New York by Cuomo v. Intel Corporation, No. 09-827(JJF) (D. Del. Nov. 4, 2009)
State of New York filed a federal antitrust suit against Intel Corporation charging that Intel engaged in a worldwide, systematic campaign of illegal conduct – revealed in e-mails – in order to maintain its monopoly power and prices in the market for microprocessors. The complaint alleged that over the last several years, Intel has extracted exclusive agreements from large computer makers in which they agreed to use Intel’s microprocessors in exchange for payments totaling billions of dollars. Intel also threatened to and did in fact punish computer makers that they perceived to be working too closely with Intel’s competitors. Retaliatory threats included cutting off payments the computer maker was receiving from Intel, directly funding a computer maker’s competitors, and ending joint development ventures. According to the complaint, to obtain exclusive agreements, Intel paid hundreds of millions of dollars annually in so-called “rebates†to individual computer makers. These rebates were actually just payoffs with no legitimate business purpose that Intel invented to disguise their anticompetitive nature. Sometimes, the payments from Intel exceeded a company’s reported quarterly net income. Intel’s pressure on computer makers to guarantee it specified market shares of their sales prevented computer makers from responding to consumer demand. The state sought to bar further anticompetitive acts by Intel, restore lost competition, recover monetary damages suffered by New York governmental entities and consumers, and collect penalties. Intel’s various motions to dismiss were granted, greatly reducing the scope of the state’s case. The parties settled in 2012. New York dismissed the action with prejudice and agreed to terminate its investigation. Intel did not admit wrongdoing and did not change its business practices, but agreed to pay $6.7 million in costs.
U.S., Missouri and Nebraska v. Stericycle, Inc. Case. No. 1:09-cv-02268 (D.D.C. 2009)
U.S. DOJ, Missouri and Nebraska filed complaint alleging that acquisition of Medserve by Stericycle would substantially lessen competition in infectious waste collection and treatment services to hospitals and other critical healthcare facilities in Kansas, Missouri, Nebraska and Oklahoma, resulting in higher prices and reduced service. The parties reached a settlement under which Stericycle and MedServe must divest all of MedServe’s assets primarily used in the provision of infectious waste collection and treatment services to large customers in Kansas, Missouri, Nebraska and Oklahoma to a viable purchaser approved by DOJ after consultation with the states. These assets include MedServe’s Newton, Kan., treatment facility, and its transfer stations in Kansas City, Kan., Oklahoma City, Omaha, Neb., and Booneville, Mo. Notice of future acquisitions must be provided to the plaintiffs.
Hood ex rel. Mississippi v. Microsoft, No. G2004-1542 (Chan. Ct. Hinds County Miss., July 16, 2008)
The state sued Microsoft in 2004 on behalf of governmental purchasers and as parens patriae for its citizens claiming the company monopolized the market for software and caused customers to pay more for software than they would have if there had been competition. Microsoft agreed to pay Mississippi $40 million. Up to $60 million in hardware/software vouchers will be provided to consumers, businesses, all county/local/municipal government entities, public schools and public school districts. Depending on how many vouchers go unclaimed, Mississippi could get an addition $8 million. All Mississippi residents, businesses, county/local governments or schools that purchased Microsoft products or computers containing Microsoft products between January 1, 1996 and June 2009 were eligible to receive a voucher of $12 or $5 (depending on which products were purchased). The vouchers could be used towards the purchase of any software or hardware product (not just Microsoft).
Nevada by Masto, v. Service Corporation International, No. 2:09-cv-02248. (D.Nev. 2009)
SCI sought to acquire the assets of Palm Mortuary, a cemetery company in Las Vegas, Nevada. After state and FTC investigation, determined that the acquisition would have created a combined company controlling 76% of the cemetery market in the Las Vegas area, the state and FTC filed a complaint and settlement. SCI agreed to divest most of its assets in the Las Vegas area in order to proceed with the acquisition. The complaint alleged that the acquisition, as planned, would eliminate direct competition between SCI and Palm Mortuary for cemetery services in the Las Vegas area. This would leave area cemetery consumers with fewer choices, along with the prospect of higher prices or reduced levels of service. The complaint also alleged that entry into this market from new cemetery providers would not be timely, likely or sufficient to prevent these anticompetitive effects. The settlement provides that SCI must sell its Davis Funeral Home and Memorial Park property as well as the pre-paid business derived from this property and another SCI-owned Davis funeral home to a buyer approved by the Attorney General within 90 days of SCI acquiring Palm Mortuary. Prior to SCI selling these Davis assets, SCI must ensure the economic and competitive viability of these Davis assets in accordance with past practices. A series of firewall protections help accomplish this. The Attorney General’s staff will monitor SCI’s compliance and can name an independent third party to monitor the company’s compliance. For the next three years, SCI will provide notice to the Attorney General of future acquisitions that involve cemetery service or funeral service markets where the company already has a presence in Nevada. Additionally, SCI reimbursed the Office of the Attorney General for its attorneys’ fees and costs resulting from the investigation, as well as any potential future investigations. SCI is subject to fines and injunctive relief for non-compliance.
California v. Education Media and Publishing Group Ltd, No. 09-2134-JCS (N.D. Cal. 2009, May 15, 2009)
As part of the review of the acquisition by textbook publisher Houghton Mifflin of textbook publisher Harcourt Education, the state filed a consent decree under which price increases on California-adopted textbooks and workbooks would be capped at 4.25 percent per annum for six years. The merging parties agreed to pay the state $300,00 in attorneys’ fees and costs.
FTC and California ex rel. Brown v. Watson Pharmaceuticals No. CV-09-00598 (C.D. Cal Feb. 12, 2009)
Plaintiff State and the FTC challenged so-called “reverse payment” agreement between Solvay Pharmaceuticals (patent holder) and Watson Pharmaceuticals, Par Pharmaceuticals and Paddock Laboratories that delayed the entry of a generic substitute for Androgel, a testosterone-replacement drug. State and the FTC alleged that Solvay, fearing the entry of lower-cost generic substitutes for Androgel, resolved patent litigation with the other three companies by making substantial payments to them, on the condition that they not enter the market with their generic version. the parties seek injunctive relief and fines of $2500 per violation under California antitrust law. Case was transferred to district court in Georgia and state did not re-file in Georgia, although the FTC did.
Florida v. Champion Laboratories, No. 1:09-cv-02321 (N.D. Ill. 2009)
State filed against nine manufacturers of aftermarket auto filters, alleging a scheme to illegally fix prices, allocate customers and eliminate price competition since at least 1999. The suit alleges that high-level filter company executives conspired to maintain artificially high prices for
their companies� filters by agreeing among themselves to fix, increase, maintain and/or stabilize the prices of filters sold in the United States, in violation of state and federal antitrust laws and state consumer protection laws. The executives allegedly communicated about prices and even met with each other on numerous occasions, including at filter industry trade association meetings, to fix the prices and allocate customers and markets. The lawsuit further alleges the defendant companies used misleading information in letters seeking to justify their price increases. The suit seeks treble damages, injunctive relief and attorneys� fees and costs as well as civil penalties of up to $1 million per violation against each defendant. Private litigation is pending, USDOJ investigated but did not pursue case.
Arizona ex rel. Goddard v. Gannett Co., Inc. (D. Ariz. 2009)
Two newspapers in Pima County sought to stop publishing one of the papers and share the profits on the other paper, pursuant to a change in their ongoing Joint Operating Agreement. Judge denied state’s request for TRO, on grounds that newspaper was a “failing firm.” State dismissed complaint.
Minnesota v. Children’s Health of St. Paul, No. 4-94-CV-513 (D. Minn. 1994),
The children’s hospitals in Minneapolis and St. Paul sought to merge. The state filed a complaint and eventuallyreached a settlement, the term of which was five years, under which the entity would not be able to merge with any health care provider or specialty physician practice without the approval of the Attorney General. The merged entity would not be able to manage pediatric practices at other area hospitals. The merged entity was also prohibited from ent4ering into exclusive agreements with any group purchaser. The merged entity also could not, for two years, enter into any exclusive contract with physician specialty groups that would prevent them from providing services at other hospitals.
Connecticut v. Nutmeg Test Boring, No. CV-84-298394 (Conn. Super Ct. Hartford Dist.1984)
Trade association and its members were enjoined from fixing the prices for industrial drilling and test-boring services, and from communicating certain pricing information with each other.