holdings, Inc., the successor to long-time battery brand Rayovac®. The groups are hoping to take advantage of more aggressive merger enforcement under current leadership and commitment by federal agencies to look back at consummated mergers that have proved to be ...
Photo by Pietro Mattia via Unsplash. What entity gets oversight of the health and safety of thoroughbred racehorses? With seven horse deaths in the lead up to this year's Kentucky Derby, most agree the horse racing industry must do better. While fatal injuries have dropped from 2 per 1,000 starts in 2009, to 1.25 per 1,000 starts in 2022, doping scandals and life-ending injuries remain prevalent year after year. Just look the record and recent suspension of controversial trainer Bob Baffert. This bombastic horseman is one of the winningest of ...
In a deal announced on May 9, Tempur Sealy International, Inc., the world’s largest mattress manufacturer, has agreed to acquire Houston-based Mattress Firm Group, Inc., the largest U.S. brick-and-mortar bedding retailer, with more than 2,300 locations and a robust e-commerce platform. The companies hope to finalize the $4 billion deal in the second half of 2024. Following pre-merger notification of the deal last October, the FTC is reportedly taking a deep dive into the mattress industry to assess whether the transaction is likely to harm ...
On April 24, 2023, a three-judge panel from the Ninth Circuit largely affirmed a district court’s judgment following a bench trial that Epic Games, Inc., failed to prove its antitrust claims against Apple, Inc., challenging its rules: Restricting app distribution on iOS devices to Apple’s App Store. Requiring in-app purchases on iOS to use Apple’s in-app payment processor. Limiting the ability of app developers to communicate the availability of alternative payment options to iOS device users. Despite finding several legal errors in the ...
The Biden administration continues its campaign against wage suppression as a source of harm to workers, competitive markets, and the economy. In its latest move, the Department of Justice is supporting players in professional e-sports leagues with a suit to stop Overwatch and Call of Duty developer, Activision Blizzard, Inc., from capping player compensation. Unlike salary restrictions in traditional sports leagues, those implemented by Activision were not produced through collective bargaining and, therefore, are not exempt from antitrust ...
The Federal Trade Commission recently filed an amicus brief in support of a generic drug maker’s antitrust case involving Apokyn®, a drug developed to treat late stages of Parkinson’s disease. The plaintiffs allege the makers and distributors of Apokyn have unlawfully maintained their monopoly by delaying FDA approval and then market entry of generic alternatives, which harms competition and consumers. According to the FTC, this case “may have significant implications for patients who rely on apomorphine to treat debilitating symptoms of ...
Photo by Blake Wisz on Unsplash The Second Circuit affirmed a district court’s approval of a $5.6 billion settlement in a Sherman Act antitrust case brought on behalf of 12 million merchants against Visa U.S.A. Inc., MasterCard International Inc., and a phalanx of financial institutions. The merchants maintained that the card companies and banks adopted payment card rules that allowed Visa and MasterCard to charge supracompetitive interchange fees on each transaction. In re Payment Card Interchange Fee and Merchant Discount Antitrust ...
Photo by National Cancer Institute on Unsplash U.S. Judge Karen Spencer Martson of the Eastern District of Pennsylvania approved on March 15, 2023, a $25 million settlement of a class action lawsuit against Johnson & Johnson for allegedly blocking biosimilar products that compete with high-priced Remicade®, J&J’s immunosuppressive drug. Remicade® (infliximab), originally approved to treat patients with Crohn’s disease, was later approved for ailments including ulcerative colitis, psoriatic arthritis, and rheumatoid arthritis. The ...
Beverage aisle at Pennsylvania Costco March 2023. Photo by Jane Hagy. The Federal Trade Commission has reportedly launched an investigation to explore price discrimination in the soft-drink industry, apparently as part of FTC Chair Lina Khan’s effort to reinvigorate use of the Robinson-Patman Act. The Act, a 1936 amendment to Section 2 of the Clayton Act, strengthened the Clayton Act’s limitations on price discrimination. In the 1960’s, the government brought 518 Robinson-Patman cases against one form or another of price discrimination, but ...
Photo by Nathan Rogers on Unsplash On March 7, 2023, the Second Circuit U.S. Court of Appeals revived an antitrust lawsuit brought by Relevant Sports LLC (“Relevant”), a soccer promoter, against FIFA and the United States Soccer Federation (the “USSF”). In doing so, the Second Circuit reaffirmed longstanding antitrust law that a rule enacted by an association that governs member conduct is concerted activity subject to Section 1 of the Sherman Act. Background FIFA is the international governing body for soccer. It is a membership-based ...
Image: March 7, 2023, screen capture of Ticketmaster notices re Taylor Swift tickets. Live music fans have been dealt another setback in their war on ticket prices. The Ninth Circuit U.S. Court of Appeals has upheld a mandatory arbitration provision between fans of pop icon Taylor Swift and Live Nation Entertainment and its subsidiary, Ticketmaster, LLC, dismissing their proposed class action. Swifties, as her fans are known, had filed suit against the concert giant for allegedly using its market power to charge supra-competitive fees for ...
Photo by Maxim Hopman on Unsplash The FTC has decided to abandon its challenge to Meta Platforms Inc.’s acquisition of virtual reality (VR) exercise app developer, Within Unlimited, Inc., after U.S. District Judge Edward J. Davila from the Northern District of California rejected the Federal Trade Commission’s bid for a preliminary injunction blocking the deal. A setback for the Biden administration’s campaign to get tougher on anticompetitive mergers, the judge found that entry by acquiring Within was Meta’s only option because – despite its ...
Photo by Marquise Kamanke on Unsplash What's Happening On January 23, 2023, the U.S. Federal Trade Commission (“FTC”) announced the Hart-Scott-Rodino (“HSR”) premerger notification thresholds would increase by 10.3%. These changes will go into effect Feb. 27 and apply to transactions closing after that date. The minimum threshold for HSR merger reporting is now $111.4 million, up from $101 million in 2022. Just a few days prior, on Jan. 20, 2023, the FTC announced thresholds for Section 8 would increase as well and that this change was ...
Photo by Owen Lystrup on Unsplash Christmas 2022 was bedlam for thousands of travelers as Southwest Airlines cancelled 16,700 flights amid severe winter storms that separated passengers from their families, their luggage, and their money. The Wall Street Journal reported that the carrier’s route configuration and the failure of its crew scheduling software caused the fumbled response. Massachusetts Senator Elizabeth Warren reacted in a holiday tweet that the debacle was an example of how airline mergers have been a disaster for consumers. ...
Photo by CardMapr.nl on Unsplash Mastercard has entered into a consent order with the Federal Trade Commission following the Commission’s investigation into the payment network’s refusal to provide token conversion services to competing debit networks for online and in-app eWallet transactions. The Durbin Amendment to the 2010 Dodd-Frank Act sought to inject competition into the debit network market by requiring issuers to enable debit cards for at least two unaffiliated debit networks. Numerous “regional” debit networks compete with ...
If anyone knows the workings of Washington’s antitrust machinery, it’s Microsoft’s president, Brad Smith, who served as the company’s general counsel during the late 1990s, when the Justice Department sued Microsoft in one of the most famous monopolization cases in modern times. So, it is hardly surprising that Smith has been trying to “fix it first” in the past few months, making deals and announcing commitments designed to make Microsoft’s $ 68.7 billion acquisition of Activision Blizzard more palatable to antitrust regulators. Microsoft, ...
RealPage, Inc., a real estate software and data analytics company, is facing class action litigation and a federal investigation over whether it is facilitating a data-driven rental property cartel with landlords and property managers, driving up the prices renters pay each month. RealPage Class Action Filed in Federal Court in San Diego A federal antitrust class action complaint has been filed against the company and several of its property management clients in federal court in San Diego on behalf of renters who claim they paid inflated ...
The road back from the COVID-19 pandemic hasn’t been easy for Harley-Davidson. Although the company shipped more than 194,000 motorcycles globally last year, it failed to meet its growth targets. Now the firm is facing legal troubles, too. This past August, plaintiffs filed “right-to-repair” class action lawsuits against the firm in Wisconsin and California. Then, on November 3, plaintiffs filed yet another federal class action lawsuit against Harley-Davidson in Chicago. The Chicago lawsuit alleges the company used its warranty to force Harley ...
Alphabet, Inc., Google’s parent company, has won an early victory in the Google Maps antitrust litigation filed in the Northern District of California. U.S. Judge Jeffery S. White dismissed the complaint without prejudice on Nov. 1, 2022, ruling that the plaintiffs failed to adequately allege their illegal tying claim. The antitrust case, which brought as a class action, was filed by Big Dream Media, Getify Solutions, Inc. and Sprinter Supplier, LLC on behalf of themselves and all other companies engaged in digital advertising, app ...
What was promised in 2010 to deliver a robust pro-consumer ticketing and live events industry has created exactly the opposite 12 years later. That is the message from a collection of pro-competition advocacy groups that are encouraging consumers to pressure the Department of Justice to investigate and break up Live Nation Entertainment, Inc. – the company formed by the merger of Live Nation and Ticketmaster. “Live Nation-Ticketmaster owns more than 70 percent of the primary ticketing and live event venues market. They’ve routinely abused this ...
Finding the deal would substantially lessen competition in the U.S. market for publishing rights for potential top-selling books, U.S. District Judge Florence Y. Pan granted the Department of Justice Antitrust Division’s move to block Penguin Random House’s (PRH) proposed $2.2 billion acquisition of Simon & Schuster (S&S). The ruling followed a 13-day bench trial in August. The government filed suit a year ago on Nov. 2, 2021 to block the world’s largest publisher, PRH, from acquiring a rival to create a “publishing behemoth” that ...
Federal lawmakers troubled by The Kroger Co.’s impending acquisition of one of its chief competitors, The Albertson Cos., for $25 billion, will hold a hearing on the impact of the deal on the competitive landscape and consumers next month. Members of the U.S. Senate Judiciary Committee’s antitrust panel who recently announced the move are not the only skeptics, however. Senators Richard Blumenthal (D-CT) and Cory Booker (D-NJ) joined Sen. Amy Klobuchar (D-MN), who chairs the antitrust panel, in sharing trepidations about the deal. The trio did ...
Three poultry processors and a consulting firm that circulated wage information among them have entered a consent decree with the Department of Justice to end a “long-running conspiracy to exchange information about wages and benefits for poultry processing plant workers and collaborate with their competitors on compensation decisions,” a violation of the Sherman Antitrust Act. The poultry companies -- Cargill Inc. and Cargill Meat Solutions Corp., Sanderson Farms Inc., and Wayne Farms LLC – agreed to pay nearly $85 million. In addition to the ...
AbbVie Inc., which owns the patent on the global blockbuster drug, Humira, has again defeated a pair of claims by welfare-health plans that the company violated Sections 1 and 2 of the Sherman Antitrust Act. On Aug. 1 the Seventh Circuit U.S. Court of Appeals affirmed a district court’s dismissal of the antitrust suit against the drug maker (Mayor and City Council of Baltimore, et al. v. AbbVie Inc., et al., No. 20-2402, 7th Cir.). Appearing on the World Health Organization’s list of “essential drugs,” Humira is used to treat various forms of ...
The Justice Department’s Antitrust Division is investigating the PGA Tour for potentially anticompetitive conduct, the Wall Street Journal was first to report. Specifically, the DOJ is investigating conduct related to the PGA Tour’s suspension of all members who compete on the rival LIV Golf Tour – a new series of eight invitational tournaments largely funded by Saudi Arabia’s Public Investment Fund. This wealthy backer has lured several top golfers away from the PGA Tour through guaranteed compensation packages for players (opposed to ...
A group of AT&T and Verizon wireless subscribers have filed a proposed class action arguing that the T-Mobile / Sprint merger – despite all of their emphatic assurances to the contrary – is harming consumers and should be unwound. The suit was filed on June 17 in federal court in Chicago against Deutsche Telekom AG, T-Mobile U.S., Inc., and former Sprint Corp. owner SoftBank Group Corp. of Japan. The consumers allege the merger paved the way for anticompetitive conduct in violation of Section 7 of the Clayton Act and Section 1 of the ...
The U.S. Court of Appeals for the Fifth Circuit recently slammed the courthouse door on the plaintiff in Continental Automotive Systems v. Avanci, LLC (5th Cir., Feb. 28, 2022), a manufacturer of telematic control units (“TCUs”) that provide cellular communications to automobiles. The court held that Continental lacked Article III standing to sue patentees, Nokia, Conversant, Optis, Sharp, and their licensing agent, Avanci, for monopolization for refusing to license standard-essential patents (“SEPs”) under fair, reasonable, and ...
In early February, Frontier Airlines and Spirit Airlines announced a $6.6 billion merger that gives Frontier a 51.5% controlling interest in a combined airline that will become the fifth largest carrier in the country and the largest ultra-low-cost carrier (ULCC). Spirit shareholders will receive 1.9126 shares of Frontier plus $2.13 in cash for each Spirit share, which has an implied value of $22.54 as of May 4. The deal does not sit well with lawmakers, special interest groups, or antitrust commentators, several of whom have written to the ...
Timothy Z. LaComb, Jonathan Rubin
May 05, 2022Antitrust law enforcers at the Department of Justice and Federal Trade Commission remain dedicated to increasing competition in several rapidly consolidating industries, including healthcare and labor markets. Despite two losses handed to them by juries in Texas and Colorado in favor of defendant executives, they vowed to continue their accountability crackdown. They also remain committed to exploring ways to combat the harmful effects of over-concentration on patients, workers, and the markets themselves – this includes a renewed focus on ...
Broadcom and the Federal Trade Commission just settled an antitrust probe in November 2021. Yet, roughly five months later, Broadcom is again in the FTC’s crosshairs. According to people familiar with the situation and a document viewed by The Information -- a well-respected source for important, deeply reported stories about the technology industry -- Broadcom is using supply-chain issues to justify forcing customers to adopt exclusive agreements. Just five months ago Broadcom agreed to stop forcing exclusive agreements on customers as part ...
There was reason for optimism in August 2021, when the Ninth Circuit Court of Appeals granted rehearing en banc of a 2-1 decision that would have made it more difficult for antitrust claimants to secure class certification. The three-judge panel in Olean Wholesale Grocery Coop., Inc. v. Bumble Bee Foods LLC, 993 F.3d 774 (9th Cir. 2021) had determined that Federal Rule of Civil Procedure 23(b)(3) required a district court to find that no more than a de minimis number of class members are uninjured before a class may be certified. Having ...
It’s a case that challenges the limits of the “freedom of design” usually enjoyed by companies accused of product design changes alleged to harm competition. Ordinarily, a design change is not the kind of conduct that runs afoul of the antitrust laws, but on March 21, U.S. Judge Jeffrey S. White from the Northern District of California denied Apple Inc.’s motion to dismiss an antitrust case brought against it by AliveCor Inc. The suit alleges that Apple unlawfully maintained its monopoly in the market for heart rate analysis apps by updating ...
In 1990, the Department of Defense could turn to 13 companies to produce tactical missiles, eight to make fixed-wing aircraft, and another eight to build ships. Now there are only three missile and three aircraft makers, and only two surface ship builders. There were eight satellite manufacturers in 1990; today there are only four. Tanks and other tracked vehicles are now made by a single company. Such market consolidation is potentially harmful for the usual reasons, such as less innovation, higher prices, and a lower level of customer ...
“Second time lucky?” That is how U.S. Judge James E. Boasberg began his opinion allowing the Federal Trade Commission’s antitrust suit against Meta Platforms, Inc. (formerly, Facebook) to proceed, saying the government “stumbled out of the starting blocks” but has rectified in its amended complaint against Meta the deficiencies he found in its initial complaint. In June 2021, Judge Boasberg, who presides in U.S. District Court for the District of Columbia, dismissed the FTC’s first complaint because the Commission had “failed to plausibly ...
Various leaders in the federal government have made it clear that they are now applying greater scrutiny to mergers and acquisitions and are not enamored with many years of anticompetitive business deals and settlements that offer inadequate protection to competition. Statements from the Antitrust Division of the Justice Department and the antitrust enforcers at the Federal Trade Commission have been saying as much since President Biden took office. Before that, he wasn’t alone in the pack of Democratic candidates who felt the government ...
HBLC · Ninth Circuit Opinion In Telescope Case By J Rubin And T LaComb 12 - 13 - 2021 The Ninth Circuit Court of Appeals this month upheld judgment in favor of Optronic Technologies, Inc., finding there was sufficient evidence that Chinese telescope manufacturer, Ningbo Sunny Electronic (“Sunny”), conspired with a competitor in the U.S. consumer telescope market to allocate customers, fix prices, and monopolize the telescope market in violation of federal antitrust laws (Optronic Technologies, Inc., v. Ningbo Sunny Electronic Co., Ltd., No. ...
Jonathan Rubin, Timothy Z. LaComb
December 13, 2021The UK’s Competition and Markets Authority (CMA) has ordered the company formerly known as Facebook to unwind its acquisition of Giphy, Inc. due to potential harms in the markets for social media and digital display advertising. Facebook completed the $400 million acquisition of Giphy on May15, 2020 but has held the businesses separate since June 9, 2020, under CMA orders. Giphy proclaims itself to be the largest curator of quick-looping silent video clips, or GIFs. The company draws more than a billion searches each month in the UK, traffic ...
The Federal Trade Commission has approved a final order settling charges that chip giant Broadcom Inc. illegally monopolized markets for semiconductor components used to deliver television and broadband internet services through exclusive dealing and other tactics. While the FTC’s settlement with Broadcom is a net positive for certain rivals and customers, it fails to protect others and leaves all parties uncompensated. In its June 2021 complaint, the government said Broadcom is a monopolist in the sale of three types of chips used in the core ...
Saying the deal would create a “publishing behemoth,” the Antitrust Division of the U.S. Department of Justice filed an antitrust lawsuit on Nov. 2 to block the world’s largest publisher, Penguin Random House (PRH), from acquiring rival Simon & Schuster (S&S). A combined company would be able to “exert outsized influence” over which books are published and how much authors are paid for their work, the suit alleges. The publishing industry is already highly concentrated, largely controlled by the “Big Five” publishers. PRH (which owns ...
Download the PDF Marking the first cannabis industry antitrust case to reach trial, a California jury on Sept. 23, 2021, returned a $5 million verdict to the Richmond Compassionate Care Collective (RCCC). Under the state’s Cartwright Act, the damages will be trebled to $15 million, plus attorney fees. Judge Edward G. Weil presided over the trial. Independently owned dispensary RCCC sued the owners of Richmond Patients’ Group (RPG) for conspiring to prevent RCCC from opening a new shop, citing evidence that RPG blocked access to the limited ...
In a recently published paper, a pair of academics propose that the application of artificial intelligence can offer a potent weapon against antitrust behavior in the Big Tech sector. This is the very industry that has advanced this technology, noted one of those academics, Giovana Massarotto, a Center for Technology, Innovation and Competition academic fellow at the University of Pennsylvania Carey Law School and an adjunct professor at the University of Iowa. She underscored this fact in an article for Bloomberg Law, in which she maintains ...
Two class action certifications in two months have put credit card giants Visa and Mastercard on the defensive over the alleged anticompetitive transaction fees and rules the companies impose on merchants in one case and independent ATM operators in the other. Most recently, U.S. District Judge Margo K. Brodie of New York certified a class action against Visa, Mastercard and a group of large banks on Sept. 27 for fixing the “merchant discount,” the fee paid by merchants on credit and debit card transactions, and for rules that prevent ...
Since February 2020, staff members at the Federal Trade Commission have been studying past acquisitions by Google, Amazon, Apple, Facebook, and Microsoft – several years’ worth of deals that did not require reporting to antitrust authorities because the deal sizes fell below regulatory requirements. FTC Chair Lina M. Khan says the study reveals “the extent to which these firms have devoted tremendous resources to acquiring start-ups, patent portfolios, and entire teams of technologists—and how they were able to do so largely outside of our ...
Jonathan Rubin, Jennifer M. Oliver
September 21, 2021Apple, Inc. has been enjoying a tremendous advantage in the highly lucrative gaming-app market. This is thanks to the immense popularity of Apple devices running the iOS platform and restrictions imposed by Apple barring merchants from steering iOS users to non-Apple payment options. Nor has Apple allowed merchants to communicate directly with users about alternatives to Apple’s App Store for game-related purchases. But U.S. Judge Yvonne Gonzalez Rogers’ decision on Friday (Sept. 10, 2021) has taken much of the edge off that advantage, ruling ...
Delivering some good news for advocates of competitive markets, the Ninth Circuit U.S. Court of Appeals has vacated a 2-1 decision that would have made it more difficult for antitrust claimants to secure class certification. Yesterday (Aug. 3, 2021) the court decided to rehear the matter en banc, issuing a brief order in the case of Olean Wholesale Grocery Coop., Inc. v. Bumble Bee Foods LLC, 993 F.3d 774 (9th Cir. 2021). As we wrote previously, we are witnessing rapid market concentration and the emergence of dominant players in important ...
A quick recap of recent antitrust-related developments in semiconductors, real estate, college sports, insurance brokerage, digital advertising, agriculture, health data privacy, retail, automotive manufacturing, and defense contracting, plus a change that all but guarantees more antitrust enforcement activity from the FTC. Broadcom’s Three-Chip Monopoly Draws FTC Charges, Consent Decree FTC has charged leading chipmaker Broadcom with illegally monopolizing markets via exclusive dealing for semiconductor components necessary to deliver ...
As predicted by some, the Federal Trade Commission issued a complaint charging Broadcom Inc. with illegally monopolizing several markets for semiconductor chips used to deliver television and broadband internet services. The Commission simultaneously issued a proposed consent order that, if approved, would settle the FTC’s charges against Broadcom and allegedly restore competition in the impacted markets. But this is likely just the beginning of Broadcom’s antitrust issues in the U.S. because the FTC’s complaint provides an effective roadmap ...
Dan Mogin, Timothy Z. LaComb, and Steven Benz*
July 06, 2021The Supreme Court’s unanimous ruling in favor of student-athletes in their antitrust dispute with the National Collegiate Athletic Association (NCAA) over education-related benefits is certainly a boon for the players. But it may be Justice Brett Kavanaugh’s concurring opinion that will prove more significant. Instead of restricting his analysis to education-related benefits, Justice Kavanaugh said he wrote his concurrence specifically to underscore his belief that the NCAA’s remaining compensation rules (e.g., restrictions on salaries and the ...
JUNE 21, 2021 -- The National Collegiate Athletic Association (NCAA) doesn’t get a free pass when it comes to antitrust law, the Supreme Court held today in a unanimous decision written by Justice Neil Gorsuch. The justice said lower courts correctly applied antitrust scrutiny to the NCAA’s “amateur” requirement which denies athletes compensation they would command in a competitive market. In a concurring opinion, Justice Brett Kavanaugh said the NCAA is not above the law. He noted the adverse impact of the organization’s restrictions ...
It is a common refrain by people familiar with Amazon’s merchant relationships: Amazon is great if you are a consumer, but if you’re a merchant on the platform, or a competitor, it is powerful bully who doesn’t hesitate to wield is dominance at your expense. Attorney General for the District of Columbia Karl A. Racine obviously agrees with the second part of that statement. On May 25, 2021, he sued Amazon over a litany of allege anti-competitive practices that violate the D.C. Antitrust Act, causing harm to consumers and third-party sellers ...
As we witness increased market concentration and dominant players in many important industries, antitrust law and its enforcement are under attack as weak and ineffectual. Many in Congress want to strengthen antitrust law and make it more relevant to today’s business environment, including the increasing number of clear or near monopolies. So now is an awkward time for judicial decisions making it more difficult for antitrust claimants to secure class certification. The Ninth Circuit U.S. Court of Appeals has done just that in Olean Wholesale ...
A three-judge panel of the Ninth Circuit U.S. Court of Appeals – on its own initiative – has invited attorneys in an antitrust class action to argue whether the full court should reexamine the panel’s own ruling, one that could make class certification more difficult to obtain in antitrust class actions. Interestingly, the parties had not requested en banc review. According to the order entered April 28, 2021 in Olean Wholesale Grocery Cooperative Inc. v. Bumble Bee Foods LLC (Case No. 19-56514, Dkt. No. 101, 9th Cir., April 28, 2021), “a ...
Citing “more than enough evidence," the U.S. Court of Appeals for the Fifth Circuit has upheld the Federal Trade Commission’s determination that Impax Laboratories, LLC engaged in an illegal pay-for-delay settlement to block consumers’ access to a lower-cost generic version of Endo Pharmaceuticals Inc.’s Opana ER, an extended-release opioid pain reliever. Entering into what is known as a “reverse payment” arrangement, Impax had agreed to accept funds from Endo to stay out of the market for two-and-a-half years. Judge Gregg Costa wrote in the ...
When it comes to companies offering workplace collaboration software platforms such as Microsoft Teams and Slack there is little in the way of collaboration. The wave of technology solutions that enable groups to collaborate efficiently and creatively despite being dispersed around the planet, or forced by a pandemic into quarantine, is big business. Organizations are beginning to use them in market-facing applications, too, so the prospects are exciting and the race for market share is on. Grandview Research put the 2019 global market at $9.5 ...
Dan Mogin, Jonathan Rubin, and Jennifer Oliver
April 01, 2021FTC Commissioner Noah Phillips and George Washington Law School Competition Law Director William E. Kovacic, who once chaired the agency, appeared on a webinar today (March 16, 2021) hosted by the Information Technology and Innovation Foundation (ITIF). Aurelien Portuese, ITIF’s Director of Antitrust and Innovation Policy, asked the speakers what we might expect from the Biden administration in terms of antitrust law, reform, and enforcement. “[Litigation] can also result in losses and legal rulings that don’t favor the agencies.” Commissioner ...
The European Commission has opened a formal antitrust investigation to assess whether the pharmaceutical company Teva Pharmaceutical Industries Ltd. has illegally delayed the market entry and uptake of medicines that compete with Copaxone, its blockbuster multiple sclerosis drug. The EC will investigate whether Teva has abused a dominant market position in breach of EU antitrust rules. Teva is headquartered in Israel and operates from several subsidiaries in the European Economic Area. EC launched surprise inspections of Teva subsidiaries in ...
Calling the case a “poster child for divestiture,” the Fourth Circuit Court of Appeals affirmed the divestiture of a company in the door manufacturing industry in response to a private merger challenge. The plaintiffs claimed that the deal harmed and even eliminated suppliers and competitors and secured the defendant’s position in a resulting duopoly (Steves and Sons, Inc. v. JELD-WEN, Inc., 4th Cir., No. 19-1397). Steves and Sons, Inc. and JELD-WEN, Inc. (JW) sell molded doors. Made by fitting a composite skin over a wood frame, these doors ...
Dan Mogin, Jonathan Rubin, and Jennifer Oliver
February 20, 2021Facebook believes Apple abused its power in the smartphone market by forcing app developers to follow App Store rules that Apple itself doesn’t follow for Apple mobile applications, according to sources speaking to TheInformation.com. In its report on the story, the New York Times wrote: “Tensions between Apple and Facebook have been growing for months, rooted in how the companies are diametrically opposed on how they make money. Apple, which has made privacy a key tenet, prefers that consumers pay for their internet experience, leaving less ...
Healthcare insurance companies, like other insurers, have enjoyed an exemption from U.S. antitrust laws since March 1945 when President Roosevelt signed the McCarran-Ferguson Act, one of his last major acts before his death one month later. On Jan. 13, 2021, President Trump signed a bill repealing this immunity for health insurers. Titled the Competitive Health Insurance Reform Act of 2020 (CHIRA), the measure was passed by the House of Representatives on Sept. 21, 2020, and by the Senate on Dec. 22. The exemption remains in place for other ...
That’s practically what has happened in the U.K. where the Competition and Markets Authority (CMA) has increased oversight of ad-driven digital platforms, namely Facebook and Google, by establishing a dedicated Digital Markets Unit (DMU). While it was created to enforce new laws to govern any platform that dominates their respective market, when the new unit starts operating in April 2021 Facebook and Google will get its full attention. The CMA says the intention of the unit is to “give consumers more choice and control over their data, help ...
In its 56-page Feb. 13 report, the GAO listed three issues that should be considered: Which agency or agencies should oversee Internet privacy. What authorities an agency or agencies should have to oversee Internet privacy, including notice-and-comment rulemaking authority and first-time violation civil penalty authority. How to balance consumers’ need for Internet privacy with industry’s ability to provide services and innovate. The Federal Trade Commission, the lead agency when it comes to Internet privacy, has not issued privacy regulations ...
On October 7, 2020, the European Commission accepted commitments offered by Broadcom Inc., ending its investigation into the chipmaker. Although a step in the right direction, the commitments address only a subset of Broadcom’s anticompetitive conduct in just a few discrete chip markets. Stated differently, the commitments do not alter the anticompetitive status quo in most product markets in which Broadcom operates. This is particularly true for companies operating in the U.S. because the commitments offer fewer protections outside of the ...
Dan Mogin, Timothy LaComb, Steven Benzand Jayme Weber
November 11, 2020Suit says company improperly uses market power to achieve exclusivity. The U.S. Department of Justice and 11 states have sued Google LLC in federal court in Washington, D.C. for unlawfully maintaining its position as “monopoly gatekeeper for the internet” by blocking competitors in Internet search and search advertising markets. “For many years, Google has used anticompetitive tactics to maintain and extend its monopolies in the markets for general search services, search advertising, and general search text advertising -- the cornerstone of ...
By Jonathan Rubin The case involves questions "on the frontier edges" of U.S. antitrust law, according to the judge overseeing it. It is a legal battle between a $4 billion company (Epic Games, Inc.) and a $260 billion company (Apple, Inc.) in a market that's valued at $160 billion globally. At the center of the legal battle is the distribution of a digital one: a mobile application played by hundreds of millions of gamers on billions of devices around the world. It's no small matter, and Apple has scored a temporary victory in the suit, which ...
At a conference earlier this year on the Committee on Foreign Investment in the United States, or CFIUS, Assistant Treasury Secretary Thomas P. Feddo spoke with pride of the Committee’s increased funding, jurisdiction, expenditures, and more aggressive review activities. Feddo began the speech by detailing how CFIUS has implemented the 2018 Foreign Investment Risk Review Modernization Act, or FIRMMA, which expanded its jurisdiction and increased its funding. The Committee has invested in new IT infrastructure and personnel, and since May of ...
Dan Mogin, Jonathan Rubin, Jennifer M. Oliver, and Timothy Z. LaComb
October 15, 2020Why and how your organization's purchasing, legal, and finance professionals can form a formidable defense against profit-killing price-fixing, bid-rigging, monopoly and other anticompetitive schemes that could be costing your company millions. The chief executive started her day like any other. Hot coffee and a scan through the day’s business news. Then came a sinking feeling. A question popped into her head that she could not answer. More questions followed. She had just read an article about how several suppliers in the food industry had ...
'Apple wanted us out of the App Store.' In January 2018 Apple investors complained publicly about the lack of parental controls on their popular devices. At one point even CEO Tim Cook expressed concern about the addictive nature of social media. Vancouver-based app entrepreneur Justin Payeur saw this as validation for the Boomerang Parental Control app he was developing. What is really needed, apparently, is an app to move apps through the Apple Store app approval process. Reasons for rejecting and requiring changes to the app were numerous, ...
At the end of the beloved 1939 film The Wizard of Oz, Dorothy famously says to her Auntie Em, "There's no place like home!" It's one of the best known quotes from one of the happiest of happy endings to ever come to movie theaters. But there was much more going on behind the scenes than just Munchkinland. The year before the film was released movie studios and the government clashed when the government enjoined certain of the studios' most lucrative distribution and licensing practices. Alleging a breach of antitrust law, the government ...
Altria must show it was failing in the e-cig business for deal to survive. Altria Group, Inc. and JUUL Labs, Inc. fired back at the FTC’s April complaint alleging Altria’s acquisition of 35% of JUUL and the corresponding agreements violated the Sherman Antitrust Act and the Clayton Act. The Commission argued the deal unlawfully reduced competition and consolidated the e-cigarette market, and would allow the companies to split the resulting monopoly profits. In their answers, the companies argued the FTC’s conclusions were clouded by a ...
While rare, this use of CFIUS powers may be a harbinger. Making good on his threats and citing national security risks, President Donald J. Trump signed an executive order on Friday, Aug. 14, 2020, demanding the unwinding of a Chinese company's acquisition of what would become TikTok, the short-form video-sharing-app sensation. This begins the unspooling of Beijing-based ByteDance Ltd.'s $1 billion acquisition of Shanghai-based Musical.ly in 2017, the predecessor to TikTok. ByteDance, which is incorporated in British territory in the Cayman ...
When should 'marketplace platforms' be treated as markets controlled by operators? It poses a new brand of antitrust problem: private parties controlling platforms that work like marketplaces. This week, Epic Games, maker of mobile app juggernaut "Fortnite," filed suit in federal court against Apple, and then Google, for banning the app from their stores. "Epic Games has defied the App Store Monopoly," the company announced via social media. "In retaliation, Apple is blocking Fortnite from a billion devices." Epic drew fire from the platforms ...
The Antitrust Division of the U.S. Department of Justice is taking a close look at the announced $7.1 billion acquisition of market disruptor Credit Karma by Intuit Inc. According to an internal Intuit memo obtained by ProPublica, the DOJ is looking at “the influence that Intuit’s purchase of Credit Karma will have on consumer tax preparation platforms and [the] software market.” And, for the reasons discussed below, there is a good chance the DOJ will ultimately conclude the merger violates the Clayton Act and file suit to challenge it. Photo ...
The sky is not falling. Opinion limited to 'at will' contracts. When a third party craters a contract, you and the other contracting party almost certainly will suffer demonstrable financial ramifications. But if your contract can, by its own terms, be terminated at-will, the California Supreme Court has now commented, any financial rewards and expenses associated with the agreement fall more into the "prospective" category. Therefore, the court determined, if a third party, a competitor for example, interferes with your at-will agreement they ...
The CEOs of Amazon, Apple, Facebook, and Google are scheduled to appear before the U.S. House of Representatives’ Judiciary Antitrust Subcommittee on Monday, July 27, 2020 in a hearing titled, “Online Platforms and Market Power, Part 6: Examining the Dominance of Amazon, Apple, Facebook, and Google.” Modified House rules currently permit witnesses to attend virtually. According to the Subcommittee’s press release, it has been scrutinizing the companies’ domineering presence in their respective markets and the corresponding “adequacy of ...
One of U.S. Attorney General Bill Barr's team has come to his defense against allegations that he has mismanaged the Department of Justice. Assistant Attorney General for the Antitrust Division Makan Delrahim sent a letter to ranking House Judiciary Committee members on July 1, 2020, rebuking the testimony given by DOJ trial attorney John Elias a week earlier that the AG used DOJ resources for political and personal reasons. Elias testified after receiving a subpoena from House Judiciary Committee Chairman Jerrold Nadler in a hearing titled ...
California Attorney General Xavier Becerra says the COVID-19 virus has “shone a light” on the impact consolidation in the healthcare market has had on Californians’ access to “affordable, quality healthcare.” A bill that would give the AG more power to oversee healthcare industry consolidation, monitor anticompetitive conduct, and enforce corresponding laws is getting closer to becoming law. A wave of scrutiny over the healthcare, pharmaceutical, and medical device industries is taking place at the national level as well, but industry ...
On May 5, 2020, U.S. Judge Nina Gershon of New York granted certification to a class of end-payor plaintiffs (EPPs) who purchased the successful dry-eye treatment Restasis, created and manufactured by Allergan, Inc. in In re: Restasis (Cyclosporine Ophthalmic Emulsion) Antitrust Litigation, 1:18-md-02819-NG-LB (E.D.N.Y 2018). The certified class includes individuals with and without health insurance, and third-party payors like union benefit funds that pay or provide reimbursement for drug costs for people they insure. The EPPs alleged that ...
The National Collegiate Athletic Association’s rules limiting education-related benefits for student-athletes are impermissible restraints on trade that violate Section 1 of the Sherman Antitrust Act according to a unanimous decision by the Ninth Circuit U.S. Court of Appeals. The decision enables student-athletes to receive a variety of education-related, non-cash benefits above the “cost of attendance,” which previously functioned as the cap on compensation they could receive. But it also maintained the narrative that demand for college ...
On Feb. 24, 2020, the Seventh Circuit U.S. Court of Appeals revived refusal-to-deal and tying claims brought against Comcast Corp. by Viamedia Inc. The case drew significant attention from antitrust practitioners given its potential impact on the viability of refusal-to-deal claims brought under Section 2 of the Sherman Act, which has long been the source of debate among antitrust practitioners. Comcast recently said it will ask the Supreme Court to review the Seventh Circuit’s decision. Photo by Cupcake Media on Unsplash Background Cable ...
Jonathan Rubin, Timothy Z. LaComb
June 16, 2020Driven by competitive pressure and pandemic-related losses, Uber Technologies Inc. has expressed its intention to acquire competitor Grubhub Inc. to improve its position in the digital food-delivery market, where its Uber Eats service lost ground in 2019. A group of Democratic lawmakers says this is a “troubling,” opportunistic, and anti-consumer move that U.S. antitrust law enforcers should watch closely. Photo by Kai Pilger on Unsplash Sen. Amy Klobuchar of Minnesota, former presidential candidate and senior member of the Senate Antitrust ...
Antitrust law doesn't take a back seat to bankruptcy. While bankruptcy is no one's idea of a dream, the beauty of the U.S. Bankruptcy Code is that it makes a business failure less of a nightmare for debtors and creditors alike. Litigation is stayed. Debts are put on hold. Assets of the estate may be purchased -- once certain conditions are met -- "free and clear."But, like anything, especially when it comes to law, details are a tricky thing. That applies especially to the nuanced practice of antitrust law. Are court-ordered asset sales under ...
Live Nation Threatens Anyone Who Doesn’t Play Along, Plaintiffs Allege Concert-goers tired of paying “supracompetitive fees” on ticket purchases from Ticketmaster LLC filed a class action against the company and its parent, promoter Live Nation Entertainment, Inc., in U.S. District Court for the Central District of California on April 28 for abusing its more than 70% share of the primary ticketing market (i.e. where tickets are initially sold) for major concerts. The merged companies are also aggressively deploying anticompetitive tactics in ...
Insurance coverage works when risk is spread across a large number of policyholders. But for the insurance market to function properly losses must be somewhat predictable and experienced by only small percentage of insureds. Claims models for accidents everyone knows will happen – auto collisions and trees falling on houses – are acceptably accurate. In this relatively predictable world, that means an accident happens, a claim is filed, and, usually, the insurer pays. Photo by tam wai on Unsplash But when claims fly off the actuarial charts – ...
Living by the adage “if you can’t beat them, join them,” tobacco giant Altria Group, Inc. acquired a 35% stake in e-cigarette market leader Juul Labs, Inc. in December 2018. As part of the deal, Altria agreed to not compete with Juul in the e-cigarette market for six years and use its marketing and financial resources to help Juul further cement its dominance. Photo by Spencer Davis on Unsplash This deal was always going to face significant antitrust headwinds from regulators. Not only is the transaction an agreement by competitors to ...
On March 10, 2020, the U.K.’s Competition and Markets Authority gave Cengage and McGraw-Hill an ultimatum – provide remedies that cure the competition problems caused by the merger or face a Phase II inquiry. Then, on March 24, 2020, the CMA rejected the merging parties’ proposed remedies and said it will proceed to a Phase II investigation. The CMA is required to complete the Phase II probe and issue a decision on the proposed merger by Sept. 7, 2020. The CMA joins several other nations that have raised concerns about the merger, including ...
On March 10th, the U.K. Competition and Markets Authority (CMA) gave Cengage Learning and McGraw-Hill an ultimatum: address competition concerns or face a Phase II review. After finishing its Phase I investigation, the CMA concluded the proposed merger “gives rise to a realistic prospect of a [substantial lessening of competition] as a result of horizontal unilateral effects in relation to the supply of [higher education] titles for 51 [higher education] courses in the U.K.” The CMA believes the loss of competition could lead to higher prices ...
Timothy Z. LaComb, Jennifer M. Oliver
March 24, 2020For believers in free markets it is important that they operate free of “shenanigans,” Food & Drug Administration (FDA) Commissioner Stephen Hahn said during a joint workshop with the Federal Trade Commission (FTC) on March 9, 2020. The event set in motion the agencies’ joint effort to address the difficulties in biosimilar uptake – a market rife with anticompetitive practices - and to restrict dissemination of false and misleading information on biosimilar efficacy or safety. “Shenanigans” and “whack-a-mole” became catch phrases during ...
Live Nation Entertainment, Inc., owner of some of the world’s biggest music venues, events and festivals, is currently operating under what the Department of Justice’s Antitrust Division calls “the most significant enforcement action” of an existing antitrust consent decree in its history, one that has secured stricter and longer lasting terms designed to rein in the event conglomerate’s anticompetitive behavior. Photo by Yvette de Wit on Unsplash The DOJ action began more than a decade ago after the company acquired Ticketmaster ...
Big Tech mergers make big headlines, but there is much more to a deal than how much money changes hands. More important questions need to be answered, such as how much future innovation might be lost, how much healthy competition will be eliminated, and what volumes of consumer data will suddenly be controlled by one or only a handful of companies. Some lower-cost acquisitions fly under the radar of antitrust law enforcement agencies. But should they? Criticized for ignoring “killer acquisitions” and going too easy on Big Tech – approving more ...
Anticompetitive conduct and misleading advertising practices in the burgeoning biosimilars market – where nearly identical versions of bioilogics are made by different companies – have captured the attention of federal regulators. The U.S. Food and Drug Administration (FDA) and the Federal Trade Commission (FTC) have announced their joint commitment to promoting competition and pursuing biologic product makers that make false statements. The agencies seek to improve patient access to biologics and to curb the prices consumers are charged for ...
Morgan Stanley’s proposed $13 billion all-stock acquisition of the popular E*TRADE online discount brokerage made big headlines last week. While no major antitrust problems are immediately apparent, the deal is part of a trend of consolidation in the financial services industry triggered by disruptions to profits like zero commission trading. The deal now heads for shareholder and regulatory review. According to the New York Times, this is the biggest acquisition in the financial sector since the 2008 meltdown, and signals Morgan Stanley’s ...
The U.S. Treasury Department’s final regulations, giving it more power to scrutinize any national security risks that may arise from deals between U.S. and foreign companies, are scheduled to go into effect this week, Feb. 13, 2020. The regs implement the Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) and provide the interagency Committee on Foreign Investment in the United States (CFIUS) broader authority over certain investments and real estate transactions. Critics say the regs will change cross-border M&A deal-making ...
The Federal Trade Commission (FTC) voted unanimously to challenge Edgewell Personal Care Co.’s proposed $1.37 billion acquisition of Harry’s, Inc. The complaint alleges that, for many years the two biggest razor companies operated as a “comfortable duopoly” made increasingly profitable by annual price increases that were “not driven by changes in costs or demand.” But this dynamic changed in recent years thanks to digital, direct-to-consumer upstarts like Harry’s and Dollar Shave Club. According to the FTC, losing Harry’s as an independent ...
The Federal Trade Commission and the New York Attorney General have sued Vyera Pharmaceuticals and two of its executives for antitrust law violations, saying the company illegally blocked generic drug makers from replicating its life-saving off-patent drug Daraprim, which has been on the market for 60 years. “This is just one example of the considerable hurdles companies face in trying to develop and market biosimilars,” said MoginRubin Senior Counsel Joy M. Sidhwa. When it acquired the drug in 2015, Vyera infamously hiked the price of ...
The Federal Trade Commission (FTC) announced on Jan. 28, 2020, that the “size-of transaction threshold” for reporting proposed mergers and acquisitions for 2020 under Section 7A of the Clayton Act will adjust from $90 million to $94 million (see page 2). The FTC revises these figures each year based on changes in the nation’s gross national product. The 2020 thresholds under Section 8 of the Clayton Act that trigger prohibitions on certain interlocking memberships on corporate boards of directors are $38,204,000 for Section 8(a)(l ) and ...
The Department of Justice (DOJ) and Federal Trade Commission (FTC) have released for public comment their joint draft guidelines which courts may also use in evaluating any anticompetitive effects of vertical mergers and acquisitions, such as when a product manufacturer buys a company that supplies that manufacturer as well as its competitors. The comment period ends Feb. 11, 2020. The Vertical Merger Guidelines (VMGs) are meant to accompany and address issues not covered in the 2010 Horizontal Merger Guidelines (HMGs) regarding mergers of ...
“If that procedure sounds unfair, that’s because it is.” That’s how Axon Enterprise, Inc. describes the inner workings of the Federal Trade Commission, calling it a “constitutional anomaly” that has the near absolute power, free of political accountability, to both prosecute and pass final judgment on the appropriateness of corporate mergers and acquisitions. Axon designs and manufactures non-lethal police equipment, such as body cameras and digital evidence management systems. In 2018 it acquired Vievu LLC, which Axon says was a failing ...
Jonathan Rubin, Jennifer M. Oliver
January 13, 2020Charles Schwab Corp. has announced it will acquire TD Ameritrade Holding Corp. for $26 billion in stock. But the merger should receive significant attention from the Antitrust Division of the U.S. Department of Justice and potentially affected private parties given the significant antitrust issues it raises. Registered Investment Advisor (RIA) Custodial Market Both Schwab and Ameritrade are well known for their brokerage services, but both also serve as RIA custodians for money managed by independent advisors registered with the U.S. ...
The Federal Trade Commission (FTC) is challenging Illumina Inc.'s $1.2 billion acquisition of Pacific Biosciences of California Inc. (PacBio), calling it an unlawful attempt by Illumina to maintain its monopoly over the U.S. market for next generation DNA sequencing (NGS). In their case, antitrust enforcers in the U.K. say the effects would be global; that the acquisition would increase prices and dampen competition and innovation. The U.K. action sparked a lengthy response from the companies which argue that the deal is good for the industry ...
Claiming Comcast Corp. is using its significant buying power and ambitious nationwide acquisition strategy to dominate the lucrative regional sports network industry, Altitude Sports & Entertainment has sued the cable colossus in a Colorado federal court for Sherman Act and Colorado Antitrust Act violations. Altitude alleges Comcast is deploying “predatory” negotiation tactics to drive it out of business and then raise consumer prices once competition is eliminated. With so much buying muscle in the Rocky Mountain region, Comcast is a ...
You have to give Google credit. It’s no quitter. Despite pressure in the United States and Europe that might tell other companies to take a breath, Google took another in a series of steps to collect and leverage individuals’ healthcare data. In a deal valued at $2.1 billion, the company has entered into a definitive agreement to acquire Fitbit, Inc., the maker of popular health-tracking device wearables. This deal is yet another one that challenges the conventional analysis of what might constitute an anticompetitive merger in the context of ...
Copy equipment giant HP Inc. turned down the much smaller Xerox Holdings Corp.’s acquisition overtures twice in one week as the exchange of statements between corporate leadership grows increasingly hostile. From an anticompetition perspective, the case raises the interesting question of how the “failing firm” defense could come into play. A deal would bring together the world’s second largest copier company, HP, a company whose leadership position was once so strong that its very brand name, derived from the word “xerographic” in 1938, became ...
Reuters broke the story that the Treasury Department’s Committee on Foreign Investment in the United States (CFIUS) is conducting a national security review of the owners of TikTok, a social media video-sharing platform that claims a young but formidable U.S. audience of 26.5 million users. CFIUS is engaged in the context of TikTok owner ByteDance Technology Co.’s $1 billion acquisition of U.S. social media app Musical.ly two years ago, a deal ByteDance did not present to the agency for review. Meanwhile, U.S. legislators are concerned about ...
DNA sequencing giant Illumina, Inc.’s proposed $1.2 billion acquisition of Pacific Biosciences of California Inc. has drawn opposition in the U.K. and the attention of the U.S. Federal Trade Commission (FTC). The invaluable systems these and other companies provide are used to study genetics in order to develop crucial medicines and medical treatments. The serious headwinds greeting this merger make it clear that the life sciences industry has matured to the point where antitrust considerations are significant. The evolving technological ...
Moderator & Speaker: Daniel J. Mogin | Managing Partner, MoginRubin LLP Speakers: Jennifer M. Oliver, CIPP/US | Partner, MoginRubin LLP Thomas N. Dahdouh | Director, Western Region, Federal Trade Commission Franklin M. Rubinstein | Partner, Wilson Sonsini Goodrich & Rosati Randi W. Singer, CIPP/US, CIPT | Partner, Weil, Gotshal & Manges Contributor: Dina Srinivasan | Independent Researcher & Author of The Antitrust Case Against Facebook Dina was unable to present but we thank her for her content contributions. Highly publicized ...
Now it’s the direct purchasers of one of the nation’s most delicious and protein-rich commodities -- beef. The purchasers claim in a new class action complaint that the country’s largest meatpackers conspired to reduce the capacity of their slaughter and packing plants in order to pay less on one end of the supply chain so they could raise prices on the other. Some of the Big Beef defendants are also defendants in on-going price fixing and supply manipulation cases pending against Big Chicken and Big Pork. Perhaps Big Meat views supply ...
California Governor Gavin Newsom has signed several amendments to the California Consumer Privacy Act of 2018. Issues range from the timing of employer disclosure requirements to data gathered and used in consumer identity verification, vehicle recalls and warranties, consumer credit checks, and business due diligence work. You can read MoginRubin Partner Jennifer M. Oliver's take on the changes in her Oct. 10 post, titled CCPA Changes Sent to Governor’s Desk as January Effective Date Draws Closer and Compliance Costs Loom Large. Going into ...
California Gov. Gavin Newsom has signed AB 824, known as the “Pay-for-Delay" bill, blocking pharmaceutical companies from paying generic drug makers to not develop and bring lower-cost medicines to market. The law makes these so-called “reverse payment” settlements of patent disputes – which the Federal Trade Commission says cost consumers $3.5 billion a year – “presumptively anticompetitive.” The new law provides that an agreement resolving a patent infringement claim is anticompetitive if the generic drug or biosimilar drug makers receive ...
Jennifer M. Oliver, Timothy Z. LaComb
October 17, 2019Several amendments to the California Consumer Privacy Act of 2018 are headed to Gov. Gavin Newsom’s desk. Issues range from the timing of employer disclosure requirements to data gathered and used in consumer identity verification, vehicle recalls and warranties, consumer credit checks, and business due diligence work. One bill, which attempted to address the non-discriminatory provisions of the CCPA and its potential impact on sellers’ popular customer rewards programs, didn’t make it out of the Senate. Going into effect in January and still ...
September 30, 2019, was a big day for college athletics. Alongside Lakers’ star LeBron James (who ironically skipped college), California Governor Gavin Newsom signed the Fair Pay to Play Act (FPTPA), which permits collegiate athletes in California to profit from the use of their names, images and likenesses (NILs) beginning in 2023. The governor said “colleges and universities reap billions from these student athletes’ sacrifices and success but block them from earning a single dollar. That’s a bankrupt model — one that puts institutions ...
Timothy Z. LaComb, Jennifer M. Oliver
October 05, 2019U.S. Judge Janis L. Sammartino in California’s Southern District certified a price fixing class action against “Big Tuna” this summer following a Daubert review of experts, keeping with Ninth Circuit precedent and focusing on the rigorousness of the review of expert reliability, but not the admissibility of evidence. This is just one in a growing line of cases that address the propriety of a Daubert review at the class certification stage, a country-wide discussion following the cryptic message handed down from the Supreme Court in Wal-Mart ...
Google says cookies are good. They are critical to generating advertising revenue and they help the company improve its product from functionality and privacy perspectives. Competing search engines do more to give users control over how these tiny tracking files monitor them. In April Google said it would move in that direction. It has since come out strongly against their complete elimination, however, arguing that it would be bad for privacy. Without cookies, Google says, more risky tracking methods will proliferate. This increasingly heated ...
When a company with a new idea shakes up an industry and delights consumers, it is tempting for established players to devour them. But is that in the best interests of the consumer? Sometimes the answer is yes, other times no. In the case of the air travel booking industry the Antitrust Division of the Department of Justice says hell no. The DOJ has sued to stop Texas-based Sabre Corp., the $3.9 billion operator of the largest global distribution systems (GDS) booking services provider in the U.S., from acquiring Farelogix, Inc., a $42 ...
The U.S. Department of Justice Antitrust Division has inserted itself into a case that questions whether the Anti-Malware Testing Standards Organization, Inc. (AMTSO) and some of its members are creating standards in a manner that violates antitrust laws. AMTSO says it is exempt from such per se claims by the Standards Development Organization Act of 2004 (SDOA). Symantec Corp., an AMTSO member, says the more flexible “rule of reason” applies – that it must be proven that standards actually undermine competition, which the recommended ...
Jonathan Rubin, Timothy Z. LaComb
August 07, 2019The Department of Justice Antitrust Division and the Federal Trade Commission are making good on their promises to scrutinize the world’s leading technology platform providers – Amazon, Apple, Facebook and Alphabet’s Google – as the cries from competitors for what they consider to be unchecked market dominance and anticompetitive practices grow in number and volume. Retailers blame Amazon and Google for an information bottleneck, the collection of third-party sales data, and the spread of counterfeit products. Independent developers say Apple ...
The world’s leading talent agencies claim the two Writers Guild of America (WGA) unions violated antitrust laws by executing what they call an illegal boycott that prevents talent agents from collecting talent-packaging fees – fees they receive for pulling together creative teams such as directors, actors and writers for film and television and pitching the “package” of talent to a studio. William Morris Endeavor Entertainment Inc. (WME), United Talent Agency, and Creative Artists Agency say the alleged conspiracy restricts competition, noting ...
Ubiquitous modem chips allow our smart devices to communicate with each other over cellular networks using industry standards like 4G LTE. A small group of companies (and nations) are racing for global leadership in 5G, considered by many to be the second coming of mobile connectivity and experience. 5G promises not just faster phones, but smarter cars and homes, augmented and virtual reality, and better national defense systems. 5G is creeping into U.S. consumer markets now. Qualcomm Inc., Intel Corp., Taiwan’s MediaTek Inc., and China’s ...
Assistant Attorney General Makan Delrahim announced on July 11, 2019, the Antitrust Division’s new policy for incentivizing antitrust compliance, saying the government “will consider compliance at the charging stage in criminal antitrust investigations,” credit that was explicitly not considered previously. The Division announced revisions to its Justice Manual and published a document to guide prosecutors’ evaluation of corporate compliance programs at the charging and sentencing stages. “The Antitrust Division is committed to rewarding ...
For a group of organizations whose very existence is based on fair world-class competition, the competitive spirit of professional sports leagues has drawn its share of challenges over the years, not for their sportsmanship in their arenas, but in their corporate board rooms. Professional basketball, football and hockey leagues have faced challenges over whether they restrained trade by combining their power to control television broadcasts, merchandizing, and web media rights. The leagues have prevailed, withstanding court scrutiny over ...
Jennifer M. Oliver, Timothy Z. LaComb
July 16, 2019Commercial U.S. buyers of Farmed Atlantic Salmon have sued many of the leaders of what they maintain is a global cartel that has colluded to fix and drive up prices. The European Commission is investigating them as well, kicking off its probe with simultaneous raids of plants operated by Norwegian companies. In Re Farm-Raised Salmon and Salmon Products Litigation is the combination of several lawsuits brought by salmon purchasers. According to one of those complaints, filed by Beacon Fisheries on May 15, 2019, the salmon producers “must ...
According to a recent Wall Street Journal report millions of business listings on Google Maps are fake, thanks to businesses seeking to drive call volume by posting made-up store and office locations. Google is reportedly overrun by false business addresses and names but is doing little to resolve the issue, since it also profits from the practice, according to the Wall Street Journal. The ability for aggrieved consumers to pursue the thousands of disparate businesses engaging in this behavior is nil. Adding insult to injury, Google also ...
The meat packing industry is coming under increasing pressure in the form of separate antitrust lawsuits filed this year by consumers and cattle ranchers. Both groups allege anticompetitive conspiracies that unfairly enriched the meat packers at their expense, including successful efforts to lower livestock prices on one end of the supply chain and artificially increasing the price of beef on the other. Consumers Sue in Minnesota Federal Court Four of the defendants in the consumer case of Peterson v. Agri Stats, Inc., et al., filed April 26, ...
The line of politicians, regulators, and legislators in the U.S. and abroad expressing serious concerns about the market power held by big technology companies seems to grow longer by the day. This week, U.S. House of Representatives Antitrust Subcommittee Chairman David N. Cicilline (D-RI) announced a bipartisan investigation, saying the "market power in digital markets presents a whole new set of dangers" for the U.S., both politically and economically. "After four decades of weak antitrust enforcement and judicial hostility to antitrust ...
The Wall Street Journal reported on May 31 that the U.S. Justice Department is “gearing up” for an antitrust investigation of Google, “a move that could present a major new layer of regulatory scrutiny for the search giant.” WSJ reporters Brent Kendall and John D. McKinnon quoted unnamed sources as telling them that DOJ’s Antitrust Division has been “laying the groundwork for the probe” in recent weeks. That groundwork includes the agreement between the Federal Trade Commission and the DOJ that the DOJ would take the lead. In related news, The ...
Qualcomm Inc. has asked U.S. Judge Lucy H. Koh of the Northern District of California to stay, pending appeal to the Ninth Circuit U.S. Court of Appeals, her decision that the company's modem chip licensing practices violate the Sherman Act and constitute unfair competition practices under the Federal Trade Commission Act. Qualcomm calls the decision “irreparably flawed” and the FTC case's case “lacking any plausible theory of competitive harm.” FTC Bureau of Competition Director Bruce Hoffman hailed the decision as "an important win for ...
The committee has been playing a bigger role on the global M&A stage, figuring prominently in the U.S.-China trade war and putting the breaks on some giant acquisitions. The Committee on Foreign Investment in the United States (CFIUS) is authorized to review -- and block, if necessary -- transactions involving foreign investment to determine whether they threaten national security. The committee operates pursuant to Section 721 of the Defense Production Act of 1950, authorizing the president to suspend or prohibit transactions. The ...
The U.S. Department of Justice Criminal Division has issued guidance to assist prosecutors in assessing corporate compliance programs during criminal investigations. Saying “each company’s risk profile and solutions to reduce its risks warrant particularized evaluation,” the DOJ says it does not apply a “rigid formula” when assessing program effectiveness. However, the DOJ says prosecutors tasked with pressing charges must answer whether a program was “well designed” and “applied earnestly and in good faith.” Ultimately they must answer ...
The Supreme Court held today that iPhone users are “direct purchasers” of apps from Apple’s wildly popular multi-billion-dollar App Store and have standing to sue, despite Apple’s arguments to the contrary. In Apple v. Pepper, the court held in a 5-4 decision that the users meet the definition of “direct purchasers” as required by Supreme Court precedent (Apple Inc. v. Pepper, et al., Sup. Ct., No 17-204). Apple’s store is the only legal place iPhone users can purchase iPhone apps, most of which are created by independent contractors. These ...
The German competition regulatory authority has decided to bar Facebook from combining user data with data it scrapes from non-Facebook sources -- a major spring of information used by the company -- unless the user expressly gives permission. The agency says Facebook has used its restrictive user agreement to dominate the German market. Facebook, which is appealing the decision, says competition there is “fierce.” Facebook’s terms and conditions require users to allow such data gathering as a precondition to participating in the social ...
Swedish music streaming company Spotify Technology SA’s antitrust complaint against Apple Inc. in Europe is another example of a dispute arising when a company is both the provider of a platform and a participant in that platform. Spotify says Apple uses its wildly popular App Store to undercut competitors to the Apple Music steaming service. Apple says the Swedish company simply wants to avoid the fees associated with selling services via the tremendous store it took years to build. Apple Music recently surpassed Spotify in the U.S. market, ...
This is an excerpt of a thorough discussion of the issue captured in a 14-page article. Download the PDF. No one wants their most valuable assets taken. For businesses, those assets often include employees, customers, and trade secrets. But employers who try to protect these assets are on notice: anticompetitive agreements related to employment are subject to scrutiny and may result in fines or even criminal charges. In October 2016, the DOJ and FTC took the extraordinary step of issuing guidelines putting HR professionals on notice that ...
The global cannabis market is on track to triple in size in the next three years, expecting to hit $32 billion, with two-thirds of that coming from the U.S. market. It is a highly regulated and inherently regional and local business: dispensaries must have a highly-sought after government-issued license and product cannot be purchased online so customers must travel to local dispensaries to buy. With these conditions in place it should come as a surprise to no one that licensed dispensaries are attempting to prevent competitors from entering ...
Mississippi Attorney General Jim Hood told CNBC on Monday, March 18, that he is developing his antitrust case against Google similar to the one brought against Microsoft in the 1990s. According to CNBC, he also intends to address the privacy policies of Google parent company, Alphabet. If it seems like everyone everywhere is pursuing Google and other tech giants, it’s because they are. Hood is just one of the state attorneys general going after tech companies, and the EU Commission has hit Google with three fines in three years totaling $9.4 ...
The European Commission has fined Google $1.69 billion for breaching EU antitrust rules. “Google has abused its market dominance by imposing a number of restrictive clauses in contracts with third-party websites which prevented Google's rivals from placing their search adverts on these websites,” according to today’s press release from the EU Commission. Commissioner Margrethe Vestager, in charge of competition policy, said the fine was for Google’s “illegal misuse of its dominant position in the market for the brokering of online search ...
Democrats and Republicans in both chambers of Congress have come out against drug industry practices such as paying generic drug companies to delay the release of lower-priced versions of their products. The tactic drew criticism as anticompetitive at least and immoral at worst. Rep. David N. Cicilline (D-RI), for example, said the average hospital stay for a child with cancer is $40,000; organ transplants often cost more than $1 million; and drug costs have increased 200% in 10 years. Ten years is also the time it took for the FTC to settle ...
In a move that could redefine how 2.6 billion people use Facebook Messenger and Facebook’s acquired WhatsApp and Instagram apps, The New York Times reported on Jan. 25 that Facebook CEO Mark Zuckerberg plans to integrate the platforms. The announcement turned up the volume on antitrust and privacy warnings directed at the social media giant. The Times cited unnamed sources involved in the project who said the apps will continue as stand-alone services, but their “underlying technical infrastructure will be unified” so people can chat across ...
The Federal Trade Commission’s Bureau of Competition has set its sights on the U.S. technology sector. On Feb. 28 it launched a task force that will monitor the industry, investigate potential anticompetitive conduct, and taking enforcement action as necessary. In announcing the new team, FTC Chairman Joe Simons said "it makes sense for us to closely examine technology markets to ensure consumers benefit from free and fair competition. Our ongoing Hearings on Competition and Consumer Protection in the 21st Century are a crucial step to deepen ...
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