Legal Library: Cases and Proceedings

The Federal Trade Commission required ARKO Corp. and its subsidiary GPM to roll back anticompetitive provisions of their acquisition of 60 Express Stop retail fuel outlets from Corrigan Oil Company last year. The complaint alleged that as originally proposed, the agreement not to compete that ARKO and GPM required Corrigan to sign as part of the acquisition harmed customers in local retail gasoline and retail diesel fuel markets throughout Michigan and Ohio. The order required them to amend a non-compete agreement they imposed on Corrigan, agree to obtain prior approval from the Commission before acquiring retail fuel assets under certain circumstances, and return to Corrigan five retail fuel outlets, among other provisions.  On Aug. 9, 2022, the Commission announced the final consent agreement in this matter.

The operators of a scheme that conned consumers into paying non-existent debts will be permanently banned from the debt collection business and from misleading consumers about debt in a settlement with the Federal Trade Commission.

The Federal Trade Commission is sending payments totaling more than $1 million to 1,966 consumers who were harmed by a debt collection scheme that conned consumers into paying debts they did not owe. The defendants used several names including GAFS Group, Global Mediation Group, and Mediation Services.

The Federal Trade Commission imposed strict limits on JAB Consumer Partners’ future acquisitions of specialty and emergency veterinary clinics as a condition of JAB’s proposed $1.1 billion acquisition of specialty and emergency veterinary services provider SAGE Veterinary Partners, LLC. The Commission also alleged that the acquisition was likely to be anticompetitive in three geographic markets, ordering divestitures for various types of veterinary care in and around Austin, Texas, in and around San Francisco, California, and in and between Oakland, Berkeley, and Concord, California, and it ordered divestitures in these market.  On Aug. 5, 2022, the Commission announced the final consent agreement in this matter.

As a condition of Hikma Pharmaceuticals PLC’s $375 million acquisition of generic drug services company Custopharm, Inc., the Federal Trade Commission required Custopharm’s parent company, private equity fund Water Street Healthcare Partners, LLC to retain and transfer Custopharm’s assets related to the corticosteroid drug triamcinolone acetonide, or TCA, to another company Water Street owns, Long Grove Pharmaceuticals, LLC. According to the complaint, absent a remedy, Hikma likely would have stopped developing its injectable TCA product, forestalling the increased price competition it would have brought to the market. Thus without this remedy, the acquisition likely would have harmed future competition in the U.S. market for injectable triamcinolone acetonide.

The Federal Trade Commission required Medtronic, Inc. to divest a key subsidiary of Intersect ENT, Inc. as a condition of acquiring Intersect. Under the FTC consent decree, Instersect’s Fiagon subsidiary, which makes ear, nose, and throat navigation systems and balloon sinus dilation products, will be sold to Hemostasis, LLC. According to the complaint, without this divestiture, the acquisition would pose a threat to future competition in the United States for both ENT navigation systems and balloon sinus dilation products. On June 30, 2022, the Commission announced the final consent agreement in this matter.

In March 2022, the FTC announced that two Texas-based companies and their owner are banned from advertising or selling dietary supplements, and from making claims that their products treat, cure, or reduce the risk of disease, under a proposed settlement with the Federal Trade Commission. The agency announced final approval of the order in June 2022.

In September 2019, the operators of a deceptive negative option scheme agreed to a court-ordered preliminary injunction temporarily barring them from a wide range of conduct.  The preliminary injunction stops the defendants from misleading consumers about supposedly “free trial” offers, enrolling them in unwanted continuity plans, billing them without their authorization, and making it nearly impossible for them to cancel or get their money back. In June 2022, the Commission announced it was returning $5.4 million to defrauded consumers.

The Federal Trade Commission authorized an administrative complaint and a suit in federal court to block the proposed merger of two large healthcare systems in Utah, alleging the deal would lead to higher prices and lower quality of care in the region surrounding Salt Lake City, known as the Wasatch Front region. The deal would impact a broad range of essential medical and surgical diagnostic and treatment services that require an overnight hospital stay, known as inpatient general acute care, the FTC alleged.

The FTC’s federal court suit sought  a temporary restraining order and preliminary injunction to stop the deal and to maintain the status quo while the FTC pursues an administrative trial on the merits of the case. On June 16, 2022, the parties announced that they had abandoned the transaction.

In December 2018, the Federal Trade Commission announced that the operators of Florida-based student loan debt relief scheme Student Debt Doctor are banned from the debt relief business as part of agreements settling allegations that they collected illegal upfront fees and falsely promised to help some consumers enroll in government programs that would reduce or forgive their student loan debt. In June 2022, the agency announced that it is sending 22,817 checks totaling more than $2 million to borrowers who lost money to the scheme.

Yellowstone Capital, a provider of merchant cash advances, will pay more than $9.8 million to settle Federal Trade Commission charges that it took money from businesses’ bank accounts without permission and deceived them about the amount of financing business owners would receive and other features of its financing products.

Merchant cash advances are a form of financing in which a company provides money to a small business up front in exchange for a larger amount repaid through daily automatic payments. In this case, the FTC alleged that Yellowstone and its owners continued withdrawing money from businesses’ bank accounts for days after their balance had been repaid. The complaint alleged that these unauthorized withdrawals left businesses without needed cash and that any refunds from the company could take weeks or months.

The Federal Trade Commission is sending 7,731 checks totaling more than $9.7 million to small businesses who were harmed by Yellowstone Capital, a merchant cash advance company that withdrew money from their bank accounts without permission.