Oregon v 3M and SPM Settlement Agreement
The settlement resolved allegations that the companies engaged in illegal and anticompetitive practices related to bids for highway pavement marking contracts on State of Oregon projects. The state alleged that 3M, a manufacturer of pavement striping tape, and SPM, a striping contractor, exchanged information regarding bids, coordinated bids, allocated projects and provided false certifications. As a result, the state alleged that competition was reduced and the government received less advantageous terms for the purchase and installation of roadway marking products. The companies denied wrongdoing. The settlement required 3M and SPM to pay a combined $750,000 to the State of Oregon. An additional $750,000 was made available as a credit to the Oregon Department of Transportation for a total of $1.5 million. The companies also agreed to refrain from conduct that could substantially lessen competition and to provide the Department ongoing certification of compliance.
Investigation Concerning an Agreement Between Competing Pharmaceutical companies to Not challenge Each Other’s sole first to file Exculsivity, Assurance No. 14-034 (Feb. 19, 2014)
State challenged an agreement between two generic pharmaceutical makers under which they agreed not to challenge the exclusivity of any of the other party’s pharmaceuticals (pursuant to the Hatch-Waxman Act). The parties agreed to drop that provision and not enter into a similar provision with other generic manufacturers
Utah v. Allied Waste Industries, Inc., No. 2:99-CV00303H
Plaintiff state entered into a consent decree with Allied to ensure that Allied did not use its control of the Washington County landfill to disadvantage competitors. Allied agreed to treat all haulers the same with respect to storage of waste containers, hauling outside normal business hours, inclusion of banned hazardous waste in waste hauled to the landfill. Allied also will not tie the sale of any other services (e.g. recycling) or products to the purchase of commercial waste services from Allied. Allied will not enter into any contracts for a term of more than 2 years, and there shall be no automatic renewal (evergreen) contracts for longer than one year.Allied may not provide any commercial waste-hauling services below cost so long as it has more thatn 60% of commercial small container waste hauling in Washingotn County.
District of Columbia v. ExxonMobil Oil Corp.,
The District of Columbia filed a lawsuit against ExxonMobil Oil Corporation and its gasoline distributors for Washington, D.C., to stop enforcement of exclusive‐supply agreements that make one group of affiliated distributors the only suppliers of Exxon‐branded gasoline in D.C. The complaint, filed in D.C. Superior Court, alleges that the exclusive‐supply agreements violate the District’s Retail Service Station Act. The affiliated distributors – Capitol Petroleum Group, LLC, Anacostia Realty, LLC, and Springfield Petroleum Realty, LLC – are the exclusive gasoline suppliers for about 60% of the 107 gasoline stations in D.C., including all 31 Exxon stations, 19 of 20 Shell stations, all 12 Valero stations, and 3 unbranded stations. The District’s lawsuit challenges agreements that make these affiliated distributors the exclusive suppliers of Exxon‐branded gasoline for the 27 independently‐operated Exxon stations in D.C., or about 25% of the gasoline stations in the city. The exclusive‐supply agreements, or earlier versions of them, were established by ExxonMobil and were transferred in 2009 to the affiliated distributors, along with ExxonMobil’s ownership of the 30 D.C. Exxon stations to which the agreements then pertained. According to the District’s complaint, these supply agreements can now be enforced either by the affiliated distributors or by ExxonMobil through its separate agreements with other area distributors.
The District alleges that the exclusive‐supply agreements allow the affiliated distributors to “set the wholesale prices paid for Exxon‐branded gasoline in D.C., depriving D.C. residents . . . of the benefits of competition in the wholesale supply of Exxon‐branded gasoline.”
Investigation by Attorney General of the State of New York, of the Proposed Combination of Seamless North America, LLC and GruHub Inc.
Seamless and GrubHub are two services that allow consumers to search for local restaurants, browse menus, and order food for delivery or takeout via their respective websites or mobile applications. The two proposed to merge. The Attorney General was concerned that exclusivity provisions in their contracts would impede entry of other competitors in the online food ordering platform market in Manhattan. In an Assurance of Discontinuance, the companies agreed to waive their exclusivity provisions, not enter into any new exclusivity arrangements with restaurants for 18 months, nor provide any incentives for exclusivity. The companies also agreed not to enter into any exclusive arrangement with the online review site Yelp for a period fo 18 months.
In the Matter of Aggregate Industries, PLC, No. 02-3947 (Mass. Super. Ct. Suffolk Cty., Sept. 6, 2002)
USDOJ and plaintiff state challenged acquisition by British aggregate company of a local aggregate company with concrete plants serving eastern Massachusetts and New Hampshirealleging that the acquisition would reduce the number of ready-mix concrete suppliers able to service large construction projects in northern metropolitan Boston from three to two. In northern metropolitan Boston, Aggregate Industries and Wakefield often were each other’s most significant competitor. Aggregate Industries was required to divest the Wakefield facility to a third-party buyer. The state entered into an Assurance of Discontinuance with Aggregate Industries requiring it to relinquish a lease on another concrete plant in central Massachusetts.
In the Matter of the Proposed combintion of Faxton-St. Luke’s Healthcare and St. Elizabeth Medical Center, Assurance No. 13-489 (Dec. 11, 2013))
The two acute care hospitals in the city of Utica sought to merge. Both are in a weak financial state and treat needy patients, most of whose care is covered by Medicaid or Medicare. The settlement includes provisions prohibiting the hospitals from requiring independent physicians to work exclusively at the hospitals, and from requiring health plans to reimburse competing hospitals or health care providers at the same or lower rates than the health plans reimburse the hospitals. The hospitals committed to negotiate in good faith with rate payers. If these payors believe that the hospitals are acting unfairly, the settlement gives the payors the right to continue their currently-existing relationships with the hospitals for five years at current prices, subjected to annual increases not to exceed historic levels. The settlement also provides for continued monitoring by the Attorney General to ensure that the hospitals have implemented their promised efficiencies prior to termination of the rate-protection provisions.
Commonwealth of Pennsylvania v. Geisinger Health System Foundation et al., No. 1:13-cv-02647 (M.D. Pa. Oct. 25, 2013)
State challenged merger of two hospitals that would have reduced competition in two Pennsylvania counties. Hospitals agreed to settlement.
U.S. and Plaintiff States v. US Airways Group et al., No. 1:13-CV-01236 (D.D.C. Aug. 13, 2013)
US DOJ and plaintiff states filed a complaint in federal court challenging the proposed merger between American Airlines and U.S. Airways. The complaint alleged the proposed merger would result in decreased competition, higher airfares and fees, reduced service and downgraded amenities. The dollar impact nationwide could exceed $100 million a year. The merger would make a combined U.S. Airways/American Airlines the largest worldwide carrier and reduce the number of the larger “legacy” airlines from four to three – U.S. Airways/American, United/Continental and Delta/Northwest – and the number of major airlines from five to four. If the merger were approved, the three remaining legacy airlines combined with Southwest Airlines would account for more than 80 percent of domestic travel. American Airlines is U.S. Airways’ chief competitor in the marketplace, meaning that the merger will likely only serve to increase fares and fees. Texas settled its case, entering into an agreement under which the merged airlines would maintain their operations at Texas airports, maintain DFW as a hub, and maintain its corporate headquarters in the Dallas area. DOJ and the remaining states reached settlements with the merging parties. The settlement requires US Airways and American to divest or transfer to low cost carrier purchasers approved by the department: 1) All 104 air carrier slots (i.e. slots not reserved for use only by smaller, commuter planes) at Reagan National and rights and interest in other facilities at the airport necessary to support the use of the slots; 2) Thirty-four slots at LaGuardia and rights and interest in other facilities at the airport necessary to support the use of the slots; and 3) Rights and interests to two airport gates and associated ground facilities at each of Boston Logan, Chicago O’Hare, Dallas Love Field, Los Angeles International and Miami International. The settlement reached by the states requires maintenance of existing hubs in those states, consistent with their historical operations, for three years, and continued daily service for five years to each airport in the affected states that American and US Airways serviced at the time of filing.
Board of Regents v. Atlantic Coast Conference, No. (Cir. Ct. Pr. George’s Cty. Maryland, Jan. 18, 2013)
After the University of Maryland decided to leave the Atlantic Coast Conference (ACC) for the Big Ten Conference for its collegiate athletics, the ACC sued the university in North Carolina. The state then sued in Maryland courts, seeking a declaratory judgment that the fee imposed by the ACC on the university was excessive and was a violation of state antitrust laws because the fee was an illegal restraint of trade. The case has been stayed and the stay has been appealed.
