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Combination of Idaho’s Largest Health System and Largest Physician Practice Must Be Unwound

Within the span of about two weeks, each of the federal antitrust agencies has been handed a major win in their merger enforcement efforts.

Last Friday, it was the Federal Trade Commission’s turn. The U.S. district court in Boise ordered St. Luke’s Health System, Ltd.—the largest health care system in Idaho—to divest Saltzer Medical Group—the state’s largest independent, multi-specialty physician practice—after concluding that St. Luke’s 2012 acquisition of Saltzer violated Section 7 of the Clayton Act and the Idaho Competition Act. In that matter, the FTC and the State of Idaho joined a challenge initiated by private plaintiffs.

On January 8, the federal district court in San Fr [...]

The FCC’s Incentive Auction: Getting Spectrum Policy Right

The authors are David Balto, an antitrust attorney in Washington, D.C., who was formerly a policy director of the Federal Trade Commission, attorney-adviser to Chairman Robert Pitofsky, and trial attorney at the U.S. Department of Justice, and Hal J. Singer, Ph.D., who is a Managing Director at Navigant Economics and a Senior Fellow at the Progressive Policy Institute.

As the Federal Communications Commission (FCC) considers how to allocate the broadcasters’ spectrum in the upcoming “incentive auction,” it should be guided by economic principles designed to maximize social benefits. To date, the spectrum policy debate largely has been driven by considerations of the private benefits of [...]

Can the FTC Be a Fair Umpire?

Nearly 100 year ago, Congress established the Federal Trade Commission to protect consumers against unfair, deceptive and anticompetitive practices.  Part of the reason for its creation was to create an independent, fair and expert body to resolve complex antitrust claims, because the federal courts seemed incapable of enforcing the antitrust laws.  So Congress enabled the FTC to adjudicate its own cases in an administrative process.

Over the century, the Commission had many successes, but its power to adjudicate cases has always been controversial.  The FTC issues complaints which are adjudicated before an FTC Administrative Law Judge and that decision can be appealed to the Commission. [...]

Arbitration Agreement Did Not Prevent Effective Vindication of Antitrust Rights

Consumers and small businesses that are parties to contracts containing arbitration agreements will find it tougher, if not impossible, to avoid the terms of those agreements and pursue an antitrust action in court against the other contracting party, in light of a recent U.S. Supreme Court ruling.

Noting that “the antitrust laws do not guarantee an affordable procedural path to the vindication of every claim,” a sharply divided Supreme Court ruled on Thursday that a contractual waiver of class arbitration is enforceable under the Federal Arbitration Act (FAA), even though the cost of individually arbitrating the federal statutory claim exceeded the potential recovery. The High Court [...]

Antitrust Division Lawyer Picked to Fill Vacancy on Federal Trade Commission

Terrell McSweeny, Chief Counsel for Competition Policy and Intergovernmental Relations at the Department of Justice Antitrust Division, is President Obama’s pick to fill the current vacancy on five-member Federal Trade Commission.

The White House announced today the President’s intention to nominate McSweeny. According to the announcement, McSweeny has served in the senior counsel position at the Antitrust Division, since 2012.  Prior to that, she served as Deputy Assistant to the President and Domestic Policy Advisor to the Vice President at the White House from 2009 to 2012.

Based on her background, McSweeny appears to be a Democrat. If confirmed, she would provide the Democrats with a th [...]

A Legal Rationale for Liability Under Section 2 of the Sherman Act for Patent ‘Hold-up’ by Patent Assertion Entities with Respect to Standard Essential Patents

(Note:  In December 2012, the Department of Justice and the Federal Trade Commission held a Hearing on the impact of patent assertion entities (PAEs) on innovation and competition and the implications for antitrust enforcement policy.  The Agencies then issued a Request for Public Comments on the topic of the Hearing.  In response, on April 5th, Richard Wolfram submitted the following comment to the DOJ and FTC, adapted and shortened here for Antitrust Connect.  The full Public Comment – one of almost 70 public comments submitted to the Agencies — is available at or from the author.)

This comment is submitted in my personal capacity and d [...]

Phoebe Putney: A Quick Post-Mortem, and Some Thoughts on the Next Justice Stevens

I often feel a certain deflation after the Supreme Court decides an antitrust case.  After watching a case for months, prognosticating about it with other antitrusters, reading umpteen blog posts, reading the briefs if you’re into it and even some amici briefs if you’re really into it, the Court then rules one way or the other, and usually tailors its opinion pretty narrowly, breaking no meaningfully new ground.  I suppose many will have that feeling about Tuesday’s decision in Federal Trade Commission v. Phoebe Putney Mem. Hosp. Sys., and some are already saying that Justice Sotomayor’s brief opinion for a unanimous Court is just a narrow application of garden variety state action [...]

Paper Considers Consolidation in Health Care Markets

In Consolidation in Health Care Markets: A Review of the Literature, authors David Balto and James Kovacs in a study funded by and submitted to the Robert Woods Johnson Foundation discuss the recent literature concerning consolidation across various health care markets.

The paper focuses on consolidation of hospital, provider, and health insurance markets with the goal of understanding the impact consolidation has on health care prices, quality of care, and overall costs.  The paper seeks to provide an overview of the key research and present findings in different areas of healthcare to facilitate further investigation.

The authors find that while there is consolidation across many heal [...]

Is There a Reason to Think the Court Will Reign In the Filed-Rate Abomination? Oh Please, Oh Please, Oh Please!

Keep an eye out for the Court’s decision on certiorari in McCray v. Fidelity Nat’l Ins. Co., 682 F.3d 229 (3rd Cir. 2012).  I have my fingers crossed that it may be the case in which the Court finally does the right thing with the accursed “filed rate doctrine.”  I filed a brief in support of certiorari in the case on behalf of myself, eighteen leading antitrust scholars, and the American Antitrust Institute.

Pretty much everybody who is not a regulated industry is in agreement about the FRD, an old rule now commonly associated with Louis Brandeis’s famous opinion in Keogh v. Chicago & Nw. Ry. Co., 260 U.S. 156 (1922).  Specifically, they all pretty much agree that the FRD is ba [...]

Eradicating Patent Trolls

One of the critical obstacles to our innovation economy are patent trolls or Patent Assertion Entities (“PAE”) which acquire patents simply to bring patent litigation and effectively tax innovation. PAEs exploit numerous problems in our legal system including the expense and uncertainty of patent litigation, the excessive granting of patents in the high-tech space, the ambiguity of abstraction surrounding the claims of many high-tech patents, and the anticompetitive pricing power that comes from aggregating patents in an industry where market definition is especially difficult. PAEs are costing the economy over $29 billion annually and creating barriers to the innovation that is critical [...]

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