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OTA Case Turns Out to Be Less about MFNs and More about Agreement

Back in September 2012, the potential anticompetitive aspects of most favored nation (MFN) clauses was the hot antitrust topic.  While antitrust counselors (and courts) had found the clauses to be innocuous almost all the time, government officials made speeches and even held a workshop in front of an overflow crowd to discuss theories about when MFNs might actually be anticompetitive.  Two live cases were thought to offer U.S. courts the opportunity to evaluate MFNs:  the Justice Department’s e-books case against Apple, and the private class action against the major hotel chains and online travel agents (OTAs).

Eighteen months later, however, the speeches seem to have ended, no report [...]

Why the FTC’s McWane Opinions Raise More Questions Than They Answer

The Federal Trade Commission is meant to be, and is, an expert body on antitrust laws.  So, when a case like McWane—that raises both collusion and exclusion issues—is in front of the FTC, it seems reasonable to expect to receive guidance that is more helpful than we might get from a jury or generalist judge on two questions important to those of us who counsel clients daily.  Unfortunately, the two opinions in this matter raise more questions than they answer.

McWane, Inc. is the only U.S. producer of ductile iron pipe fittings and one of a small number of sellers of the product in the country.  McWane was accused by the FTC both of excluding its few rivals from the domestically-produ [...]

The Auto Parts Antitrust Case: Is This What Success Looks Like?

Wow, what a success! The Antitrust Division recently announced that its investigations in the auto parts market uncovered “separate conspiracies to fix the prices of more than 30 different products sold to US car manufacturers ….” [1] This adds to the results thus far in the investigation, with guilty pleas from 20 companies and fines of over $1.6 billion. Seventeen executives are either in or headed to prison. And ongoing investigations mean more are in the works. In the words of the head of criminal enforcement in the Division, “The deterrent impact of their sentences should resonate in boardrooms around the world.”

But wait, should this make us feel comfortable about antitrust enforceme [...]

Apple Found to Have Orchestrated Conspiracy to Fix E-Book Prices

Apple Inc. played a central role in facilitating and executing a conspiracy among publishers to fix retail prices for electronic books, or e-books, the federal district court in New York City decided last week. The finding of liability against Apple comes after a bench trial that lasted from June 3 to June 20 in an action brought by the U.S. Department of Justice and 33 states and territories.

In April 2012, the Department of Justice Antitrust Division and a number of state attorneys general brought actions against Apple and leading publishers for conspiring to fix the sales prices of e-books. The suits named as defendants Apple and publishers Hachette Book Group (USA), HarperCollins Publish [...]

Justice Department Sues eBay over No Hire Agreement with Intuit

Online marketplace eBay, Inc. has been charged by the Department of Justice with entering into an agreement with business and financial management solutions provider Intuit, Inc. not to hire each other’s employees. On Friday, the Justice Department filed an 11-page civil antitrust complaint against eBay in the federal district court in San Jose, California.

The complaint details a naked no-solicitation and no-hire agreement reached at the highest levels of the companies. Meg Whitman, then eBay’s CEO, and Scott Cook, Intuit’s founder and executive committee chair, were allegedly involved in forming, monitoring, and enforcing the pact.

According to the government,  the agreement barred e [...]

Department of Justice Requires Verizon, Cable Companies to Revise Marketing Agreements to Resolve Antitrust Concerns

The Department of Justice will not challenge a proposed acquisition by Verizon Wireless of a significant portfolio of wireless spectrum licenses from a consortium of four cable companies and the subsequent transfer of a significant amount of that spectrum to T-Mobile USA; however, the parties will be required to modify separate marketing agreements to settle charges that they would, if left unaltered, harm competition by diminishing the companies’ incentive to compete. Verizon is one of the nation’s largest providers of wireline telecommunications services, including both video and broadband services as well as bundles that contain those products.

The U.S. Department of Justice and the S [...]

Information Sharing: Still Risky After All These Years

Two recent antitrust matters serve as reminders that exchanging sensitive information with business competitors can pose significant antitrust risks – particularly when companies stray from the “safety zones” established by the federal antitrust enforcement authorities.

From an antitrust perspective, agreements to exchange information present significant risks. An information exchange has the potential to facilitate unlawful coordination among competitors, and even if coordination does not occur, companies that share information might face difficult questions about how frequent access to sensitive competitor information does not undermine competition. In 1996, the Antitrust Division of [...]

Potash Potash Potash!!!!! En Banc Review Is in the Hizz-ouse, Y’all!

Something striking occurred in the Seventh Circuit this year. In two different, massive antitrust class actions, in the space of about nine months, panels of that court applied the Twombly-Iqbal pleading formula to reach opposite conclusions, even though both cases involved very similar fact allegations and the same procedural posture.  Both cases also involved the quite rare interlocutory review of denial of motions to dismiss—such review is almost never granted except where defendant claims some special immunity from suit [Mitchell v. Forsyth, 472 U.S.  511 (1985)].  Granting two such orders so close in time is no doubt a demonstration of just how grave the appellate courts consider t [...]

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