Legal Library: Cases and Proceedings

Final order permitted Valspar's acquisition of Lilly Industries, Inc., but requires Valspar to divest its mirror coatings business to Spraylet Corporation. Mirror coatings are applied to the back of a piece of glass in order to produce a mirror.

Final consent order permitted the acquisition of Mynd Corporation and required the divestiture of Mynd's Claims Outcome Advisor System to Insurance Services Office, Inc. Claims assessment systems are used by insurance companies to evaluate appropriate payments for claims of bodily injury and to evaluate return-to-work plans in workers compensation matters.

Complaint filed in the U.S. District Court for the District of Columbia charged Mylan with restraint of trade, monopolization and conspiracy to monopolize the market for two generic drugs used to treat anxiety, lorazepam and clorazepate, through exclusive dealing arrangements.  The Commission alleged that Mylan, Gyma Laboratories of America, Inc., Cambrex Corporation and Profarmaco S.R.L. conspired to deny Mylan’s competitors ingredients necessary to manufacture lorazepam and 40 clorazepate. The complaint sought consumer redress of at least $120 million and to enjoin the alleged illegal exclusive licensing agreements. The district court upheld the Commission’s authority to seek restitution in antitrust injunction actions under Section 13(b).  The Commission approved a $100 million settlement. The opinion settled Commission concerns that Mylan, Gyma Laboratories of America, Inc., Cambrex Corporation and Profarmaco S.R.L. conspired to deny Mylan’s competitors ingredients necessary to manufacture lorazepam and 40 clorazepate. On February 1, 2002, the court granted approval to a plan of distribution to injured consumers who paid the increased prices and state agencies, including Medicaid programs, that purchased the drugs while the illegal agreements were in effect. The funds were distributed by the states.

A consent order requires Agrium to divest a deepwater terminal near Portland, Oregon, an up water terminal in central Washington and other assets settling charges concerning its proposed acquisition of the nitrogen fertilizer business of Union Oil Company of California. Agrium and Unocal are the leading producers in the Northwest of nitrogen fertilizer – anhydrous ammonia, urea and UAN 32% solution – ingredients used for plant growth.

The FTC charged that five distributors of recorded music illegally required retailers to advertise compact discs at or above the minimum advertised price (MAP) set by the distribution company in exchange for substantial advertising payments for various types of media including television, radio, newspaper and signs and banners within the retailers own stores. Time-Warner Inc., Bertlesmann, Universal Music and Video Distribution Corporation and UMG Recordings, Inc., EMI Music Distribution, and Sony Music Entertainment represent approximately 85 percent of all CD’s purchased in the United States. According to the complaint, the MAP policies violated the antitrust laws in two respects. First, when considered together, the arrangements constitute practices that facilitate horizontal collusion among the distributors, and, when viewed individually, each distributor's arrangement constitutes an unreasonable vertical restraint of trade under the rule of reason.  In separate settlements, each distributor agreed to stop linking promotional funds to the advertised prices of their retailer customers for the next seven years. For the next 13 years after that, each company was prohibited from conditioning promotional money on the prices contained in advertisements they do not pay for, or terminating relationships with any retailer based on that retailer's prices.

United States Court of Appeals Opinion Denying Novartis's Petition for Review of Final Order of the Commission (D.C. Cir. August 18, 2000)

Conso International Corporation, owner of the Simplicity brand of home sewing patterns, abandoned its proposed acquisition of McCall Pattern Company after the Commission filed a motion for a preliminary injunction in the United States District Court for the Southern District of New York. The complaint charged that the acquisition would reduce the number of United States sewing pattern designers and producers from three to two, creating a firm with more than 75% of the domestic unit sales of domestic home sewing patterns.