Federal Trade Commission (2005)
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Text
Federal Trade Commission
Bureau of Competition
Susan A. Creighton, Director
Antitrust Enforcement Activities
Fiscal Year 2001 March 15, 2 0 0 5
-
ABA Antitrust Section Spring Meeting 2005
II cub1 U1 I IUUb b V I I I I I I I O U I V I .
Februav ZOOS
Bureau of competition
Susan A. Creighton
Director
I
Bernard A. Nigro, Jr.
Deputy Director
Jeffrey Schmidt
Deputy Direclor
i
Mergers I
Michael R. Moiseyev, Assistant Director
Yolanda M. Gruendel and
Matthew I. Reilly
Deputy Assistant Directors
I I
H
I I
II
H
I
Mergers 11
Michael H. Knight. Assistant Director
Rhen ~ r u l l a nd
Morris A. Bloom,
Deputy Assistant Directors
<.
Healthcare Services & Products
Assistant Director
(vacant)
David R. Pender and
Markus H. Meier,
Deputy Assistant Directors
Complianee
Daniel P. Ducore, Assistant Director
Roberta S.Baruch and
Elizabeth A. Piolrowski,
Deputy Assistant Directors
-
Premereer Notflication
Marian R. Bruno, Assistant Director
Roben L. Jones,
Deputy Assistant Director
Deputy Assistant Director
I
I
Barbara Anthony,
Thomas I. Klok
Assistants to the Director
1-- 4
I
I
NWRO
Charles A. Mnnuood.
Regional Director
Jeffrey A. Klurfeld.
Merger Guidelines
Commentary Task Force
I
m
I
H
I
Mergers N
ChuI Pak, Assistant Director
Catharine M. Moscatelli,
Deputy Assistant Director
t
Antle~mpetitivePrsctices
GeofFrey D. Oliver,
Assistant Director
Pahick I. Roach,
Dmuhi Assistant Director
Policy and Coordination
Alden F. Abbott, Associate Director
Ernest A. Nagata,
Deputy Associate Director
Merger Process
Task Force
- Marian R. BOperations
m o , Assistant Director
- Honors Paralegal Program
Mack D. Foster,
Deputy Assistant Director
I I
Philo Liedquist-Scott,
Coordinator
International Antitrust
Randolph W. Tritell,
Assistant Director
t
ABA ANTITRUST SECTION
SPRING MEETING
Summary of Bureau of Competition Activity
Fiscal Year 2001 Through March 15. 2005
Table of Contents
I. Mergers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
A
Consentorders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Agrium. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Airgas. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Albertson's. Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
American Air Liquide. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
AmericaOnline. Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
AmgenInc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Baxter International. Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
BayerAG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
TheBoeingCompany . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Buckeye Partners, L.P. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Cemex,S.A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Cephalon,Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Chevron Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Cytec Industries, Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Dainippon Ink and Chemicals, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Delhaize Freres et cie "Le Lion" S.A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Deutsche Gelatine-Fabriken Stoess AG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Diageoplc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Dow Chemical Company, The . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
DSMN.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
El Paso Energy Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
El Paso Energy Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Enterprise Products Partners L.P. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Exxon Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
GenCorpInc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
General Electric Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
General Electric Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Genzyme Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
INA-HoldingSchaefflerKG ......................................... 6
1tron.Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Koch Industries. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Koninklijke Ahold NV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Lafarge Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
.
.
B
C.
D.
.
E
ManheimAuctions. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
MCN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
MetsoOyj . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Magellan Midstream Partners, L.P. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
MSC . Software Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Nestle Holdings. Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
NovartisAG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
PfizerInc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Philip Moms Companies, Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Phillips Petroleum Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Quest Diagnostics, Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
RHIAG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Sanofi-Synthklabo . . . . . . . . . . . . . . . . . . . : . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
ShellOilCompany . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SiemensAG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SrnithKline Beecham plc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
So1vayS.A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Southern Union Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Tyco International. Ltd . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Valero Energy Corporation ......................................... 10
Valspar Corporation ............................................... 10
Wal-Mart Stores, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Authorizations to Seek Preliminary Injunctions ...................... 10
Archcoal, Inc....................................................
10
Cytyc Corporation ................................................ 11
Deutsche Gelatine-Fabriken Stoess AG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Diageoplc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
The Hearst Trust and The Hearst Corporation ........................... 11
Kroger CompanylRaley's Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Libbey.Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Meade Instruments Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Nest16 Holdings, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Vlasic Pickle Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Commission OpinionsAnitial Decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Chicago Bridge & Iron Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
. . ................................................. 13
Court Decs~ons
Archcoal, Inc.................................................... 13
H.J. Heinz Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SwedishMatchAB ............................................... 13
Order Violations ................................................. 14
Boston Scientific Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
RHIAG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14
1
F.
G
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H
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11
Other Commission Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
H.J.HeinzCompany . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Swedish Match AB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Administrative Complaints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Archcoal. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
AspenTechnology.1nc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Chicago Bridge & lron Company N.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Evanston Northwestern Healthcare Corporation . . . . . . . . . . . . . . . . . . . . . . . . . 15
H.J. Heinz Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Libbey,Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
MSC . Software Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Swedish Match AG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Best Practices Analysis for Merger Review Process . . . . . . . . . . . . . . . . . . . . . . 16
Conference on the Price Effects of Mergers and Concentration in the United
States Petroleum Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Guidelines for Merger Investigations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Horizontal Merger Investigation Data, Fiscal Years 1996 - 2003 . . . . . . . . . . . . 17
Merger Efficiency Roundtable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Merger Enforcement Workshop . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Merger Remedies - Second Workshop . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Hart-Scott-RodinoAntitrust Improvements Act . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
A
CourtDec~s~ons
The Hearst Trust and The Hearst Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
19
William H . Gates. III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
B
ConsentOrders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
C
Complaints (Complaints filed as part of a consent agreement not listed
separately) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
D.
Complaints .Authorized . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Archcoal. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Blockbuster.Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
E
Rules and Formal Interpretations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
F
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
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111
Non-Merger Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
A
Commission Opinionsnnitial Decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Kentucky Household Goods Caniers Association. Inc. . . . . . . . . . . . . . . . . . .
North Texas Specialty Physicians . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Polygmm Holding. Inc. (The Three Tenors) . . . . . . . . . . . . . . . . . . . . . . . . . .
Schering-Plough Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
South Carolina State Board of Dentistry . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Summit Technology and VISX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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"
B
.
C.
D
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..
Toys R Us . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
CourtDec~s~ons
Schering-Plough Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Authorizations to Seek PreliminaryRermanent Injunctions . . . . . . . . . . . . . . 24
A l p h m a , Inc. and Pcmgo Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Mylan Laboratories. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Consent Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Alaska Healthcare Network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
American Home Products Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
American Institute for Conservation of Historic and Artistic Works ......... 25
Anesthesia Service Medical Group, lnc . and Grossmont Anesthesia Services
MedicalGroup . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Aurora Associated Primary Care Physicians, L.L.C. . . . . . . . . . . . . . . . . . . . . . . 26
Biovail Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Biovail Corporation and Elan Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Bristol-Myers Squibb Company ..................................... 26
Carlsbad Physician Association . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Clark County, Washington Attorneys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Evanston Northwestern Healthcare Corporation ........................ 27
FMCCorporation ................................................. 27
Hoechst Marion Roussel ........................................... 28
Indiana Household Movers and Warehousemen, Inc...................... 28
Institute of Store Planners .......................................... 28
Iowa Movers and Warehousemen's Association .......... :.............. 28
MaineHealthAlliance ............................................. 28
Memorial Hermann Health Network Providers .......................... 28
Minnesota Transport Services Association ............................. 28
National Academy of Arbitrators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
New Hampshire Motor Transport Association .......................... 29
Obstetrics & Gynecology Medical Corporation of Napa Valley . . . . . . . . . . . . . 29
Physician Network Consulting, L.L.C. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Preferred Health Services, Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Professional Integrated Services of Denver, Inc., fichael J . Guese, M.D., and
Marcia A . Brauchler . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Professionals in Women's Care . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Southeastern New Mexico Physicians P A . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30
South Georgia Health Partners, L.L.C. ................................30
SPA Health Organization dba Southwest Physician Associates ............. 30
Surgical Specialists of Yakima ...................................... 30
System Health Providers ........................................... 31
Tenet Healthcare Corporation ....................................... 31
Virginia Board of Funeral Directors and Embalmers ..................... 31
Warner Communications Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
E.
Washington University Physician Network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
White Sands Health Care System. L.L.C. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Administrative Complaints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Alabama Trucking Association. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
California Pacific Medical Group dba Brown and Toland Medical Group . . . . . 32
GeraldWear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
JoelR.Yoseph . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Kentucky Household Goods Carriers Association. Inc . . . . . . . . . . . . . . . . . . . . . 32
Movers Conference of Mississippi. Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
North Texas Specialty Physicians . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Piedmont Health Alliance, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Polygram Holding, Inc. (The Three Tenors) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Rambus.Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
RobertLewis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Schering - Plough Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
South Carolina State Board of Dentistry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Union Oil Company of California . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Public Documents/Policy StatementsIConferences . . . . . . . . . . . . . . . . . . . . . . . 35
Second Public Conference on the U.S. Oil and Gasoline Industry . . . . . 35
Commission StudiesIGuidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
AdvisoryOpinions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
AdvocacyFilings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Workshops/Hearings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Intellectual Property and Patent Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
0
F.
.
V . Competitionspeeches . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
IV International Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
ABA ANTITRUST SECTION
SPRING MEETING
Summary of Bureau of Competition Activity
Fiscal Year 2001 Through March 15,2005
I.
Mergers
A.
Consent Orders
Agrium, Inc. (Final Order November 13,2000): A consent order requires Agrium to divest a
deepwater terminal near Portland, Oregon, an up water terminal in central Washington and other
assets settling charges concerning its proposed acquisition of the nitrogen fertilizer business of
Union Oil Company of California. Agrium and Unocal are the leading producers in the
Northwest of nitrogen fertilizer - anhydrous ammonia, urea and UAN 32% solution -ingredients
used for plant growth.
Airgas, Znc. (Final Order December 18,2001): Airgas, Inc., the nation's largest distributor of
industrial, medical, and specialty gases, settled antitrust charges that its January 2000 acquisition
of Mallinckrodt, Inc.'s Puritan Bennett Medical Gas Business eliminated competition in the
North American market for the production and sale of nitrous oxide. Under terms of the order,
Airgas is required to divest two nitrous oxide plants and related assets to Air Liquide America
Corporation within 10 days after the Commission issues its final order. Nitrous oxide is a clear,
odorless gas used mainly in dental and surgical procedures as an analgesic agent or as a
supplement to anesthesia.
Albertson's, Znc. (Final Order December 8,2000): Albertson's Inc. agreed to divest 104
supermarkets and American Stores Company agreed to divest 40 supermarkets to settle charges
that Albertson's acquisition of American Stores raised antitrust concerns in 57 markets in
California, Nevada and New Mexico. The divestiture agreement is the largest retail divestiture
of supermarkets ever required by the Commission. The final order, modified after the public
comment period, does not require the divestiture of a Lucky (American Stores Company) store in
Lompoc, California to Ralph's.
American Air Liquide, Znc. (Final Order June 29,2004): L'Air Liquide was permitted to
acquire Messer Griesheim GmbH, a leading industrial gas producer. Under terms of the order,
Air Liquide is required to divest six air separation units operated by Messer in California, Texas,
Louisiana, and Mississippi within six months. According to the complaint, the transaction as
proposed would substantially lessen competition in the market for liquid argon, liquid oxygen
and liquid nitrogen.
AmericaOnline, Znc. (Final Order April 17,2001): AOL and Time Warner Inc. settted
Commission concerns relating to their proposed merger. The order requires AOL Time Warner
to open its cable system to competitor intemet service providers. In addition, the company is
prohibited from interfering with content passed along the bandwidth contracted for by nonaffiliated intemet service providers; and prohibited from interfering with the ability of nonaffiliated providers of interactive television services to interact with interactive signals that AOL
Time Warner agreed to carry.
Amgen Znc. (Final Order September 3,2002): Amgen settled antitrust charges that its proposed
$16 billion acquisition of Immunex Corporation would reduce competition and tend to create a
monopoly in the biopharmaceutical markets for neutrophil (white blood cell) regeneration
factors; tumor necrosis factor (TNF) inhibitors; and interleukin-1 (IL-1) inhibitors. The consent
order requires the firms to sell all of Immunex's assets related to Leukine - a neutrophil
regeneration factor - to Schering AG; license certain intellectual property rights to TNF inhibitors
to Serono S.A.; and license certain intellectual property rights related to IL-1 inhibitors to
Regeneron Pharmaceuticals Inc.
Barter Znternational, Znc. (Final Order February 3,2003): Baxter settled Commission
concerns stemming from its $316 million proposed acquisition of Wyeth Corporation's generic
injectable drug business and agreed to divest several pharmaceutical products. The Commission
charged that the acquisition would reduce competition in the manufacture and sale of propofol (a
general anesthetic); new injectable iron replacemint therapies; metocloprarnide (used to treat
nausea); and vecuronium and pancuronium (neuromuscular blocking agents used to temporarily
freeze muscles during surgery). The consent order requires divestitures in each of the
pharmaceutical markets.
Bayer AG (Final Order August 2,2002): A consent order permits Bayer to purchase Aventis
CropScience Holdings S.A. from Aventis S.A. The order requires Bayer to divest businesses and
assets in the following
chemical insecticide products: new
.four major markets: new generation
generation chemical insecticide active ingredients; post-emergent grass herbicides for spring
wheat; and cool weather cotton defoliants. According to the complaint, the transaction as
proposed would result in the elimination of both actual and
competition in the four
markets; increase barriers to entry; reduce innovation competition for certain products; and
increase the possibility of coordinated interaction between competitors.
The Boeing Company (Final Order January 5,2001): The consent order permits the
acquisition of Hughes Space and Communications,a subsidiary of General Motors Corporation,
but prohibits Boeing from providing systems engineering and technical assistance (SETA) to the
U.S. Department of Defense for a specific classified program. According to the complaint,
Boeing is the sole supplier of SETA programs and Hughes is one of two competing contractors.
Buckeye Partners, L.P. (Final Order December 17,2004): Buckeye agreed to notify the
Commission before acquiring any interest in the Niles petroleum terminal for a period of ten
years under provisions of a consent order. The consent order settled charges that Buckeye's
proposed acquisition of five refined petroleum products pipelines and 24 petroleum products
terminals in the United States from Shell Oil Company would reduce competition in the market
for the terminaling of gasoline, diesel fuel, and other light petroleum products in the area of
Niles, Michigan.
Cemex, S.A. (Proposed Consent Agreement Accepted for Public Comment February 11,2005):
Cemex S.A. agreed to settle concerns stemming from its proposed $5.8 billion acquisition of
RMC Group PLC. Under terms of the proposed consent order, Cemex will divest RMC's five
ready-mix concrete plants in the Tucson, Arizona area, at no minimum price to a Commissionapproved buyer.
Cephalon, Inc. (Final Order September 20,2004): The consent order settled charges that
Cephalon's proposed acquisition of Cima Labs, Znc. would allow Cephalon to continue its
monopoly in the United States market for drugs that eliminate or reduce the spikes of severe pain
that chronic cancer patients experience. The consent order required Cephalon to grant Barr
Laboratories, Inc. a fully paid, irrevocable license to make and sell a generic version of
Cephalon's breakthrough cancer pain drug, Actiq, in the United States.
Chevron Corporation (Final Order January 4,2002): A consent order permitted the $45
billion merger of Chevron and Texaco Inc., but required significant divestitures in the petroleum
industry, including gasoline marketing assets, refining and bulk supply facilities, crude oil
pipeline interests and terminaling facilities.
Cytec Industries, Inc. (Proposed Consent Agreement Accepted for Public Comment Febmary
25,2005): A proposed consent order requires Cytec Industries, Inc. to divest UCB's Amino
Resins Business in Massachusetts and Germany to a Commission-approved buyer. According to
the complaint issued with the agreement, the acquisition as proposed would eliminate direct
competition between the two finns in the market for amino resins used for industrial liquid
coatings and ~ b b e adhesion
r
promotion.
Dainippon ink and Chemicals, Inc. (Final Order March 13,2003): Dainippon agreed to
divest the perylene business of its U.S. subsidiary, Sun Chemical Corporation, to Ciba Specialty
Chemicals Inc. and Ciba Specialty Chemicals Corporation to settle allegations that its proposed
acquisition of Bayer Corporation's high-performance pigment manufacturing facility would
eliminate competition in the highly concentrated world market for perylenes - organic pigments
used to impart unique shades of red color to products, including coatings, plastics and fibers.
Delhaize Freres et cie "Le Li0n"S.A. (Final Order May 30,2001): The consent order
permitted the merger of Establissements Delhaize Freres et Cie "Le Lion" S.A. and Delhaize
America, Inc. with l$annaford Bros. Co. and required the sale of 37 Hannaford supermarkets and
one Hannaford site to three different buyers.
Deutsche Gelatine-Fabriken Stoess AG (Final Order April 17,2002): A consent order
allowed DGF to complete its $170 million acquisition of Leiner Davis Gelatin Corporation and
its Goodman Fielder USA, Inc. subsidiary under terms that the entire pigskin and beef hide
gelatin business of Goodman Fielder would be excluded from the transaction. The complaint
issued with the order alleged that if the firms were allowed to consummate the transaction, as
originally proposed, they would account for more than 50 percent of the U.S. market for these
gelatin products used by the food industry as an ingredient in edible products and by the
pharmaceutical industry to produce capsules and tablets. The consent order requiring the
restructured transaction was negotiated after the Commission authorized staff to seek a
preliminary injunction in federal district court to block the parties from consummating the
transaction.
Diageoplc (Final Order December 19, 2001): Diageo and Vivendi Universal S.A. resolved
antitrust concerns regarding Diageo's and Pemod Ricard S.A.'s joint acquisition of Vivendi's
Seagram Spirits and Wine Business that would combine the second- and third- largest rum
producers in the United States. The consent order, among other things, required Diageo to divest
the Malibu rum business worldwide to a Commission-approved buyer within six months of the
acquisition of Seagram. On October 23,2001, the Commission authorized staff to seek a
preliminary injunction in federal district court to block the transaction.
DOWChemical Company, The (Final Order March 15,2001): Dow settled antitrust concerns
relating to its proposed merger with Union Carbide Corporation. Dow agreed to divest and
license intellectual property necessary to the production of linear low-density polyethylene - an
ingredient used in premium plastic products such as trash bags and sealable food pouches - to
BP Amoco plc.
DSM N.V. (Final Order January 6,2004): A consent order permitted DSM N.V. to acquire the
Vitamins and Fine Chemicals Division of Roche Holding AG but requires DSM to divest its
phytase business to BASF AG within 10 days after the transaction is completed. Phytase is an
enzyme added to certain animal feed to promote the digestion of nutrients necessary for livestock
production.
El Paso Energy Corporation (Final Order January 30,2001): A final order allowed El Paso
Energy Corporation to acquire PG&E Gas Transmission Teco, Inc. and PG&E Gas Transmission
Texas Company (subsidiaries of Pacific Gas & Electric) with the provision that it divest its
interest in the Oasis Pipe Line Company; PG&E's share of the Teco Pipeline; and the Matagorda
Island Offshore production area. The divestitures ensure that competition is maintained for
natural gas transportation in three Texas markets.
El Paso Energy Corporation (Final Order March 19,2001): A modified consent order allows
the merger of El Paso and Coastnl Corporation and requires the divestiture of more than 2,500
miles of gas pipeline system in Florida, New York and the Midwest. The modifications relate to
the establishment of the Devclopment Fund for the Green CanyonKarpon pipeline acquirer and
is described in the final order.
Enterprise Products Partners L.P. (Final Order November 23,2004): Enterprise Products
Partners L.P. settled charges that its $13 billion merger with Gulfrerra Energy/Partners L.P.
would eliminate competition in two markets: the pipeline transportation of natural gas from the
West Central Deepwater region of the Gulf of Mexico; and propane storage and terminaling
services in Hattisburg, Mississippi. The consent order requires the divestiture of an interest in a
pipeline transportation system and an interest in a propane facility that serves the Dixie Pipeline.
Exxon Corporation (Final Order January 30,2001): A consent order settled antitrust concems
stemming from Exxon's proposed acquisition of Mobil Corporation, and required the largest
retail divestiture in Commission history. The divestitures, representing only a fraction of the
worldwide assets of Exxon and Mobil, include 2,431 gas stations; an Exxon refinery in
Califomia; a pipeline; and other assets. According to the complaint, the proposed merger would
injure competition in moderately concentrated markets - Califomia gasoline refining; marketing
and retail sales of gasoline in the Northeast, Mtd-Atlantic, and in the State of Texas; and in the
highly concentrated markets for jet turbine oil.
GenCorp Znc. (Final Order December 19,2003): A consent order allowed GenCorp Inc. to
acquireAtlantic Research Corporation while requiring the divestiture of Atlantic's in-space
liquid propulsion business within six months of consummating the transaction. According to the
complaint issued with the consent order, the transaction as originally planned would have
lessened competition in the United States in four different types of in-space propulsion engines:
monopropellant thrusters; bipropellant apogee thrusters; dual mode apogee thrusters; and
biopropellant attitude control thrusters.
General Electric Company (Final Order January 28,2004): A final consent order settled
antitrust concems stemming from General Electric Company's proposed acquisition of A d a Gevaert N. V.'s nondestructive testing business. According to the complaint issued with the
consent order, the transaction as proposed would have eliminated competition in the United
States markets for portable flaw detectors, corrosion thickness gages, and precision thickness
gages - equipment used to inspect the tolerance of materials withoput damaging them or
impairing their future usefulness. The consent order requires General Electric to divest its
worldwide Panametrics Ultrasonic NDT business to RID Tech, Inc. within 20 days after the
transaction is completed.
General Electric Company (Final Order October 25,2004): General Electric was permitted
to acquire ZnVision Technologies, Inc. with conditions that it divest Invision's YXLON x-ray
nondestructive testing and inspection equipment to a Commission approved acquirer. According
to the complaint issued with the consent order, the two firms are direct competitors in a highly
concentrated market. The consent order protects competition in the United States market for
specialized x-ray testing and inspection including standard x-ray cabinets; x-ray systems
equipped with automated defect recognition software; and high-energy x-ray generators.
Genzyme Corporation (Final Order January 31,2005): A consent order allowed Genzyme's
acquisition of ILEX Oncology, Inc., but requires the companies to divest certain assets in the
market for solid organ transplant acute therapy drugs. Specifically, Genzyme is required to
divest all contractual rights related to ILEX's Campath@, an immunosuppressant antibody used
in solid organ transplants to Schering AG.
INA-Holding Schaef9er KG (Final Order February 15,2002): The consent order permits
WA's acquisition of FAG Kugelfischer Georg Schufer AG but requires the divestiture of FAG'S
cartridge ball screw support bearing business to Aktiebolaget SKF within 20 business days after
the consummation of the INAJFAG transaction. According to the complaint issued with the
consent order, the acquisition, as planned, would create a monopoly in the market worldwide.
Itron, Inc. (Final Order August 5,2004): The consent order, designed to preserve competition
in the market for the manufacture and sale of mobile radio frequency automatic meter reading
technologies for electric utilities in the United States, permitted Itron's $255 million acquisition
of Schlumberger Electricity, Inc. The consent order requires Itron to grant a royalty-free,
perpetual, and irrevocable license to Hunt Technologies, Inc., creating an effective competitor in
this market that allows utility companies and others to gather electric consumption data
automatically and remotely from electricity meters.
-
Koch Industries, Znc. (Final Order January 31.2001): A consent order settles allegations that
Entergy-Koch LP'S (a limited partnership owned equally by Entergy Corporation and Koch)
acquisition of 50 percent
of the Gulf South Pipeline Companv,
LP from Koch would lessen
.~
competition for the sale of electricity to consumers in Louisiana and western Mississippi and the
distribution of natural gas to consumers in New Orleans and Baton Rouge. Entergy is the
regulated electric and natural gas utility in parts of Louisiana and Mississippi. The order requires
Entergy to establish a transparent process to buy natural gas and natural gas transportation that
will assist state regulators in determining whether Entergy purchased gas supplies at inflated
prices from its Entergy-Koch partnership.
&
Koninklgke Ahold NV (Final Order December 7,2001): Ahold would be permitted to acquire
Bruno's Supermarkets, Inc. under terms of a consent order, but would be required to divest two
BI-LO supermarkets in Georgia - one Milledgeville, and one in Sandersville. The Commission's
complaint charged that the acquisition as originally proposed would reduce competition in the
retail sale of food and grocery items in supermarkets in the area and would eliminate direct
competition between supermarkets owned and controlled by Ahold and those owned or
controlled by Bruno's.
6
h f a r g e Corporation (Final Order August 8,2001): The consent order required the divestiture
of Blue Circle Industries PLC's cement business serving the Great Lakes region of Ohio,
Michigan, Illinois, Wisconsin and New York; its cement business in the Syracuse, New York;
and its lime business in the southeast United States. These d~vestituressettled antitrust concerns
stemming from Lafarge's proposed merger with Blue Circle. The two firms are market leaders in
the industry for cement and lime.
Manheim Auctions, Znc. (Final Order November 13,2000): The consent order settles
antitrust concerns stemming from the acquisition of ADTAutomotive Holdings, Inc., the nation's
third largest operator of wholesale motor vehicle auctions. The order requires Manheim to divest
nine auctions in Kansas City, Missouri; Denver and Colorado Springs, Colorado; Atlanta,
Georgia; San Francisco, California; Seattle, Washington; Tampa, Orlando and Daytona Beach,
Florida; and Phoenix, Arizona.
MCN (Final Order May 15,2001): A final order permitted the $4 billion merger of MCN, a
natural gas utility servicing communities in Michigan, and DTE, a public utility engaged in the
generation and sale of electricity in Detroit and southeastern Michigan. The consent order,
designed to resolve Commission concerns that the merger would lessen competition in the local
distribution of electricity and in the local distribution of natural gas in the city of Detroit and in
the Michigan counties of Macomb, Monroe, Oakland, Washtenaw and Wayne. MCN is the
parent of Michigan Consolidated Gas Company and DTE is the parent holding company of The
Detroit Edison Company.
Metso Oyj (Final Order October 23,2001): Metso settled charges that if its acquisition of
Svedala Idustri AB were allowed to proceed as planned, competition would be lessened in four
rock processing equipment markets: primary gyratory crushers; jaw crushers; cone crushers; and
grinding mills. The firms agreed to divest Metso's worldwide primary gyratory crusher and
grinding mill businesses and Svedala's worldwide jaw crusher and cone crusher businesses. The
three crusher businesses would be purchased by Sandvik AB, a Swedish corporation; the
grinding mill business would be purchased by Outokumpu of Finland. Metso and Svedala are
the two largest suppliers of rock processing equipment in the world.
lMagellan Midstream Partners, L.P. (Final Order November 23, 2004): Under terms of a
consent order, Magellan completed its acquisition of pipelines and terminals in the Midwestern
United States and a refined petroleum products terminal in Oklahoma City that supplies light
petroleum products such as gasoline and diesel fuel from the Shell Oil Company. The consent
order required Magellan to divest the Shell OMahoma City terminal to a Commission-approved
buyer within six months after the transaction is consummated.
MSC. Software Corporation (Final Order August 14,2002): MSC settled charges that its
1999 acquisitions of Universal Analytics, Inc. and Computerized Structural Analysis & Research
Corp. eliminated competition between the three firms in the development and application of
engineering software. The administrative complaint issued October 2000, alleged that the two
acquisitions would eliminate competition for advanced versions of Nastran, an engineering
simulation software program
used throughout the aerospace and automotive industries. The
consent order required MSC to divest atleast one clone-copy of its current advance Nastran
through royalty-free perpetual, non-exclus~velicenses to one or two acquirers approved by the
Commission.
-
Nestle Holdings, Inc. (Final Order February 8, 2002): Nestle settled antitrust charges that its
$10.3 billion proposed acquisition of Ralston Purina Company would substantially lessen
competition in the United States market for dry cat food through the elimination of direct
competition between the two firms and increase the likelihood that the combined firm could
unilaterally exercise market power. The order requires the divestiture of Ralston's Meow Mix
and Alley Cat brands to J.W. Childs Equity Partners II,L.P.
Novartis AG (Final Order December 19,2000): The consent order permits the merger of
Novartis and AstraZeneca PLC into a new Swiss company, Syngenta AG. The order requires
Novartis to divest its worldwide foliar fungicide business (based on the strobilurin chemical
class) to Bayer Ag; and requires AstraZeneca to divest its worldwide com herbicide business
(based on the active ingredient acetochlor) to Dow AgroSciences LLC.
Pfzer Znc. (Final Order May 27,2003): A final consent order permits Pfizer Inc.'s acquisition
of Phamacia Corporation while requiring the divestiture of various products including extended
release drugs used in the treatment of an overactive bladder; hormone replacement therapies;
erectile dysfunction; canine arthritis; and motion sickness. Novartis AG, Neurocrine
Biosciences, Inc., Schering-Plough Corporation, Johnson & Johnson, Insight Pharmaceuticals
Corporation, and Cadbury Schweppes are named in the order as potential buyers of the various
pharmaceuticals and products.
Philip Morris Companies, Znc. (Final Order February 27, '-001): The consent order permits
the merger of Philip Monis and Nabisco Holdings Corporation while settling charges that the
merger of the two food companies would reduce competition in the already highly-concentrated
food product markets. Under terms of the order, the parties are required to divest Nabisco's drymix gelatin, dry-mix pudding, no-bake dessert, and baking powder assets to The Jet Sea
Company and Nabisco's intense mints assets to Hershey Foods Corporation.
Phillips Petroleum Company (Final Order February 7,2003): A final consent order allows
the merger of Phillips Petroleum and Conoco Inc. but requires certain divestitures and other
relief to maintain competition in the gasoline refining market in specific areas of the United
States. Among the assets to be divested are refineries, propane terminals, and natural gas
gathering facilities. The combined firm will be known as ConocoPhillips.
Quest Diagnostics, Inc. (Final Order April 3,2003): Quest Diagnostics settled antitrust
concerns that its proposed acquisition of Unilab Corporation would substantially increase
concentration in the clinical laboratory testing services market by agreeing to divest clinical
laboratory testing assets in Northern California to Laboratory Corporation of America.
RHZAG (Final Order March 21, 2001): A consent order permits the acquisition of Global
Irzdustrial Technologies, Irzc. and requires the divestiture of two refractories manufacturing
facilities -Global's Hammond, Indiana and Marelan, Quebec plants - to Resco Products, Inc.
According to the complaint, the proposed acquisition would create the largest producer of
refractories in North America with dominant positions in the magnesia - carbon brick refractory
market and in the high alumina brick refractory market. Refractories are used to line furnaces in
many industries that involve the heating or containment of solids, liquids, or gases at high
temperatures.
Sanofi-Synthdlabo (Final Order September 20,2004): The consent order settled antitrust
concerns that Sanofi's proposed $64 billion acquisition of Aventis would create significant
overlaps in several markets for pharmaceutical products while creating the world's third largest
pharmaceutical company. Under terms of the consent order, Sanofi must: 1) divest its Arixtra
factor Xa inhibitor to GlaxoSmithKline, plc; 2) divest its key clinical studies for the Camptom
cytotoxic colorectal cancer treatment to Pfizer, Inc. and 3 ) divest Aventis' contractual rights to
the Estorra insomnia drug either to Sepracor, Inc. or to another Commission-approved buyer.
Shell Oil Company (Final Order November 18,2002): Shell Oil Company was allowed to
complete its $1.8 billion acquisition of Pennzoil-Quaker State Company but required to divest
certain assets to maintain healthy competition in the refining and marketing of Group II
paraffinic base oil in the United States and Canada. Under terms of the consent order, S k i 1 and
Pennzoil must divest its 50 percent interest in Excel Paralubes (a base oil refinery in Westlake,
Louisiana) and freeze Pennzoil's right to obtain additional Group II supply under a contract with
ExxonMobil at approximately current levels (up to 6,500 barrels of base oil per day).
Siemens AG (Final Order May 18,2001): Siemens settled charges relating to its proposed $9
billion acquisition of Atecs Mannesmann AG, a subsidiary of Vodafone. The consent order
requires, among other things, the divestiture of Vodafone's Mannesmann Dematic Postal
Automation business to Northrop Grurnman Corporation. Siemens and Vodafone, through its
Dematic subsidiary, are the two leading suppliers of postal automation systems in the world.
SmithKline Beecham plc (Final Order December 26,2001): Under terms of a final consent
order settling charges stemming from the merger of SmithKline and Glaxo Wellcomeplc, the
parties agreed
to divest pharmaceutical products in six markets: antiemetics; the antibiotic,
.
ceftazidime; oral and intravenous antiviral drugs for the treatment of herpes; topical antiviral
drugs for the treatment of genital herpes; and over-the-counter H-2 blocker acid relief products.
Solvay S.A. (Final Order June 25,2002): Solvay settled antitrust concerns stemming from its
proposed acquisition of Ausimont S.p.A. from Italenergia S.p.A., and agreed to divest its U.S.
polyvinylidene fluoride (PVDF) operations and its interest in Alventia LLC, a joint venture
which manufactures the main raw material for PVDF. According to the complaint, the proposed
acquisition would lessen competition in two markets: the production and sale of all grades of
PVDF; and the production and sale of melt-processible grades of PVDF.
Southern Union Company (Final Order July 16,2003): Southern Union Company settled
antitrust concerns stemming from its proposed acquisition of the Panhandle pipeline from CMS
Energy Corporation. The consent order permitted the acquisition but required Southern Union to
terminate an agreement to manage the Central pipeline which transports natural gas to several
counties in Missouri and Kansas.
Tyco International, Ltd. (Final Order December 5,2000): Tyco settled antitrust concerns
relating to its acquisition of Mallinckrodt, Inc. Tyco agreed to divest its endotracheal tube
business to Hudson RCI. The consent order permitted the acquisition.
Valero Energy Corporation (Final Order February 22,2002): The consent order permitted
Valero to complete its $6 billion merger with Ultramar Diamond Shamrock Corporation, but
required the divestiture of Ultramar's Golden Eagle Refinery, bulk gasoline contracts, and 70
Ultramar retail service stations in Northern California to a Commission-approved acquirer.
According to the complaint, the merger as onginally proposed, would have kssened competition
in two refining markets in California resulting in consumers paying more than $150 million
annually if the price of CARB gasoline increased just one cent per gallon. CARB gasoline meets
the specifications of the Califomia Air Resources Board.
Valspar Corporation (Final Order January 26,2001): Final order permitted Valspar's
acquisition of Lilly Industries, Inc., but requires Valspar to divest its mirror coatings business to
Spraylet Corporation. Mirror coatings are applied to the back of a piece of glass in order to
produce a mirror.
Wal-Marfstores, Inc. (Final Order February 27,2003): A consent order settled Commission
concerns that Wal-Mart's proposed acquisition of the largest supermarket chain in Puerto Rico,
Supermercados Amigo, Inc., would eliminate competition between supercenters and club stores
owned or controlled by Wal-Mart and supermarkets owned or controlled by Arnigo. While the
consent order permits the acquisition, it requires Wal-Mart to divest four Amigo supermarkets in
Cidra, Ponce, Manati, and Vega Baja, Puerto Rico to Supermercados Maximo.
B. Authorizations to Seek Preliminary Injunctions
Arch Coal, Znc. (March 30,2004): The Commission authorized staff to file acomplaint to
block Arch Coal, Inc.'s proposed acquisition of Triton Coal Company, L.L.C. from New Vulcan
Holdings, L.L.C. on grounds that the acquisition would increase concentration and tend to create
a monopoly in the market for coal mined from the Southern Powder River Basin and in the
production of 8800 British Thermal Unit coal. On April 1,2004, the complaint was filed in the
U.S. District Court for the District of Columbia
Cytyc Corporation (June 24,2002): The Commission authorized staff to seek a preliminary
injunction to block the acquisition of Digene Corporation on grounds that the combination of the
two firms would reduce competition and increase consumer prices within the highly concentrated
market for primary cervical cancer screening tests, both now and in the future. The parties
abandoned the transaction before court papers could be filed.
Deutsche Gelatine-Fabriken Stoess AG (January 15,2002): The Commission authorized
staff to seek a preliminary injunction to block DGF's proposed acquisition of Leiner Davis
Gelatin Corporation and its Goodman Fielder USA, Inc. subsidiary. According to the
Commission this transaction, if allowed to proceed as planned, would increase the likelihood of
anticompetitive activity in the U.S. market for pigskin and beef hide gelatin, used by the food
industry as an ingredient in edible products and by the pharmaceutical industry to produce
capsules and tablets. The combination of the two firms would account for more than 50 percent
of the relevant market in the U.S. A proposed consent agreement designed to remedy the
significant antitrust concerns was accepted for public comment March 7,2002; the consent order
was finalized April 17,2002.
Diugeoplc (October 23,2001): The Commission authorized staff to file a motion for a
preliminaxy injunction to block the proposed acquisition of Vivendi Universal S.A. ' s Seagram
Wine and Spirits Business on grounds that the transaction, would not only combine the secondand third-largest rum producers in the U.S. eliminating actual competition between the firms, but
could also create higher prices for consumers of rum. A consent order permitted the acquisition,
with certain conditions.
The Hearst Trust and The Hearst Corporation (April 5,2001): Hearst and its First
DataBank subsidiary were charged with illegally acquiring a monopoly over a key type of drug
information database used by pharmacists, hospitals, health plans, and other health care
professionals through Hearst's 1998 acquisition of it main competitor, Medi-Span. The
complaint, filed in the U.S. District Court for the District of Columbia, asked the court to either
order Hearst to create a new competitor to replace Medi-Span or forfeit its profits from the
anticompetitive price increases that followed the acquisition of its only competitor. The
complaint further alleged that the acquisition was consummated as a result of Hearst illegally
withholding documents required for the premerger antitrust review under the Har-Scott-Rodino
Antitrust Improvements Act of 1976. On December 18,2001, a federal district court entered a
proposed Final Order and Stipulation requiring Hearst to pay $19 million as disgorgement of
unlawful profits and to divest Medi-Span to Facts and Comparisons. This settlement marks the
first time the Commission has sought either divestiture or disgorgement of profits in a federal
court action for a consummated merger. A separate complaint to settle allegations that The
Hearst Tmst and The Hearst Corporation subsidiary, violated the reporting requirements of the
Har-Scott-Rodino Act was filed October 11,2001. In that settlement, Hearst paid $4 million in
civil penalties.
Kroger Company/Raley 's Corporation (October 2, 2002): The preliminary injunction
authorized by the Commission during the investigation into Kroger's acquisition of 18 Raley's
supermarkets in the Las Vegas, Nevada area was not filed. After staff determined that the
transaction would promote healthy competition in the Las VegasiHenderson area due to the rapid
growth of the market and the presence of Wal-Mart, Albertson's, Kroger and Safeway - the four
major competitors in the area, the investigation was closed.
Libbey, Inc. (December 18, 2001): The Commission authorized staff to seek a preliminary
injunction to block Libbey's proposed $332 million acquisition of Anchor Hocking, a subsidiary
of Newel1 Rubbermaid, Inc., on grounds that the acquisition would substantially lessen
competition in the market for soda-lime glassware sold to the food service industry in the United
States. A complaint was filed in the U.S. District Court for the District of Columbia on January
14,2002. The district court granted the Commission's request for an injunction on April 22,
2002. An administrative complaint, issued on May 9, extend the injunction until the conclusion
of the administrative proceedings. Pursuant to the delegation of authority, the Commission
withdrew the matter from adjudication on July 25,2002, to consider a proposed consent
agreement. A consent order was finalized October 7, 2002.
Meade Instruments Corporation (May 29,2002): The Commission authorized staff to seek a
temporary restraining order and a preliminary injunction to prevent Meade from acquiring any of
the assets that could become available as a result of the pending bankruptcy proceedings in Tasco
Holdings, Znc. 's Celestron International. According to the Commission, the purchase of the
performance telescope assets would eliminate competition in that market and create a monopoly
for the Schmidt-Cassegrain telescopes. Meade agreed not to submit any bid for Celestron or its
assets.
Nestle' HoMings, Znc. (March 4,2003): The Commission authorized staff to seek a preliminary
injunction to block the merger of Nestle and Dreyer's Grand Ice Cream, Inc. on grounds that the
merger would reduce competition in the highly concentrated market for superpremium ice cream.
Nestle markets superpremium ice cream under the Haagen Dazs brand; Dreyer's superpremium
brands include Dreamery, Godiva and Starbucks. Before the complaint was filed in a federal
district court, the parties agreed to enter into a consent agreement to settle the charges. The final
order requires the divestiture of superpremium ice cream brands Dreamery and Godiva, the
Whole Fruit sorbet brand, and NestlCs distribution assets to CoolBrands International, Inc.
VZasic Pickle Company (October 22,2002): The Commission authorized staff to seek a
preliminary injunction to block the proposed acquisition of Claussen Pickle Company by Hicks,
Muse, Tate & Furst Equity Fund V L.P., the owner of Vlasic Pickle Company on grounds that the
transaction would combine the dominant firm in the market for refrigerated pickles (Claussen)
with its most significant competitor in refrigerated pickles (Vlasic). Six days after the complaint
was filed in federal district court, the parties abandoned the transaction.
C.
Commission OpinionsIInitial Decisions
Chicago Bridge & lroiz Company (January 7,2005): The Commission upheld in part the
ruling of an administrative law judge that Chicago Bridge & Iron's acquisition of the Water
Division and the Engineered Construction Division of Pitt-Des Moines, Inc. created a nearmonopoly in four separate markets involving the design and construction of various types of
field-erected specialty industrial storage tanks in the United States. In an effort to restore
competition as it existed prior to the merger, the Commission ordered Chicago Bridge to
reorganize the relevant product business into two separate, stand-alone, viable entities capable of
competing in the markets described in the complaint and to divest one of those entities within six
months. The parties have 60 days from the final service of the decision and order to file an
appeal. On June 27,2004, an administrative law judge upheld the complaint and ordered the
divestiture all of the assets acquired in the acquisition. In December 2003, the Commission
approved an interim consent order prohibiting Chicago Bridge & Iron from altering the assets
acquired from Pitt-Des Moines, Inc. except "in the ordinary course of business." These assets
included but were not limited to real property; personal property; equipment; inventories; and
intellectual property.
D.
Court Decisions
Arch Coal, Znc. (August 13,2004): The U.S. District Court for the District of Columbia denied
the Commission's request for a preliminary injunction to block Arch Coal, Inc.'s proposed
acquisition of Triton Coal Company, L.L.C. from new Vulcan Holdings, L.L.C. The parties
consummated the deal after the Circuit Court of Appeals for the District of Columbia refused to
issue a stay pending an appeal of the district court decision. The Commission decided not to
pursue an appeal of the decision of the U.S. District Court for a preliminary injunction to block
the sale of Triton to Arch Coal.
H.J. Heinz Company (April 27,2001): The U.S. District Court of Appeals for the District of
Columbia reversed the federal district court decision and granted the Commission's request for
entry of a preliminary injunction to enjoin Heinz's proposed acquisition of Milnor Holding
Company, the owner of the Beech-Nut Nutrition Corporation. Within minutes of the Appeals
Court decision, the parties abandoned the transact'ion.
(Dec. 14,5,2002):
2000): The U.S. District Court for the District of Columbia
Swedish Match AB (August
granted the agency's request for a preliminary injunction to block the proposed acquisition of the
loose leaf chewing tobacco business of National Tobacco Company, L.P. The parties later
abandoned the transaction.
E.
Order Violations
Boston Scientific Corporation (March 31,2003): A federal district judge ordered Boston
Scientific Corporation to pay $7,040,000 in civil penalties to settle charges that it violated a 1995
consent order when it failed to provide Hewlett-Packard Company with a license to all of its
intellectual property and technical information relating to intravascular ultrasound catheters. The
complaint was filed on October 31, 2000 by the Department of Justice on behalf of the
Commission. The trial was held in August 2002.
RHZAG (April I , 2004): RHI AG paid a total civil penalty of $755,686.41 to settle charges that
it violated a 1999consent order concerning its acquisition of Global Industrial Technologies, Inc.
According to the complaint, filed in the United States District Court for the District of Columbia,
RHI not only failed to divest the two refractories plants and other assets to Resco Products, Inc.,
but it did not completely comply with other provisions required by the settlement agreement.
F.
Other Comnzission Orders
H.J. Heinz Company (December 7,2001): The Commission dismissed the Part 3
administrative complaint after Heinz abandoned its proposed merger with Milnot Holding
Company,the owner of Beech-Nut Nutrition Corporation, that would combine the nation's
second- and third- largest manufacturers of jarred baby food, respectively.
Swedish Match AB (January 5,2001): The Commission dismissed the administrative
complaint after Swedish Match and National Tobacco Company, L.P. abandoned the transaction
that would give Swedish Match control of 60 percent of the loose leaf chewing tobacco market.
G.
Administrative Complaints
Arch Coal, Znc. (April 6 , 2004): An administrative complaint challenged the proposed
acquisition of all the assets of Triton Coal Company, L.L.C. from New Vulcan Coal Holdings,
L.L.C. According to the complaint, the acquisition would combine two of the four leading
producers of coal in Wyoming's Southern Powder River Basin. The parties closed the
transaction after the Circuit Court of Appeals for the District of Columbia refused to issue a stay
pending an appeal of the district court decision that denied the Commission's motion for a
preliminary injunction. On September 10,2004, the administrative complaint was withdrawn
from adjudication.
Aspen Technology, Znc. (August 6,2003): The Commission issued an administrative
complaint that challenged Aspen's 2002 acquisition of Hyprotech, Ltd. alleging that the
acquisition eliminated a significant competitor in the provision of process engineering simulation
software for industry. According to the complaint, the acquisition has led to reduced innovation
competition in six specific process engineering simulation software markets. In July 2004, under
terms of a proposed consent agreement, Aspen agreed to divest Hypotech's continuous process
and batch process assets and Aspen's operator training software and service business to a
Commission-approved buyer to settle charges in the complaint and resolve the administrative
proceedings. The consent order became final December 20,2004.
Chicago Bridge & Iron Company N. V. (October 25,2001): The Commission challenged the
February 2001 purchase of the Water Division and Engineered Construction Division of Pitt-Des
Moines, Inc. alleging that the acquisition significantly reduced competition in four separate
markets involving the design and construction of various types of field-erected specialty
industrial storage tanks in the United States. The initial decision filed June 27,2003 upheld the
complaint. On January 7,2005, the Commission upheld the initial decision in part and issued an
order requiring a divestiture.
Evanston Northwestern Healthcare Corporation (Febmary 10,2004): An administrative
complaint alleges that following Evanston Northwestem Healthcare Corporations's acquisition
of Highland Park Hospital prices charged to health insurers for medical services increased and
therefore higher costs for health insurance were passed on to consumers of hospital services in
the Cook and Lake counties of Illinois. The complaint also alleges that a physicians group
affiliated with both hospitals, Eghland Park Independent Physician Group, negotiated prices for
physicians on staff at Evanston as well as for several hundred independent physicians not
affiliated with either hosuital. According
" to the com~laint.these actions constitute illegal rice
fixing among competing physicians or physician groups and denies consumers the benefits of
competition in physician services. The administrative hearings commenced February 10,2005.
-
H.J. Heinz Company (November 22,2000): An administrative complaint charged that the
proposed acquisition of Milnor Holding Corporation, owner of Beech-nut Nutrition Corporation,
would substantially reduce competition in the manufacture and sale of jarred baby food in the
United States. On November 1, 2000, the Commission sought an emergency stay from the Court
of AppeaIs for the D.C. Circuit after the federal district court denied the Commission's request
for a preliminary injunction. The Court of Appeals for the District of Columbia enjoined the
transaction. The parties abandoned the proposed transaction and the administrative complaint
was dismissed by the Commission.
Libbey, Inc. (May 9,2002): An administrative complaint charged that the proposed acquisition
of Anchor Hocking, a wholly-owned subsidiary of Newel1 Rubbermaid, Inc. would substantially
reduce competition in the market for soda-lime glassware sold to the food service industry in the
United States. The complaint was issued after the U.S. District Court in Washington, D.C.
enjoined the acquisition pending administrative adjudication. The matter was withdrawn from
adjudication on July 25,2002 to consider a proposed consent agreement. A consent order was
finalized October 7,2002.
MSC. Software Corporation (October 9,2001): An administrativecomplaint challenged the
1999 acquisitions of Universal Analytics, Znc. and Computerized Structural Analysis & Research
Corp. alleging that MSC., the dominant supplier of advanced computer-aided engineering
software known as "Nastran", acquired the other two suppliers in the market. According to the
complaint, the acquisitions eliminated competition and tended to create a monopoly in the
market. The complaint was settled by a consent agreement that became final on October 29,
2002.
Swedish Match AG (December 21,2000): An administrativecomplaint was issued after the
United States Federal District Court for the District of Columbia granted the Commission's
motion for a preliminary injunction to block Swedish Match North America from acquiring the
loose leaf chewing tobacco brands of National Tobacco Company. The admnistrative complaint
alleged that the acquisition would substantially reduce competition by combining the first and
third sellers of loose leaf chewing tobacco in the United States. According to the complaint, if
the acquisition were consummated, Swedish Match would gain a market share of 60 percent in
U.S. sales. The Commission dismissed the administrative complaint after the parties abandoned
the transaction.
I%
Other
Best Practices Analysis for Merger Review Process (Announced March 15,2002): The
Commission conducted "brown bag" public workshops in Chicago, Los Angeles, New York, San
Francisco, and Washington, DC during 2002 to solicit input from a broad range of interest groups
who have participated in the Commission's or the Department of Justice's merger review
process. The areas under consideration included:
the initial waiting period under HSR;
the content and scope of the second request;
* negotiation of modifications to the second request;
special issues concerning electronic records and accounting of financial data.
Remedies issues included:
the package of assets to be divested;
the manner of a proposed divestiture;
the proposed buyer of divested assets;
the Buyer Up Front;
the use of Fix-It-First;
the use of Crown Jewel Provisions;
third party rights;
the risks to competition and to the parties.
Workshops held:
Workshop on Accounting and Financial Data (July 10,2002) Washington, DC
General Session on Best Practices for Merger Investigations (June 27,2002)
Washington, DC
General Session on Best Practices for Merger Investigations (June 25, 2002) Los
Angeles, CA.
General Session on Best Practices for Mcrger Investigations (June 12, 2002) Chicago,
IL
Electronic Records (June 5,2002) Washington, DC
General Session on Best Practices for Merger Investigations(June 5,2002) San
Francisco, CA
Conference on the Price Effects of Mergers and Concentration in the United States
Petroleum Industry (January 14,2005,Washington, DC.) The conference reviewed two
studies that examined price effects within the petroleum industry: the March 2004 case study of
the effects of the Marathon/Ashland Corporation joint venture; the second, the May 2004 report
by the Government Accountability Office that examined the effects of mergers and market
concentration in the United States petroleum industry.
Guidelinesfor Merger Investigations: The Guidelines represent the first outcome of the Best
Practices Workshop which began March 2002. Available at www.ftc.opa/2002/12/mergerguides
Primary components:
Witnesses will be able to obtain investigational hearing transcripts.
Documents will no longer have to be sorted or identified by specification.
Second sweeps will be avoided whenever possible.
In response to second requests,parties will be able to submit documents and other
materials in an electronic format rather than in hard copy.
Sample products are no longer required by Specification 5(a) of the Model Second
Request.
Horizontal Merger Investigation Data, Fiscal Years 1996 - 2003 Staff analysis of
horizontal investigations. The staff tabulated certain market structure information as it relates to
the Commission's decision whether or not to seek relief in specific markets investigated.
Released February 2004.
Merger Efficiency Roundtable (December 9 - 10,2002;Washington, DC): Experts in
mergers and acquisitions from the academic, consulting, and business communities gave
presentations on how to determine whether a proposed transaction is likely to generate merger
efficiencies.
Merger Enforcement Workshop (February 17 - 19,2004) sponsored by the Federal Trade
Commission and the Department of Justice. Topics discussed:
Hypothetical Monopolist Test
Concentration & Market Shares
Monopsony
Non-Price Competition/Innovation
Unilateral Effects
Coordinated Effects
Uncommitted Entry
Efficiencies/Dynamc AnalysisIIntegrated Analysis
-
Merger Remedies Second Workshop (October 23,2002; New York, New York):
Workshop, co-hosted by the Antitrust and Trade Regulation Committee of The Association of
the Bar of the City of New York, was designed to gather information from a broad range of
interested parties regarding consent order remedies in merger and acquisition matters.
11.
Hart-Scott-Rodino Antitrust Improvements Act
Enforcement
A. Court Decisions
The Hearst Trust and The Hearst Corporation (October 11,2001): Hearst and its
subsidiary paid a $4 million civil penalty t i settle charges that they failed to include required
documents in the notification and report form file in 1998 for the proposed
acquisition of Medi.
Span International, Inc. The complaint alleged that the omitted documents hindered the antitrust
agencies in their review and analysis of the proposed acquisition. The complaint, stipulation and
final judgment were filed in U.S. District Court for the District of Columbia by Commission
attorneys acting as special attorneys to the United States Attorney General. During fiscal year
2001, the Commission filed a related complaint for a permanent injunction alleging that Hearst
and First DataBank created a monopoly through the acquisition of Medi-Span, First DataBank's
only other competitor selling software and data detailing information for pharmaceutical prices,
descriptions, dosages, and interactions. The Final Order and Stipulation requiring divestiture and
disgorgement of profits was entered December 18,2001.
-
William H. Gates, ZZZ (May 4,2004): William H. Gates, III paid $800,000 in civil penalties
to settle charges that he acquired more than ten percent of the voting securities of Republic
Services, Inc. without observing the filing and waiting period requirements under the Hart-ScottRodino Antitrust Improvements Act of 1976. The complaint was filed in the federal district
court in Washington, DC.
B.
Consent Orders
None
C. Complaiizts (Coinplaints filed as part of a consent
agreement not listed separately)
None
D.
Complaints - Authorized
Arch Coal, Inc. (February 23,2004): The Commission authorized staff to file a complaint in
federal district court for a temporary restraining order under Section 7A(g)(2) of the Clayton Act
to block Arch Coal's proposed acquisition of Triton Coal Company until Arch Coal substantially
complied with the Commission's request for addition information under the Hart-Scott-Rodino
Act. After Arch Coal was notified that the Commission authorized a Section 7A(g)(2)
complaint, Arch withdrew its Certification of Substantial Compliance with the second request
and provided additional information.
Blockbuster, Znc. (March 4 , 2005): The Commission tiled a complaint under Section
7A(g)(2) of the Clayton Act in U.S. District Court for the District of Columbia to require
Blockbuster, Inc. to provide sufficient and accurate pricing data in compliance with the second
request issued by the Commission under the statutory rules of the Hart-Scott-Rodino Act.
Blockbuster cannot proceed with its proposed acquisition of Hollywood Entertainment
Corporation until 30 days from the date it has substantially complied with the second request.
E.
Rules and Formal Interpretations
Hart-Scott Rodino Final Rulemaking (Effective April 7 , 2005): Final rules adopted from
proposed rules published April 8,2004. The amendments require notification of:
acquisitions of interests in unincorporated entities and formations of unincorporated
entities.
The rules also extend the application of certain exemptions, including the intraperson
exemption, to unincorporated entities.
Hart-Scott Final Rulemaking (Effective March 2,2005): The notification and filing
thresholds under the premerger nties have been revised as required by the 2000 amendments to
Section 7A of the Clayton Act. Section 7A(a)(2) requires the Commission to revise the
jurisdictional thresholds annually, based on the change in gross natlonal product, in accordance
with section S(a)(5) for each fiscal year beginning after September 30,2004.
Hart-ScoffRodino Reform (Amended Final Rules, Published March 12,2002):
Amendments to Parts 801 and 802 of the Premerger Notification Rules.
Amendments to Section 802.21: Acquisitions of voting securities not meeting or
exceeding greater notification threshold.
Hart-Scott-Rodino Reform (Effective February I, 2001): Significant changes in the filing
requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
The size of transaction threshold increases from $15 million to $50 million. The 15
percent size of transaction threshold is eliminated.
Transactions valued at more than $200 million will be reportable without regard to "size
of person". The current size of person test will continue to be in place for transactions valued at
$200 million or less.
All dollar thresholds will be adjusted each fiscal year, beginning with fiscal year 2005,
to reflect changes in the gross national product during the previous year.
A tiered fee structure replaces the standard $45,000 filing fee for all reportable
transactions. Companies will now pay $45,000 for transactions valued at less than $100 million,
$125,000 for transactions valued at $100 million to less than $500 million, and $280,000 for
transactions valued at $500 mlllion or more.
The length of the waiting period that follows substantial compliance with a second
request for additional information will become 30 days for most transactions (instead of 20 days
under the current law).
Whenever the end of any waiting period falls on a Saturday, Sunday or legal holiday, the
official end of the waiting period will end on the next regular business day.
Minor amendments announced March 20,2001: The changes reflect the new $50
million filing threshold and the revision of a footnote to reflect the size-of-person test for
transactions valued at more than $200 million.
F.
Other
Model Retail Second Request (April 28,2004) Model Request for Additional Information
and Documentary Material (Second Request) for transactions involving retail industries.
Premerger Notification Annual Report to Congress Pursuant to Section 201 of the HartScott-Rodino Antitrust Improvements Act of 1976 (April 30,2001): Twenty-third Annual
Report (Fiscal Year 2000).
Premerger Notification Annual Report to Congress Pursuant to Section 201 of the HartScott-Rodino Antitrust Improvements Act of 1976 (September 27,2002): Twenty-fourth Annual
Report (Fiscal Year 2001).
Premerger Noh~cationAnnual Report to Congress Pursuant to Section 201 of the HartScott-Rodino Antitrust Improvements Act of 1976 (August 1,2003): Twenty-fifth Annual
Report (Fiscal Year 2002).
Premerger Notification Annual Report to Congress Pursuant to Section 201 of the HartScott-Rodino Antitrust Improvements Act of 1976 (September 7,2004): Twenty-sixth Annual
Report (Fiscal Year 2003).
111. Non-Merger Enforcement
A.
Cornmission Oyinionsllnitial Decisions
Kentucky Household Goods Camers Association, Znc. (June 21,2004): An administrative
law judge upheld an administrative complaint that charged a group of affiliated intrastate movers
with engaging in horizontal price-fixing by filing collective rates on behalf of its member motor
common caniers for the intrastate transportation of property within the Commonwealth of
Kentucky. The judge also ruled that the association's conduct was not protected by the state
action doctrine because the State of Kentucky did not supervise the rate-making practices of the
group. On July 12,2004, the Kentucky Household Goods Camers Association, Inc. filed an
appeal of the initial decision with the Commission. The oral argument was held January 24,
2005.
North Texas Specialty Physicians (November 8,2004): An administrative law judge upheld
the administrative complaint that charged that the Noah Texas Specialty Physicians, a physician
group practicing in Forth Worth, Texas, collectively determined acceptable fees for physician
services in negotiating contracts with health insurance plans and other third party payers. The
judge ruled that complaint counsel proved that North Texas Specialty Physicians engaged in
horizontal price fixing. The accompanying order prohibits the group from negotiating, on behalf
of its members, collective pricing of contracts with health plan services for the provision of
physician services. On January 14,2005, North Texas Specialty Physicians filed a notice of
appeal of the initial decision. The oral argument has not yet been scheduled.
Polygram Holding, Znc. (The Three Tenors) (July 24,2003): The Commission upheld the
ruling of an administrative law judge and prohibited PolyGram from entering into any agreement
with competitors to fix the prices or restrict the advertising of products they have produced
independently. The administrative complaint generally known as The Three Tenors and
involving respondents PolyGram Holding, Inc.; Decca Music Group Limited; UMG Recordings
Inc.; and Universal Music & Video Distribution Corporation charged PolyGram with entering
into an illegal price fixing agreement not to advertise or discount earlier albums and video
recordings of concerts featunng the Three Tenors in an effort to promote the latest concert,
thought to be less appealing to the public. The Commission ordered the respondents to cease and
desist from entering into any combination, conspiracy, or agreement - with producers or sellers at
wholesale of audio or video products - to "fix, raise, or stabilize prices or price levels" in
connection with the sale in or into the United States of any audio or video product.
Rambus, Znc. (July 6,2004): The Commission issued a decision that reversed and vacated the
initial decision of the administrative law judge and remanded the complaint to the judge for
further proceedings. The administrative law judge dismissed all charges against Rambus, Inc.,
on February 17, 2004, ruling that Commission staff had failed to sustain their burden of proof
with respect to all three violations alleged in the complaint. On March 1,2004, complaint
counsel filed a notice of appeal. The oral argument was held December 9,2004
Scherirtg-Plough Corporation (December 8, 2003): The Commission reversed the
administrative law judge's initial decision that had dismissed all charges of anticompetitive
conduct. The Commission found that Schering-Plough Corporation entered into agreements with
Upsher-Smith Laboratories, Inc. and American Home Products to delay the entry of generic
versions of Schering's branded K-Dur 20, a widely prescribed potassium chloride supplement.
According to the opinion, the parties settled patent litigation with terms that included
unconditional payments by Schering in return for agreements to defer introduction of the generic
products. The Commission entered an order that would bar similar conduct in the future.
South Carolina State Board of Dentistry (July 28,2004): The Commission denied the
motion of the South Carolina State Board of Dentistry to dismiss allegations in an administrative
complaint that the Board adopted a regulation restricting dental hygienists from providing
preventive dental services to children on-site in South Carolina schools unless the children were
preexamined by a dentist. According to the complaint, the Board's emergency regulation was
adopted after the state enacted legislation to provide dental treatment in the schools by dental
hygienists. The Commission ruled that the Board was not entitled to protection under the state
action doctrine because the Board's actions were not regulated by the State of South Carof na,
but were an intent to circumvent state law that eliminated the preexamination requirement.
Summit Technology and VZSX (February 7, 2001):The Commission dismissed its complaint
after the U.S. patent and Trademark Office issued a Reexamination Certificate of U.S. Patent No.
5,108,388. On June 4,1999 an administrative law judge dismissed charges against VISX, a key
developer of laser eye surgery equipment and technology, known as photo refractive keratectomy
(PRK). According to the 1998 administrative complaint, VISX and Summit Technology, the
only two firms legally able to market equipment for PRK, placed their competing patents in a
patent pool and shared the proceeds each and every time a Summit or VISX laser was used. The
administrative law judge also dismissed charges that VISX. acquired a key patent by inequitable
conduct and fraud on the U.S. Patent and Trademark Office, ling that complaint counsel failed
to present evidence that an act of fraud was committed since information was not willfully
withheld from the patent office. A final order settled the price fixing allegations in the 1998
complaint.
-
Toys "R" Us (Commission Decision November 1,2000 Final Order; Initial Decision
September 30, 1997): An Administrative Law Judge issued an initial decision that, if made final,
would prohibit Toys " R Us from entering into agreements with toy manufacturers and others
that result in restrictions on sales to warehouse clubs. TRIJ threatened to stop buying products
that were sold to warehouse clubs, which resulted in major toy makers halting the sale of certain
products to clubs. The AW found that these practices reduced competition and led to higher toy
prices. The initial decision would prohibit the toy chain from entering into any agreement with a
supplier to restrict sales to any toy discounter; from facilitating agreements among suppliers that
would limit sales to any retailer; and for five years, from refusing to or announcing it will refuse
to purchase from a supplier because the supplier sells to a toy discounter. On October 14, 1998
the Commission issued its decision that Toys " R Us had orchestrated horizontal and vertical
agreements with and among toy manufacturers to restrict the availability of popular toys to
wxehouse clubs. On December 7, 1998,Toys "R" Us filed a notice of appeal in the U.S. District
Court for the Seventh Circuit. In August 2000, the Commission's complaint was upheld by
Seventh Circuit Court of Appeals.
Union Oil of California (November 25,2003): An administrative law judge dismissed a
conlplaint in its entirety against Union Oil of California that charged the company with
convnitting fraud in connection with regnlatoxy proceedings before the California Air Resources
Board regarding the development of reformulated gasoline. The judge ruled much of Unocal's
conduct was permissible activity under the Noerr-Pennington doctrine and that the resolution of
the issues outlined in the complaint would require an in depth analysis of patent law which he
believed were not with the jurisdiction of the Commission. In July 2004, the C o M s s i o n
reversed the judge's ruling and reinstated charges that Unocal illegally acquired monopoly power
in the technology market for producing a "summer-time" low-emissions gasoline mandated for
sale and use by the California Air Resources Board for use in the state for up to eight months of
the year.
B.
Court Decisions
Schering-Plough Corporation (March 8,2005) The United States Court of Appeals for the
Eleventh Circuit set aside and vacated the Commission decision that found that Schering-Plough
entered into agreements with Upsher-Smith Laboratories, Ine. and American Home Products to
delay the entry of generic versions of Schering's branded K-Dur 20, a prescribed potassium
chloride supplement.
C.
Authorizations to Seek Preliminary/Permanent Injunctions
Alpharma, Znc. and P e r m Company (August 11,2004): The Commission authorized staff
to file a complaint in federal district court charging that Alpharma, Inc. and Pemgo Company
drove up the prices for over-the-counter store-brand children's liquid ibuprofen through an
agreement eliminating competition between the two firms and allowing Pemgo to raise its prices
creating higher profits to then be shared between the firms. According to the complaint, while
both Alpharma and Pemgo filed for U.S. Food and Drug Administration approval to sell a
generic version of children's liquid Motrin, Alpharma was eligible to sell its product at least six
months before approval would be granted to Pemgo. The two companies entered into an
agreement not to compete whereby Pemgo would sell the children's liquid ibuprofen for seven
years and Alpharma, while would not marketing a competing product, would receive an up-front
payment and a royalty on Pemgo's sales of the product. To settle the charges, Alphanna and
Pemgo paid a total of $6.25 million in illegal profits and agreed not to enter into agreements not
to compete when one party to the agreement is a first filer of an abbreviated new drug
application.
Mylan Laboratories, Znc. (December 22, 1998): Complaint filed in the U.S. District Court for
the District of Columbia charged Mylan with restraint of trade, monopolization and conspiracy to
monopolize the market for two generic drugs used to treat anxiety, lorazepam and clorazepate,
through exclusive dealing arrangements. The complaint seeks consumer redress of at least $120
million and to enjoin the alleged illegal exclusive licensing agreements. Federal District Court
Judge Hogan released a 46 page decision upholding the Commission's authority to seek
restitution in antitmst injunction actions under Section 13(b) of the Federal Trade Commission
Act. November 29,2000: Commission approved a $100 million settlement-the largest
monetary settlement in Commission history. The opinion settled Commission concerns that
Mylan, Gyma Laboratories of America, Inc., Cambrex Corporation and Profarmaco S.R.L.
conspired to deny Mylan's competitors ingredients necessary to manufacture lorazepam and
clorazepate. On April 27, 2001, the U.S. District Court for the District of Columbia granted
preliminary approval to a plan of distribution to injured consumers who paid the increased prices
and state agencies, including Medicaid programs, that purchased the drugs while the illegal
agreements were in effect. The court granted final approval of the settlement February 1,2002.
The funds were distributed by the states.
D.
Consent Orders
Alaska Healthcare Network (Final Order April 25,2001): An association of 86 physicians
practicing in the Fairbanks, Alaska area settled charges that the Alaskan Healthcare Network
illegally formulated a fee schedule based on its members' current prices for use in negotiations
with third-party payers in an effort to obtain higher prices for medical services.
American Home Products Corporation (Final Order April 5,2002): A consent order settled
charges that American Home Products entered into an anticompetitive agreement with ScheringPlough Corporation to delay the entry of a low-cost generic drug that would be in direct
competition with a branded version developed and manufactured by Schering. According to the
complaint issued with the consent, Schering illegally paid American Home millions of dollars to
delay the entry and sale of its generic version of Schering's K-Dur 20, a drug used to treat
patients who suffer from insufficient levels of potassium, a condition that could lead to cardiac
problems. The consent order, which expires in 10 years, prohibits American Home Products
from entering into such agreements in the future. On December 8,2003, the Commission issued
an opinion that found thatthe agreements between Schering and Upsher-Smith and American
Home Products violated the antitrust laws. The Commission entered an order for Schering
- and
Upsher-Smith that is similar to the American Home Products order.
American Institute for Conservation of Historic and Artistic Works (Final Order October
30,2002): A consent order settled charges that the American Institute for Conservation of
Historic and Artistic Works adopted and enforced provisions in its rules of conduct that
prohibited professional conservators to work for free or at reduced fees. The association agreed
to remove all provisions from its Code of Ethics, and its Commentaries to the Guidelines for
Practice that are inconsistent with the order. Professional conservators manage and preserve
cultural objects (including historical scientific, religious, archaeological and artistic objects).
Anesthesia Service Medical Group, Znc. and Grossmont Anesthesia Services Medical
Group (Final Order July 11,2003): Two anesthesiologists groups settled charges that they
entered into joint agreements to establish fees and services from Grossmont Medical Hospital in
San Diego County. Specifically, the groups agreed on fees that both would demand from health
care insurance companies and other third party payers for taking call for obstetrics and providing
services to uninsured emergency room patients. Together, the two groups are composed of
approximately 200 physicians that provide competing anesthesiology services in the San Diego
area.
Aurora Associated Primary Care Physicians, L.L.C. (Final Order July 19,2002): A
consent order settled charges that the organization of internists, pediatricians, family physicians
and general practitioners in the Aurora, Colorado area engaged in boycotts and entered into
collective negotiations with health care insurers in an effort to increase the costs of physician
services. The order prohibits the organization from entering into any agreement with insurance
payers or providers to negotiate fees on behalf of the physicians group.
Biovail Corporation (Final Order October 2,2002): The Commission charged Biovail
Corporation with illegally acquiring an exclusive patent license for Tiazac, a pharmaceutical used
to treat high blood pressure and chronic chest pain. The complaint further alleged that Biovail, in
an effort to maintain its monopoly, wrongfully listed the acquired license in the U.S. Food and
Drug Administration's "Orange Book" for the purpose of blocking generic competition to its
branded Tiazac. The consent order requires Biovail to divest part of its exclusive rights to DOV,
prohibits the firm from taking any action that would trigger additional statutory stays on final
FDA approval of a generic form of Tiazac; and also prohibits Biovail from wrongfully listing any
patents in the Orange Book for a product for which the company already has an New Drug
Application from the FDA.
Biovail Corporation and Elan Corporation (Final Order August 20,2002): A consent order
settled charges that Biovail and Elan Corporation entered into an agreement that contained
substantial monetary incentives not to compete in the market for specified dosages of generic
forms of Adalat CC, a drug used to treat hypertension. The final consent order requires the
companies to terminate their agreement and prohibits them form entering into similar agreements
in the future. This is the Commission's first enforcement action involving an allegedly
anticompetitive agreement between two competing generic drug manufacturers.
Bristol-Myers Squibb Company (Final Order April 14,2003): Bristol-Myers Squibb
Company (BMS) settled charges that it engaged in illegal business practices to delay the entry of
three low price generic pharmaceuticals that would he in direct competition with three of its
branded drugs. The complaint alleged that BMS purposely made wrongful listings in the Orange
Book of the U.S. Food & Drug Administration and that it also paid a potential competitor over
$70 million to delay the entry of its generic drug. The three drugs involved in the complaint are:
Tmol (containing the active ingredient paclitaxel) - used to treat ovarian, breast, and lung
cancers; Platinol (containing the active ingredient cisplatin) - used for the treatment of various
forms of cancer; and BuSpar (containing the active ingredient buspirone) - used to manage
anxiety disorders.
Carlsbad Physician Association (Final Order June 13,2003): A New Mexico physician
organization settled charges that it and its members entered into agreements to fix prices and to
refuse to deal with third party payers and other health care plans except on collectively agreedupon terms.
Clark County, Washington Attorneys Final Order July 23,2004): Private attorneys in
Clark County, Washington who provide criminal legal services for indigent defendants under a
county contract settled charges that they illegally entered into an agreement known as the
"Indigent Defense Bar Consortium Contract" to collectively demand higher fees for certain types
of cases and refuse to accept specific additional cases unless the Clark County complied with
their demands. The county was forced to substantially increase the reimbursement rate for each
of the case categories specified in the Consortium Contract. According to the Commission, the
conduct of the attorneys was identical to the boycott staged by criminal defense attorneys in
Washington, DC which was ruled to be price fixing by the U.S. supreme Court in the matter of
Superior Court Trial Lawyers Association. Robert Lewis, James Sowder, Gerald Wear, and Joel
R. Yoseph, the four attorneys who led the activities and served as the representatives of the 43
attorneys who signed the Consortium Contract, were named in the complaint and in the consent
order.
Evanston Northwestern Healthcare Corporation (Proposed Consent Agreement Accepted
for Public Comment February 23,2005): Under terms of a proposed consent order, Evanston
Northwestern Healthcare Corporation agreed not to negotiate fee-for-service contracts. The
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I of an admnistrative complant Issued February
proposed order settled charges under Count J
10.2004.
FMC Corporation and Asahi Chemical Industry Co. Ud. (Final Order June 12,2002): A
consent order settled charges that FMC and Asahi Chemical Industry Co. Ltd. of Japan entered
into a conspiracy to divide the world market for micmrystalline cellulose (MCC), a binder used
in making pharmaceutical tablets, into two tenitories. According to the complaint, FMC
allegedly agreed not to sell the pharmaceutical to customers in Japan or East Asia without Asahi
Chemical's consent, while Asahi Chemical agreed not to sell the pharmaceutical to customers in
North America or Europe without the consent of FMC. The final order prohibits such behavior
in the future and restricts FMC from acting as the U.S. distributor for any competing
manufacturer of microcrystalline cellulose (including Asahi Chemical) for 10 years. In addition,
for five years, FMC is prohibited from distributing in the United States any other product
manufactured by Asahi Chemical.
Hoechst Marion Roussel (renamed Aventis as a result of the merger between Hoechst
AG and Rhone-Poulenc S.A.) (Final Order April 2,2001): A consent order settled
allegations in an administrative complaint that charged that Hoechst agreed to pay Andrx
Corporation millions of dollars not to market and distribute a generic version of Hoechst's
branded Cardizem CD, a once-a-day diltiazem drug product used in the treatment of hypertension
and angina. The consent order prohibits the companies from entering into agreements designed
to restrict the entry of generic competitors in an attempt to monopolize relevant markets .
Indiana Household Movers and Warehousemen, Inc. (Final Order April 25,2003): The
corporation that represents household goods movers in Indiana settled charges that it filed
collective intrastate rate tariffs with the State's Department of Revenue on behalf of its members.
According to the complaint issued with the consent order, these collective filings reduced
competition for household goods moving services within the state.
Institute of Store Planners (Final Order May 27,2003): Under the terms of a final consent
order, The Institute of Store Planners is required to remove from its Code of Ethics any provision
that prohibits its members from providing their services for free and any provision that prohibits
competition with other members for work on the basis of price. Its members provide
architectural store design and store and merchandise planning to retail stores.
Iowa Movers and Warehousemen's Association (Final Order September 10,2003): The
Iowa Movers and Warehousemen's Association settled allegations that it filed collectively
established tariffs for intrastate moving rates in Iowa - a practice which did not meet the
requirements of the state action doctrine. Under the state action doctrine, some practices of
private firms are protected against scmtiny by the federal antitrust laws.
Maine Health Alliance (Final Order August 27,2003): A network of doctors, hospitals, and
its executive director, William R. Diggins, settled charges that they illegally engaged in pricefixing activities that raised health care costs in five Maine counties by negotiating jointly with
third-party payers in a effort to obtain higher compensation and more advantageous contract
terms for its members.
Memorial Hermann Health Network Providers (Final Order January 18,2004): Memorial
Hermann Health Network Providers settled charges that it negotiated fees and other services for
medical care provided by its member physicians in the Houston, Texas area in an effort to obtain
higher fees and more advantageous terms. According to the complaint these alleged price fixing
practices increased costs for consumer, employers, and health plans.
Minnesota Transport Services Association (Final Order September 15,2003): A consent
order settled charges that the household goods movers association filed collectively established
rate tariffs for its members in Minnesota, conduct that was not protected by the state action
doctrine. Under a state action doctrine, some private companies may be protected from the
federal antitrust laws if the state authority regulates and regularly reviews the operations and
practices of the companies.
National Academy of Arbitrators (Final Order January 13,2003): The National Academy of
Arbitrators is prohibited from adopting policies that restrict its members from advertising truthful
information about their services, including prices and conditions of services, under terms of a
consent order. The association is required to remove all provisions that do not conform to the
provisions in the consent order from: (1) its Code of Professional Responsibility for Arbitrators
of Labor-Management Disputes; (2) its Formal Advisory Opinions; (3) any Statements of Policy;
and (4) its Web site.
New Hampshire Motor Transport Association (Final Order December 4,2003): The New
Hampshire Motor Transport A$sociation settled charges that it filed tariffs containing rules that
called for automatic increases in intrastate rates. In addition, the organization agreed to void its
collectively filed tariffs current in effect in New Hampshire.
Obstetrics & Gynecology Medical Corporation of Napa Valley (Final Order May 14,
2002): A doctors' group consisting of nearly every obstetrician and gynecologist with active
medical staff privileges at the two general acute care hospitals in Napa County, California settled
charges that they restrained price and other competition by engaging in illegal agreements to fix
fees and other terms of dealing with health care insurance plans. According to the complaint
issued with the consent order, the doctors refused to deal with the third party payers except on
collectively determined te,rms. The consent order not only prevents the doctors from engaging in
similar practices in the future but also requires the dissolution of the group.
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Physician Network Consulting, L.L.C. (Final Order August 27,2003): The Physician
Network Consulting, L.L.C. of Baton Rouge Louisiana; Michael J. Taylor; Professional
Orthopedic Services, Inc; The Bone and Joint Clinic of Baton Rouge, Inc.; Baton Rouge
Orthopaedic Clinic, L.L.C.; and Orthopaedic Surgery Associates of Baton Rouge, L.L.C. settled
charges that they entered into agreements to fix pnces and other terms on which they would deal
with United Healthcare of Louisiana, Inc., a health insurance company. Physician Network
Consulting is an agent for Professional Orthopedic Services' members.
Preferred Health Services, Znc. (Proposed Consent Agreement Accepted for Public
Comment Februarv 25,2005):
. A uroposed consent order prohibits Preferred Health Services
from orchestrating collective agreements and other terms for physician services when negotiating
with health insurance plans and other third party payers. According to the complaint issued with
the proposed consent order, these agreements among the physician-hospital organization of
doctors and the Oconee Memorial Hospital in northwestern South Carolina to collectively
negotiate fees and terms of services could lead to higher health care costs and limited physician
access.
&
*
Professional Integrated Services of Denver, Znc., Michael J. Guese, M.D., and Marcia
A. Brauchler (Final Order July 19, 2002): A consent order settled charges that a Denver,
Colorado physician organization and its members, its president, Dr. M. J. Guese, and its nonphysician consultant, M. A. Brauchler, increased fees for services through collective boycotts and
agreements in a effort to fix the prices they would receive from health care insurance payers. The
order prohibits the organization and its members and other respondents from entering into any
agreement with insurance payers or providers to negotiate on behalf of the physicians group.
ProfessionaIs in Women's Care (Final Order October 2,2002): Eight Denver, Colorado
physician groups specializing in obstetrics and gynecology and their non-physician agent settled
allegations that the practice group and other physicians entered into collective contracts in an
effort to increase prices and terms of services when dealing with health insurance firms and other
third-party payers. The consent order prohibits the following respondents from entering into
such agreements in the future: R.T. Welter and Associates, Inc.; R. Todd Welter; Consultants in
Obstetrics and Gynecology, P.C.; Mid Town Obstetrics & Gynecology, P.C.; Mile High
OGIGYN Associates, P.C.; The OB-GYN, P.C.; The Women's Health Group, P.C.; Cohen and
Womack, M.D., P.C.; and Westside Women's Care, L.L.P.
Southeastern New Mexico Physicians ZPA (Final Order August 6,2004): A Roswell, New
,Mexico physicians' association, southeastern New Mexico Physicians P A , settled charges that it
and two of its employees entered into collective agreements among physician members on fees
and refused to deal with health plans that did not accept the collective agreed-upon terms.
According to the complaint, these practices increased the price of health care in the Roswell area.
The consent order prohibits the IPA and its employees named in the consent from orchestrating
agreements between physicians to negotiate with health insurance plans on behalf of any
physician and deal or refuse to deal individually with any third party payer.
South Georgia Health Partners, L.L.C. (Final Order October 31,2003): A Georgia
physician-hospital organization and its other associated physician groups settled charges that they
entered into agreements to fix physician and hospital prices and refused to deal with insurance
companies, except on collectively agreed-upon terms.
SPA Health Organization dba Southwest Physician Associates (Final Order July 17,
2003): A physician group in the DallaslFort Worth, Texas area settled charges that it collectively
bargained on behalf of its members to negotiate fee schedules with third party payers and other
health insurance companies. According to the complaint, issued with the consent order, these
practices decreased competition and increased prices for the provision of medical services to area
consumers.
Surgical Specialists of Yakima
(Final Order November 11,2003): The Surgical Specialists
of Yakima, Cascade Surgical Partners, Inc., P.S. and Yakima Surgical Associates, P.S. settled
charges that they jointly entered into agreements for their members to fix prices and terms for the
provision of medical services when dealing with health care insurers.
1
System Health Providers (Final Order August 20, 2002): System Health Providers and its
parent corporation, Genesis Physicians Group, Inc., settled charges that they collectively
bargained with health insurance finns to accept proposed fee schedules; discouraged members
from entering into contracts directly with payers; and refused to deal with health insurance firms
and other third-party payers except on collectively agreed upon terms. The order prohibits the
recurrence of the alleged practices and actions.
Tenet Healthcare Corporatiorr (Final Order January 29,2004): A consent order prohibits
Frye Regional Medical Center, Inc., an acute care hospital in Hickory, North Carolina, and its
parent company Tenet Healthcare Corporation from entering into any agreement to negotiate fees
on behalf of any physician practicing in four North Carolina counties and from refusing to deal
with insurance companies and other payers. Also refer to related administrative complaint issued
to Piedmont Health Alliance. This settlement is the first case in which the Commission has
named a hospital as a participant in an alleged physician price-fixing conspiracy.
Virginia Board of Funeral Directors and Embalmers (Final Order October 1,2004):The
Virginia Board of Funeral Directors and Embalmers settled charges that it prohibited Virginia
funeral directors and service providers from engaging in truthful advertising to notify consumers
of prices and discounts for funeral products and services. Under terms of the consent order, the
Board is prohibited from engaging in such practices in the future and is required to amend its
regulation prohibiting Board licensees from advertising funeral services including those services
that can be contracted prior to the death of the person whose funeral is being planned.
Warner Communications Znc. (Final Order September 17,2001): Warner Communications,
Inc. and Vivendi Universal S.A. settled charges that they entered into agreements to fix prices
and restrict advertising. According to the complaint issued with the consent order, the two firms
formed a joint venture to distribute compact discs, cassettes, videocassettes of the public
performances of the Three Tenors. The venturers agreed not to advertise or discount the 1990
and 1994 concerts of the Three Tenors in an effort to restrict competition with the recordings of
the1998 concert recording. The 1998 concert was thought to be less appealing and not as popular
as the earlier performances. The consent order prohibits the firms from restraining competition
by entering into agreements fix prices or restrict advertising in the future.
Washington University Physician Network (Final Order August 22,2003): A consent order
prohibits a St. Louis, Missouri physicians' organization from negotiating with third party payers
on behalf of its member physicians and from refusing to deal with health insurance companies.
White Sands Health Care System, L.L.C. (Final Order January 1I, 2005): A consent order
settled charges that the White Sands Health Care System refused to deal with health care insurers
that resisted the collectively negotiated prices set by its member physicians and nurse
anesthetists. The complaint alleged
- that these practices increased costs for health care for
consumers in the Alamogordo, New Mexico area. White Sands, a physician-hospital
organization, consists of Alamogordo Physicians, an independent practice association; Gerald
Champion Regional Medical Center, and 31 non-physician health care providers, including all
five nurse anesthetists in the area.
E.
Administrative Complaints
AZabama Trucking Association, Znc. (July 8,2003): An administrative complaint charged
that the association of household goods movers engaged in the collective filing of tariffs on
behalf of its members who compete in the provision of moving services in the state of Alabama.
Under terms of a final consent order issued October 28,2003, Alabama Trucking Association,
Inc. agreed to stop filing tariffs containing collective intrastate rates and to voidcollectiveiy filed
tariffs currently in effect in Alabama.
California Pacific Medical Group dba Brown and Toland Medical Group (July 8,2003):
An administrative complaint charged a San Francisco, California physicians' organization with
engaging in an agreement under which its competing members agreed collectively on the price
and other terms on which they would enter into contracts with health plans or other third party
payers. The complaint also alleged that Brown and Toland directed its physicians to end their
preexisting contracts with payers and required its physician members to charge specified prices in
all Preferred Provider Organization contracts. A final consent order issued February 3,2004,
prohibits Brown and Toland from negotiating with payers on behalf of physicians, refusing to
deal with payers, and setting terms for physicians to deal with payers, unless the physicians are
clinically or financially integrated.
Gerald Wear
Joel R. Yoseph
Refer to discussion under Chrk County Attorneys
Refer to discussion under Clark County Attorneys
Kentucky Household Goods Cam'ers Association, Znc. (July 8,2003): An administrative
complaint charged that the association composed of competing household goods movers filed
collective rates for intrastate moving services in the state of Kentucky. According to the
complaint, these activities were not protected under the state action doctrine and are not immune
from federal antitrust scrutiny.
Movers Conference of Mzksissippi, Znc. (July 8,2003): An administrative complaint
charged that the association composed of competing household goods movers filed collective
rates for intrastate moving services in the state of Mississippi. According to the complaint, these
activities were not protected under the state action doctrine and are not immune from federal
antitrust scrutiny. Under terms of a final consent order issued October 28,2003, the Movers
Conference agreed to stop filing tariffs containing collective intrastate rates.
North Texas Specialty Physicians (September 16, 2003): An administrative complaint
charged that the corporation of 600 physicians negotiated the price and other terms of medical
services that its participating physicians would accept in contracting with thil-d party payers.
According to the complaint, the exchange of prospective price information among otherwise
competing physicians reduced competition and enabled the physicians to achieve supracompetitive prices. The initial decision filed November 16, 2004 is presently on appeal to the
Piedmont Health Alliance, Inc. (December 22,2003): An administrative complaint charged
Piedmont Health Alliance, Inc. with collectively setting prices it demanded for physician services
with third party payers. According to the complaint, the physician-hospital organization entered
into signed agreements on behalf of its member physicians to participate in all contracts
negotiated and to accept the negotiated physician fees. The complaint further alleges that these
practices eliminated price competition among physicians in the North Carolina counties of
Alexander, Burke, Caldwell and Catawba. The complaint also names ten individual physicians
who participated in the alleged price fixing services. On August 10, 2004, the organization and
physicians agreed to settle charges that they fixed prices for medical services. On October 1,
2004, a final consent order prohibited Piedmont Health Alliance, Inc. and the ten physicians from
entering into any such agreements with physicians in the area that negotiate fees or terms of
services with health insurance companies or other third party payers. Also refer to settlement
entered with Tenet Healthcare Corporation @rye Regional Medical Center, Inc.).
Polygram Holding, Inc. (The Three Tenors) (July 30,2001): An administrative complaint
i
I
charged that the Warner and PolyGram Music Group joint venture ageed not to discount or
advertise the 1990 and 1994 Three Tenors albums and videos in an attempt to promote the 1998
Three Tenors concert. The complaint further alleged that the parties to the venture, formed to
distribute compact discs, cassettes and video cassettes, was concerned that the 1998 performance
would not be as well received as the earlier recordings. An initial decision upheld the complaint.
The Commission issued an opinion that affirmed the initial decision. The decision is on appeal
in the District of Columbia Court of Appeals.
Rambus, Inc. (June 19, 2002): An administrative complaint charged that between 1991 and
1996, Rambus joined and participated in the JEDEC Solid State Technology Association
(JEDEC), the leading standard-setting industry for computer memory. According to the
complaint, JEDEC rules require members to disclose the existence of all patents and patent
applications that relate to JEDEC's standard-setting work. While a member of JEDEC, Rambus
observed standard-setting work involving technologies which Rambus believed were or could be
covered by its patent applications, but failed to disclose this to JEDEC. In 1999 and 2000, after
JEDEC had adopted industry-wide standards incorporating te technologies at issue and the
industry had become locked in to the use of those technologies, Rambus sought to enforce its
patents against companies producing JEDEC-compliant memory, and in fact has collected
substantial royalties from several producers of DRAM (dynamic random access memory). An
initial decision dismissed the charges.
Robert Lewis
Refer to discussion under Clark County Attorneys
Schering - Plough Corporation (March 30, 2001): The complaint alleged that Schering Plough, the manufacturer of K-Dur 20 - a prescribed potassium chloride, used to treat patients
with low blood potassium levels - entered into anticompetitive agreements with Upsher-Smith
Laboratories and American Home Products Corporation to delay their generic versions of the KDur 20 dmg from entering the market. According to the charges, Schering-Plough paid UpsherSmith $60 million and paid American Home $15 million to keep the low-cost generic version of
the drug off the market. The charges against American Home were settled by a consent
agreement. An initial decision filed July 2,2002 dismissed all charges against Schering - Plough
and Upsher-Smith Laboratories. A Commission opinion found that the agreements violated the
Federal Trade Commission Act. On March 8,2005, the Eleventh Circuit Court of Appeals set
aside and vacated the Commission decision.
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South Carolina State Board of Dentktry (September 12,2003): An administrative
complaint alleged that the South Carolina State Board of Dentistry prevented dental hygienists
from providing dental care and services on-site to children in South Carolina schools. According
to the complaint, the Board passed regulation that required the children to have a dentist examine
the children before they would be eligible for the school dental program. The complaint further
alleged that this provision decreased competition in the delivery of preventive dental services to
school-aged children. On July 30,2004, the Commission denied the motion of the Board to
dismiss the complaint on grounds that its actions were protected from antitrust scrutiny under the
state action doctrine. The South Carolina State Board of Dentistry appealed the Commission
opinion to the Fourth Circuit Court of Appeals.
Union Oil Company of California (March 4,2003): An administrative complaint charged
that Union Oil Company of California (Unocal) made misleading statements concerning its
emissions results for the production of "summer-time" gasoline mandated by the California Air
Resources Board (CARB) for use March through October. According to the complaint, Unocal
lead producers of the CARB gasoline to believe that its research was non-proprietary and in the
public interest, while at the same time it failed to disclose that it had patent pending claims on the
research results with the U.S. Patent and Trademark Office. As a result of the patent being
allowed, Unocal is now in a position to enforce its patent rights - requiring companies that
produce the "summer-time" CARB gasoline to pay substantial royalties to Unocal if they use the
patented technology. An initial decision dismissing the complaint was filed on February 17,
2004.
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Other
Public Documents/I'olicy Statements/Conferences
Agreements Filed with the Federal Trade Commission under the Medicare Prescription
Drug, Improvement, and Modernization Act of 2003: Summary of Agreements Filed in
FY 2004: A Report by The Bureau of Competition (January 7,2005): Information
regarding the 22 agreements that were filed with the Commission in fiscal year 2004.
Policy Statement on Monetary Equitable Remedies in Competition Cases (July 25,2003):
The Commission issued a policy statement that identified three factors that will be considered in
determining whether the Commission will seek disgorgement or restitution in competition cases.
First, the Commission will ordinarily seek monetary relief when the underlying violation is clear.
Second, there must be a reasonable basis for calculating the amount of remedial payment. Third,
the Commission will consider the value of seeking monetary relief in light of other remehes
available in the matter including private actions and criminal proceedings.
FTC Antitrust Actions in Pharmaceutical Services and Products (November 8,2002):
Summary of health care antitrust matters involving the pharmaceutical industry and enforcement
policy prepared by the FTC Health Care Services and Products Division Staff.
Second Public Conference on the U.S. Oil and Gasoline Industry (May 2002): From May 6 9,2002, the Commission held a second public conference to examine factors that affect prices of
refined petroleum products in the United States. The goal of the conference was to solicit
information and views on the major factors affecting the prices of refined petroleum products,
along with the relative importance of such factors.
I
Refined Petroleum Products in the United States (Public Conference August 2,2001): A
public conference was held to examine factors that affect prices of refined petroleum prices in the
United States. The participants included consumer groups, industry participants, and
independent experts - parties that can focus on domestic and international aspects of gasoline
industry.
Midwest Gas Price Investigation (March 30,2001): The final Commission Report found that
there was no evidence of collusion or other anticompetitive conduct bv the oil industm to cause
gasoline price spikes during the spring and summer of 2000. The nine-month investigation
identified several key factors that contributed to the price increases: refinem
- production
problems; errors in estimating the potential for supply shortages in the Midwest.
Commission Studies/Guidelines
The Petroleum Industry: Mergers, Structural Change and Antitrust Enforcement: A
Report of the Staff of the Federal Trade Commission, Bureau of Economics (August
2004): The staff report describes the Commission's merger enforcement actions in petroleumrelated markets during the past 20 years; provides an overview of industry trends in production
and pricing; provides an analysis of merger activity for the period 1985 through 2001; and
examines trends at specific industry levels: crude oil production and reserves; bulk transport of
crude oil; refining; bulk transport of refined products; and product terminals and gasoline
marketing.
Improving Health Care: A Dose of Competition: A Report by the Federal Trade
Commission and the Department of Justice (July 23,2004): Joint report to inform
consumers, businesses, and policy-makers on a range of issues affecting the cost, quality, and
accessibility of health care.
Fulfilling the Original Vision: The FTC ai 90
(April 2,2004): Report highlights some
of the Commission's accomplishments from the past year and outlines several goals to guide the
agency's twin missions of competition and consumer protection.
Possible Anticompetitive Barriers to E-Commerce: Contact Lenses: A Report from the
Staff of the Federal Trade Commission (March 29,2004): The staff report concludes that
ecommerce offers consumers greater choices and more convenience in the contact lens market.
Pharmaceutical Agreement Notification Filing Requirements (Effective January 7 ,
2004): Agreements between Brand-name and generic pharmaceutical companies regarding the
manufacture, marketing, and sale of generic versions of brand-name drug products are required to
be filed with the Commission and the Department of Justice, pursuant to Section 1112 of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003.
Slotting Allowances in the Retail Grocery Industry: Selected Case Studies of Slotting
Allowances in Five Product Categories (November 14,2003): Slotting allowances paid to
certain retailers in certain geographic areas for five product categories: fresh bread, hot dogs, ice
cream and frozen novelties, shelf-stable pasta, and shelf-stable salad dressing.
To Promote Innovation: The Proper Balance of Competition and Patent Law and
Policy, A Report by the Federal Trade Commission (October 2003): The report is the first of
two reports about how to maintain that balance. The report concludes that questionable patents
are a significant competitive concern andcan harm innovation. The report makes
recommendation to reduce the number of questionable patents that are ~ssuedand upheld.
Report of the State Action Task Force: Recommendations to Clarib and R e a f f i n the
Original Purposes of the State Action Doctrine to Help Ensure that Robust
Competition Continues to Protect Consumers (September 23,2003): The staff report
concludes that the scope of the antitrust state action doctrine has expanded dramatically since its
articulation by the Supreme Court. The report recommends clarifications of the doctrine,
including more rigorous application of the "clear articulation" and "active supervision"
requirements.
Possible Anticompetitive Barriers to E-Commerce: Wine (July 3,2003): Staff report
concludes that e-commerce offers consumers lower prices and more choices in the wine market.
Report concludes that state bans on interstate direct shipping imposes the largest regulatory
barrier to expanded e-commerce in wine.
Generic Drug Entry Prior to Patent Expiration: An FTC Study (Released July 30,2002):
The Commission recommends changes to the Hatch-Waxman Amendments to permit only one
automatic 30-month stay per drug product, per generic entry application, and to resolve
infringement disputes over patents listed in the "Orange Book" prior to the filing of a generic's
entry application. By limiting the availability of 30-month stays to one per drug product, per
generic application, the report concludes that generic entry by other firms would be facilitated.
In addition, the Commission supports S.754, The Drug Competition Act, to require brand-name
companies and first generic applicants to provide copies of certain agreements to the Federal
Trade Commission and the Department of Justice.
Advisory Opinions
Bristol-Myers Squibb. Staff advised Bristol-Myers Squibb that its proposed settlement with
Teva Pharmaceuticals USA, inc. does not raise issues under Section 5 of the Federal Trade
Comm~ssionAct. (May 2004)
Dunlap Memorial Hospital in Orville, Ohio. Staff concluded that Dunlap's provision of
pharmaceuticals to the Viola Startzman Free Clinic falls within the scope of the Non-Profit
Institutions Act. (January 9,2004)
Medical Group Management Association: Letter from Jeffrey W. Brennan to Gerald
Niedeman. An association of medical practice administrators requested an opinion
concerningits proposal to conduct and publish the results of a survey of physician practices.
3,2003)
(November
Partlinx LLC. Staff advised that Commission does not presently intend to recommend law
enforcement action in connection with Partlinx's proposed e-commerce joint venture. (October
10,2003)
Bay Area Preferred Physicians. The Bureau advised that it does not presently intend to
recommend an enforcement action if Bay Area Preferred Physicians establishes a physician
network to create new contracting opportunities between physicians and health plans and other
third-party payers. (September 23,2003)
Valley Baptist Medical Center. Sale of pharmaceuticals to contracted workers who provide
services at VBMC.
(March 18,2003)
Arkansas Children's Hospital. Sale of pharmaceuticals to patients seen in clinics that are
located on ACH's campus but are operated by the University of Arkansas for Medical Sciences.
(March 18,2003)
PriMed Physicians : Proposal by physician group to create with other Dayton, Ohio area
physicians an advocacy group to undertake "a campaign to inform and educate the general
public" of policies and procedures by third party payers in Dayton. (February 6,2003)
Joint FTC and DOJ letter urging Council of the North Carolina State Bar to approve a
proposed opinion that would explicitly permit non-lawyers to compete with lawyers to
perform real estate closings. (July 11,2002)
MedSouth, Znc. A multi-specialty physician practice association in Denver, Colorado intends
to operate a nonexclusive physician network joint venture. (February 21,2002)
Connecticut Hospital Association The applicability of the Non-Profit Institutions Act to sales
of pharmaceuticals by its member hospitals to their retired employees.(December 20,2001)
Harvard Vanguard Medical Associates7 Znc. Sale of pharmaceuticals by non-profit, multispecialty medical clinic to employees and to patients treated at the clinic. (December 18,2001)
Advocacy Filings
Comments of Staff of the Federal Trade Commission Bureau of Competition, Bureau of
Economics and the Office of Policy Planning regarding three bills that the Virginia Assembly
considered: HB 2518 - would loosen current restrictions on competition between commercial and
independent optometrists; and HB 160 and SB 272 - would further impair competition between
these groups of eye care professionals. (March 9,2005)
Comments of Staff of the Federal Trade Commission Bureau of Competition, Bureau of
Economics and the Office of Policy Planning to North Dakota State Senator Richard L. Brown
concerning HB 1332 which might have the unintended consequences of increasing the price of
pharmaceuticals within the state and ultimately decrease the number of North Dakotans with
insurance coverage for pharmaceuticals. (March 8,2005)
Joint Amicus Brief Filing with the U.S. Department of Justice
Empagran, S.A. v.
Hoffmann-LaRoche, Ltd., No. 01-71 15 (D.C. Cir.). International cartels. (February 18, 2005)
Brief Amicus Curiae Teva Pharmaceuticals USA, Inc. v. Pfizer, Inc. Case No. 04-1 156
(Fed. Cir.) Teva, in an effort to market its generic version of Pfizer's Zoloft drug, sued Pfizer
challenging the patent for Zoloft. (February 11, 2005)
Joint Comments of the Federal Trade Commission and the Department of Justice to
Chief Justice McFarland of the Kansas Supreme Court concerning the Unauthorized Practice of
Law Committee of the Kansas Bar Association's proposal to define the practice of law.
(February 4,2005)
Joint Comments of the Federal Trade Commission and the Department of Justice
urging the Massachusetts Bar Association to narrow or reject a proposal that would reduce
competition between nonlawyers and lawyers to provide certain services. (December 16,2004)
Joint Comments of the Federal Trade Commission and the Department of Justice to
The Honorable Paul Kujawski, Member of the Massachusetts House of Representatives,
concerning the adoption of HB 180, a bill that would enable nonlawyers to compete with lawyers
to perform certain real estate closing services. (October 12,2004)
Comments of Staff of the Federal Trade Commission to California Assembly Member
Greg Aghazaian concerning a bill (AB 1960) that requires pharmacy benefit managers to disclose
certain information to purchasers of their services. (September 10,2004)
Brief Amicus Curiae Cleveland Bar Association v. CompManagement, Inc. (Case No.: W L
02-04) Matter on appeal from a decision rendered by Ohio's W L Board finding that
CompManagement, an actuarial firm, had engaged in the unauthorized practice of law through its
representation of employers in workers' compensation matters before the Ohio Industrial
Commission. (August 5,2004)
Joint Brief Amicus Curiae Federal Trade Commission and the Department of Justice
Andrx Pharmaceuticals, Inc. v. Kroger Company, et al. (US. Court of Appeals for the Sixth
Circuit) Private antitrust matter concerning an interim settlement of a pharmaceutical patent
infringement case, in which the alleged infringer agreed not to market its product while the
infringement litigation was pending. (July 16,2004)
Comments of the Federal Trade Commission to the Federal Energy Regulatory Commission
concerning revisions to the conditions under which FERC will permit electric utilities to sell
wholesale power at market rather than regulated rates. (July 16,2004)
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Comments of the Federal Trade Commission to the Federal Energy Regulatory Commission
concerning FERC's policies governing electric utility procurement of wholesale electric supply
from affiliated generators and through acquisition of affiliated, unregulated generation assets.
(July 14,2004)
Comments of Staff of the Federal Trade Commission
Bureau of Competition, Bureau of
Economics and the Office of Policy Planning to Michigan House Representative Gene DeRosset
on Michigan's proposed bill 4757, "Petroleum Marketing Stabilization Act". (June 18,2004)
Joint Brief Amicus Curiae Federal Trade Commission and the Department of Justice
in Jackson Tennessee Hospital Co., No. 04-5387 (6* Cir.) Brief contends that the district court
improperly concluded that Tennessee Hospital Co. and other defendants were exempt from
antitrust enforcement under the state action doctrine. (June 4,2004)
Joint Brief Amicus Curiae Federal Trade Commission and the Department of Justice
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in McMahon v. Advanced Tltle Services Company of West Virginia. The brief argues that
allowing nonlawyers to compete wlth lawyers in the provision of real estate settlement services,
including title searching, title reports, closings, and document deliveries, would benefit West
Virginia consumers in a variety of ways.
(May 25,2004)
Comments of the Staff of the Federal Trade Commission
Bureau of Competition,
Bureau of Economics and the Office of Policy Planning to Rhode Island Attorney General
Patrick C. Lynch and Deputy Senate Majority Leader Juan M. Pichardo on seven state bills that
contain "freedom of choice" and "any willing provider" provisions for pharmaceutical sales.
(April 12,2004)
Comments of the Staff of the Federal Trade Commission Bureaus of Competition,
Consumer Protection and Economics and the Office of Policy Planning provide comments on
Maryland House Bill 795 which would permit corporate ownership of funeral homes. (April 6,
2004)
Comments of the Staff of the Federal Trade Commission Bureaus of Competition,
Economics, Consumer Protection, the Northeast Regional Office and the Office of Policy
Planning provided comments on three bills that would allow out-of-state vendors to ship wine
directly to New York consumers if the vendors comply with certain regulatory requirements.
(March 30,2004)
Comments of Staff of the Federal Trade Commission Bureau of Competition, Bureau of
Economics and the Office of Policy Planning to Kansas State Senator Les Donovan regarding
Bill No. 2330 which would bar the "below-cost" sale of motor fuel. (March 16,2004)
Comments of the Staff of the Federal Trade Commission Bureau of Competition, Bureau
of Economics, and the Office of Policy Planning. Comments to the Speaker Pro Tempore of the
,
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Alabama State House of Representatives Concerning the Alabama Motor fuels Marketing Act
(January 29, 2004)
Joint Comments of the Federal Trade Commission and the Department of Justice on a
draft of the proposed amendment to the Indiana Supreme Court Admissions & Discipline Rule
regarding Unauthorized Practice of Law to the Indiana State Bar Association. (October 10,
2003)
Comments of the Staff of the Federal Trade Commission Bureau of Competition, Bureau
of Economics, and the Office of Policy Planning. Analysis of Wisconsin's Unfair Sales Act:
Letter to Wisconsin State Representative Shirley Kmg. (October 1, 2003)
Comments to th Federal Energy Regulatoly Commission regarding proposed revisions to
market-based tariffs and authorization.
(August 28,2003)
Letter sent to New York Attorney Eliot Spitzer. Comments of the Office of Policy and
Planning and the Bureau of Competition stated that there is a significant risk that the Motor Fuel
Marketing Practices Act could harm consumers by reducing competition in the sale of motor
fuels. (July 24,2003)
Application for Approval of Asset transfer Agreements with Affiliated Company,
Ameren Union Electric Comnanv. Comments to the Jliinois Commerce Commission
A
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regarding the transfer of generation assets from an unregulated affiliated to its regulated parent
utility. (June 18,2003)
1
Proposed Amendments to the North Carolina Motor Fuel Marketing Act. Comments of
I
the Federal Trade Commission's Bureau of Competition, Bureau of Economics, and the Office of
Planning. Letter to Senator Daniel G. Clodfelter, Chairman of the Judiciary I Committee, stating
that the proposed amendments to the state's Motor Fuel Marketing Act are not only unnecessary,
but have significant potential to harm consumers by causing them to pay more at the pump.
(May 2 1,2003)
Standards for Determining Whether Natural Gas Prices are Constrained by Market
Forces. Comments to the Georgia Public Service Commission regarding proposed standards to
determine whether market forces constrain retail prices for natural gas. (April 24,2003)
The Potential Effect of Tenet Healthcare Corporation's Proposed Purchase of Slidell
Memorial Hospital. Letter from Bureau of Competition, Bureau of Economics and the Office
of Policy Planning to Louisiana Attorney General, The Honorable Richard P. Ieyoub, opposing
the proposed acquisition by Tenet Health Care Systems of the Slidell Memorial Hospital.
According to the letter, the proposed acquisition would eliminate competition and probably give
Tenet the opportunity to increase prices unilaterally following the acquisition. (April 1,2003)
Real Estate Closing Activities. The Commission and the Department of Justice Joint letter to the
Rhode Island House of Representatives on Proposed Bills H.5936 and H.5639: Proposed
Restrictions on Competition from Non-Attorneys. The agencies expressed concerns that the bills
would eliminate competition between non-lawyers and lawyers in the closing of real estate deals
in Rhode Island by requiring a lawyer to close almost all real estate closings. (April 1,2003)
Competition and the Effects of Price Controls in Hawaii's Gasoline Market
(January
28,2003)
Competition and the Effects of Price Controls in Hawaii's Gasoline Market (January
28,2003)
In the Matter of Application for FDA Approval to Market a New Drug; Patent Listing
Requirements; Comments of the FTC Before the HHS and FDA (December 23,2002)
FTC/DOJ Comments on the American Bar Association's Proposed Model Definition of
the Practice of Law (December 20,2002)
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Ohio House Bill 325 Physician Collective Bargaining (October 16,2002)
Bill No.SO4522 (New York Motor Fuel Marketing Practices Act); /Bill No. A06942 (An
Act to Amend the General Business Law, in Relation to the Operation of Retail Service
Stations) (August 8,2002)
Proposed North Carolina State Bar Opinions Concerning Non-Attorneys' Involvement
in Real Estate Transactions (July 11,2002)
Proposed Bill H. 7462, Restricting Competitionfrom Non-Attorneys in Real Estate
Closing Activities (March 29,2002)
The Threat of Consumer Harm Resulting from Physician Collective Bargaining Under
Alaska Senate Bill 37 (March 22,2002)
Virginia Senate Bill No. 458, "Below-Cost sales of Motor Fuels"
(February 15,2002)
Washington House Bill 2360, Physician Antitrust Immunity (February 8,2002)
Alaska Senate Bill 37, Physician Antitrust Immunity (January 18,2002)
North Carolina State Bar Opinions Restricting Involvement of Non-Attorney in Real
Estate Closings and Refinancing Transactions Pecember 14,2002)
Competition and Consumer Protection Perspectives on Electric Power Regulatory
Reform (July 20,2002)
Healthcare
Hearings on Healthcare and Competition Law and Policy sponsored by the Commission
and the Department of Justice. September 24 - 26; and 30; October 1,2003, Washington, DC.
Physician Product and Market Definition
Physician Information Sharing
Physician P A S - Pattems and Pattems of Integration - Messenger Model
Physician Unionization; Group Purchasing Organizations
International Perspectives on Health Care and Competition Law and Policy
Medicare and Medicaid
Remedies: CivilICriminal
Hearings on Healthcare and Competition Law and Policy sponsored by the Commission
and the Department of Justice. June 25 - 26,2003, Washington,DC.
Mandated Benefits
Pharmaceutical: Formulary Issues
Prospective Guidance
Hearings on Healthcare and Competition Law and Policy sponsored by the Commission
and the Department of Justice. May 27; 29; and 30 and June 10 - 12,2003, Washington, DC.
Quality and Consumer Information - Hospitals
Physicians
Market Entry
Long Term CareIAssisted Living Facilities
Noerr-PenningtodState Action
Financing DesigdConsumer Information Issues
Hearings on Healthcare and Competition Law and Policy sponsored by the Commission
and the Department of Justice. April 21 - 23; May 7 - 8,2003, Washington, DC.
Health Insurance Monopoly - Market Definition. Competitive Effects
Health Insurance Monopoly - E n t v and Efficiencies
Health Insurance Monopsony - Market Definition - Competitive Effects
Health Insurance/Providers: Countervailing Market Power - Most Favored Nation Clauses
Physician Hospital Organizations
Qualify and Consumer Information - Overview
Hearings on Healthcare and Competition Law and Policy sponsored by the Commission
and the Department of Justice. March 26 - 28,2003, Washington, DC.
Round table discussion on hospital-related issues and an examination of product and
geographic markets for hospitals
Issues in litigating hospital mergers
Hearings on Healthcare and Competition Law and Policy sponsored by the Commission
and the Department of Justice. February 26 - 28, 2003, Washington, DC. Examined the state of
the healthcare market place and the role of competition, antitrust, and consumer protection in
satisfying citizens' preferences for high-quality, cost-effective healthcare.
Healthcare Impact of Competition Law & Policy on the Cost, Quality and Availability of
Healthcare and the Incentives for Innovation in the Field. September 9 10,2002 Workshop,
Washington,DC.
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Intellectual Property and Patent Law
(April 15 - 16,2004)
Ideals into Action: Implementing Reform of the Patent System
The Commission , the National Academy of Sciences, and the Berkeley Center for Law and
Technology sponsored a conference to address patent reform and how it might be implemented.
Town Meetings on Patent System Reform Three meetings in San Jose, California,
Febmary 18,2005; Chicago, IIlinois on March 4,2005; and Boston, Massachusetts on March 18,
2005 to bring together government officials, business representatives, lawyers and other
members of the patent community to discuss significant recommendations for patent reform
made by the Commission, the National Academies' Board on Science, Technology and
Economic Policy, and the American Intellectual Property Law Association.
-
Intellectual Property Law and Policy Roundtable Discussion (October 25,2002)
Competition, Economic, and Business Perspectives on Patent Quality and Institutional
Issues: Competitive Concerns, Prior Art,Post-Grant Review, and Litigation
Competition,Economic, and Business Perspectives on Substantive Patent Law Issues:
Non-Obviousness and Other Patentability Criteria
Antitrust Law and Patent Landscapes
Standard Setting Organizations: Evaluating the Anticompetitive Risks of Negotiating
Intellectual Property Terms and Conditions Before a Standard is Set
RelationshipsBetween Competitors and Incentives to Compete: Cross Licensing of
Patent Portfolios, Grantbacks, Reach-Through royalties, and Non-Assertion Clauses
www.ftc.gov/opp/inteIlect/index
Antitrust and Intellectual Property Law and Policy
Patent Pool and Cross-Licensing:When Do They Promote or Harm Competition? (April
17,2002)
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Standard-SettingPractices: Competition, Innovation and Consumer Welfare to Deal?
(April 18,2002)
The Strategic Use of Licensing: Is There Cause for Concern about Unilateral Refusals to
Deal? (May 1, 2002)
Patent Settlements: Efficiencies and Competitive Concerns (May 2, 2002)
Antitrust Analysis of Licensing Practices (May 14, 2002)
An International ComparativeLaw Perspective on the Relationship Between
Competition and Intellectual Property, Parts I and II (May 22 - 23, 2002)
Competition and Intellectual Property Policy
Cross-IndustryPerspectives on Patents (April 9, 2002)
Substantive Standards of Patentability (ApriI 10, 2002)
Patenting Procedures, Presumptions, and Uncertainties (April 10,2002)
Patentable Subject Matter - Business Method and Software Patents (April 11, 2002)
Patent Criteria and Procedures - Intemational Comparisons (April 11,2002)
Hearings to Focus on the Zmplications of Competitionand Patent Law and Policy
Competition and Intellectual Property Law and Policy in the Knowledge-Based
Economy (February 6,2002)
Patent Law for Antitrust Lawyers (February 8, 2002)
Antitrust Law for Patent Lawyers (February 8,2002)
Economic perspectives on Intellectual Property; Competition and Innovation (February
20,2002)
Business and Economic Perspectives on Real-World Experiences with Patents
(February 25 - 28,2002)
Business and Other Perspectives on Real-World Experiences with Patents march 19 20,2002)
Other
Oil industry Merger Effects (January 14,2005) The public conference discussed two recent
studies that focused on the price effects of mergers and concentration in the United States
petroleum industry.
(September 22 - 23,2004) The Federal Trade Commission
honored the agency's 90" anniversaryand featured over 50 participants, current Commissioners
and other agency officials, as well as prominent academics and practitioners, many of whom are
Federal Trade Commission alumnae.
9@hAnniversarySymposium
Anticompetitive Efforts to Restrict Competition on the Internet - (October 8 - 10,2002
Washington, DC): Public workshop explored possible anticompetitiveefforts to restrict
competition on the Internet.
Federal Circuit Jurisprudence: Jurisdiction, Choice of LAW, and Competition Policy
Perspectives (July 11,2002)
Slotting Allowances (May 31; June 1,2000): Commission held two public workshops on
"Slotting Allowances" - lump sum and up-front payments that food manufacturers pay to get
new products placed on supermarket shelves. The workshop provided manufacturers, retailers
and other interested persons who have had actual-hands on experience with grocery marketing
practices with a forum to discuss the nature of slotting allowances to assess whether they raise
competitive concerns.
Report on Slotting Allowances and Other Grocery Marketing Practices
(February 20,2001): Staff report on information gathered and antitrust issues addressed at
the public workshops held in 2000. C o m s s i o n staff recommended that the agency
gather basic data on current grocery marketing practices and continue to pursue
anticompetitive conduct on a case-by-case basis. In addition, staff recommended that the
agency refrain from issuing slotting allowance guidelines.
IV. International Activities
In recent years, the FTC has become increasingly involved with international aspects of
antitrust enforcement and policy. We work closely with other nations to protect
American consumers who can be harmed by cross-border anticompetitive conduct.
Because competition increasingly takes place on a worldwide scaie, cooperation with
competition agencies in the world's major economies and seeking convergence toward
sound antitrust policy are important components of the ETC's enforcement program.
Given differences in laws, cultures, and priorities, complete harmonization of antitrust
policy with other nations is unrealistic in the foreseeable future. However, areas of
agreement far exceed those of divergence with major trading partners, and instances in
which differences will result in conflicting outcomes are likely to remain the exception.
Both through formal agreements and informal relationships, the ETC has increased its
cooperation with agencies around the world on individual cases and on policy issues, and
is committed to addressing and minimizing policy divergences.
For example, the European Commission and the U.S. agencies routinely consult one
another both on cases of common concern and on policy and practice issues. The merger
process best practices issued in Fall 2002 show how we, along with merging parties, can
cooperate effectively in merger cases subject to review in the US and the EC. Similarly,
on competition policy, the U.S. agencies consulted with the EC on some of its recentlyadopted reforms, including its horizontal merger guidelines, that illustrate trans-Atlantic
convergence.
i
The recent merger transactions involving SanojXAventis, Sony/BMG, and GE/ZnVision
are examples of cases in which the FTC, the European Commission, and other antitrust
enforcers, aided by parties' confidentiality waivers, cooperated in analyzing the likely
effects of the mergers and in designing compatible remedies.
The FTC is a leader in various multilateral competition fora that further international
cooperation and convergence, such as:
.
The International Competition Network (ICN), which provides a venue for
antitrust officials worldwide to achieve consensus on proposals for procedural and
substantive convergence on best practices in antitrust enforcement and policy.
The FTC and the Department of Justice were among the sixteen agencies that
founded the ICN in 2001. Its membership has since grown to eighty-seven
agencies from seventy-eight jurisdictions. In June 2005, the ICN will hold its
fourth annual conference to discuss its work on multi-jurisdictional merger
review, anti-cartel enforcement, competition policy implementation, and antitrust
enforcement in regulated sectors.
The OECD's Competition Committee is an important forum for competition
officials from developed countries to share experiences and promote best
practices. The FTC participates actively in the OECD's continuing work on, inter
alia, merger process convergence, regulatory reform, the interface between trade
and competition policy, and exploring the synergies between competition and
consumer policy. We also promote sound competition policies in multilateral fora
such as the Asia-Pacific Economic Cooperation and lJNCTAD.
Trade agreements increasingly involve competition issues. The ETC participates with
other US agencies in negotiating competition chapters of bilateral and regional free trade
agreements. Last year we completed the competition chapter of the US-Australia
agreement, and we are currently involved in the US-Andean Community and USThailand negotiations. The FTC, with the DOJ Antitrust Division and other US
agencies, has worked with the nations of our hemisphere to develop competition
provisions for a Free Trade Agreement of the Americas. We also participate in
competition policy activities of the WTO.
The Commission continues its long-standing program to assist competition agencies in
new market-based economies. With funding pnncipally from the U.S. Agency for
International Development and in partnership with DOJ, we have provided competition
assistance to forty-six nations located in Latin America and the Caribbean, Central and
Eastern Europe, the fonner Soviet Union, Southeast and South Asia, and Africa. During
EY 2004, we began new programs with ASEAN and India, and provided assistance in
Central America.
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V. Competition Speeches
"New Trends in Antitrust Oversight of Mergers" (March 3,2005) Susan Creighton.
Director, Bureau of Competition. Panelist on Antitrust Issues in Today's Economy. New York,
New York.
"The Federal Trade Commission: Fostering a Competitive Health Care
Environment That Benefits Patients" (February 28,2005), Deborah Platt Majoras,
Chairman. World Congress Leadership Summit, New York, New York.
Steering Committee of the Antitrust and Consumer Law Section of the D.C. Bar
(February 23,2005) Deborah Platt Majoras, Chairman. Keynote Speaker, Washington, DC.
"Current Topics in Antitrust, Economics and Competition Policy" (February 8,2005)
Deborah Platt Majoras, Chairman and Susan Cre~ghton,D~rector,Bureau of Compet~tion.
Keynote Speakers, Charles River Associates Program, Washington, DC.
"The Use of Economics in Merger Analysis"
(January 27,2005) Luke M. Froeb,
Director, Bureau of Economics. The IBC Conference: The Use of Economics in Competition
Law, Brussels, Belgium.
"Promoting International Convergence: Spring Training for Antitrust
Professionals" (January 25, 2005) Deborah Platt Majoras, Chairman. Final Keynote at
ABA International Forum, Miami, Florida.
"Recent Actions at the Federal Trade Commission"
I
(January 18,2005) Deborah Platt
Majoras, Chairman. The Dallas Bar Association's Antitrust and Trade Regulation Section,
Dallas, Texas.
"Estimating the Price Effects of Mergers and Concentration in the Petroleum
Industry: An Evaluation of Recent Learning" (January 14,2005) Deborah Platt
Majoris, Chairman. Opening Remarks, Federal Trade Commission.
"Quantitative Methods in Merger Control" (December 3,2004) Luke Froeb, Director,
Bureau of Economics. King's College, London, England.
"Looking Forward: Merger and Other Policy Initiatives at the F T C (November 18,
2004) Deborah Platt Majoras, Chairman. ABA Antitrust Section Fall Forum, Washington, DC.
"From Theory to Praxis: Quantitative Methods in Merger Control" (October 30,
2004) Luke M. Froeb, Director, Bureau of Economics. Summit at Como: A Discussion of
Competition Policy, Law and Economics, Como, Italy.
"The Art and Science of Cost-Effective Counseling" (October 2,2004) Thomas B.
Leary, Commissioner. ABA Antitrust Section 2004 Antitrust Masters Course, Atlanta, Georgia.
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"Presenting Your Case to the FTC and DOJ The Keys to Success" (October 1,2004)
Pamela Jones Harbour, Commissioner. ABA Antitrust Section 2004 Ant~trustMasters Course,
Atlanta, Georgia.
ABA Antitrust Section 2004 Antitrust Masters Course (September 30,2004) Deborah
Platt Majoras, Chairman. Atlanta, Georgia.
"Antitrust Policy and Intellectual Property''
(September 27,2004) Thomas B. Leary,
Commissioner. Andrews' Publications Intellectual Property
- - 2004 Litigation Conference.
Chicago, Illinois.
"Competition Law and Consumer Protection Law: Two Wings of the Same House"
(September 22,2004) Thomas B. Leary, Commissioner. Written version of a speech delivered at
the FTC 90" Anniversary Symposium.
.
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The Economic Roots of Antitrust An Outline by Thomas B. Leary, Commissioner.
Speech given by Alden Abbott, Assistant Director, Office of Policy and Coordination, Federal
Trade Commission. Japan.
The Economic Roots of Antitrust
- An Outline by- Thomas B. Lean, Commissioner.
-.
(July 31,2004) Outline prepared for a presentation at the International Seminar on Antitrust
Law and Economic Development, Chinese Academy of Social Sciences Institute of Law.
Beijing, China.
Prepared Remarks (May 17,2004)
Thomas B. Leary, Commissioner. The American
Antitrust Institute's Roundtable Discussion on Antitrust and Category Captains, Washington,
DC.
Report from the Bureau of Competition (April 2,2004) Barry Nigro, Deputy Director,
Bureau of Competition. 52ndAnnual ABA Antitrust Section Spring Meeting.
"Unilateral Merger Effects & Economic Models" (March 3,2004) Luke M. Froeb,
Director, Bureau of Economics. The 2004 Antitrust Conference: Antitrust Issues in Today's
Economy, New York, New York.
"Diagnosing Physician-Hospital Organizations" (January 22,2004) Susan A. Creighton,
Director, Bureau of Competition. American Health Lawyers Association, Program on Legal
Issues Affecting Academic Medical Centers and Other Teaching Institutions, Washington, DC.
"A Regulator's Perspective on Protecting Consumers and Competitive
Marketplaces: Developments at the FTC" (November 7,2003) Orson Swindle,
Commissioner. American Bar Association, Section of Administrative Law and Regulatory
Practice, 2003 Administrative Law Conference, Washington, DC.
'The Role of Expert Economic Testimony in Antitrust Litigation" (November 2003)
Luke M. Loeb, Director, Bureau of Economics. Committee on Antitrust and Trade Regulation
of the Association of the Bar of the City of New York.
"A Federal-State Partnership on Competition Policy: State Attorneys General as
Advocates" (October 1,2003), National Association of Attorneys General, 2003, Antitrust
Seminar, Washington, DC.
"A&ust
in Healthcare: A Keynote Address" (May 15,2003) Thomas B. Leary,
Commissioner. Written version of May 15,2003 speech given at forum on Antitrust and
Healthcare, Health Lawyers Associat~onand the ABA Sections on Antitrust Law and Health,
Washington, DC.
"Advertising and Unfair Competition: FTC Enforcement" (March 21,2003) Thomas
B. Leary, Commissioner. 1 8 Annual
~
Advanced ALI-ABA Product Distribution and Marketing
Course of Study Program, Orlando, Florida.
"Vertical issues: The Federal View" (March 20,2003) Thomas B. Leary, Commissioner.
18" Annual Advanced ALI-ABA Product Distribution and Marketing Course of Study Program,
Orlando, Florida.
"Discussion of Generic Drug Study" (January 29, 2003) Michael S. Wroblewski, Assistant
General Counsel for Policy Studies, Office of General Counsel. Generic Pharmaceutical
Association Annual Meeting, Rio Grande, Puerto Rico.
Institute of Public Utilities' 34thAnnual Regulatory Policy Conference (December 10,
2002) Thomas B. Leary, Commissioner. Keynote Speaker, Tampa, Florida.
"Antitrust Implications Under Hatch-Waxman" (December 6,2002) Thomas B. Leary,
Commissioner. Food and Drug Law Institute Hatch-Waxman Update Conference, Washington,
DC.
"Competition" (October 30,2002) Thomas B. Leary, Commissioner. International Chamber
of Commerce, Department of Policy and Business Practices, ICC Commission, Ncw York, New
York.
American Bar Associations Antitrust Masters Course (October 25,2002) Thomas B
Leary, Commissioner. Remarks, Sea Island, Georgia.
"Current Developments in EC & US Antitrust Law" (October 10,2002) Thomas B.
Leary, Commissioner. European Law Research Center at Hanard Law School, Cambridge,
Massachusetts.
Anticompetitive Efforts to Restrict Competition on the Internet Workshop (October
8, 2002) Timothy J. Muris, Chairman, Opening Remarks. Comments by Thomas B. Leary,
Commissioner. October 10,2002 Session, Opening Remarks by Sheila F. Anthony,
Commissioner; and Concluding Remarks by Ted Cruz, Director, Office of Policy Planning,
Washington, DC.
"New Directions in Antitrust Enforcement" (July 4,2002) Thomas B. Leary,
Commissioner. National Economic Research Associates 22ndAnnual Antitrust and Trade
Reg
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