Legal Library: Cases and Proceedings

Fidelity National Financial, Inc. agreed to settle charges that its proposed $2.9 billion acquisition of Lender Processing Services, Inc. (LPS) would likely substantially lessen competition by combining the firms’ title plant assets in several local markets in Oregon. To preserve competition, the proposed settlement requires Fidelity to sell a copy of LPS’s title plants in six Oregon counties and an ownership interest equivalent to LPS’s share of a jointly owned title plant in the Portland, Oregon, metropolitan area.

In the matter of Polypore International/Daramic LLC, the Commission issued an administrative complaint challenging Polypore’s consummated acquisition of Microporous Products in the global market for battery separators, a key component in flooded lead-acid batteries. According to the Commission’s complaint, the acquisition, which occurred in February 2008, substantially lessened competition and led to higher prices in several North American product markets including 1) deep-cycle separators used in golf carts, 2) motive separators for batteries used primarily in forklifts, 3) automotive separators used in car batteries, and 4) uninterruptible power supply (UPS) separators used in batteries that provide backup power during power outages. Additionally, the complaint alleged that Polypore engaged in anticompetitive conduct by entering into a joint marketing agreement with a competitor, restricting the competitor’s entry into the polyethylene battery separator markets. The complaint also charged that Polypore sought to maintain monopoly power through anticompetitive means in several battery separator markets. On 3/8/2010, the ALJ announced an Initial Decision finding that Polypore International Inc.’s consummated acquisition – through its Daramic Acquisition Corporation subsidiary – of rival battery separator manufacturer Microporous L.P. was anticompetitive and violated federal law in four battery separator markets in North America. In an Order filed with the Initial Decision on 2/22/2010, Judge Chappell ordered Polypore to divest Microporous to an FTC-approved buyer within six months after the divestiture provisions of the Order become final. Judge Chappell also ruled that a 2001 joint marketing agreement between Polypore and a rival battery separator manufacturer illegally divided up the markets for particular types of battery separators in North America, and ordered Polypore to amend the agreement to terminate and declare null and void the covenant not to compete. Finally, the Judge dismissed a separate allegation that Polypore engaged in exclusionary conduct in specific battery separator markets. In December of 2010, the Commission voted to uphold in large part the March 2010 Initial Decision, finding that the acquisition reduced competition in three of the four relevant markets, and ordering divestiture. Polypore subsequently filed a petition for review of the Commission's Decision and Order in the US court of Appeals for the Eleventh Circuit. On 07/12/2012, the U.S. Court of Appeals upheld the FTC's Opinion and Order, and on 06/24/2013, the Supreme Court denied Polypore's petition for certioari. In December 2013, the FTC approved the sale of all stock and assets related to Microporous to Seven Mile Capital Partners.

Honeywell International Inc agreed to license patents critical to the manufacture of two-dimensional (2D) bar code scanners to settle FTC charges that it's acquisition of rival Intermed Inc would be anticompetitive.  Honeywell will license its and Intermec's patents for 2D scan engines to Datalogic IPTECH s.r.l for the next 12 years.

The FTC issued an administrative complaint on 7/17/2010 alleging that the state dental board in North Carolina is harming competition by blocking non-dentists from providing teeth-whitening services in the state. The FTC charged that the North Carolina Board of Dental Examiners impermissibly ordered non-dentists to stop providing teeth-whitening services, which has made it harder to obtain these services and more expensive for North Carolina consumers. According to the FTC’s administrative complaint, teeth-whitening services are much less expensive when performed by non-dentist than when performed by dentists. In an Initial Decision issued July 14, 2011, the ALJ found that non-dentists compete with dentists to provide teeth whitening services in North Carolina and that the Dental Board's concerted action to exclude non-dentist-provided teeth whitening services from the market had a tendency to harm competition. The ALJ further found that the Dental Board's action had no valid pro competitive justification and constituted an unreasonable restraint of trade and an unfair method of competition. On February 8, 2011, the Commission denied the respondent's motion to dismiss, ruling that the Board's actions were not entitled to state action immunity. The Commission ruled that because the Board is controlled by practicing dentists, its condcut must be actively supervised by the state. OnDecember 7, 2011, the Commission issued an Opinion concluding that the Dental Board violated of Section 5 of the FTC Act, and agreed with the ALJ that the Dental Board's conduct "constituted concerte action, . . . had a tendency to harm competition and did in fact harm competition," and had no legitimate pro-competitive justification. The Commission concluded that the Dental Board's conduct could be deemed illegal under the "inherently suspect" mode of analysis because the challenged conduct had a clear tendency to suppress competition and lacked any countervailing procompetitive virtue. On May 3, 2013, the Fourth Circuit denied the Board's petition to review the Commission's decision and on 2/25/15, the Supreme Court affirmed the ruling of the U.S. Court of Appeals for the Fourth Circuit.

The FTC filed separate complaints against the three largest U.S. suppliers of ductile iron pipe fittings, which are used in municipal water systems around the United States. The FTC charged that the three companies, McWane, Inc., Star Pipe Products, Ltd., and Sigma Corporation, illegally conspired to set and maintain prices for pipe fittings, and that McWane illegally maintained its monopoly power in the market for U.S.-made pipe fittings by implementing an exclusive dealing policy. Sigma settled the FTC's charges prior to litigation (final order dated Feb. 27, 2012); Star settled soon after (final order dated May 8, 2012).  The complaint against McWane was heard before an administrative law judge and later appealed to the Commission; see Docket No. 9351.

To settle charges that its 2008 acquisition of three LandAmerica Financial, Inc. subsidiaries was anticompetitive, Fidelity National Financial, Inc. agree to sell several title plants and related assets in six geographic areas: 1) the Portland, Oregon, metropolitan area, consisting of Clackamas, Multnomah, and Washington counties; 2) Benton County, Oregon; 3) Jackson County, Oregon; 4) Marion County, Oregon; 5) Linn County, Oregon; and 6) the Detroit, Michigan, metropolitan area consisting of Oakland, Macomb, and Wayne counties.