Legal Library: Cases and Proceedings

The FTC required Surgery Center Holdings, Inc., known as Surgery Partners, and Symbion Holdings Corporation, to divest Symbion’s ownership interest in an ambulatory surgery center in Orange City, Florida to Dr. Mark W. Hollmann, as part of a settlement resolving charges that Surgery Partners’ $792 million purchase of Symbion would be anticompetitive. Both companies operate a large number of ambulatory surgery centers located throughout the country that sell and provide outpatient surgical services to commercial health plans and commercially insured patients. The proposed merger would have combined the only two multi-specialty ambulatory surgical centers in the Orange City/Deltona area of Florida, and would have left commercial health plans and commercially insured patients there with only one meaningful alternative to Surgery Partners’ outpatient surgical services.

Global medical technology company Medtronic, Inc. agreed to divest the drug-coated balloon catheter business of Ireland-based medical products company Covidien plc, in order to settle FTC charges that its $42.9 billion acquisition of Covidien would likely be anticompetitive. Under the FTC’s proposed settlement, Medtronic will sell the drug-coated balloon catheter business to a Colorado-based medical device company, The Spectranetics Corporation. According to the FTC’s complaint, both Medtronic and Covidien are developing drug-coated balloon catheters to compete with C.R. Bard, Inc., which currently is the only company that supplies these products, used to treat peripheral artery disease, in the U.S. market. Medtronic and Covidien are the only companies with products in clinical trials in the Food and Drug Administration’s approval process, which makes it unlikely that other competitors could enter the market in time to counteract the effects of the merger.

The FTC issued an administrative complaint against Ferrellgas Partners, L.P and Ferrellgas, L.P. (doing business as Blue Rhino) and UGI Corporation and AmeriGas Partners, L.P. (doing business as AmeriGas Cylinder Exchange), alleging that they illegally agreed on reducing the amount of propane in their tanks sold to a key customer. The complaint alleges that, together, Blue Rhino and AmeriGas controlled approximately 80 percent of the market for wholesale propane exchange tanks in the United States. In 2008, Blue Rhino and AmeriGas each decided to implement a price increase by reducing the amount of propane in their exchange tanks from 17 pounds to 15 pounds, without a corresponding reduction in the wholesale price. On 10/31/14, AmeriGas and Blue Rhino agreed to settle FTC charges of restraining competition. Faced with resistance from Walmart, the two companies colluded by secretly agreeing to coordinate their negotiations with Walmart in order to push it to accept the reduction. The consent agreements prohibit the companies from soliciting, offering, participating in, or entering or attempting to enter into any type of agreement with any competitor in the propane exchange business to raise, fix, maintain, or stabilize the prices or price levels of propane exchange tanks through any means – including modifying the fill level contained in propane tanks or coordinating communications to customers. The companies also are prohibited from sharing sensitive non-public business information with competitors except in narrowly defined circumstances.