Settlement Agreement Between States and Five Guys Franchisor LLC
Fourteen states investigated “no-poach†agreements (clauses, often contained in franchise agreements, which prevent workers from switching between employers of the same franchise in order to obtain a better job with a higher salary or improved working conditions). The states settled with four national fast food franchisors, Dunkin’, Arby’s, Five Guys, and Little Caesars, who agreed to cease using “no-poach†agreements that restrict the rights of fast food workers to move from one franchise to another within the same restaurant chain. Under the terms of the settlements, the franchisors will stop including no-poach provisions in any of their franchise agreements and stop enforcing any franchise agreements already in place. The franchisors have also agreed to amend existing franchise agreements to remove no-poach provisions and to ask their franchisees to post notices in all locations to inform employees of the settlement. Finally, the franchisors will notify the attorneys general if one of their franchisees tries to restrict any employee from moving to another location under an existing no-poach provision. Since the investigation began, Wendy’s provided confirmation that it never used no-poach provisions in their contracts with franchisees. Investigations into Burger King, Popeyes, and Panera continue.
Settlement Agreement Between States and Little Caesar Enterprises Inc.
Fourteen states investigated “no-poach†agreements (clauses, often contained in franchise agreements, which prevent workers from switching between employers of the same franchise in order to obtain a better job with a higher salary or improved working conditions). The states settled with four national fast food franchisors, Dunkin’, Arby’s, Five Guys, and Little Caesars, who agreed to cease using “no-poach†agreements that restrict the rights of fast food workers to move from one franchise to another within the same restaurant chain. Under the terms of the settlements, the franchisors will stop including no-poach provisions in any of their franchise agreements and stop enforcing any franchise agreements already in place. The franchisors have also agreed to amend existing franchise agreements to remove no-poach provisions and to ask their franchisees to post notices in all locations to inform employees of the settlement. Finally, the franchisors will notify the attorneys general if one of their franchisees tries to restrict any employee from moving to another location under an existing no-poach provision. Since the investigation began, Wendy’s provided confirmation that it never used no-poach provisions in their contracts with franchisees. Investigations into Burger King, Popeyes, and Panera continue.
Settlement Agreement Between States and Dunkin’ Brands, Inc.
Fourteen states investigated “no-poach†agreements (clauses, often contained in franchise agreements, which prevent workers from switching between employers of the same franchise in order to obtain a better job with a higher salary or improved working conditions). The states settled with four national fast food franchisors, Dunkin’, Arby’s, Five Guys, and Little Caesars, who agreed to cease using “no-poach†agreements that restrict the rights of fast food workers to move from one franchise to another within the same restaurant chain. Under the terms of the settlements, the franchisors will stop including no-poach provisions in any of their franchise agreements and stop enforcing any franchise agreements already in place. The franchisors have also agreed to amend existing franchise agreements to remove no-poach provisions and to ask their franchisees to post notices in all locations to inform employees of the settlement. Finally, the franchisors will notify the attorneys general if one of their franchisees tries to restrict any employee from moving to another location under an existing no-poach provision. Since the investigation began, Wendy’s provided confirmation that it never used no-poach provisions in their contracts with franchisees. Investigations into Burger King, Popeyes, and Panera continue.
Settlement Agreement Between States and Arby’s Restaurant Group, Inc.
Fourteen states investigated “no-poach†agreements (clauses, often contained in franchise agreements, which prevent workers from switching between employers of the same franchise in order to obtain a better job with a higher salary or improved working conditions). The states settled with four national fast food franchisors, Dunkin’, Arby’s, Five Guys, and Little Caesars, who agreed to cease using “no-poach†agreements that restrict the rights of fast food workers to move from one franchise to another within the same restaurant chain. Under the terms of the settlements, the franchisors will stop including no-poach provisions in any of their franchise agreements and stop enforcing any franchise agreements already in place. The franchisors have also agreed to amend existing franchise agreements to remove no-poach provisions and to ask their franchisees to post notices in all locations to inform employees of the settlement. Finally, the franchisors will notify the attorneys general if one of their franchisees tries to restrict any employee from moving to another location under an existing no-poach provision. Since the investigation began, Wendy’s provided confirmation that it never used no-poach provisions in their contracts with franchisees. Investigations into Burger King, Popeyes, and Panera continue.
State of Wisconsin et al. v. Indivior, No. 16-5073 (E.D. Pa. Sept. 22,2016)
Plaintiff states alleged that the makers of Suboxone, a drug used to treat opioid addiction, engaged in a scheme to block generic competitors and raise prices. Specifically, they are conspiring to wtich Suboxone from a tablet version to a flim in order to prevent or delay generic entry. The states allege that the manufacturers engaged in “product hopping” in which a company makes slight changes to its product to extend patent protections and prvent generic alternatives. The complaint was filed under seal.
New York et al. v. Cephalon, No. 2:16-cv-04234 (E.D. Pa. Aug. 4, 2016)
In May 2015, the FTC settled a “pay-for-delay” suit against Cephalon for injunctive relief and $1.2 billion, which was paid into an escrow account. The FTC settlement allowed for those escrow funds to be distributed for settlement of certain related cases and government investigations. In August 2016, forty-eight states filed suit in the Eastern District of Pennsylvania against Cephalon alleging anticompetitive conduct by Cephalon to protect the profits it earned from having a patent-protected monopoly on the sale of its landmark drug, Provigil. According to the complaint, Cephalon’s conduct delayed generic versions of Provigil from entering the market for several years. The complaint alleged that as patent and regulatory barriers that prevented generic competition to Provigil neared expiration, Cephalon intentionally defrauded the Patent and Trademark Office to secure an additional patent, which a court subsequently deemed invalid and unenforceable. Before it was declared invalid, Cephalon was able to use the patent to delay generic competition for nearly six additional years by filing patent infringement lawsuits. Cephalon settled those lawsuits by paying competitors to delay sale of their generic versions of Provigil until at least April 2012. Consumers, states, and others paid millions more for Provigil than they would have had generic versions of the drug launched by early 2006, as expected. A settlement was filed with the complaint, which includes $35 million for distribution to consumers who bought Provigil.
United States and North Carolina v. Charlotte-Mecklenburg Hospital Authority d/b/a Carolinas Healthcare System
North Carolina and USDOJ filed suit alleging that Atrium Health, formerly known as Carolinas HealthCare System illegally reduced competition in the health care market in Charlotte and limited consumers’ ability to shop around for better deals on health care. Atrium is based in Charlotte and operates Carolinas Medical Center and nine other hospitals in the Charlotte area. It dominates the hospital market in the Charlotte region with a 50 percent share of the market and approximately $8.7 billion in annual revenues. The state alleged that Atrium acted unlawfully to preserve its dominance in the Charlotte health care market by using its market power to require steering restrictions in its contracts with every major insurer. These provisions have prevented insurers from, among other things, introducing health plans that encourage patients to use medical providers that offer lower priced, higher-quality services. The plaintiffs sought injunctive relief and attorneys fees. After the court denied defendants’ motion to dismiss, the parties settled. Under the terms of the settlement, Atrium is prohibited from using anticompetitive steering restrictions in contracts between commercial health insurers and its providers in the Charlotte, North Carolina metropolitan area. These steering restrictions prevented health insurers from promoting innovative health benefit plans and more cost-effective healthcare services to consumers.
In re Natixis Funding Corp., Agreement, Feb. 18, 2016)
Plaintiff states entered into settlement agreement with Natixis Funding Corp. for fraudulent and anticompetitive conduct in municipal bond derivative transactions with state and local government entities and nonprofits across the country. Natixis will pay $29,950,000 as part of a coordinated 22-state and private class settlement. The funds will mostly be applied to restitution for municipalities, counties, government agencies, school districts and nonprofits that the states allege were harmed when they entered into municipal derivatives contracts with Natixis. In 2008, the plaintiff states, in parallel with the U.S. Department of Justice and federal regulatory agencies, began their investigation of the municipal bond derivatives market. In these markets, tax exempt entities such as municipalities, school districts, and nonprofit organizations issue municipal bonds and reinvest the proceeds until the funds are needed or enter into contracts to hedge interest rate risk. These investigations revealed anticompetitive and fraudulent conduct involving individuals at a number of large financial institutions, including Natixis, and certain brokers with whom they had worked. Certain Natixis employees and their counterparts at other institutions rigged bids, submitted noncompetitive courtesy bids and fraudulent certificates of arms-length bidding to government agencies. The misconduct led local and state governments, as well as nonprofits, to enter into municipal derivatives contracts on less advantageous terms than they would have otherwise. Natixis agreed to pay $23.4 million into a settlement fund and $1.5 million to the attorneys general as an additional payment. Natixis also agreed not to submit non-competitive bids or refrain from bidding on, or coordinate the preparation of bids for municipal derivatives and to cooperate with ongoing investigations.
In re Societe Generale S.A., Agreement
Plaintiff states entered into settlement agreement with Societe Generale for fraudulent and anticompetitive conduct in municipal bond derivative transactions with state and local government entities and nonprofits across the country. Societe Generale agreed to pay $26,750,000 as part of a coordinated 22-state and private class settlement. Pursuant to the settlement, this money will mostly be applied to restitution for municipalities, counties, government agencies, school districts and nonprofits that the states allege were harmed when they entered into municipal derivatives contracts with Societe Generale. In 2008, plaintiff states, in parallel with the U.S. Department of Justice and federal regulatory agencies, began their investigation of the municipal bond derivatives market. In these markets, tax exempt entities such as municipalities, school districts, and nonprofit organizations issue municipal bonds and reinvest the proceeds until the funds are needed or enter into contracts to hedge interest rate risk. These investigations revealed anticompetitive and fraudulent conduct involving individuals at a number of large financial institutions, including Societe Generale, and certain brokers with whom they had worked. Certain Societe Generale employees and their counterparts at other institutions rigged bids, submitted noncompetitive courtesy bids and fraudulent certificates of arms-length bidding to government agencies. The misconduct led local and state governments, as well as nonprofits, to enter into municipal derivatives contracts on less advantageous terms than they would have otherwise. Societe Generale agreed to pay $25.1 million into a settlement fund to provide restitution for injured parties and $1.4 million to the attorneys general as an additional payment. Societe Generale also agreed not to submit non-competitive bids or refrain from bidding on, or coordinate the preparation of bids for municipal derivatives and to cooperate with ongoing investigations.
Maryland et al. v. Perrigo Company, No. 1:04CV01398 (D.D.C. Aug. 17, 2004)
The FTC and states alleged that the companies had entered into a “pay-for-delay” arrangement, whereby Perrigo paid Alpharma to withdraw its generic version from the market for Children’t ibuprofen.According to the complaint, in June 1998, Perrigo and Alpharma signed an agreement allocating to Perrigo the sale of OTC children’s liquid ibuprofen for seven years. In exchange for agreeing not to compete, Alpharma received an up-front payment and a royalty on Perrigo’s sales of children’s liquid ibuprofen. The FTC received $6.25 million to compensate injured consumers. The states received $1.5 million in lieu of civil penalties. the parties were enjoined from future agreements.
