As the year concludes, the FTC has been quite busy. Not only has the upcoming leadership transition meant the FTC has been working on a variety of matters, the transition has also highlighted stark differences in the Commissioners’ perspectives on enforcement. For example, Commissioners Holyoak and Fergusons published strong dissenting statements regarding the withdrawal of the Collaboration Among Competitors guidance and the first Robinson-Patman Act matter in nearly a quarter century. All this and more –

Monday, December 9, 2024

Bureau of Competition: Healthcare, Pharmacy Benefit Mangers, Pharmacies, Mergers

• The FTC approved a petition by Cooperativa De Farmacias Puertorriqueñas, known as Coopharma, a Puerto Rican cooperative of independent pharmacy owners, to reopen and modify the FTC’s related 2012 final order. The FTC’s 2012 order prohibited Coopharma from facilitating agreements between pharmacies and facilitating information exchange between pharmacies based on allegations that Coopharma harmed competition and fixed prices. The FTC’s modifications will allow Coopharma to jointly negotiate with insurers and PBMs on behalf of pharmacies, based on changes in Puerto Rico’s laws regarding oversight and state immunity related to healthcare. The commissioners voted 5-0 to approve Coopharma’s petition to modify the 2012 order, with both Chair Khan and Commissioner Holyoak issuing separate statements. Chair Khan’s statement expressed that the current FTC had no reason to doubt the actions of the 2012 FTC were appropriate, but given available resources this matter was not worth continued FTC oversight. Commissioner Holyoak’s statement expressed that the unanimous decision to modify the order was issued solely due to the changes in Puerto Rican law and highlighted her skepticism of state-action immunity for anticompetitive conduct as well as her disagreements with Chair Khan. 

Bureau of Consumer Protection: Debt, Credit and Finance, Student/Educational Loans, Deceptive Conduct, False Advertising

• The FTC filed a complaint and obtained a temporary restraining order and preliminary injunction against Superior Servicing, a loan servicing company. The FTC alleges that Superior Servicing, and its operator Dennise Merdjanian, promised consumers student debt relief and forgiveness and feigned a relationship with the Department of Education. Superior Servicing falsely offered loan consolidation services with reduced interest rates and monthly payments, while collecting advance fees. The FTC alleges that the scheme defrauded consumers out of millions of dollars. The complaint alleges that Superior Servicing violated the FTC’s Impersonation Rule, the Telemarketing Sales Rule, the Gramm-Leach-Bliley Act, and the FTC Act’s prohibition on deceptive practices. The Commission voted 5-0 to file the complaint in the U.S. District Court for the District of Nevada.

Tuesday, December 10, 2024

Bureau of Consumer Protection: Debt Collection, Credit and Finance, Consumer Refunds, Deceptive Conduct

• The FTC sent approximately $540,000 in refunds to consumers based on its 2020 lawsuit against National Landmark Logistics and Absolute Financial Services (also operating under additional names), debt collectors who engaged in allegedly abusive debt collection practices. The debt collectors used robocalls that left messages threatening legal action and arrest for unpaid debts, and in many instances consumers owed no debt or the defendants had no right to collect any existing debt. The case settled with an agreement that permanently banned the defendants from the debt collection industry and required them to compensate the affected consumers. The FTC will send 1,625 checks to consumers who will receive approximately $330 each.

Bureau of Consumer Protection: Healthcare, Warning Letters, Advertising and Marketing, Deceptive Conduct

• The FTC issued warning letters to 21 companies that provide marketing or advertising, including creating sales leads, for insurance plans, specifically Affordable Care Act Marketplace health insurance plans. The letters provide guidance and put companies on notice about actions that the FTC considers deceptive related to open enrollment season. The letters warn companies to not misrepresent the benefits included in healthcare plans, misrepresent the costs of healthcare plans, and to not misrepresent any free offers, cash rewards, rebates, or other incentives associated with the healthcare plan. The letters do not allege any wrongdoing by any of the recipients, but do encourage each recipient to review their advertisements to ensure compliance with FTC guidance.

Wednesday, December 11, 2024

Bureau of Competition: Unfair Competition, Collusion, Guidance Documents

• The FTC and Department of Justice’s Antitrust Division jointly withdrew their Antitrust Guidelines for Collaborations Among Competitors (known as the Collaboration Guidelines). The Collaboration Guidelines were originally issued in 2000 to provide guidance about how enforcers assess the legality of collaboration amongst b. The statement of withdrawal suggests that the Collaboration guidelines no longer reflect recent, significant cases involving collaboration among competitors, rely on outdated analytical methods, rely on withdrawn policy statements, and do not sufficiently consider modern business practices. The vote to withdraw the guidelines was split 3-2, with Commissioners Ferguson and Holyoak dissenting. Both Commissioners Ferguson and Holyoak published brief dissents focused on the majority’s failure to provide any replacement guidance and leaving businesses in the dark.

Thursday, December 12, 2024

Bureau of Competition: Price Discrimination, Robinson-Patman Act

• The FTC filed a complaint against Southern Glazer’s Wine and Spirits, LLC, the largest U.S. distributor of wine and spirits, for alleged price discrimination Robinson-Patman Act violations. The complaint alleges that Southern Glazer sold wine and spirits to small and independent retailers at substantially increased prices and did not offer those businesses the same discounts and rebates offered to national and regional chains. Under the Robinson-Patman Act, seller price discrimination is generally illegal. The Complaint alleges that Southern Glazer engaged in discriminatory pricing practices since 2018, contributing to the company’s $26 billion in revenue in 2023. Further, the complaint alleges that Southern Glazer engaged in a variety of discriminatory pricing methods, including discount and rebates accessible only to large purchasers that are not based on quantity or bulk purchase discounts. The Commission voted 3-2 to authorize the filing in the U.S. District Court for the Central District of California. Commissioner Bedoya, joined by Chair Kahn and Commissioner Slaughter, released a 29 page statement focusing on the purpose of the Robinson-Patman Act to address illegal discriminatory pricing conduct and highlighting this action as the first Robinson-Patman-based action from any federal agency in almost 25 years.  Commissioner Ferguson released a 30 page dissenting statement, while Commissioner Holyoak released an almost 90 page dissenting statement, written as a law review article. In detail, Commissioner Holyoak discusses how the complaint failed to identify any harm to competition or consumer (as opposed to the alleged harm to competitors), and failed to otherwise satisfy the requirements of the Robinson-Patman Act.

Bureau of Consumer Protection: Job Scams, Advertising and Marketing, Online Marketing

• The FTC reported on consumer complaint data, specifically highlighting a dramatic increase in online job-related scams. Such scams require consumers to repeat sets of tasks and are known as task scams. The FTC recorded no complaints of these scams in 2020, 5,000 in 2023, and now 20,000 in just the first half of 2024. The scams often start with a text or WhatsApp message about online work, but after the consumer begins completing the work they are asked to provide money or personal information. The FTC seeks to make addressing these types of job scams an enforcement priority.