Antitrust

In its analysis of Cont’l Auto. Sys., Inc. v. Avanci, L.L.C.,, the Fifth Circuit made several interesting findings: (1) that potential pass-through non-FRAND royalties are too speculative to create an injury in fact; (2) that SEP holders can fulfill their obligations to SSOs, with respect to suppliers, by actively licensing SEPs to downstream OEMs; and (3) that not all implementers are intended beneficiaries entitled to FRAND licenses.

This alert covers the FTC’s increased jurisdictional thresholds for premerger notification filings under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act), as amended.

As has been expected, on January 18, 2022, the Federal Trade Commission (“FTC”) and Antitrust Division of the Department of Justice (“DOJ”) announced in a joint press conference an initiative to review and revise the antitrust merger guidelines.  In his competition Executive Order last summer, President Biden announced a policy calling for increased scrutiny of mergers.  Against this backdrop, one would expect the effort would result in the toughening of standards over what currently is found in the existing guidelines.

The Federal Trade Commission is closing out the year with vigorous enforcement of the Hart Scott Rodino Antitrust Improvements Act of 1976 (“HSR Act”) by imposing fines totaling nearly $2 million.  On December 22, 2021, the FTC settled charges in two separate matters for repeated violations of the HSR Act. In one, investment fund operator Biglari Holdings Inc. will pay $1.4 million to settle charges that it failed to file the required HSR notification for stock acquisitions it made in 2020.  In the other, Clarence L. Werner, founder of Werner Enterprises, Inc. will pay $486,900 to settle charges that he failed to file for acquisitions between May 2007 and February 2020 of his company’s stock.

On December 6 and 7, 2021, the Department of Justice Antitrust Division (“DOJ”) and the Federal Trade Commission (“FTC”) hosted a virtual workshop to discuss competition issues in labor markets and plans to execute President Biden’s Executive Order to address competition issues in our modern economy.  The workshop, along with enforcement actions already underway, reinforces that this is a priority area for the Administration; marketplace participants are well advised to review their policies and compliance programs accordingly.

The DOJ is requesting public comment on a new draft policy concerning licensing negotiations and remedies for standards-essential patents (SEPs) subject to voluntary F/RAND commitments recently jointly issued by the U.S. Patent & Trademark Office (USPTO), the National Institute of Standards and Technology (NIST), and the U.S. Department of Justice, Antitrust Division (DOJ)(collectively, “the Agencies”).  The Agencies have requested comment on eleven questions until the comment period closes January 5, 2022.

The Federal Trade Commission (“FTC”) and the Department of Justice Antitrust Division (“DOJ”) just announced that they will host a virtual workshop on December 6 and 7, 2021, to discuss the agencies’ efforts to promote competition in labor markets and worker mobility.

Mintz’s antitrust team discussed what you should know as you conduct your business and plan your transactions and investments.

Read about the FTC Bureau of Competition’s new process reforms to make the merger review process more rigorous and streamlined amid the surge in mergers and HSR notifications.

Joe Miller returns to Integrity Through Compliance to share his perspective on what changes president Biden may make, or encourage Congress to make, regarding antitrust enforcement.

Joe Miller and Bruce Sokler, Co-Chairs of Mintz's Antitrust Practice, discuss President Biden’s July 9 executive order, which called for a government-wide focus on antitrust competition issues and identified 72 initiatives across several industries.

In this episode, AMI’s Dionne Lomax speaks with Joe Miller. They discuss recent developments in antitrust compliance — specifically, compliance with government consent decrees and what might be occurring behind the scenes at federal enforcement agencies once a company has settled antitrust charges.

Last week was momentous for the Federal Trade Commission.  First, the campaign use antitrust to reign in “Big Tech” faced a setback as the United States District Court for District of Columbia dismissed the FTC’s suit against Facebook (as well as a similar suit brought by virtually all the State Attorney Generals).  In juxtaposition, on July 1, 2021, the FTC held an unusual open meeting of the Commission.  Clearly indicating that she intends to utilize her 3-2 Democratic majority while she has it1, Chair Lina Khan passed several agenda items foreshadowing broad, aggressive antitrust enforcement activity by the FTC.

Read about President Biden’s July 9 Executive Order with 72 initiatives to promote competition in the U.S. economy, including through actions directed at labor markets and the health care, technology, agriculture, and banking sectors.

On June 11, 2021, the U.S. Court of Appeals for the Second Circuit dismissed the Federal Trade Commission’s (FTC) administrative order against 1-800 Contacts, Inc. The Second Circuit found that the online retailer’s trademark settlements with competitor online contact lens sellers were not “inherently suspect” and, instead, should be evaluated under the traditional rule of reason analysis. The trademark settlements specified, among other things, that 1-800 Contacts’ competitors would not bid on the company’s name as a keyword in online search advertising. This ruling has significant implications for the “inherently suspect” standard—according to the Second Circuit, “courts do not have sufficient experience with this type of conduct to permit [the FTC’s] abbreviated analysis.”

On Tuesday, May 11, 2021, an international coalition of competition enforcement agencies including the Federal Trade Commission, the U.S. Department of Justice’s Antitrust Division, Offices of State Attorneys General, Canada’s Competition Bureau, the European Commission Directorate General for Competition, and the U.K.’s Competition and Markets Authority issued a notice seeking public input to inform their approaches to analyzing the competitive effects of pharmaceutical mergers. 

On April 22, 2021, in a unanimous decision authored by Justice Stephen Breyer, the U.S. Supreme Court ruled that the Federal Trade Commission (“FTC”) does not have the authority to seek monetary relief under Section 13(b) of the FTC Act. The decision in AMG Capital Management, LLC v. Federal Trade Commission has significant ramifications for the FTC’s enforcement authority in federal courts. Additionally, it is likely that this ruling will spur Congress to take a serious look at amending Section 13(b) to provide an express right to equitable monetary relief. Indeed, just today, in testimony before the House Energy and Commerce Subcommittee on Consumer Protection and Commerce, the FTC asked Congress to pass such an amendment.

Earlier this week, Stone Canyon Industry Holdings LLC (“Stone Canyon”) and its portfolio company SCIH Salt Holdings Inc. (“SCIH”) reached a settlement agreement with the Department of Justice (“DOJ”) to resolve its investigation of SCIH’s proposed acquisition of Morton Salt Inc. (“Morton”).  Under the terms of the settlement agreement, which is subject to Tunney Act review, Stone Canyon and SCIH are required to divest all assets relating to evaporated salt in order to proceed with the Morton acquisition.  This settlement agreement is noteworthy in that the divestiture was of the buyer to divest its own assets in order to proceed with the transaction, and the DOJ and the parties reached agreement without a divestiture buyer identified.