E-BRIEFS, NEWS AND NOTES: MARCH 2024

By Eric A. Rivas at Latham & Watkins LLP

In re Mission Health Antitrust Litigation, No. 1:22-cv-00114-MR (W.D.N.C.), ECF 67 (Feb. 21, 2024)

On February 21, 2024, Chief Judge Martin Reidinger (W.D.N.C.) denied the defendants’ motion to dismiss for failure to state a claim.  The case arises from putative class action lawsuits filed by local government plaintiffs against HCA Healthcare and Mission Health entities, claiming that these defendants engaged in a scheme to maintain and enhance their market power in Western North Carolina counties.  The decision serves as a good reminder that even a once state-sanctioned monopoly is not immune from antitrust scrutiny. 

Procedural Background

The City of Brevard initiated the action on June 3, 2022 against HCA Healthcare and Mission Health entities.  ECF 67 at 1-2.  Plaintiffs Buncombe County and City of Asheville filed a similar action on July 27, 2022.  Id. at 2.  The cases were consolidated on August 8, 2022, for all purposes up to and including trial.  Id.  On August 19, 2022, the plaintiffs filed a consolidated class action complaint, asserting claims for an illegal restraint of trade and monopolization under Sections 1 and 2 of the Sherman Act.  Id. at 3, 18.  The HCA Defendants and the Mission Defendants filed motions to dismiss the consolidated class action complaint pursuant to Rule 12(b)(6).  Id. at 3.

Factual Background

Mission Hospital was founded in the 1880s in Asheville, North Carolina, and operated as a nonprofit institution.  Id. at 6.  In the early 1990s, Mission Hospital and St. Joseph’s Hospital were the two private acute care hospitals serving the Asheville area.  Id.  Also in the early 1990s, the North Carolina General Assembly enacted and later amended the Certificate of Public Advantage (“COPA”), allowing Mission Health to operate with monopoly power under state oversight.  Id. at 6-7.  In 2015, the General Assembly repealed the COPA, effective January 1, 2018.  Id. at 8.  In 2019, HCA acquired all of Mission’s facilities.  Id. at 9. 

Plaintiffs allege that HCA engaged in anticompetitive practices that included the following types of contractual provisions with health insurance plans:

• “All-or-nothing” provisions allegedly required health plans to include all of the HCA’s general acute care (“GAC”) and outpatient services in both the Asheville and “Outlying Regions.”  Id. at 11.  If a health plan wanted to include what was alleged to be the HCA’s “must-have” hospital (Mission Hospital-Asheville) in its network, it was compelled to also include all of HCA’s GAC and outpatient services in both the Asheville and Outlying Regions, even if those services were more expensive or of lower quality compared to those of competitors.  Id. at 11-12.  The plaintiffs alleged that when one health plan, Blue Cross, declined Mission’s 2017 “all-or-nothing” provisions, Mission removed itself from Blue Cross’s network for GAC and outpatient services, which resulted in 260,000 people in Western North Carolina being unable to seek care at Mission’s facilities unless they paid a higher “out of network” cost.  Id.
• “Anti-steering” and “anti-tiering” provisions allegedly prohibited or inhibited health plans from directing their members to use less expensive or higher quality healthcare providers for GAC or outpatient services.  Id. at 12.  The court found that such provisions could prevent health plans from creating incentives for members to choose more cost-effective or higher-quality options, thereby insulating the defendants from competitive pressures, and preserving their market dominance.  Id.
• “Gag clauses” allegedly prevented insurers from disclosing the terms of their agreements with the defendants, including the prices of healthcare services.  Id.  The lack of transparency resulting from these gag clauses was claimed to obscure the defendants’ price increases and anticompetitive contracts from regulators, the public, and potentially other market participants, making it more difficult for competition to function effectively.  Id.

These practices allegedly led to HCA maintaining a dominant market share in the alleged General Acute Care Market and Outpatient Market, with subsequent price increases and quality reductions.  Id. at 14-17.

Discussion

Statute of Limitations

Defendants argued that plaintiffs’ claims against them were barred by the statute of limitations because the plaintiffs had failed to allege any unlawful conduct occurring within the four-year limitations period immediately preceding the filing of the action, the period beginning June 3, 2018.  Id. at 18-19.

The court found that the facts necessary to determine whether the plaintiffs’ claims against the defendants were time-barred did not clearly appear on the face of the complaint.  Id. at 22-23.  The plaintiffs alleged that the defendants’ purported anticompetitive conduct began in 2017 and continued thereafter, which left the court to speculate as to precisely when the allegedly anticompetitive contracts were formed.   Id. at 23.  Plaintiffs also indicated that they did not have access to the specific dates of the contracts and other violations because that information was in the hands of the defendants.  Id.

Given plaintiffs’ allegations and the early pleadings stage of litigation, the court concluded that plaintiffs were entitled to the reasonable inference that the last anticompetitive act of the defendants was committed within the limitations period and denied defendants’ motion based on this ground.  

Section 1 Claim (Unreasonable Restraint of Trade)

Defendants argued that plaintiffs failed to allege specific anticompetitive contract provisions and to show that  defendants’ conduct harmed competition in the alleged relevant markets.  Id. at 26.  The court found, however, that plaintiffs had plausibly alleged the existence of anticompetitive provisions in contracts with health plans, such as “all-or-nothing” provisions, anti-steering and anti-tiering provisions, and gag clauses.  Id. at 26-27. 

The court also found that plaintiffs had plausibly alleged anticompetitive effects resulting from these provisions, such as increased prices, reduced output, and reduced quality of healthcare services.  Id. at 28.  Plaintiffs provided specific examples of price increases for certain healthcare services and alleged that the defendants’ conduct had led to a decrease in the availability and quality of healthcare services.  Id. at 28, n.13.

The court noted that at the pleading stage it must accept the truth of the factual allegations in the complaint and that questions about whether the procompetitive effects of defendants’ contracts with insurers outweigh the alleged harm to competition are best resolved after discovery.  Id. at 29.  This approach allows the factfinder to evaluate the purposes and competitive effects within the specific context of the relevant markets and the insurance industry.  Id.

Based on the allegations in the complaint, the court concluded that plaintiffs had stated a plausible claim for relief under Section 1 of the Sherman Act and defendants’ motions to dismiss the Section 1 claim.

Section 2 Claim (Monopolization)

Plaintiffs alleged that defendants possessed monopoly power in the GAC market and the outpatient services market within the defined Asheville and “Outlying Regions.”  Id. at 31.  The court found that plaintiffs had plausibly alleged the defendants’ possession of monopoly power by citing significant market shares held by HCA in these markets, which ranged from 74% to 90% in the GAC market and approximately 80% in the outpatient services market in Buncombe County.  Id. at 27.

Plaintiffs claimed that after the expiration of the COPA, which had previously allowed Mission Health to operate with monopoly power under state oversight, the defendants engaged in a scheme to maintain and enhance their monopoly power.  Id. at 32.  Defendants argued that they had acquired their monopoly power lawfully under the COPA and that the continued monopoly power could be consistent with lawful behavior.  Id.  However, the court noted that plaintiffs’ allegations pertained to conduct occurring after the COPA’s expiration and that plaintiffs had alleged specific anticompetitive actions—namely, the above-specified contract provisions—taken by defendants to maintain and enhance their monopoly power.  Id. at 32-33.

The court concluded that plaintiffs had plausibly alleged both the possession of monopoly power and the willful acquisition or maintenance of that power through anticompetitive conduct.  Id.  Plaintiffs’ allegations, if proven, could demonstrate that defendants engaged in illegal conduct to foreclose competition, maintain and enhance their monopoly power, and charge supracompetitive prices in violation of Section 2 of the Sherman Act.  Therefore, the court denied defendants’ motions to dismiss the Section 2 claim and allowed plaintiffs to proceed to discovery on both of their antitrust claims.

By David Lerch

The European Commission fined Apple over €1.8 billion for abusing its dominant position on the market for the distribution of music streaming apps to iPhone and iPad users (“iOS users”) through its App Store. In particular, the Commission found that Apple improperly applied restrictions on app developers, preventing them from informing iOS users about alternative and cheaper music subscription services available outside of the app (“anti-steering provisions”) and that Apple violated Article 102(a) of the Treaty of the Functioning of the European Union (TFEU).

Background

According to the Commission, Apple is currently the sole provider of an App Store where developers can distribute their apps to iOS users throughout the European Economic Area (EEA). Apple controls every aspect of the iOS user experience and sets the terms and conditions that developers need to abide by to be offered on the App Store and reach iOS users in the EEA.

In June 2020, the Commission opened formal proceedings into Apple’s rules for app developers on the distribution of apps via the App Store. In April 2021, the Commission sent Apple a Statement of Objections. Apple responded in September 2021. In February 2023 the Commission replaced the 2021 Statement of Objections by another Statement of Objections clarifying the Commission’s objections. Apple responded to the revised Statement of Objections in May 2023.

The Commission’s investigation found that Apple bans music streaming app developers from fully informing iOS users about alternative and cheaper music subscription services available outside of the app and also from providing any instructions about how to access such subscription offers. In particular, the anti-steering provisions ban app developers from: (1) informing iOS users within their apps about the prices of subscription offers available on the internet outside of the app; (2) informing iOS users within their apps about the price differences between in-app subscriptions sold through Apple’s in-app purchase mechanism and those available elsewhere; (3) including links in their apps leading iOS users to the app developer’s website on which alternative subscriptions can be bought. In addition, app developers were also prevented from contacting their own newly acquired users, for instance by email, to inform them about alternative pricing options after they set up an account.

Decision

The Commission concluded that Apple’s anti-steering provisions amount to unfair trading conditions, in breach of TFEU Article 102(a).   Article 102 and Article 54 of the European Economic Area Agreement prohibit the abuse of a dominant position.   Market dominance is, as such, not illegal under EU antitrust rules; however, dominant companies have a special responsibility not to abuse their powerful market positions by restricting competition, either in the markets where they are dominant or in separate markets.

The Commission further found that these anti-steering provisions are neither necessary nor proportionate for the protection of Apple’s commercial interests in relation to the App Store on Apple’s smart mobile devices and negatively affect the interests of iOS users, who cannot make informed and effective decisions on where and how to purchase music streaming subscriptions for use on their device.

Apple’s conduct, which lasted for almost ten years, may have led many iOS users to pay significantly higher prices for music streaming subscriptions because of the high commission fee imposed by Apple on developers and passed on to consumers in the form of higher subscription prices for the same service on the Apple App Store. Moreover, Apple’s anti-steering provisions led to non-monetary harm in the form of a degraded user experience: iOS users either had to engage in a cumbersome search before they found their way to relevant offers outside the app, or they never subscribed to any service because they did not find the right one on their own.

The Commission ordered Apple to remove the anti-steering provisions and to refrain from repeating the infringement or from adopting practices with an equivalent object or effect in the future.

Fine

The fine was set on the basis of the Commission’s 2006 Guidelines on fines.  In setting the level of the fine, the Commission took into account the duration and gravity of the infringement as well as Apple’s total turnover and market capitalization. It also factored in that Apple submitted incorrect information in the framework of the administrative procedure.

In addition, the Commission decided to add to the basic amount of the fine an additional lump sum of €1.8 billion to ensure that the overall fine imposed on Apple has sufficiently deterrent effect. Such a lump sum fine was necessary in this case because a significant part of the harm caused by the infringement consists of non-monetary harm, which cannot be properly accounted for under the revenue-based methodology as set out in the Commission’s 2006 Guidelines on Fines. In addition, the fine must be sufficient to deter Apple from repeating the present or a similar infringement and to deter other companies of a similar size and with similar resources from committing the same or a similar infringement. The Commission concluded that a fine over €1.8 billion is proportionate to Apple’s global revenues and is necessary to achieve deterrence.

By Lillian Grinnell

Tennessee v. NCAA, No. 3:24-CV-00033-DCLC-DCP, 2024 WL 755528  (E.D. Tenn., Feb. 23, 2024)

Facts

This lawsuit was brought by the states of Tennessee and Virginia in the wake of the NCAA’s decision to block “NIL” (name, image, and likeness) collectives from operating. NIL collectives began to be formed mere months after the NCAA reversed its ban on student athletes “receiving any pay based on … athletic ability, whether from boosters, companies seeking endorsements, or would-be licensors of athletes’ NIL” in July 2021. Slip Op. at 2 (citations omitted). In response, however, the NCAA issued supplemental guidance in which it labeled these NIL collectives “boosters”—meaning that discussions between them and potential student-athletes were considered impermissible inducements—and banning these organizations “from engaging in recruiting activities, including recruiting conversations, on behalf of a school.” Id. at 3, quoting May 2022 NCAA Guidance. In addition, the NIL collectives were banned from issuing any agreements to students contingent on enrolling at any particular institution. Tennessee and Virginia thereafter brought suit under the Sherman Act, arguing that this ban was an illegal agreement that acted to restrain and suppress competition within the Division I student-athlete labor market, and sought a preliminary injunction to stop its enforcement.

In his opinion granting the plaintiff states’ request, Judge Corker of the Eastern District of Tennessee considered the following factors: “(1) whether the movant has a strong likelihood of success on the merits; (2) whether the movant would suffer irreparable injury without the injunction; (3) whether issuance of the injunction would cause substantial harm to others; and (4) whether the public interest would be served by the issuance of the injunction.” Id. at 4, quoting Certified Restoration Dry Cleaning Network, L.L.C. v. Tenke Corp., 511 F.3d 535, 542 (6th Cir. 2007). In considering the first factor the Court found that the Sherman Act did indeed apply to the NCAA guidance, that the plaintiffs had shown proof of market power in addition to evidence that the guidance harmed competition in the market, and that the NCAA’s procompetitive justifications – preserving “collegiate athletics as a unique offering by (1) promoting a balance of academics and athletics and (2) maintaining a distinction between collegiate and professional athletics”—could be dealt with through less restrictive rules and through appealing to Congress. Slip Op. at 7-8.

With regard to the second factor, irreparable harm, the Court held that while the plaintiff states failed to show any irreparable harm to themselves from the guidance—Tennessee having a statute mirroring the NCAA’s guidance—there was harm to student-athletes, since “without the give and take of a free market, student-athletes simply have no knowledge of their true NIL value. It is this suppression of negotiating leverage and the consequential lack of knowledge that harms student-athletes.” Id. at 11. Conversely, as to the third factor, the Court found that neither the NCAA nor any other entity would be harmed by the granting of an injunction. And the public interest would be served because the injunction was in itself pro-competitive. Id. at 13, citing Collins Inkjet Corp. v. Eastman Kodak Co., 781 F.3d 264, 280 (6th Cir. 2015) and Ohio v. Nat’l Collegiate Athletic Ass’n, No. l :23-CV-100, 2023 WL 9103711 , at *11 (N.D.W. Va. Dec. 13, 2023).

Analysis

This ruling is an important development in the wake of the Supreme Court’s ruling in National Collegiate Athletic Ass’n v. Alston, 594 U.S. 69 (2021), which held that the NCAA’s restrictions on pay for student athletes were anticompetitive. It could very well cause a huge shift in the way student athletics works in this country, now that students are able to more effectively bargain, at least temporarily, for pay and benefits for their playing. It will be interesting to see how the schools themselves react to this changing paradigm, and how different sports are affected with increased competition for players. Moreover, these decisions are coming at a time when graduate students are increasingly unionizing as well. The line between who is an employee and who is a student is becoming more and more blurred under the law.

Thursday, March 21, 2024

Office of Public Affairs

Apple’s Broad-Based, Exclusionary Conduct Makes It Harder for Americans to Switch Smartphones, Undermines Innovation for Apps, Products, and Services, and Imposes Extraordinary Costs on Developers, Businesses, and Consumers

The Justice Department, joined by 16 other state and district attorneys general, filed a civil antitrust lawsuit against Apple for monopolization or attempted monopolization of smartphone markets in violation of Section 2 of the Sherman Act.

The complaint, filed in the U.S. District Court for the District of New Jersey, alleges that Apple illegally maintains a monopoly over smartphones by selectively imposing contractual restrictions on, and withholding critical access points from, developers. Apple undermines apps, products, and services that would otherwise make users less reliant on the iPhone, promote interoperability, and lower costs for consumers and developers. Apple exercises its monopoly power to extract more money from consumers, developers, content creators, artists, publishers, small businesses, and merchants, among others. Through this monopolization lawsuit, the Justice Department and state Attorneys General are seeking relief to restore competition to these vital markets on behalf of the American public.

“Consumers should not have to pay higher prices because companies violate the antitrust laws,” said Attorney General Merrick B. Garland. “We allege that Apple has maintained monopoly power in the smartphone market, not simply by staying ahead of the competition on the merits, but by violating federal antitrust law. If left unchallenged, Apple will only continue to strengthen its smartphone monopoly. The Justice Department will vigorously enforce antitrust laws that protect consumers from higher prices and fewer choices. That is the Justice Department’s legal obligation and what the American people expect and deserve.”

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As alleged in the complaint, Apple has monopoly power in the smartphone and performance smartphones markets, and it uses its control over the iPhone to engage in a broad, sustained, and illegal course of conduct. This anticompetitive behavior is designed to maintain Apple’s monopoly power while extracting as much revenue as possible. The complaint alleges that Apple’s anticompetitive course of conduct has taken several forms, many of which continue to evolve today, including:

• Blocking Innovative Super Apps. Apple has disrupted the growth of apps with broad functionality that would make it easier for consumers to switch between competing smartphone platforms.
• Suppressing Mobile Cloud Streaming Services. Apple has blocked the development of cloud-streaming apps and services that would allow consumers to enjoy high-quality video games and other cloud-based applications without having to pay for expensive smartphone hardware.
• Excluding Cross-Platform Messaging Apps. Apple has made the quality of cross-platform messaging worse, less innovative, and less secure for users so that its customers have to keep buying iPhones.
• Diminishing the Functionality of Non-Apple Smartwatches. Apple has limited the functionality of third-party smartwatches so that users who purchase the Apple Watch face substantial out-of-pocket costs if they do not keep buying iPhones.
• Limiting Third Party Digital Wallets. Apple has prevented third-party apps from offering tap-to-pay functionality, inhibiting the creation of cross-platform third-party digital wallets.

The complaint also alleges that Apple’s conduct extends beyond these examples, affecting web browsers, video communication, news subscriptions, entertainment, automotive services, advertising, location services, and more. Apple has every incentive to extend and expand its course of conduct to acquire and maintain power over next-frontier devices and technologies.

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For a copy of the complaint go to: https://www.justice.gov/opa/pr/justice-department-sues-apple-monopolizing-smartphone-markets.

Monday, March 4, 2024

Office of Public Affairs

JetBlue Airways Corporation (JetBlue) announced today that it has abandoned its $3.8 billion acquisition of Spirit Airlines Inc. (Spirit). In January, the U.S. District Court for the District of Massachusetts blocked the transaction because it violated “the core principle of antitrust law: to protect the United States’ markets – and its market participants – from anticompetitive harm.”

“Today’s decision by JetBlue is yet another victory for the Justice Department’s work on behalf of American consumers,” said Attorney General Merrick B. Garland. “The Justice Department proved in court that a merger between JetBlue and Spirit would have caused tens of millions of travelers to face higher fares and fewer choices. We will continue to vigorously enforce the nation’s antitrust laws.”

“Our win in court is a victory for U.S. travelers who deserve lower prices and better choices,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “We fought this case to protect consumers who, as the court recognized, ‘otherwise would have no voice.’ I am incredibly proud of the Antitrust Division’s team and our state law enforcement partners’ tireless advocacy.”

The District Court blocked the acquisition after a 17-day trial that began in October 2023. In March 2023, the Justice Department, California, Maryland, Massachusetts, New, Jersey, New York, North Carolina, and the District of Columbia sued to stop the merger under Section 7 of the Clayton Act. The Department alleged that if the acquisition was allowed to proceed, prices would increase on routes where the two airlines currently compete as JetBlue sought to acquire and eliminate its main ultra-low-cost competitor, depriving travelers of choice.

https://www.justice.gov/opa/pr/justice-department-statements-jetblue-terminating-acquisition-spirit-airlines

Tuesday, March 5, 2024

Agencies Seek Info on Transactions, Including Non-Reportable Deals, That May Harm Patients’ Health, Workers’ Safety, Quality of Care and Affordability

The Justice Department’s Antitrust Division, Federal Trade Commission (FTC) and Department of Health and Human Services (HHS) jointly launched a cross-government public inquiry into private-equity and other corporations’ increasing control over health care.

Private equity firms and other corporate owners are increasingly involved in health care system transactions, and, at times, those transactions may lead to a maximizing of profits at the expense of quality care. The cross-government inquiry seeks to understand how certain health care market transactions may increase consolidation and generate profits for firms while threatening patients’ health, workers’ safety, quality of care and affordable health care for patients and taxpayers.

The agencies issued a Request for Information (RFI) requesting public comment on deals conducted by health systems, private payers, private equity funds and other alternative asset managers that involve health care providers, facilities or ancillary products or services. The RFI also requests information on transactions that would not be reported to the Justice Department or FTC for antitrust review under the Hart-Scott-Rodino Antitrust Improvements Act.

“Preserving competition in health care markets is a priority for the Justice Department because of its important impact on the health and well-being of Americans,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “This RFI will enable the agencies to accurately understand the modern market realities of the health care industry and forcefully enforce the law against unlawful deals. Hearing from patients, workers and market participants will be critical in developing future enforcement and policy efforts relating to consolidation in the health care sector.”

“When private equity firms buy out healthcare facilities only to slash staffing and cut quality, patients lose out,” said Chair Lina M. Khan of the FTC. “Through this inquiry, the FTC will continue scrutinizing private equity roll-ups, strip-and-flip tactics and other financial plays that can enrich executives but leave the American public worse off.”

“Increasing competition in health care markets gives people more choices. Competition helps ensure patients have access to high-quality, lower cost care, and that health care workers receive higher pay and work under better conditions. And it saves taxpayers money,” said Secretary Xavier Becerra of HHS. “We need to do more to understand the impact of private equity and corporate dealmaking on our policymaking, regulatory decisions and enforcement actions. The Biden-Harris Administration is committed to improving transparency and competition in health care.”

Research has shown that competition in health care provider and payer markets promotes higher quality, lower cost health care, greater access to care, increased innovation, higher wages and better benefits for health care workers. Comments submitted in response to the joint RFI will inform the agencies’ enforcement priorities and future action, including potential regulations aimed at promoting and protecting competition in health care markets and ensuring appropriate access to quality, affordable health care items and services.

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All market participants — including patients, consumer advocates, doctors, nurses, health care providers and administrators, employers, insurers and more — are invited to share their comments in response to the RFI. The agencies seek comments on a variety of transactions, including those involving dialysis clinics, nursing homes, hospice providers, primary care providers, hospitals, home health agencies, home- and community-based services providers, behavioral health providers, as well as billing and collections services.

The public will have 60 days to submit comments at Regulations.gov, no later than May 6. Once submitted, comments will be posted to Regulations.gov.

March 12, 2024

The Federal Trade Commission has learned that Choice Hotels International has abandoned its proposed acquisition of Wyndham Hotels & Resorts and withdrawn its nominations to replace Wyndham’s Board of Directors. In response, FTC Bureau of Competition Director Henry Liu issued the following statement:

“I am pleased that Choice Hotels International has abandoned its efforts to seize control of its rival Wyndham Hotels & Resorts. The FTC was closely scrutinizing Choice’s tender offer as well as its efforts to replace the Wyndham Board of Directors with its own hand-picked slate of nominees. Each of these actions posed serious competition questions and their abandonment is a win for consumers.

The FTC will continue to monitor this industry. We will not hesitate to enforce the antitrust laws to ensure that travelers have access to quality, affordable lodging and that hotel franchisors compete on the merits for franchisees. I want to extend my thanks to the entire FTC team for their work on this matter.” 

The Federal Trade Commission works to promote competition, and protect and educate consumers.  The FTC will never demand money, make threats, tell you to transfer money, or promise you a prize. You can learn more about how competition benefits consumers or file an antitrust complaint.  For the latest news and resources, follow the FTC on social media, subscribe to press releases and read our blog.

March 14, 2024

The Federal Trade Commission is sending more than $527,000 in refunds to consumers who bought certain Nature’s Bounty and Sundown vitamins and supplements from Amazon.com. The FTC alleged that these products were marketed deceptively by The Bountiful Company.

According to the FTC’s February 2023 complaint, Bountiful abused features on Amazon.com to deceive consumers into thinking that its newly introduced supplements had more product ratings and reviews, higher average ratings, and “#1 Best Seller” and “Amazon’s Choice” badges. The FTC’s action against Bountiful was the agency’s first time challenging “review hijacking,” a deceptive practice in which a marketer steals the reviews of another product to boost sales. The order settling the FTC’s allegations required the company to pay monetary relief and prohibits it from engaging in deceptive review tactics.

Monday, March 4, 2024

OAKLAND — California Attorney General Rob Bonta today issued the following statement after JetBlue and Spirit called off their proposed $3.8 billion merger agreement. The merger was expected to eliminate low-cost airfare options for consumers, resulting in fewer seats available and substantially threaten competition in an industry already experiencing the negative impacts of market consolidation. In March 2023, Attorney General Bonta joined a multistate coalition led by the U.S. Department of Justice in a lawsuit challenging the proposed merger. Following trial last year, the district court in January ruled in favor of the coalition, blocking the proposed merger.

“Today we celebrate another victory for the important work we do on behalf of consumers and a competitive marketplace here in California and across the country. This merger would have meant higher prices and fewer choices for air travelers, and the stifling of the competitive economy that makes California vibrant and innovative,” said Attorney General Bonta. “I am proud of the work my office has done in collaboration with the U.S. Department of Justice and my fellow attorneys general and will always keep fighting on behalf of a fair and competitive economy and California consumers.”

Thursday, January 1, 2024 Press Release

“California Attorney General Rob Bonta today announced a $350 million national settlement with Publicis Health, LLC, to resolve investigations into the global marketing and communications firm’s role in the prescription opioid crisis. California will receive approximately $31 million from the settlement to help address this crisis. The settlement money is anticipated to be paid in the second quarter of 2024.”

According to the Press Release:

“No settlement can bring back the lives lost or reverse the devastating pain caused by the opioid crisis. At the California Department of Justice, we are committed to holding accountable those who fueled this crisis through their greed and willful misconduct,” said Attorney General Bonta.  “Today’s settlement with Publicis builds on that commitment in our continued fight for justice and relief for Californians. I am proud of the work put in by my team and by our partners across the nation in making this settlement possible.”

Monday, February 26, 2024

LOS ANGELES — California Attorney General Rob Bonta, the Federal Trade Commission (FTC), and a bipartisan coalition of states, today announced the filing of a lawsuit that challenges the proposed merger of Kroger and Albertsons. Kroger and Albertsons are the two largest national supermarket chains in the country and this merger presents a significant risk of reduced competition and higher food prices nationwide. In California specifically, Kroger’s $24.6 billion purchase of Albertsons is expected to further consolidate the highly concentrated retail grocery market in Southern California, leading consumers to face fewer choices and higher prices. The merger is also expected to reduce the ability of unions to negotiate working conditions at these stores, impacting thousands of employees in California.

“This megamerger is bad for workers, for agricultural producers, and for California communities. In some markets in Southern California, Kroger-Albertsons is expected to be the only one-stop grocery option. Today, we are going to bat for a more just and competitive economy, one where companies need to compete for labor and where prices and service matter,” said Attorney General Bonta. “This merger will leave Californians with limited choices over where to shop – and for workers in this industry, where to work. As many families continue to feel the burden of inflation, fighting corporate consolidation that threatens to increase prices and reduce service is more important than ever.”

The lawsuit seeks to block the proposed Albertsons-Kroger merger, alleging it is in violation of the federal Clayton Act, which prohibits the acquisition of assets where the effect of such acquisitions may substantially lessen competition or create a monopoly. Businesses facing less competition have the ability to charge higher prices without providing improvements to the quality of goods. Anticompetitive supermarket mergers can impose other harms, including a reduction in labor market competition which may lower wages or slow wage growth, worsen benefits or working conditions, or result in other degradations of workplace quality.

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In filing today’s lawsuit, Attorney General Bonta joins the FTC, and the attorneys general of Arizona, Illinois, Maryland, Nevada, New Mexico, Oregon, Wyoming, and the District of Columbia.