Announced Actions For July 18, 1997

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The Federal Trade Commission today announced the following action.

Commission action regarding petitions to reopen and modify FTC orders: Following a comment period, the FTC has ruled on a petition from the following:

The Commission has granted the petition of Columbia/HCA Healthcare Corporation of Nashville, Tennessee to modify an October 1995 consent order to end Columbia/HCA's obligation to divest a commercial lease for office space (the Infusamed Lease) in a building next to Pioneer Valley Hospital in West Valley City, Utah. Divestiture of the lease agreement was required under a 1995 consent order that settled charges that Columbia/HCA's acquisition of Healthtrust, Inc. would violate federal antitrust laws by substantially reducing hospital competition in several areas, including Utah. In its petition, Columbia explained that at the time of the acquisition, it mistakenly included the Infusamed Lease as one of the assets that comprised the Pioneer Valley Hospital. The Commission concluded that it would be in the public interest to reopen and modify it to delete the Infusamed lease from the list of assets to be divested. (See April 5, 1995 news release for more details regarding the consent order, Docket No. C-3619; Commission vote to grant the petition was 5-0, with Commissioner Mary L. Azcuenaga and Roscoe B. Starek, III concurring in the result only, and issuing separate statements.)

"Because Columbia/HCA failed to make the requisite showing of affirmative need," Commissioner Azcuenaga said, she did not agree with the majority that the petition should be granted under the public interest standard. "The affidavit filed in support of Columbia/HCA's petition contains the bare assertion that the expenditure of time and other resources (presumably to find a buyer for the lease) will impede its ability to compete in the hospital market. It is virtually always foreseeable at the time a consent agreement is signed that a divestiture will entail 'time and other resources' to accomplish. An order need not be reopened and modified on the basis of a circumstance that is foreseeable at the time that a consent order is signed. . . . Columbia/HCA does not assert, much less support, a particular cost of leaving the requirement to divest the lease in the order. This omission alone is sufficient ground to deny the petition under the public interest standard. . . . The petitioner asserts that the petition should be granted on the basis of . . . constructive change of fact . . .. On that ground, I concur in the result."

In his separate statement, Commissioner Starek said: "I reach the same conclusion as my colleagues: respondent has made the case for modifying the order. The Infusamed Lease is not critically related to Pioneer Valley Hospital and should not have been included in the assets to be divested. I am comfortable reaching this result either on a 'constructive change of fact' basis or on the ground that it is in the public interest to grant the requested modification." With respect to the basis on which the majority granted Columbia/HCA's petition -- the public interest -- Starek said: " . . . I cannot agree that respondent has satisfied the 'affirmative need' standard, which has become enshrined in the Commission's public interest order modifications despite having no rightful place in our jurisprudence. . . . Nevertheless, it is clearly in the public interest to grant the requested relief. The Infusamed Lease was included among the divestiture assets through an error, and -- entirely apart from the role that this error plays under the constructive change of fact doctrine -- the public interest requires that it be rectified."

Staff contact is Elizabeth Piotrowski, 202-326-2623.

Consent agreements given final approval: Following a public comment period, the Commission has made final a consent agreement with the following entities. The Commission action makes the consent order binding on the respondents.

The consent order with Nutrition 21, Selene Systems, Inc., and Herbert H. Boynton settles charges that advertising claims for their weight loss and health care products containing chromium picolinate were unsubstantiated. Nutrition 21 is based in San Diego, California and is the sole U.S. supplier for chromium picolinate. The order prohibits certain challenged claims for chromium picolinate in the future, unless the respondents have competent and reliable scientific evidence to support them. The order requires competent and reliable scientific evidence to support any representation about the benefits, performance, efficacy, or safety of any food, dietary supplement, or drug they advertise or sell. The settlement also prohibits misrepresentation of the results of any test, study or research. In addition, the settlement requires the company to send its customers (who resell chromium picolinate to the public) a notice of the Commission's allegations and a request to stop using sales materials that make the challenged claims. This notice must be sent to anyone with whom Nutrition 21 has done business since 1993 and everyone with whom they do business for the next three years. (See Nov. 7, 1996 news release for more details regarding this case; Docket No. 3758; Commission vote to issue the order as final was 5-0.) Staff contacts are Loren Thompson 202-326-2049 and Beth Grossman 202-326-3019.

 

Copies of the documents referenced above are available from the FTC's Public Reference Branch, Room 130, at the same address; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710. FTC news releases and other materials also are available on the Internet at the FTC's World Wide Web site at: http://www.ftc.gov

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