Antitrust and Unfair Competition Law
ANTITRUST AND UNFAIR COMPETITION LAW: E-BRIEFS, NEWS AND NOTES—May 2022
Welcome to the May E-Briefs, News and Notes. We have three E-Briefs, each covering class certification opinions. We have also added a new feature: Other Notable Cases. In this section we note additional judicial opinions but instead of a full E-Brief, we will have a short summary describing the main antitrust/unfair competition issue in the case so that you may read the opinion if it is relevant to your practice. This will allow us to highlight more cases with the resources we have. The Agency Update section includes links to numerous DOJ/FTC press releases reflecting the aggressive posture of the Biden Administration on competition policy. The In Case You Missed It section reposts numerous articles and other items related to matters of interest to antitrust and unfair competition lawyers. To the extent possible, the news items reprinted are not behind a paywall.
We hope this E-Brief is helpful. Thanks to all the contributors. If you have any suggestions for improvement, please let us know. email@example.com.
Eastern District of Virginia Weighs Joinder vs. Class for 35-Member Proposed Class
by Thomas H. Burt and Rourke Donahue
In In re Zetia Ezetimibe Antitrust Litig., 2022 U.S. Dist. LEXIS 69566 (E.D. Va. 2022), the Eastern District of Virginia followed guidance from the Fourth Circuit on remand and denied a class of 35 Direct Purchaser Plaintiffs’ (“DPPs”) renewed motion for class certification on the sole issue of numerosity. The court’s analysis here highlights the various, challenging hurdles 20-40 person proposed classes face during class certification. With the rise of the Direct Action Plaintiffs in recent years, small classes with big claimants are likely going to be even harder to certify as increasing numbers of potential class members opt out.
Facts: The DPPs alleged that Merck and Glenmark (“Defendants”) entered into an unlawful and anticompetitive agreement to resolve their earlier patent dispute concerning the cholesterol-reducing drug ezetimibe. The proposed class consisted largely of prescription drug wholesale purchasers and distributors who allegedly overpaid for Zetia, Merck’s branded version of ezetimibe. DPPs claimed that the unlawful agreement delayed market entry of generic ezetimibe, forcing them to purchase Zetia from Merck at artificially inflated prices. DPPs sought damages for the overpayment caused by Defendants’ allegedly monopolistic behavior. Id. at 13-14.
The Magistrate Judge’s first Report and Recommendation (“R&R”) recommended certifying DPPs’ first motion for class certification, and the district court granted DPPs’ motion. On appeal, the Fourth Circuit vacated and remanded the certification order on the issue of numerosity. The Fourth Circuit concluded that the district court erred by “improperly look[ing] to the impracticability of individual suits rather than joinder,” when assessing whether the class was “so numerous that joinder of all members is impracticable” under FRCP 23(a)(1). The Fourth Circuit explained that “on remand, the district court should consider whether judicial economy favors either a class action or joinder.” It also noted that DPPs made “no showing that it would be uneconomical for [smaller claimants] to be individually joined.” Id. at 14 (citations omitted).
On remand, the Magistrate’s R&R recommended denying DPPs’ renewed motion for class certification. Id. at 16. Ultimately, the district court agreed and denied DPPs’ motion. Id. at 12-13.
Analysis: The first and most important hurdle DPPs failed to overcome was achieving a class size above 40. DPPs argued that the class was technically larger than 35 because DPPs had discovered three more class members since the R&R was issued. Id. at 20. The court rejected this attempt to increase the class size, noting that DPPs did not appeal the earlier 35-member class decision and DPPs had ample opportunity since 2019 to investigate the existence of potential class members. Id. at 20-21.
Next, the court addressed the impracticability standard of Rule 23(a). The court rejected DDPs’ assertion that the R&R conflated “impracticable” with “incapable” of joinder, id. at 23, and explained that DPPs “must bring to bear evidence demonstrating that economic roadblocks would make joinder difficult, though not necessarily impossible, with the resources ordinarily available to proposed class members.” Id. at 24 (quoting In re Modafinil Antitrust Litig., 837 F.3d 238, 259 (3d Cir. 2016)).
Next, the court affirmed the relevance of considering whether denying certification would permit allegedly wrongful conduct to go unpunished. Id. at 28. The court reemphasized the R&R’s observations, against DPPs’ objections, that class members would likely pursue 95% of the total value of putative DPP class claims through joinder and that there are other plaintiff’s groups challenging Defendants’ alleged anticompetitive behavior. Id. at 26-27.
The court spilled the most ink on the fourth topic–the putative class members’ ability and motivation to join–and divided its analysis into four sections. Under the first section, Legitimate Business Considerations, the court noted that “more than fifty percent of the putative class members here that were present in the two analogous earlier cases prosecuted their claims following denial of certification.” Id. at 31 (internal quotation marks omitted). Accordingly, the court found that the R&R assigned the appropriate weight to DPPs’ evidence concerning why business judgment may counsel against joining this litigation following denial of class certification. Id.
In addressing relative claim size, the court agreed with the R&R’s assertion that several potential class members’ failure to examine their employers’ potential recoveries in this case weighed against finding “that putative class members lack economic motivation to litigate Zetia claims” absent class certification. Id. at 32-34.
The court also considered the R&R’s treatment of fear of retaliation, holding that it had little probative value here where DPPs presented no evidence of Defendants retaliating against customers in prior litigation. Id. at 34-35. The court also rejected the contention that the R&R improperly imposed an “unreasonable or unattainable standard” for DPPs to satisfy in proving impracticability of joinder for gray-area direct purchaser classes. Id. at 41-42.
In the final section of the analysis on putative class members’ ability and motivation to join, the court held that docket management and judicial economy concerns would not place an unacceptable burden on the court if joinder were pursued. Id. at 47. The court noted many ways in which the rise of virtual proceedings in the post-Covid era have ameliorated this concern. Id. at 45-47. Accordingly, the judicial economy issue will become increasingly difficult for small plaintiff classes to argue as virtual proceedings become more normalized and efficient.
This case may be distinguishable outside the context of a class of 20 to 40 members. However, it may also indicate a shift in thinking around the calculus of the superiority prong of Rule 23(b)(3) in an era where groups of non-class institutional purchasers increasingly pursue claims joined in groups.
En Banc Ninth Circuit Rejects de minimis Standard Established a Year Before in Certifying a Class That Includes Uninjured Members.
By Anthony Leon
On April 8, 2022, in an en banc decision, the Ninth Circuit affirmed the certification of classes of direct purchasers in the canned tuna antitrust litigation, effectively rejecting the argument that a class cannot be certified with more than a de minimis number of uninjured class members. See Olean Wholesale Grocery Coop., Inc. v. Bumble Bee Foods LLC, No. 19-56514 (9th Cir. Apr. 8, 2022)(en banc). The Ninth Circuit’s en banc opinion follows an earlier panel decision, which had vacated the district court’s class certification orders.
This Ninth Circuit order goes further than simply adding a new chapter to the seafood antitrust litigation saga. As a short reminder of this long story, a few tuna purchasers—including consumers, retailers, wholesalers, and commercial food preparers—filed lawsuits against Bumble Bee Foods LLC (Bumble Bee), StarKist, and Chicken of the Sea, Inc. (COSI), accusing them of conspiring to fix and maintain prices of canned tuna. Consolidated in a multidistrict litigation (MDL), the Plaintiffs moved to certify classes under Rule 23(b)(3). One of these classes was for the Direct Purchaser Plaintiffs (DPP)—retailers and wholesalers, another was the End Payer Plaintiffs (EPP)—consumers, and the last one being the Commercial Food Service Product (CFP). In parallel, the U.S. DOJ brought criminal charges against the coconspirators, where notably Bumble Bee pled guilty.
As part of the prerequisites to obtaining class certification under Rule 23(b)(3), the plaintiffs must show that that there are “questions of law or fact common to the class,” and that those questions “predominate over any questions affecting only individual members.” Using expert testimony, Plaintiffs tried to establish common antitrust impact. Their expert argued that only 5.5% of the class members did not suffer an injury, while Defendants argued that about 28% of the class did not suffer any injury. Despite this dispute, the District Court for the Southern District of California certified the three classes.
On April 6, 2021, the Ninth Circuit vacated the certification, holding that the District Court abused its discretion when it refused to resolve the dispute on the uninjured class members between the two expert witnesses. Writing for the majority, Judge Patrick J. Bumatay considered that, at the class certification stage, a Court “find by a preponderance of the evidence that the plaintiff has established predominance under Rule 23(b)(3).” Olean Wholesale Grocery Coop. v. Bumble Bee Foods, No. 19-56514, at 16 (9th Cir. Apr. 6, 2021). In this case, the District Court considered that Plaintiffs’ statistical evidence exposed through their expert testimony was “‘plausibly reliable’ and otherwise left determination of this question to the jury” while this dispute is “of paramount importance to certification of the class.” Id. at 30. In Judge Bumatay’s words, “[a]lthough [the Ninth Circuit has] not established a threshold for how great a percentage of uninjured class member would be enough to defeat predominance, it must be de minimis.” Id. at 32. As a result, the Ninth Circuit remanded to the District Court “to resolve the factual disputes concerning the number of uninjured parties in each proposed class before determining predominance.” Id. at 34.
On August 3rd, 2021, the Ninth Circuit vacated the panel decision, ordering the case to be reheard en banc. In its extensive en banc opinion released on April 8th, 2022, the Ninth Circuit developed critical points on class certifications expected to be transposed to cases other than antitrust class actions. Wholesale Grocery Coop., Inc. v. Bumble Bee Foods LLC, No. 19-56514, 2022 U.S. App. LEXIS 9455 (9th Cir. Apr. 8, 2022).
The en banc court followed other circuit courts in establishing the burden of proof for satisfying Rule 23’s requirements. In Judge Sandra S. Ikuta’s words, Plaintiffs “must prove the facts necessary to carry the burden of establishing that the prerequisites of Rule 23 are satisfied by a preponderance of the evidence.” Id. at 22. The Court also noted that only admissible evidence can be used to seek class certification. Id. at 23.
The Ninth Circuit then held that when evaluating whether evidence is persuasive to determine whether Rule 23(b)(3)’s predominance requirement has been met, courts may “weigh conflicting expert testimony and resolve expert disputes.” Id. at 25. Further, the en banc Court notes that district courts are not to assess whether the evidence establishes that Plaintiffs would win at trial, but only to determine “whether the ‘common question’ prerequisite is met . . . [by] resolving whether the evidence establishes that a common question is capable of class-wide resolution. . .” Id. at 26. As a result, “a district court cannot decline certification merely because it considers plaintiffs’ evidence relating to the common question to be unpersuasive and unlikely to succeed in carrying the plaintiffs’ burden of proof on that issue” Id. at 28.
Finally, and in contrast from the earlier panel decision, the Ninth Circuit rejected the per se argument that “Rule 23 does not permit the certification of a class that potentially includes more than a de minimis number of uninjured class members” Id. at 30. Instead, district courts must “after rigorous analysis” assess whether “the common question predominates over any individual questions, including individualized questions about injury or entitlement to damages.” Id. at 30.
This Ninth Circuit order offers a great level of clarification for practitioners on Courts’ expected standard on whether to certify or not a class comprised of uninjured members. It also reminds the plaintiffs side of their burden of proof in order to get their class certified.
Class Certification in the Apple iPhone Antitrust Litigation Denied Due to Economist’s “Unjustifiable Assumptions”
By Abiel Garcia
Kesselman Brantly and Stockinger
On March 29, 2022, the Judge Rogers from the Northern District of California denied Consumer Plaintiffs’ motion for class certification without prejudice and then granted in part and denied in part Apple’s Daubert motion to exclude expert testimony. As a refresher given the amount of on-going Apple litigation, this specific Apple litigation relates to Consumer Plaintiffs’ claims that Apple charges developers on the App Store supracompetitive commissions, which are then passed to consumers in the form of increased prices for app downloads or subscriptions. Order Denying Plaintiffs’ Motion for Class Certification Without Prejudice, In re Apple iPhone Antitrust Litigation, case no. 11-cv-6714-YGR (March 29, 2022 N.D. Cal.).
First, Apple challenged the overarching model used by the Consumer Plaintiffs’ economist, Professor McFadden. Apple argued that Prof. McFadden’s model was not based on principles of hypothesis generation, scrupulous study design, meticulous data collection, and objective interpretation, but rather, the model was designed in order to achieve a desired, preconceived outcome. The court disagreed. In a brief paragraph, the court stated that while Apple’s experts disagreed with the assessment and quantification of an impact, they failed to dispute the fundamentals of the methodology. The court denied the motion on said grounds.
Next, Apple challenged Prof. McFadden’s opinion on market definition, pointing to the fact that Prof. McFadden ignored the two-sidedness of the App Store. In another brief paragraph, the court disagreed and found that the considerations undertaken were sound in rendering an expert opinion.
Turning to the actual damages model, the court undertook a three-step analysis to review Professor McFadden’s model. In reviewing the benchmark analysis, which attempts to identify a “but-for” commission rate, the court disagreed with the expert’s claim that they used a benchmark analysis to find a “but-for” commission rate. Rather, the court found examples of how the Prof. McFadden cherry-picked data in order to find the model’s commission rate. The court reviewed various data points that were relevant that should have been considered in Prof. McFadden’s analysis but were conveniently omitted. The court then granted Apple’s motion with respect to Prof. McFadden’s opinion on the “but-for” commission rate due to a lack of foundation.
For step two of the analysis, the court turned to the estimation of the app and in-app prices that consumers would have paid in the but-for world. The court found multiple problems in the model, including changing definitions of what constitutes an “uninjured account,” computational errors throughout the model, and finally, Prof. McFadden’s concession that the individual damages calculation should have used a percentage calculation rather than a fixed-dollar calculation method. Focusing on the calculation method, Apple offered evidence that showed Professor McFadden’s model led to absurd results, including some accounts having larger damages than actual spend and negative pricing.
The court then walked through a variety of additional issues raised by Apple: Negative But-For Pricing, Focal Pricing and Pricing Tiers, Sample Size and Robustness, Free Apps Analysis, and the Identification of Unharmed Class Members. In reviewing these topics, the court did find some additional problems, which led the court to ultimately find that the Professor McFadden’s current model was unreliable for determining class wide impact or damages. The court allowed Consumer Plaintiffs leave to resolve the issues.
After reviewing Prof. McFadden’s model and excluding it, the court turned to the Consumer Plaintiffs’ class certification motion under Fed. R. Civ. P. 23(a) and 23(b)(3). In reviewing the typical requirements under Fed. R. Civ. P. 23(a), the court quickly found numerosity, four common questions of fact or law, and that the Consumer Plaintiffs satisfied the adequacy and typicality requirements under Fed. R. Civ. P. 23(a).
Turning to the Fed. R. Civ. P. 23(b)(3), the Consumer Plaintiffs put forth, and Apple challenged, Prof. McFadden’s three-step methodology as a viable method for demonstrating class wide injury based on common proof. Incorporating the previous Daubert analysis, the court dove deeper into the fact that the model found a substantial number of class members that have suffered no injury (about 14.6% of accounts). Due to the model being flawed and ultimately excluded on Daubert, the court concluded that the Consumer Plaintiffs cannot meet their predominance burden because the model cannot reliably demonstrate which members, and how many, were injured, as common proof of class wide impact. This would lead to individual issues predominating with respect to injury.
On class wide damages, the Consumer Plaintiffs offered Prof. McFadden’s model to prove that damages are measurable. Just as with the predominance analysis, the court found that the model failed to prove measurable damages. Stepping outside of the flaws found in the Daubert analysis, the court discussed how the Consumer Plaintiffs indicated that they did not intend to run the model until after trial. Rather, the Consumer Plaintiffs would tell the jury about a damages range between $7 billion and $10 billion and then use the model afterwards to determine distribution amounts. While the court noted that this decision is novel, it believed it would result in damages that would be too speculative, without any adequate underlying rational for the decision. Thus, again the court found the model to be unreliable in assessing class-wide damages and denied Consumer Plaintiffs’ motion for class certification. Importantly, the court noted that while the economists’ models and assumptions are flawed, the court “anticipates that the deficiencies can be addressed” and thus, denied the motion without prejudice.
Other Notable Cases
Trendsettah USA, Inc., et al v. Swisher International, Inc., — F.4th –, 2022 WL 1123196 (9th Cir. April 14, 2022)
In longstanding antitrust litigation involving the market for “cigarillos” (small cigars), a jury trial and verdict, and a prior trip to the Ninth Circuit, the Ninth Circuit addressed the proper and “high standard” for seeking relief from a judgment under Federal Rule of Civil Procedure 60. The Ninth Circuit concluded that the plaintiff’s participation in a tax-avoidance scheme allowed it to inflate its profits by allowing it to evade excise taxes, affecting presentation of the plaintiff’s damages case at trial. The Ninth Circuit explained that “not all fraud is fraud on the court” so as to warrant vacating a judgment, that the “mere nondisclosure of evidence is typically not enough to constitute fraud on the court,” and “perjury by a party or witness, by itself, is not normally fraud on the court.” In granting relief from judgment under Rule 60 based on fraud on the court, a district court should make specific findings and support them by reference to the record. Notwithstanding the Ninth Circuit’s reversal of the district court’s order granting relief from the judgment on the basis of “fraud on the court,” the Ninth Circuit affirmed the district court’s doing so on the basis of “newly discovered evidence” finding that evidence of the tax avoidance scheme would have bore upon the plaintiff’s “competitive viability.” This “precluded” the defendant’s “defense to the antitrust claims from being fully and fairly presented.”
Confederacion Hipica de Puerto Rico, Inc. v. Confederacion de Jinetes Puertorriquenos, Inc., 30 F.4th 306 (1st Cir. April 4, 2022)
The First Circuit recently offered guidance on the statutory, labor dispute exemption to the antitrust laws. Labor-related activities—such as horse jockeys’ refusal to participate in horse racing events until working conditions are improved—are immune from antitrust scrutiny where they “aris[e] (1) out of the actions of a labor organization and undertaken (2) during a labor dispute, (3) unilaterally, and (4) out of the self-interest of the labor organization.” The First Circuit concluded that the existence of an independent-contractor relationship does not “categorically” render inapplicable the statutory, labor dispute exemption. Nor do “any political motivations for a work stoppage . . . take a dispute out of the labor exemption.”
Celestin v. Caribbean Air Mail, Inc., 30 F.4th 133 (2d Cir. March 31, 2022)
The Second Circuit determined that “[u]nder the act of state doctrine, U.S. courts may not declare the official acts of a foreign sovereign to be invalid.” But, that does not mean that U.S. courts cannot adjudicate claims that involve foreign sovereigns, simply because doing so “may embarrass foreign governments” or requiring “passing judgment on the policies, laws, and motivations of a foreign sovereign.” In rendering its decision, the Second Circuit characterized as “muddled” the “case law in some circuits” construing the act of state doctrine.
The PLS.COM v. National Association of Realtors, No. 21-55164 (9th Cir. April 26, 2022)
A competitor has legal standing to sue under the Sherman Act—which bars monopolization and the maintenance of monopolies—when the claimed injury flows from acts harmful to consumers. In reviving the case, the Ninth Circuit panel explained that the term “consumer” is not limited to one who purchases goods or services for personal use without any intention to resell. It also extends to a business that uses a product as input to create another product or service. And contrary to the district court’s holding, the panel said that in order to demonstrate an antitrust injury PLS was neither required to show that NAR’s policy has increased prices for services paid for by home sellers and buyers nor that they were being denied services they desired.
Chase v. Johns Manville Corporation, Civ. No., 19-cv-00872 (D. Col. April 26, 2022)
The court granted summary judgment and dismissed plaintiff’s lawsuit which alleged that Johns Mansville, a supplier of insulation, illegally coerced distributors to continue solely buying its insulation. To prove monopolization, plaintiff must demonstrate conduct whose only rational benefit is to harm competition. After reviewing the various means by which plaintiff alleged defendant engaged in exclusionary conduct, the court held: “Defendant’s conduct did not go so far as to harm competition, itself. To the contrary, Defendant’s response to Plaintiff’s entry into the market–to test its relationships with distributors and to tout the advantages of its product–was both legitimate and procompetitive in nature.”
Host International v. Marketplace, PHL, Case No. 2848 (3d Cir. April 27, 2022)
The Third Circuit held that an airport concession company lacked standing to sue Philadelphia International Airport’s retail landlord over its Pepsi exclusivity rule: “MarketPlace selected Host to develop retail space [in the Philadelphia airport] and offered a proposed lease. Host did not like the terms and, weighing its options, declined the offer….But it is not an antitrust injury because competition has not been suppressed. Host has not been excluded from any market nor forced to purchase non-alcoholic beverages from anyone.”
Reilly v. Apple, Case No. 21-cv-04601 (N.D. Cal. April 25, 2022)
Plaintiff alleged that Apple violated California Business Code Section 17200, also known as the “Unfair Competition Law” (“UCL”), by placing plaintiff’s app in the Apple Store and then removing the app two weeks later. The court held that plaintiff failed to state a claim under either the unlawful prong or the unfair prong of the UCL. Plaintiff’s complaint failed to meet Rule 9(b)’s heightened pleading standard. Under Rule 9(b), plaintiff must allege with specificity the circumstances which constituted Apple’s fraud. Plaintiff failed to plead all the necessary elements of a fraud. Further, Plaintiff’s allegation that Apple acted arbitrarily and capriciously by removing plaintiff from the Apple store is not sufficient to state a UCL claim under the unfairness prong because the complaint does not explain how Apple’s arbitrary actions harmed competition.
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A Deeper Dive: Antitrust Division, USDOJ Suffers Labor Case Setbacks but Pledges to Press On
Law Office of Robert Connolly
The Antitrust Division has been aggressively investigating collusive wage-fixing and no-poach agreements in labor markets and bringing criminal cases when they believe a “naked” (not ancillary to a procompetitive agreement) agreement has been uncovered. The Antitrust Division recently suffered two consecutive setbacks in its initial labor market collusion jury trials. On April 14, 2022, a Texas federal jury returned not guilty verdicts for two former health care executives in the DOJ’s first ever wage-fixing case. United States v. Jindal, case No. 4:20-cr-00358 (E.D. Texas). One day later, on April 15, 2022, a federal jury in Colorado acquitted DaVita, Inc. and its former chief executive on all counts of conspiring with other companies in an employee allocation case. United States v. DaVita Inc., Crim. No. 21-cr-00229 (D. Colo).
In both cases, however, the DOJ survived motions by the defendants to have to indictments dismissed. Defendants had argued that the alleged agreements did not constitute per se violations of the Sherman Act. The DOJ argued that buyer side labor market agreements in restraint of trade are no different than seller cartels, and therefore, while the courts did not have extensive experience with these particular restraints, the allegations were of a per se nature. In both cases, the DOJ obtained rulings allowing the indictment to stand so the losses at trial should be viewed as a failure of proof in those cases, not a defect in the government’s legal theory. The DOJ has vowed to press on with what it views as “naked” wage-fixing and/or no-poach (employee allocation) cases. It is early in their effort with several other cases under indictment and due to be tried. But the message is clear that these types of cases are a priority for the Biden administration and the number of matters reportedly under investigation is a message that this is an area in great need of antitrust compliance training.
This feature includes excerpts from selected press releases issued by the Antitrust Division, USDOJ, the Federal Trade Commission and the California Attorney General’s Office. It does not include all press releases issued by those offices. This appears to be a truly transitional time in antitrust enforcement and reading the press releases can be very helpful to stay on top of changes.
Antitrust Division, U.S. Department of Justice
To link to all Antitrust Division, DOJ press releases, click here.
Assistant Attorney General Jonathan Kanter Delivers Keynote at the University of Chicago Stigler Center
April 21, 2022
“With the remainder of my time today, I would like to outline what I see as five pillars of an effective civil antitrust enforcement regime. Although I am heartened by the productive discussions taking place in Congress to clarify our antitrust laws, Americans cannot afford to wait for new legislation to combat our competition crisis. These five pillars, which are by no means exhaustive, focus on enforcing the laws we already have—as Congress wrote them and as courts have interpreted them for decades.”
Former Caltrans Contract Manager Pleads Guilty to Bid Rigging and Bribery
First Guilty Plea in Ongoing Investigation at the California Department of Transportation (Caltrans)
April 11, 2022
“A former contract manager for the California Department of Transportation (Caltrans) pleaded guilty for his role in a bid-rigging and bribery scheme involving Caltrans improvement and repair contracts. According to a plea agreement filed in the U.S. District Court for the Eastern District of California in Sacramento, Choon Foo “Keith” Yong and his co-conspirators engaged in a conspiracy, from early 2015 through late 2019, to thwart the competitive bidding process for Caltrans contracts to ensure that companies controlled by Yong’s co-conspirators submitted the winning bid and would be awarded the contract.”
Antitrust Division Updates Its Leniency Policy and Issues Revised Plain Language Answers to Frequently Asked Questions
April 4, 2022
“The Justice Department’s Antitrust Division today announced updates to its Leniency Policy and issued a revised set of frequently asked questions (FAQs). The Antitrust Division also launched a new dedicated email address to make it easier for companies and individuals to apply for leniency. These changes reaffirm the Antitrust Division’s commitment to transparency, predictability and accessibility in criminal enforcement.”
[Note: The revised Leniency Policy, the FAQs and other related leniency documents can be found at the Antitrust Division’s Leniency Program page here.]
Assistant Attorney General Jonathan Kanter Delivers Opening Remarks at 2022 Spring Enforcers Summit
April 4, 2022
“I would like to open by highlighting some changes we have made at the Antitrust Division, and announcing some new ones. As I have discussed before, the Division has a preference for remedies over settlements. Over the last few months, the division has taken important steps to reject risky settlements and challenge illegal mergers in court. In fact, we have sued to block or obtained abandonments in four merger matters in as many months. Just last week, we rejected a settlement proposal from Cargotec and Konecranes, which abandoned their proposed $5 billion transaction in the face of opposition from the Antitrust Division and the UK’s CMA.”
Federal Trade Commission
To link to all FTC press releases, click here.
Federal Trade Commission Chair Lina M. Khan Announces Senior Agency Leaders
April 25, 2022
“Federal Trade Commission Chair Lina M. Khan announced the appointment of two senior agency leaders: General Counsel Anisha Dasgupta and Office of Policy Planning Director Elizabeth Wilkins.”
FTC Requires Prince and Ferro to Sell Off Three Facilities amid Concerns that Deal would Increase Concentration in North American Market for Porcelain Enamel Frit
April 21, 2022
“The Federal Trade Commission took action today to preserve competition by requiring Prince International Corp. and Ferro Corp. to divest three facilities used to make porcelain enamel frit, glass enamel, and forehearth colorants, as a condition of Prince’s parent company – American Securities Partners VII, L.P. – acquiring competitor Ferro Corp. for $2.1 billion.”
Federal Trade Commission Preserves Competition for Development and Marketing of Steroid Injectable Drug
April 19, 2022
“The Federal Trade Commission today required – as a condition of Hikma Pharmaceuticals PLC’s $375 million acquisition of Custopharm, Inc. – that Custopharm’s parent company retain and transfer Custopharm’s assets related to the corticosteroid drug triamcinolone acetonide, or TCA, to another subsidiary, Long Grove Pharmaceuticals, LLC.”
Federal Trade Commission Extends Public Comment Period for Request for Information on Impact of Pharmacy Benefit Managers
April 13, 2022
“The Federal Trade Commission is extending the public comment period, until May 25, 2022, on a request for information that covers a wide range of issues in the PBM market – including contract terms, rebates, fees, pricing policies, steering methods, conflicts of interest, and consolidation. The agency seeks information on these practices and their impact on patients, physicians, employers, independent and chain pharmacies, and other businesses across the distribution system.”
FTC Approves Final Order Prohibiting Louisiana Real Estate Appraisers Board from Fixing Prices for Appraisal Services in Louisiana
April 5, 2022
“Following a public comment period, the Federal Trade Commission has approved a final order settling charges that the Louisiana Real Estate Appraisers Board violated Section 5 of the Federal Trade Commission Act by unreasonably restraining price competition for appraisal services in Louisiana and limiting the freedom of individual appraisers and their customers to engage in bona fide negotiations to determine fees for real estate appraisals.”
California Department of Justice
To link to All California Department of Justice press releases, click here.
Attorney General Bonta Announces Settlement with Smart & Final for Price Gouging Eggs During Height of the Pandemic
April 5, 2022
“California Attorney General Rob Bonta today announced a settlement with Smart & Final resolving allegations that the grocer engaged in price gouging of certain types of eggs during the COVID pandemic. Smart & Final operates more than 250 retail stores throughout the western United States, selling groceries and supplies to households and small businesses. Between March 4th, 2020 and June 22nd, 2020, Smart & Final increased the price of four premium egg products beyond what was allowable during a state of emergency.”
Attorney General Bonta Files Brief in Epic v. Apple
March 31, 2022
“California Attorney General Rob Bonta filed an amicus brief in the Ninth Circuit Court of Appeals in Epic Games v. Apple, arguing in support of the broad protections for fair competition under the state’s Unfair Competition Law. Last year, a district court found that Apple’s anti-steering policy — which prohibits app developers from informing consumers about other, potentially cheaper ways to pay for their apps — violated the Unfair Competition Law. In today’s brief, Attorney General Bonta explains the importance of the Unfair Competition Law to antitrust enforcement and fair competition in California.”
In Case You Missed It
Below are headlines from various news reports with a short excerpt from the article. The article is hyperlinked so you can read it in its entirety. Some articles may require a subscription.
Jared Council, Forbes, April 26, 2022
“This year’s list features a higher proportion of companies in banking and financial services, the healthcare and social sector, and education. Each sector increased its presence on the 500-company list, with each making up 8% of the list versus 6% last year.”
Reuters, April 15, 2022
“A jury in Denver, Colorado, acquitted dialysis provider DaVita and its former CEO Kent Thiry on Friday of charges that they conspired with competitors not to hire each other’s employees.”
Bob Van Voris, Bloomberg, April 14, 2022
“The U.S.’s top antitrust enforcer, who flew from Washington to Denver at the behest of a skeptical judge, struggled to convince the court that the Justice Department will be successful in its third trial over charges of collusion in the chicken industry. [Two prior trials against 10 individual defendants resulted in hung juries. The DOJ dismissed the case against 5 of the 10 defendants but is going ahead with a third trial against the remaining 5 defendants]
Mike Scarcella, Reuters, April 18, 2022
“ Nearly 20 universities accused of violating antitrust laws over their student aid practices assert they are immune from liability and have asked a Chicago federal judge to dismiss a lawsuit filed in January.”