The wait is -almost- over! Eighteen years after the case was filed and nearly one year from the day the Second Circuit heard oral arguments in the MasterCard/Visa Interchange Fee Litigation, the Court of Appeals affirmed District Judge Margo Brodie’s approval of the $5.6 billion class action settlement agreed upon by the parties. While many observers believed the settlement would ultimately be affirmed, the panel did so with some unanticipated wrinkles, affirming a majority of the district court’s order, but leaving many of appellants’ questions and issues unanswered.
On May 25, 2022, following markup in the Judiciary Committee, Senator Amy Klobuchar introduced an amended version of the American Innovation and Choice Online Act (“AICOA”), an antitrust bill we previously reported on that aims to curtail self-preferential conduct by certain online platforms. The revised bill now carves out telecommunications providers and financial service companies from the bill’s prohibitions, and reduces potential penalties for violations. Additionally, the revision now creates an exception to the bill’s technical interoperability requirements “where such access would lead to significant cybersecurity risk.” Although critics complain the revisions do not go far enough to address the bill’s shortcomings, Senator Klobuchar and other bi-partisan supporters are pushing for a Senate floor vote this summer.…
On October 25, 2021, the FTC announced that it will seek to impose prior approval provisions on merging parties in all future consent decrees. These provisions will require parties to merger consent decrees to request formal Commission approval before closing any future transactions in the same market, and potentially adjacent markets, regardless of whether those subsequent transactions are reportable under the HSR Act. This shift reinstates a policy abandoned by the FTC in 1995, and seeks to provide the Commission the unilateral ability to block future transactions it views as problematic, without having to carry the legal burden in court.
Continue Reading FTC Plans to Impose Prior Approval Requirements for Future Transactions
As the world continues to settle into its new normal regulators have so too. Recently, State Attorneys General (AGs) are increasingly focused on several specific enforcement priorities, including (1) price gouging; (2) privacy concerns; (3) antitrust litigation; and (4) harmful substances in products and environmental issues. Many of these priorities have gained prominence in the midst of the COVID-19 pandemic.
Continue Reading Enforcement in the New Normal: Recent Trends in State AG Enforcement
Tuesday, September 14, 2021
Bureau of Competition and Bureau of Consumer Protection
- The FTC and Justice Department issued a joint statement detailing antitrust guidance for businesses taking part in relief efforts and those involved in rebuilding communities affected by Hurricane Ida without violating the antitrust laws. The statement highlighted that the agencies will hold businesses or individuals accountable for attempting to “illegally subvert competition or engage in fraudulent conduct under the guide of disaster recovery.”
- The FTC approved a series of resolutions that will enable agency staff to efficiently and expeditiously investigate conduct in core FTC priority areas over the next ten years. The Bureau of Consumer Protection and the Bureau of Competition recommended that the Commission authorize eight new compulsory process resolutionsin these essential areas: (1) Acts or Practices Affecting United States Armed Forces Service Members and Veterans; (2) Acts or Practices Affecting Children; (3) Bias in Algorithms and Biometrics; (4) Deceptive and Manipulative Conduct on the Internet; (5) Repair Restrictions; (6) Abuse of Intellectual Property; (7) Common Directors and Officers and Common Ownership; and (8) Monopolization Offenses.
Last week the Supreme Court unanimously held that §13(b) of the Federal Trade Commission Act does not give the Federal Trade Commission the power to seek equitable monetary relief such as disgorgement or restitution. The Court’s opinion in AMG Capital Management LLC v. Federal Trade Commission removes a powerful tool that the FTC has long relied on to pursue monetary relief for consumers in both consumer protection and competition matters.
By way of background, the FTC has authority to protect consumers from unfair or deceptive acts or practice (“UDAP”) and unfair methods of competition (“UMC”) with an overlapping but distinct set of tools it can use to pursue its dual consumer protection and competition missions:
- Administrative Proceeding: The FTC can initiate an administrative proceeding to seek a cease and desist order for either a UDAP or UMC violation from an administrative law judge. If necessary, the FTC can later bring a contempt proceeding in federal court seeking to enforce the terms of an administrative order. A defendant may respond by arguing that it has “substantially complied” with the terms of the order. If the FTC prevails in such a case, it can seek civil penalties and other equitable relief necessary to enforce the order (however monetary relief only applies to UDAP violations).
- Rulemaking: The FTC has authority to promulgate rules that define UDAP with specificity. Generally, this requires a lengthy, formal rulemaking process that allows for public comment, and a final rule can be challenged in federal court. If a defendant later violates a duly enacted UDAP rule, the FTC can seek civil penalties for a knowing violation. The FTC can also file suit in federal court and obtain monetary relief “to redress consumer injury,” including an order compelling “refund of money or return of property,” but only if “a reasonable man would have known under the circumstances [that the challenged conduct] was dishonest or fraudulent.”
- Federal Court: The FTC can sue in federal court under §13(b) of the FTC Act to enjoin a defendant when the defendant “is violating, or is about to violate” a law that the FTC enforces and such an injunction is in the public’s interest. While courts have historically read §13(b) as giving the FTC an implied right to recover equitable monetary relief in addition to injunctive relief, the Supreme Court’s ruling now limits the FTC to seeking injunctive relief only.
Nearly fifteen years after a class of merchants first brought suit against Visa, MasterCard, and their member banks in the MasterCard/Visa Interchange Fee Litigation, retailers can finally see the light at the end of the tunnel. For years, the increasingly cashless economy has put pressure on retailers to accept credit cards for payment, but…
Here, we identify 10 key issues relating to how the U.S. antitrust agencies—the Federal Trade Commission (FTC) and Department of Justice (DOJ)—analyze CPG transactions.
1) High-End vs. Low-End
Antitrust agencies often define the market for the merging parties’ products quite narrowly. In one notable example, the FTC defined a market limited to “intense mints” (think…
In the third of our series of blog posts on antitrust and e-commerce in Europe, we look at the €40 million fine imposed on clothing company Guess by the European Commission (EC) in December 2018.
The case is the first in which the EC finds that restrictions on the use of a brand name for…
For twenty years or more, the European Commission (EC) has taken little or no formal enforcement action against anticompetitive distribution practices. However, the recent fines on Nike, Guess and others mark a dramatic change of policy. In the latter half of 2018, the EC imposed fines totalling over €150 million in relation to online distribution…