Legal Library: Cases and Proceedings

New York-based supermarket operators The Golub Corp., which owns the Price Chopper chain, and Tops Market Corp. have agreed to divest 12 Tops supermarkets to C&S Wholesale Grocers to settle Federal Trade Commission charges that their proposed merger would likely be anticompetitive in 11 local markets in New York and Vermont. In those markets, according to the complaint, without a remedy the merger is likely to allow the newly merged company to increase prices above competitive levels, unilaterally or by coordinating with competitors. The merger is also likely to diminish the combined company’s incentives to compete on quality and service in its stores. The Decision and Order requires Price Chopper and Tops to divest the 12 Tops stores and related assets to C&S on a rolling basis, beginning by Jan. 17, 2022, at a rate of two stores pe week for six weeks. On Jan. 24, 2022, the Commission announced the final consent agreement in this matter.

Richard Fairbank, CEO of Capital One Financial Corp., has agreed to settle Federal Trade Commission charges that his March 8, 2018, acquisition of Capital One Financial (COF) stock violated the Hart-Scott-Rodino Act. Under a negotiated settlement, Fairbank will pay a $637,950 civil penalty. The complaint alleges that in 2018,  Fairbank violated the notice and waiting period requirements of the HSR Act because he did not file before acquiring COF voting securities in excess of the $100 million filing threshold, as adjusted (which at the time was $168.8 million).

Under an order with the FTC, OpenX Technologies, Inc. will be required to pay $2 million over allegations that the company collected personal information from children under 13 without parental consent. The FTC also alleged that the company collected geolocation information from users who specifically asked not to be tracked.

Following a public comment period, the Federal Trade Commission has approved a final order settling charges that three PET resin producers’ proposed $1.1 billion joint acquisition out of bankruptcy of an under-construction PET production facility would violate federal antitrust law.

Pharmaceutical and biologic manufacturers Bristol-Myers Squibb Company and Celgene Corporation agreed to divest Celgene’s Otezla, the most popular oral treatment in the United States for moderate-to-severe psoriasis, for $13.4 billion. The divestiture settled Federal Trade Commission charges that BMS’s proposed $74 billion acquisition of Celgene would violate federal antitrust law. Under the terms of the proposed consent order, the parties were required to divest Celgene’s worldwide Otezla business – including its regulatory approvals, intellectual property, contracts, and inventory – to Amgen, Inc. no later than 10 days after consummating the proposed acquisition. On Nov. 12, 2021, the Commission  announced that it has approved certain modifications to Bristol Meyers Squibb’s divestiture agreements.

The Federal Trade Commission has issued a complaint charging Broadcom with illegally monopolizing markets for semiconductor components used to deliver television and broadband internet services through exclusive dealing and related conduct. The complaint alleges that Broadcom illegally maintained its power in the three monopolized markets by entering long-term agreements with both OEMs and service providers that prevented these customers from purchasing chips from Broadcom’s competitors. The complaint also alleges that Broadcom leveraged its power in the three monopolized chip markets to extract from customers exclusivity and loyalty commitments for the supply of chips in the five related markets. Under the consent order, Broadcom must stop requiring its customers to source components from Broadcom on an exclusive or near exclusive basis.

A federal court issued a temporary restraining order against Marc and Courtney Grisham and two companies they operate, Disruption Theory LLC and Emergent Technologies LLC, which do business as inmatecall.com and inmatecallsolutions.com, related to FTC allegations they offered fake calling plans for unlimited minutes and falsely claiming to be affiliated with companies authorized to provide calling services to people who are incarcerated.

Announced in June 2019 as part of a crackdown on illegal robocalls against operations around the country responsible for more than one billion calls, thisFTC complaint against five corporate and four individual defendants<, alleges that since at least 2017 the defendants have used a combination of illegal telemarketing robocalls, live telephone calls, text messaging, internet ads, emails, social media, and live events to market and sell consumers fraudulent money-making opportunities. The complaint charges the defendants, who operate from California, Colorado, New York, and Tennessee, with violating the FTC Act, the Telemarketing Sales Rule (TSR), or both, by making deceptive earnings claims through robocalls and other marketing techniques. In September 2021, The Federal Trade Commission sent checks totaling more than $1 million to consumers who were harmed by the company.

The Federal Trade Commission alleged that BlueHippo Funding, LLC, and BlueHippo Capital, LLC operated a deceptive computer financing scheme in violation of a federal court order. 

The Federal Trade Commission’s complaint against FleetCor, a company that sells fuel card services to businesses, alleges that it has charged customers at least hundreds of millions of dollars in hidden fees after making false promises about helping customers save on fuel costs. The case was filed in December 2019.

Career Education Corporation (CEC) and its subsidiaries, American InterContinental University, Inc., AIU Online, LLC, Marlin Acquisition Corporation, Colorado Technical University, Inc., and Colorado Tech., Inc. (collectively, CEC), has been ordered to pay $30 million to the FTC to settle Federal Trade Commission charges that the operator used sales leads from lead generators that falsely told consumers they were affiliated with the U.S. military, and that used other unlawful tactics to generate leads. CEC’s lead generators also induced consumers to submit their information under the guise of providing job or benefits assistance. The FTC also charged that CEC’s lead generators falsely told consumers that their information would not be shared, and that both CEC and its lead generators illegally called consumers registered on the National Do Not Call (DNC) Registry.

The Federal Trade Commission is sending nearly $30 million in refunds to people tricked by agents working on behalf of Career Education Corporation (currently operating as Perdoceo Education Corporation), the operator of several post-secondary schools.

In September 2016, the FTC announced a court order banning the operators of an alleged mortgage relief scam that preyed upon distressed homeowners from the debt relief business. The final orders banned the defendants from selling secured or unsecured debt relief products or services, and prohibited them from misrepresenting any financial or other products or services. The orders imposed a judgment of more than $1.7 million. The FTC’s July 2014 complaint alleged the defendants claimed they could lower consumers’ mortgage payments and interest rates or prevent foreclosure, pretended to be affiliated with a government agency or consumers’ lenders or servicers, and illegally charged advance fees for these services. The FTC announced additional settlements in the case through March 2020.

In May 2021, the FTC sent payments totaling more than $147,000 in full refunds to people affected by the student loan debt relief scam.   

The Federal Trade Commission charged the operators of two similar student loan debt relief schemes, Manhattan Beach Ventures and Student Advocates Team, and a financing company that assisted them, Equitable Acceptance Corporation, with bilking millions of dollars from consumers.

In May 2021, the FTC sent payments totaling more than $273,500 to consumers who lost money to the student loan debt relief scheme.