E-Briefs, News and Notes: May 2025

The Antitrust and Unfair Competition Section will host two New Lawyers Summer Mixers:

• San Francisco: June 12, 5-7 PM at Harborview Restaurant & Bar
• Los Angeles: July 10, 5-7 PM at Perch

Register for the mixers here: San Francisco and Los Angeles.

We look forward to welcoming you at one or both of these events!

The mixers aim to connect students, peers, and established members of the California antitrust and unfair competition bar in a relaxed and enjoyable setting. Tom Dahdouh, CLA’s Antitrust Lawyer of the Year, will be speaking at the events.

Sponsorship opportunities are also available. Learn more and sponsor today!

Eliot A. Adelson

Well-respected antitrust attorney Gary R. Spratling passed away on March 26, 2025. Gary Spratling was considered a legal giant based on his leadership at both the United States Department of Justice Antitrust Division and in private practice at Gibson Dunn in San Francisco.  The E-Brief Editors are honored to provide the following summary based on Gary’s public biography and obituary.

According to his public biography, Gary earned BS and MBA degrees at UC Berkeley. During his second month of law school at the University of San Francisco (USF) in 1966 when – in the nation’s largest draft call since WWII – Gary was directed to report for induction into the Army in less than 3 weeks. Following his 2-year active-duty tour (the first teaching at the Adjutant General School at Ft. Harrison, the second in operations in SE Asia), he returned to the USF to restart law school.

Upon graduation, Gary joined the Antitrust Division of the U.S. Department of Justice. Gary was Chief of the San Francisco Office of the Antitrust Division-widely considered “the crown jewel of the Antitrust Division.” In 1993, Gary was made the top career official at the Antitrust Division and the first career Deputy Assistant Attorney General for Criminal Enforcement (DAAG). According to his public biography, Gary faithfully served under numerous Attorneys General with Janet Reno his favorite. Gary and the Attorney General shared kind hearts, fierce minds and brave spirits.

In 1993 Gary persuaded Attorney General Janet Reno to allow the Antitrust Division to replace its voluntary disclosure program, which had not led to the detection of a single significant cartel since its inception in 1978, and adopt a novel approach: Create a prisoner’s dilemma for cartel members by promising full immunity for the company and all of its employees to the first company to self-report. The Leniency Program that Gary trailblazed was unlike every other DOJ voluntary disclosure program when it was adopted and that also remains true today.

Following Gary’s lead, competition authorities in scores of countries on every continent except Antarctica have adopted leniency programs modeled after the Antitrust Division’s. The leniency revolution became the great campaign against price-fixing cartels, all to the benefit of competition and consumers around the globe.
The proof of his success is in the outcomes achieved. When Gary assumed his leadership position in Washington, the highest criminal antitrust fine ever imposed was $10 million; the total fines collected by DOJ in a single year was $42 million. In Gary’s last year as DAAG, DOJ fines topped $1 billion with the takedown of the international vitamin cartel and the first ever prison sentences were secured for foreign nationals residing abroad who violated the US antitrust laws. The $500 million fine imposed on Hoffmann La Roche was a record fine for the DOJ for any crime.

When Attorney General Reno learned that Gary had received every award that a US President or Attorney General can bestow on a DOJ prosecutor (including two Presidential Awards), she presented Gary with a new award – the “Attorney General Award For Extraordinary Contributions to the Protection of Our Free Market Economy.”

In 2000, Gary returned to California and joined Gibson Dunn, where he served as Co-Chair of the Global Antitrust and Competition Practice for 17 years. Gary’s intimate knowledge of enforcement policies and practices around the globe, coupled with his relationships and instant credibility, made Gary the go-to option for companies facing international cartel investigations. He crafted a nuanced, carefully constructed global strategy for resolving exposure and then traveled the globe meeting with each relevant authority to implement the strategy.

Gary was known throughout the global bar for his “around the world” trips, where he boarded an airplane headed east, and met face to face with competition authorities in a dozen jurisdictions or more before finally crossing the Pacific and returning home to his beloved Tiburon. His representation of clients was so informed and geographically comprehensive, typically with desirable outcomes, that the lawyer-rating organization Chambers Global variously described Gary as “‘the best of the best,’ ‘an amazing lawyer with international repute,’ and ‘the Godfather of the antitrust market’.” During his tenure, Gary handled 40 separate international competition matters in 20 countries on 5 continents. In a single 2-year span, he represented clients in investigations by 34 separate enforcement authorities in 18 jurisdictions.

In 2017, Gary received two eminent Lifetime Achievement Awards: one from Global Competition Review and the other from the American Bar Association. He was also named the California State Bar Antitrust Section’s Lawyer of the Year in 1997.

On May 15th, California Lawyers Association hosted an engaging In-House Counsel Panel & Networking Reception at the Computer History Museum in Mountain View—and what a fantastic evening it was!

Legal professionals from across California gathered to explore timely issues facing in-house counsel, share insights, and make meaningful connections with peers across the antitrust and broader legal community.

A heartfelt thank-you to our expert panelists:

• Leslie Wulff – Chief, San Francisco Office, US Department of Justice, Antitrust Division
• Erik Herron – Acting Assistant Regional Director, Western Competition Group, US Federal Trade Commission
• Paula Blizzard – Senior Assistant Attorney General for Antitrust, California Department of Justice
• Kathleen Foote – Former Senior Assistant Attorney General for Antitrust, California Attorney General’s Office 

Their discussion spotlighted evolving discovery practices, enforcement trends, and compliance strategies relevant to today’s in-house teams. 

After the panel, attendees enjoyed a lively networking reception over drinks and refreshments—an opportunity to build relationships and exchange ideas in a relaxed setting.

Special thanks to our generous sponsors for making the evening possible:

• Latham & Watkins LLP
• Dechert LLP
• Winston & Strawn LLP
• Wolf Haldenstein Adler Freeman & Herz LLP
• Bartko Pavia LLP
• Crowell & Moring LLP

📸 Check out event photos here. We’re proud to create spaces where California’s legal professionals can learn, connect, and grow. If you missed this one, we hope to see you at a future Antitrust and Unfair Competition Law Section event!

By Wesley Sweger

In a short opinion released on March 14, 2025, Judge Slaughter (C.D. Cal.) denied Plaintiff QIAGEN GmbH’s Partial Motion to Dismiss Defendant Zymo Research Corporation’s Counterclaims, including a section 2 monopolization claim.

QIAGEN brought two patent infringement claims against Zymo alleging Zymo used QIAGEN’s patented technology “that allows researchers to extract nucleic acids, like DNA that circulate in our bodies outside of our cells.”  *1–2.  Zymo brought counterclaims seeking declaratory relief as to the validity and enforceability of QIAGEN’s patents, and Zymo’s noninfringement of said patents.  Important to our purposes, however, Zymo also brought a section 2 monopolization claim.  QIAGEN moved to dismiss a couple of Zymo’s declaratory relief claims and its monopolization claim, arguing such claims were barred by the Noerr-Pennington doctrine.

To reiterate, the Noerr-Pennington doctrine “is a rule of statutory construction that requires courts to construe statutes to avoid burdening conduct that implicates the protections of the Petition Clause of the First Amendment.”  *5.  The Petition Clause protects “the right of the people . . . to petition the government for a redress of grievances.”  *6.  Therefore, under the doctrine, “those who petition any department of the government for redress are generally immune from statutory liability for their petitioning conduct.”  Id.  The doctrine started as an antitrust doctrine but has since been applied to other areas of the law.

Noerr-Pennington, however, does not protect sham petitions.  The court identified three circumstances in which the sham litigation exception applies: (1) “where the lawsuit is objectively baseless and the defendant’s motive in bringing it was unlawful;” (2) “where the conduct involves a series of lawsuits ‘brought pursuant to a policy of starting legal proceedings without regard to the merits’ and for an unlawful purpose;” and (3) “if the allegedly unlawful conduct ‘consists of making intentional misrepresentations to the court, litigation can be deemed a sham if “a party’s knowing fraud upon, or its intentional misrepresentations to, the court deprive the litigation of its legitimacy.’’”  *6.

QIAGEN argued the Noerr-Pennington doctrine barred some of Zymo’s counterclaims unless Zymo met a heightened pleading standard showing that QIAGEN’s patent infringement claims are both objectively and subjectively baseless and therefore constitute “sham litigation.”  *5.  Zymo argued Noerr-Pennington immunity did not apply because Zymo has not yet had the opportunity to conduct discovery.

By Travis West 

The tension between antitrust enforcement and litigation immunity recently played out in the Northern District of California in Realtek Semiconductor Corp. v. MediaTek, Inc., No. 23-CV-02774-PCP, 2025 WL 744038 (N.D. Cal. Mar. 7, 2025) before Judge P. Casey Pitts, where Realtek brought an antitrust complaint against MediaTek, the dominant company in the TV Chip market, and against two non-practicing entities, IPValue and Future Link (collectively, the NPE Defendants).   The court’s ruling on a motion to dismiss offers critical insights into the Noerr-Pennington doctrine and anti-SLAPP motions.

Background

Realtek alleged that MediaTek had entered into a bounty agreement with the NPE defendants to incentivize them to bring patent litigation against MediaTek’s competitors.  Ultimately, MediaTek-sponsored plaintiffs brought six patent infringement lawsuits against Realtek in courts around the United States and Japan.  Realtek alleged these lawsuits were objectively baseless, designed to restrain competition.

Court’s Analysis

For Count I, which alleged a conspiracy to file a “series of sham lawsuits,” the court dismissed the claim based on the Noerr-Pennington doctrine, which “allows private citizens to exercise their First Amendment rights to petition the government without fear of antitrust liability.” Id.,at *4 (internal citation omitted). The court held that six lawsuits do not constitute a series nor did Realtek demonstrate the “crushing burden” that the series exception to Noerr-Pennington was designed to address.

For Counts II and III, which focused on the district court litigation, the court held that Realtek had successfully pled the sham litigation exception to Noerr-Pennington immunity.  The court found it significant that the patents in those cases were either invalidated by PTAB or voluntarily cancelled by Future Link, which is strong evidence that Future Link knew they were baseless.  The court also found that Realtek had adequately alleged that the defendants had weaponized the process of litigation—rather than its outcome—as an anticompetitive tool by issuing press releases about the lawsuits and directly contacting Realtek’s customers to warn them about patent risks. 

For Count IV, involving the ITC complaint, the court dismissed the claim because the ITC had already determined the proceeding was not frivolous, precluding the finding of objectively baselessness.

For the above claims, the court found that Realtek had adequately pled antitrust injury by alleging that the defendants’ conduct reduced competition, drew away Realtek’s resources from research and development, and allowed MediaTek to maintain supracompetitive prices that harmed consumers.

The court also found that Realtek had successfully pled a conspiracy to monopolize claim, rejecting the NPE Defendants’ argument that they could not be liable because they were not competitors in the TV Chip market.  The court emphasized that non-competitors can be liable for conspiracy to monopolize, distinguishing this from direct monopolization claims.

The court also found that Realtek had successfully pled a monopolization claim against MediaTek, a Lanham Act claim against the NPE Defendants for false press releases, a UCL claim (denying an anti-SLAPP motion to dismiss to the extent it sought to protect the false press release and an anti-SLAPP motion to dismiss that the litigation privilege protected MediaTek because MediaTek was not a party to the relevant litigation), a tortious interference claim against MediaTek (but granting an anti-SLAPP dismissal on this claim for the NPE Defendants because the alleged tortious interference was their litigation conduct), and a breach of contract claim against FutureLink for breaching the settlement agreement. 

Significance

The case stands out both for a rare finding that patent infringement lawsuits were not protected by the Noerr-Pennington doctrine and for its intersection with California’s anti-SLAPP law.  Given the presumption that patents are valid, it is difficult to establish that a lawsuit is sufficiently baseless to meet the sham exception to Noerr-Pennington. 

Second, the court dismissed an alleged tortious interference claim against the NPE Defendants for their lawsuits under California’s anti-SLAPP statute, finding that their litigation activities constituted protected petitioning conduct.  At the same time, it rejected an anti-SLAPP argument regarding the UCL claim based on the NPE Defendants’ press releases, which were not subject to the litigation privilege. 

Although the Noerr-Pennington doctrine and anti-SLAPP protections operate as two sides of the same coin—focusing on whether litigation has an improper ulterior motive—they are rarely analyzed together so thoroughly in a single opinion.  Given that anti-SLAPP laws are relatively new compared to Noerr-Pennington, defendants facing similar claims might benefit from incorporating Noerr-Pennington rationales in their anti-SLAPP motions.  The court’s nuanced approach provides a roadmap to navigating the tension between First Amendment petitioning rights and preventing lawsuits aimed at harming competition and the free exchange of ideas.  Certainly, parties believing they have been subject to unfounded lawsuits by non-practicing entities will rely on this case liberally going forward to bring antitrust claims against their foes. 

By Lillian Grinnell

In March, Judge Haywood S. Gilliam of the Northern District of California granted Visa’s motion to dismiss a putative class action lawsuit brought by a company called MiCamp Solutions, which states that it serves as a middleman between member banks, payment processors, and merchants. The suit alleged that Visa had committed several Sherman Act Section 2 violations, as well as actions prohibited under state law, alleging “anticompetitive conduct, yielding higher prices for consumers, suppressing competition, and harming various stakeholders in the credit card transaction ecosystem.” Slip op. at 2. MiCamp also filed an ex parte motion for a temporary restraining order, alleging that Visa’s “predatory practices” and “anti-competitive behaviors” are “damaging the Putative Class’s business reputations, goodwill, and recruitment efforts” and causing “economic pressure, damages to [the proposed class’s] business reputation, and lost customers.” Id., quoting Ex Parte Mot. at 5.

The Court granted in its entirety Visa’s motion to dismiss, also denying MiCamp’s motion for a restraining order. First, Judge Gilliam noted “several inappropriately flippant (or even obviously baseless) statements” in the operative complaint, including references to Visa executives as “overlords” sitting “likely in some sort of dungeon or lair” as well as “elementary mistakes” in MiCamp’s briefing, including confusion over which Section of the Sherman Act was the basis of the lawsuit. MiCamp also failed, notably, to specify which state’s law was the basis of claims of the “state law claims” of the complaint. Id. at 3. Judge Gilliam strongly implied that MiCamp’s attorneys’ representations to the Court failed to satisfy Federal Rule of Civil Procedure 11.

With regard to the Sherman Act claims, the Court ruled that MiCamp lacked antitrust standing because it did not show that there was a sufficient causal connection between Visa’s alleged anticompetitive actions and MiCamp’s pleaded injuries – increased penalties and surcharges, and an inability to offer competitive pricing models to its customers. Citing Apple Inc. v. Pepper, 587 U.S. 273 (2019), MiCamp claimed that its position was analogous to that of the plaintiffs in that case, who had directly purchased apps from Apple’s app store. But as the Court noted, MiCamp did not allege any direct relationship with Visa, but only banks and payment processors. It was therefore the indirect purchaser plaintiff specifically barred by Illinois Brick v. Illinois, 431 U.S. 720, 736 (1977).

In addition, two of the MiCamp’s causes of action alleged “that Visa’s surcharge rules impermissibly restrict speech in violation of the First Amendment and 42 U.S.C. § 1983.” Id. at 4. But, the Court noted, Visa was not a state actor and therefore not subject to § 1983 – even if, as MiCamp alleged, Visa performed traditional public function – as its company was not exercising functions that were “traditionally the exclusive prerogative of the state.” Id. at 5, Parks School of Bus., Inc. v. Symington, 51 F.3d 1480, 1486 (9th Cir. 1995). MiCamp argued in the alternative that Visa’s lobbying meant that it was combined with the state in some kind of joint action, but this was also rejected as lobbying is protected under the First Amendment, meaning that it cannot be used as a reason to attribute a private entity’s activity to the state. See Single Moms, Inc. v. Montana Power Co., 331 F.3d 743, 748 (9th Cir. 2003).

MiCamp’s state antitrust causes of action, meanwhile, in addition to failing to specify what state law was used, merely listed 49 state antitrust laws it alleged Visa had violated. This, Judge Gilliam noted, did not even rise to the level of a “a formulaic recitation of the elements of a cause of action” that is impermissible under Rule 8’s pleading standard. See Twombly, 550 U.S. at 555. Here, “MiCamp has not even provided such a recitation, let alone pled factual content that would allow the Court to plausibly conclude that MiCamp is entitled to relief under the enumerated state statutes.” Id. at 8.

In dismissing all of MiCamp’s claims the Court granted it leave to amend its Sherman Act and state law claims, but not the First Amendment claims. The motion for a temporary restraining order was also denied.

By David Lerch

Northern District of California judge Jeffrey White granted a motion to dismiss in a proposed class action as to price-fixing allegations against software provider SAS Institute Inc., based upon the software provider allegedly creating a shared pricing algorithm that Hilton, Hyatt and other hotel chains used to fix and raise room rates across the nation.  The court also indicated a separate order on a motion to dismiss from the hotel chains was forthcoming.

The Court stated that Plaintiffs alleged that SAS, IDeaS, Inc. and five hotel defendants conspired to fix hotel prices, noting that according to plaintiffs, the hotel defendants use a revenue management system created by IDeaS, which in turn used analytics software developed by SAS (Order at 1).  The Court noted that plaintiffs further alleged the Hotel Defendants send their confidential pricing and occupancy information to Ideas Inc. to process, analyze, and develop supra-competitive prices, know that the other defendants are doing the same, and set prices accordingly and that by doing so, the hotel defendants are able to achieve the same result as if they secretly met in a back room and exchanged their information and agreed to a supra-competitive price (Order at 1).  Plaintiffs contend that the defendants, including SAS, engaged in hub-and-spoke conspiracy to fix prices therefore violated Section 1 of the Sherman Act (Order at 2).

The Court stated that in order to set forth a claim under the Sherman Act, Plaintiffs must allege facts that show: (1) a contract, combination or conspiracy among two or more persons or distinct business entities; (2) by which the persons or entities intended to harm or restrain trade or commerce among the several states (3) which actually injures competition (Order at 2, citing Kendall v. Visa U.S.A., Inc., 518 F.3d 1042, 1047 (9th Cir. 2008).  The Court also stated that, as the Supreme Court set forth in Twombly, “when allegations of parallel conduct are set out in order to make a § 1 claim, they must be placed in a context that raises a suggestion of a preceding agreement, not merely parallel conduct that could just as well be independent action.”   Bell Atlantic Corp. v Twombly, 550 U.S. 544, 557 (2007) (Order at 2).  In this case, the Court noted that Plaintiffs alleged that that IDeaS’s revenue management system products are “powered by” SAS analytics, pointing to allegations in the complaint that SAS developed analytics used by IDeaS’s revenue management system (Order at 2).  The Court agreed with Defendants that these allegations were insufficient to state a claim, noting that Plaintiffs did not include allegations that Defendant did more than provide one aspect of the revenue management system product and do not suggest it has continued involvement with providing the hotel defendants the revenue management system products (Order at 2-3).

In addition, the Court stated that Plaintiffs also did not include allegations from which one could reasonably infer SAS had any other connection or contact with the hotel defendants (Order at 3). The Court noted that although Plaintiffs alleged that IDeaS is a subsidiary of SAS, in general, a corporate parent is not liable for the acts of its subsidiaries, citing United States v. Best Foods, Inc., 524 U.S. 51, 61 (1998), and that Plaintiffs have not made any allegations that the corporate form should be ignored (Order at 3).  Accordingly, the Court granted SAS’s motion to dismiss with leave to amend absent a showing of futility (Order at 3).

By Cheryl Johnson

Elon Musk and his AI company, xAI, sued Open AI and Microsoft for secretly building OpenAIto become a “for-profit behemoth.” Elon Musk v.  OpenAI Inc., No. 4:24-CV-4722-YGR, —F. Supp. 3d —, 2025 WL 715797 (N.D. Cal. Mar. 4, 2025), at *1. Musk alleged this violated promises made to secure his “altruistic” $440 million investment made knowing it was to effectuate Musk’s “long standing commitments to opensource AI” and to “put people over profit.” Id. at 1. While plaintiffs were denied a  preliminary  injunction for failure to demonstrate entitlement to injunctive relief, the court offered an expedited trial on the claims to convert the companies to for-profit status, given the possible public stake. Id. at *11.

Sherman Act Boycott. Musk and xAI alleged Open AI and Microsoft agreed to bar OpenAI investors from investing in any competitor AI company. Since Musk had resigned from Open AI in 2018 and denied being xAI’s alter ego, he lacked antitrust standing. Id. at *4. xAI failed to produce evidence of the alleged agreement or boycott and could not show irreparable harm particularly given xAI’s own fundraising success. Id. at *5-6.

Interlocking Directorates. Plaintiffs were also denied a bar on interlocking directorates on the Microsoft and OpenAI boards. Since the two overlapping directors had resigned before this motion was filed, plaintiffs lacked standing to complain and had no evidence of imminent threats of a resumption of the interlocks.  Id. at *8.

Breach of Charitable Trust.  Likewise, an injunction against OpenAI’s conversion into a for-profit entity was denied because Musk’s intent to make his investment contingent on OpenAI remaining a non-profit was never reduced to a contract or gifting document. Id. at *9. Whether Musk’s emails or social media posts constituted an actual contract or charitable trust was “debatable” but insufficient to show likely success on the merits. Id. at *9. Given the public interest if Open AI took nonprofit tax deductions and converted into a for-profit enterprise, the court offered to expedite trial on the conversion claim to the fall of 2025. Id. at *10-11. Finally, the plaintiffs lacked standing to assert a self-dealing claim in violation of Cal. Corporation Code Section 5233 in the absence of a relator status, which had not been granted by the California Attorney General. Id. at *11.

By Maria Ramirez  

On March 10, 2025, in In re Telescopes Antitrust Litigation, Judge Edward J. Davila of the U.S. District Court for the Northern District of California granted class certification to a group of direct purchasers (DPPs) alleging a long-running price-fixing and market allocation conspiracy in the consumer telescope industry. The Court simultaneously denied defendants’ Daubert motion to strike the plaintiffs’ expert report.

Background

Plaintiffs, Aurora Astro Products LLC and Pioneer Cycling & Fitness, LLP, brought a class action against multiple defendants, including Celestron Acquisition, LLC and other affiliated telescope manufacturers and executives. Plaintiffs allege that starting in 2005, Defendants engaged in a conspiracy to fix prices and eliminate competition. This was carried out through anticompetitive acquisitions and collusion in the U.S. telescope market.

Plaintiffs relied on the expert testimony of economist Dr. J. Douglas Zona, who submitted a report supporting class-wide antitrust injury and damages. Dr. Zona employed three economic models to determine the extent to which prices raised beyond the levels that existed without the alleged conspiracy:

1. Cournot Model: A theoretical framework of oligopoly competition that estimates “how a combination of suppliers can impact a market and raise prices above the competitive benchmark of all purchasers.” The model assumes companies decide how much to produce at the same time, based on how many competitors there are, to make the most profit. It applies the same extra charge to every sale. Dr. Zona used this basic model to measure the effects of the alleged conspiracy and harmful mergers.
2. Connor Model Using PIC Data: This model draws from empirical overcharge data across various industries to estimate the impact of cartels. To estimate the expected overcharge, Dr. Zona employed a regression analysis using PIC data, which was conditional on (1) the number of cartel members and (2) the market share of the cartel members.
3. Regression Model Based on Transactional Data: Zona analyzed actual sales data, controlling for costs, seasonality, and customer-specific factors.  This model shows how much prices were inflated during the conspiracy by comparing them to normal prices, while also accounting for other things that could have affected prices.

Defendants challenged Dr. Zona’s report, arguing it was methodologically flawed, failed to account for demand properly, and was not tethered to actual telescope market conditions. Their expert, David Kaplan, states that Dr. Zona’s methodologies are unreliable and irrelevant.

Court’s Ruling

Judge Davila denied the Daubert motion, holding that while admissibility is relevant, the class certification stage focuses on the weight of expert evidence, not its ultimate admissibility. The Court found Dr. Zona’s methodologies reliable and sufficiently tethered to the facts of the case, particularly noting that similar models had been accepted in prior litigation involving the same expert and industry.

The Court then certified the class, finding that numerosity, commonality, typically, adequacy, and predominance were all satisfied. Specifically, the Court found that DPPs had shown common issues clearly predominated regarding the alleged antitrust violation. Key shared questions included whether Defendants conspired to fix prices, divide markets, and make unlawful acquisitions; who was involved in the conspiracy; and whether their actions broke antitrust laws.

As to antitrust injury, while the Court agreed with some criticisms of Dr. Zona’s report raised by Defendants, it found that other evidence, like emails, price lists, and testimony, could still show class-wide injury, as price-fixing often affects all market participants.

The Court also found that Dr. Zona’s damages analysis,  including the Cournot model, Connor PIC data, and regression analysis was reliable enough for class certification.

The Court found Dr. Zona’s adjustment to the “but-for” prices problematic, as it relied on conduct outside the scope of the complaint, which only alleged a conspiracy beginning in 2005. However, the Court reasoned that Dr. Zona’s other overcharge calculations could still support DPP’s argument for class certification.

Finally, superiority was uncontested and deemed met.

By Alex J. Tramontano and Stephanie Aviles
Editor’s Note: The authors are associates in the Chief Editor’s law firm.

A bill originally intended to establish “a memorial to California peace officers on the grounds of the State Capitol” now threatens millions of Americans’ digital privacy. Initially sponsored by Senator Anna Caballero, an amendment to California Senate Bill 690 attempts to re-write Sections 631, 632, 637, and 638 of the Penal Code, collectively known as the California Invasion of Privacy Act (“CIPA”).

CIPA currently protects individuals from interception of communications transmitted over the internet or telephone absent consent from both parties. The only exceptions are for correctional institutions and utility maintenance purposes.

Californians were unaware that hospitals, healthcare providers and big tech companies were tracking their messages and digital activity across both hospitals’ and physicians’ websites. Patients who received digital medical records and accessed patient portals for their medical conditions or treatments learned that information could also be simultaneously sent to technology companies which advertised to consumers, such as Facebook and Google.

In the pursuit of website optimization, many hospital and practice group administrators installed digital tracking technology to track users across their websites, capture user search terms, observe and record site usage and the conditions, doctors, specialties users searched for, and use of the patient portal. This resulted in widespread harvesting of patient data, all of which is digitally assigned to the individual’s unique advertising profile. The idea being, for example, if you are searching for cancer treatments, – you would probably be a great target for advertising concerning cancer treatment drugs. The more specific the information, the more social media and search engine companies can tailor the advertising. All of this was initially done without notice or a right to opt-out by the consumer or patient.

Consumers and patients remained largely unaware until 2022, when an online publication called The Markup published an article calling out several healthcare organizations whose websites contained this tracking technology. In December of 2022, the U.S. Department of Health and Human Services Office for Civil Rights (OCR) took notice and issued a bulletin advising that such practices could violate the Health Insurance Portability and Accountability Act of 1996 (HIPAA). And then, in 2023, the Federal Trade Commission (FTC) and the OCR sent warning letters to approximately 130 hospital systems and telehealth providers regarding the privacy and security risks of using online tracking technologies, including Meta/Facebook Pixel and Google Analytics. The letters emphasized that these technologies could impermissibly disclose sensitive health information to third parties and potentially violate HIPAA.

Consumers also filed several actions to vindicate the rights of consumers who had their most sensitive health data harvested. Many have filed class action lawsuits against the hospitals that participated in this tracking or wire-tapping conduct without their knowledge or consent. (See, e.g., Doe 1 et al. v. Scripps Health, Case No. 3:23-cv-02215-AGS-DEB (S.D. Cal.); Doe, et al. v. Cedars-Sinai Health System, et al., Case No. 22STCV41085 (Los Angeles Super. Ct.); Ortega, et al. v. Emanate Health, Case No. 22STCV28142.)

Critically, the bill introduces new language to CIPA, exempting digital privacy invasions and tracking if undertaken “for a commercial business purpose.” Specifically, the proposed amended Section 631 of the Penal Code will:

• Exempt communications intercepted for a commercial business purpose;
  • Define a commercial business purpose to mean the “processing of personal information either performed to further a business purpose or subject to a consumer’s opt-out rights;”Specify a “pen register” or “trap and trace device” does not include devices used in a manner consistent with a “commercial business purpose;”Remove the private right of action for an individual to file a lawsuit to enjoin or restrain a violation or for monetary damages, if the processing of personal information is for a commercial business purpose; and
  • Retroactively apply to any case pending as of January 1, 2026.

The bill’s sponsor is: Senator Anna Caballero

Democrat, District SD-014
Website: https://sd14.senate.ca.gov/
Contact Form: https://sd14.senate.ca.gov/contact-us
Bill Tracking: https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202520260SB690 

Thursday, May 22, 2025

Office of Public Affairs

The Justice Department, joined by the Federal Trade Commission (the “Agencies”) filed a statement of interest in the Eastern District of Texas in the case of Texas et al. v. BlackRock, Inc. The States’ lawsuit—led by the Texas Attorney General—alleges that BlackRock, State Street, and Vanguard used their management of stock in competing coal companies to induce reductions in output, resulting in higher energy prices for American consumers. This is the first formal statement by the Agencies in federal court on the antitrust implications of common shareholdings.

*       *       *

The statement of interest explains that while antitrust safe harbors for passive investment protect most index fund investing and beneficial corporate governance advocacy, they do not protect the use of commonly managed stock in competitors to encourage market-wide reductions in output. The statement explains how the law protects typical shareholder behavior, how the States’ complaint alleges an anticompetitive campaign, and how the law should properly be applied to the States’ claims.

A copy of the statement of interest can be found on the Antitrust Division’s website.  

Wednesday, May 7, 2025

Office of Public Affairs

Agencies Launch Public Inquiry Under President Trump’s Executive Order

Today, the Justice Department and the Federal Trade Commission (FTC) jointly launched a public inquiry to identify unfair and anticompetitive practices and conduct in the live concert and entertainment industry. The agencies invite members of the public to submit comments and information on harmful practices and on potential regulation or legislation to protect consumers in the industry. The Agencies will use the information in their preparation of the report and recommendations directed by President Trump’s Executive Order 14254, Combating Unfair Practices in the Live Entertainment Market.   

“Competitive live entertainment markets should deliver value to artists and fans alike,” said Assistant Attorney General Abigail Slater of the Justice Department’s Antitrust Division. “We will continue to closely examine this market and look for opportunities where vigorous enforcement of the antitrust laws can lead to increased competition that makes tickets more affordable for fans while offering fairer compensation for artists.”

“Many Americans feel like they are being priced out of live entertainment by scalpers, bots, and other unfair and deceptive practices,” said FTC Chairman Andrew N. Ferguson. “Now their voices are being heard. President Trump has sent a clear message that bad actors who exploit fans and distort the marketplace will not be tolerated. The FTC is proud to help deliver on that promise and restore fair and competitive markets that benefit ordinary Americans.”

*       *       *

The agencies therefore seek information from the public about unfair and anticompetitive conduct and practices in the live concert and entertainment industry. The agencies also encourage comments providing information on the competitive effects of current state and federal regulations and laws in the live concert and entertainment industry, including the secondary ticketing market.

The public will have 60 days to submit comments at Regulations.gov, no later than July 7, 2025.

May 14, 2025

As the National Football League prepares to announce the 2025 season schedule, staff of the Federal Trade Commission sent a warning letter  to StubHub Holdings, Inc. (StubHub), the nation’s largest ticket exchange and resale business, stating that it appears to have misrepresented the total price of some of the tickets displayed for sale on its website, in violation of the agency’s new Rule on Unfair or Deceptive Fees (Fees Rule).

“Companies have had sufficient time to prepare for these changes and update their advertising to ensure the total price of each product or service is appropriately disclosed,” said Chris Mufarrige, Director of the FTC’s Bureau of Consumer Protection. “As this letter shows, the Commission will not allow companies to circumvent the rule to gain a competitive advantage.” 

Under the Rule, which was announced in December of last year, published in January, and took effect on May 12, it is an unfair and deceptive practice for any business to offer, display, or advertise the price of a live-event ticket without clearly, conspicuously, and prominently disclosing the total price, which the FTC defines as “the maximum total of all fees or charges a consumer must pay for any good(s) or service(s) and any mandatory ancillary good or service,” excluding only taxes, shipping, and charges for optional items the consumer adds to their purchase.

As detailed in the letter, staff has identified instances in which StubHub’s displayed ticket prices failed to include all mandatory fees and charges. While the Fees Rule allows some initial exclusions from the total price, as noted above, staff contends that StubHub left out mandatory fees and charges such as required fulfillment fees and service fees.

“Given the high volume of traffic and sales expected across ticketing platforms tonight with the release of the NFL schedule for the 2025 season, we remind you that each failure to comply with the Fees Rule is a separate violation that may be subject to civil penalties,” staff states in the letter, which encouraged the company to immediately comply with the Fees Rule. Such violations also can lead to civil penalties of up to $53,088 per violation, as well as other monetary relief, under the FTC Act.

Brief argues that DOJ’s proposed final judgment is in line with privacy protections mandated by FTC in privacy and data security orders

May 9, 2025

The Federal Trade Commission filed an amicus brief today in support of the Department of Justice’s Revised Proposed Final Judgment (RPFJ) related to Google’s antitrust violations.

In August 2024, a federal judge found that Google violated Section 2 of the Sherman Act by maintaining monopolies in general search services and general text advertising. As part of the RPFJ aimed at remedying these violations, DOJ proposed that Google be required to share targeted portions of its search index, user, and ads data with certain competitors for a limited period of time with suitable security and privacy safeguards.

As the nation’s primary privacy enforcer, the FTC has a strong interest in ensuring that companies vigorously protect consumers’ privacy and long experience with crafting appropriate remedies to address such privacy and data security violations.

“The privacy safeguards proposed by DOJ are in line with the measures the FTC has required numerous companies to take to address privacy and data security failures,” said Katherine White, Deputy Director of the FTC’s Bureau of Consumer Protection. “The RPFJ may also force Google and other market participants to finally compete on protecting consumer privacy.”

In its brief, the FTC described the ways in which the RPFJ is consistent with the Commission’s own privacy and data-security orders, and noted Google’s questionable track record related to privacy. The company has entered into three separate consent agreements with the FTC since 2011 over alleged privacy violations.

DOJ’s RPFJ includes similar safeguards to those required by the FTC under the privacy orders the agency has entered into with numerous companies for allegedly failing to protect consumer privacy and data security, according to the FTC’s brief. These privacy orders include requirements that companies establish programs designed to identify and mitigate potential privacy and security risks. These programs are also subject to independent audits by third-party assessors and oversight by the FTC or a federal court.

DOJ’s RPFJ recommends that the court appoint a Technical Committee made up of independent experts that would be charged with ensuring that Qualified Competitors that receive data from Google have adequate safeguards in place to protect Google users’ privacy.

The FTC’s brief argued that the Technical Committee’s oversight is critical to ensuring Google—and competitors who receive user data—adhere to their required privacy obligations, particularly given Google’s past privacy lapses, which included paying a civil penalty for violating its 2011 privacy order with the FTC.

In addition, the brief noted that the RPFJ’s data sharing requirements may create an incentive for Google and other market participants to compete on privacy and data protection, driving higher quality protection market wide.

Friday, May 9, 2025

Urges court to keep order that will protect the agency from further dismemberment 

OAKLAND — California Attorney General Rob Bonta today announced joining a coalition of 23 attorneys general in submitting an amicus brief in National Treasury Employees Union v. Vought, a lawsuit challenging the Trump Administration’s efforts to dismantle the Consumer Financial Protection Bureau (CFPB). In February, Attorney General Bonta submitted an initial amicus brief in this case, which was followed by the court granting a robust preliminary injunction, a decision that prevents the Trump Administration from moving forward with mass layoffs while litigation in this case proceeds. The Trump Administration has now appealed the preliminary injunction, asking the court to strike it down to allow further dismantling of the CFPB to continue. In today’s amicus brief, the attorneys general argue that shuttering the CFPB would cause catastrophic harm to consumer protections nationwide. These actions by the Trump Administration trample over the decision of Congress to create the agency, violating the separation of powers under the U.S. Constitution. 

“Further demolishing the CFPB, the top cop protecting Americans from exploitation, would put families nationwide at a stark disadvantage when standing up to big businesses who aren’t playing by the rules,” said Attorney General Bonta. “I urge the court to keep in place the order preventing the Trump Administration from issuing mass layoffs at the CFPB — its loss would have devastating and deep implications for California, and the financial well-being of households across the nation.”

In the brief, filed in the United States Court of Appeals for the District of Columbia Circuit, the attorneys general argue the dismantling of the CFPB will cause irreparable harm to consumers and the states’ own consumer protection enforcement efforts, leave no oversight over large national banks, and will rapidly and substantially increase the burden on state agencies to protect consumers from conduct regulated by the CFPB. The loss of the CFPB’s partnership has concrete and widespread implications: from the sharing of complaints and trend data, to providing training, to partnering on joint investigations and litigations, the CFPB has been a force multiplier for California’s consumer protection efforts.

Background

After examining the fallout of the 2008 financial crisis, Congress concluded the crisis resulted in part from the failure of federal banking and other regulators to address significant consumer protection issues detrimental to both consumers and the safety and soundness of the banking system. In direct response to these events, Congress established the CFPB and tasked it with enforcing numerous federal consumer protection statutes and enacting regulations to further these efforts. For over a decade, the CFPB has served as an invaluable partner to state attorneys general and state banking regulators, both by working to protect consumers against fraudulent and abusive practices and by advancing a fair and level playing field in consumer financial markets by issuing regulations under federal law. 
 
In the last months, the Trump Administration has taken a series of actions intended to debilitate the CFPB, including issuing a suspension of work across the agency, terminating probationary employees, and announcing a decision not to draw additional funding from the Federal Reserve. These actions appear to be part of a unilateral effort to permanently shut down the agency, including programs and operations mandated by federal law. Most recently, the Trump Administration issued reduction in force notices to 90% of the CFPB’s workforce — a move that was swiftly blocked by the courts.

A copy of the brief can be found on California Attorney General’s website.  

Wednesday, April 30, 2025

OAKLAND – California Attorney General Rob Bonta today announced a lawsuit against Packers Sanitation Services, Inc. LTD., now doing business as Fortrex (PSSI), a national cleaning and sanitation company, for allegedly engaging in unlawful “no poach” agreements that restrict competition and harm workers’ rights. Filed in the San Diego Superior Court, the California Department of Justice (DOJ) alleges that PSSI’s use of illegal agreements – where businesses agree not to solicit or hire each other’s employees – violated California law, specifically the Unfair Competition Law. Through this lawsuit, the DOJ is seeking civil penalties, permanent injunctive relief that bars PSSI from using no-poach agreements, and restitution for employees that were harmed due to PSSI’s alleged unlawful conduct.

“When companies like PSSI use unlawful business practices to limit employee opportunities, they deny workers the freedom to compete for better wages, benefits, and career advancement,” said Attorney General Bonta. “Workers deserve a labor market free from illegal restraints. At the California Department of Justice, we will continue to support workers’ rights by holding accountable any business that undermines a fair labor market.”  

PSSI is a national cleaning and sanitation company that contracts with dozens of meatpacking and food processing facilities in California and hundreds across the country. Nationally, PSSI employs over 17,000 workers across approximately 500 worksites. PSSI has had cleaning contracts with over 20 meatpacking and food processing companies in California, including well-known names such as Foster Farms, Harris Ranch, and Pilgrim’s Pride. 

Central to the company’s alleged unlawful conduct is its use of prohibited no-poach provisions. This business practice, often hidden from employees, can have serious implications including artificially lowering employee compensation, reducing incentives for companies to improve working conditions, and limiting employee career growth. The DOJ’s investigation revealed that PSSI had implemented a no poach provision in 22 out of its 24 operative contracts in California, which impacted the rights of approximately 6,000 employees who worked pursuant to those contracts.

A copy of the lawsuit can be found on the California Attorney General’s website.