FTC and State of Idaho v. St. Luke’s Health System, No. 1:13-CV-00116-BLW (Jan. 24, 2014, D. Idaho)
The FTC and the Attorney General of Idaho filed suit to prevent the acquisition by St. Luke’s Health System of Idaho’s largest independent, multi-specialty physician practice group, Saltzer Medical Group. According to the joint complaint , the combination of St. Luke’s and Saltzer would give it the market power to demand higher rates for health care services provided by primary care physicians (PCPs) in Nampa, Idaho and surrounding areas, ultimately leading to higher costs for health care consumers. According to the joint complaint, St. Luke’s acquisition of Saltzer was anticompetitive and violated Section 7 of the Clayton Act and Section 48-106 of the Idaho Competition Act. It created a single dominant provider of adult primary care physician (adult PCP) services in Nampa, with the combined entity commanding nearly a 60 percent share of that market. In addition, an alternative network of health care providers that does not include St. Luke’s/Saltzer’s primary care physicians becomes far less attractive for employers with employees living in Nampa. The FTC and Idaho Attorney General allege that the newly combined primary care practices will give St. Luke’s greater bargaining leverage with health care plans, with higher prices for services eventually passed on to local employers and their employees. The parties consummated their transaction several months earlier, and a private antitrust complaint was filed by several competitors. Idaho and the FTC consolidated their suits for trial. The court held that the transaction was anticompetitive and that the acquisition should be unwound. The decision was affirmed by the Ninth Circuit
State of Florida et al. v. Hitachi-LG Data Storage Inc. et al., No.3:13-cv-01877
After Hitachi-LG Data Storage, Inc. was charged with a 15-count felony charge by the United States Department of Justice, pleaded guilty to bid-rigging and price-fixing of Optical Disc Drives (ODDs) and paid a $21.1 million criminal fine, Florida filed suit. The suit alleged that Hitachi-LG Data Storage, Inc. and its subsidiary, Hitachi-LG Data Storage Korea, Inc., participated in meetings, discussions, and communications to share competitively sensitive information, in order to rig bids for ODDs sold to Dell Inc., Hewlett-Packard Company, and Microsoft Corporation. The state is seeking equitable relief, damages, and civil penalties for Florida consumers, businesses, and governmental entities.
United States and New York v. Twin America LLC et al., No. 12CV8989 (S.D.N.Y. Dec. 11, 2012)
The state and USDOJ filed a joint complaint alleging violations of the Sherman and Clayton Acts as well as the Donnelly Act and New York Executive Law. The complaint alleged that the parties had entered into an illegal joint venture which created a monopoly in the “hop-on, hop-off” bus tours in New York City. The settlement reached by the parties requires the defendants to relinquish approximately fifty bus stops across Manhattan controlled by City Sightsand to disgorge $7.5 million in profits they obtained from the operation of their illegal joint venture, and as a result of their several year effort to forestall antitrust enforcement. The New York Attorney General and the United States determined that disgorgement was particularly appropriate on the facts of this case, a consummated merger involving an anticompetitive price increase and deliberate attempts to evade antitrust enforcement.
State of Nevada v. Renown Health, No. 3:12-cv-409 (D. Nev. Aug. 6, 2012)
Renown Health acquired the largest two cardiology practices in the Reno Nevada area, leaving it with 88 percent of the cardiologists in the geographic market. The settlement required Renown Health to suspend its non-compete agreements with the cardiologists until at least six cardiologists have terminated their employment by Renown. Renown will provide the Attorney General with advance notice of future acquisitions, implement a compliance program, and pay $550,000 to the AG office for fees and costs. The FTC had a parallel proceeding with similar relief.
People of the State of California v. EBay, Inc., No. CV12-5874 (N.D. Cal. Nov. 16, 2012)
State filed suit (simultaneous with USDOJ suit) alleging EBay and Intuit agreed from 2008 to 2009 not to hire one another’s employees. This agreement, allegedly enforced at the highest levels in the companies, prevented employees from seeking positions at the other companies. USDOJ filed a separate suit, but California’s seeks to enforce California laws which contain stronger protections against anti-competitive conduct than federal law. California reached a settlement with eBay for approximately $4 million in restitution to employees, damages for harm to the state’s economy, and civil penalties
Alaska v. Hilcorp Alaska et al.,No. 3An12-____ (Ak. Super. Ct. 3d Jud. Dist. Nov. 7, 2012)
Hilcorp Alaska LLC’s proposed to acquire Marathon Oil Company’s Cook Inlet, Alaska natural gas production, storage and pipeline assets for $375 million. Both the FTC and the state of Alaska expressed concerns about the acquisition because Marathon and Hilcorp are two of the three primary competitors for sales of natural gas in south-central Alaska, and account for over 90 percent of the natural gas produced in Cook Inlet and the acquisition would harm competition by diminishing the negotiating strength of the area’s primary purchasers, local utilities and industrial users. On the other hand, the acquisition could also alleviate concerns regarding local energy supply shortages. Existing fields in Cook Inlet are declining in production, and local utility demand is expected to exceed annual production within a few years. Because of this, the state has been actively working to encourage new investment in exploration and production in the Cook Inlet. The Alaska Attorney General entered into a consent decree with Hilcorp, which included (1) price caps on natural gas sold to local utilities and industrial users for the next five years; (2) a prohibition on selling Cook Inlet natural gas for liquefied natural gas export for five years; and (3) it will not knowingly sell Cook Inlet natural gas to other companies who intend to resell the gas for LNG export. The FTC decided to end its investigation as a result of the Alaska Attorney General’s action, in light of the concerns about energy scarcity in the future and the fact that only consumers in Alaska would be affected.
Washington v. National Express Group, No. 2:12-cv-00757 (W.D. Wash. Apr. 30, 2012)
National Express, a national provider of school bus services, sought to acquire Petermann Partners. After an investigation by the U.S. Department of Justice Antitrust Division and the Washington and Texas Attorneys General, the parties agreed with USDOJ to sell eight school bus transportation contracts in the states of Texas and Washington to Student Transportation of America Inc. (STA). Under a separate consent decree with the state of Washington, the parties also agreed to notify the Attorney General of Washington before any future acquisitions for the next ten years. The parties also agreed not to take any action to impede a successful bidder on a contract from obtaining leased depot and repair facilities.
Ohio v. Cargill, Tuscarawas Cty Ct. of Common Pleas (Mar. 21, 2012)
State alleged that two rock salt producers had agreed to divide up the Ohio market for rock salt, assigning different contracts to the two different producers. State alleged that the defendants actively submitted sham losing bids, which also excluded other bidders because Ohio’s “Buy Ohio” provisions give a preference to Ohio companies if at least two Ohio producers submit bids.The parties settled in June 2015 with a payments totaling $11.5 million.
Maine v. MaineHealth, No. BCD-CV-11-08 (Super. Ct. Cumberland Cty. Maine Jan. 13, 2012)
Health system sought to purchase two cardiology practice groups in the Portland Maine area and employ them at its Portland hospital. On two previous occasions, the practice groups had sought to merge and the Attorney General had disapproved the transaction. The parties agreed to a settlement with a number of injunctive provisions for a term of five years.
Texas et al. v. Penguin Group et al., No. 1:12-cv-03394-DLC (S.D.N.Y, Apr. 30, 2012)
TTexas and Connecticut led 33 state group that filed complaint charging three of the nation’s largest book publishers and Apple Inc. with colluding to fix the sales prices of electronic books. The States undertook a two-year investigation into allegations that the defendants conspired to raise e-book prices. Retailers had long sold e-books through a traditional wholesale distribution model, under which retailers, not publishers, set e-book sales prices. The states alleged that Penguin, Simon & Schuster and Macmillan conspired with other publishers and Apple to artificially raise prices by imposing a distribution model in which the publishers set the prices for bestsellers at $12.99 and $14.99. When Apple prepared to enter the e-book market, the publishers and Apple agreed to adopt an agency distribution model as a mechanism to allow them to fix prices. To enforce their price-fixing scheme, the publishers and Apple relied on contract terms that forced all e-book outlets to sell their products at the same price. Because the publishers agreed to use the same prices, retail price competition was eliminated. According to the States’ enforcement action, the coordinated agreement to fix prices resulted in e-book customers paying more than $100 million in overcharges. The States’ antitrust action seeks injunctive relief, damages for customers who paid artificially inflated prices for e-books and civil penalties. Case was filed in W.D. Tex., transferred to S.D.N.Y. as consolidated case. The States reached settlements with the five publishers, which granted E-book outlets greater freedom to reduce the prices of their E-book titles. Consumers nationwide received a total of $164 million in compensation. After entering into settlement agreement with all the Defendant publishers, DOJ and the states had a nearly 3 week trial against Apple in June 2013, during which numerous witnesses took the stand. On July 10, 2013, a decision was handed down in favor of the U.S. Department of Justice and the states against Apple. Trial of the damages phase is pending. United States et al. v. Apple, Inc., 12-CV-2826 (S.D.N.Y.).
