Legal Library: Cases and Proceedings

The consent order protects competition in three medical device product markets affected by Johnson & Johnson’s proposed $25.4 billion acquisition of Guidant Corporation. Under the terms of the order, J&J is required to 1) grant to a third party a 6 fully paid-up, non-exclusive, irrevocable license, enabling that third party to make and sell drug eluting stents with the Rapid Exchange delivery system, 2) divest to a third party J&J’s endoscopic vessel harvesting product line, and 3) end its agreement to distribute Novare Surgical System, Inc.’s proximal anastomotic assist device. On May 31st, 2006 the Commission granted a petition filed by Johnson and Johnson Corporation, requesting that the FTC reopen and set aside the entire decision and order concerning the proposed acquisition of Guidant Corporation.

Nestle settled antitrust charges that its $10.3 billion proposed acquisition of Ralston Purina Company would substantially lessen competition in the United States market for dry cat food through the elimination of direct competition between the two firms and increase the likelihood that the combined firm could unilaterally exercise market power. The order requires the divestiture of Ralston's Meow Mix and Alley Cat brands to J.W. Childs Equity Partners II,L.P.

Valassis, a leading producer of free-standing newspaper inserts in the United States, has settled charges that it violated Section 5 of the FTC Act by attempting to collude with News America Marketing, its only rival, to eliminate competition between the two companies. During a conference call with industry analysts, a Valassis executive invited NewsAmerica to join in a scheme to allocate customers and fix prices in order to end an ongoing price war between the two companies. Under the consent order settling the FTC’s complaint, Valassis is barred from engaging in or inviting collusive agreements with other publishers or attempting to collude with its competitors.

The consent order requires that Allergan and Inamed divest the rights to develop and distribute Reloxin, a potential Botox rival, to settle charges that Allergan’s $3.2 billion purchase of Inamed would reduce competition and force consumers to pay higher prices for botulinum toxin type A products. Under the terms of the FTC settlement, the companies will return the development and distribution rights to Reloxin to Ipsen Ltd., its U.K.- based manufacturer.