Legal Library: Cases and Proceedings

The FTC challenged Laboratory Corporation of America’s $57.5 million acquisition of rival clinical laboratory testing company Westcliff Medical Laboratories, Inc., alleging that the transaction would lead to higher prices and lower quality in the Southern California market for the sale of clinical laboratory testing services to physician groups. The complaint also alleges that LabCorp’s acquisition of Westcliff would leave only two significant laboratories in Southern California competing to provide critical testing services to most physician groups.The FTC also filed an action in federal court to prevent LabCorp from integrating the Westcliff assets while the case is being tried in the administrative court. The federal court denied the FTC motion for an injunction pending appeal. Staff filed an emergency motion for an injunction pending appeal with the 9th Circuit, which denied the Commission's appeal. The Commission dismissed its complaint and closed the investigation.

In May 1996, the Commission filed an administrative complaint charging Toys "R" Us with using its dominant position as a toy distributor to obtain agreements from toy manufacturers to stop selling to warehouse clubs the same toys that they sold to Toys "R" Us.  After an administrative trial, the ALJ issued an initial decision finding that Toys "R' Us' policy to stop carrying toys made by a manufacturer that sold the same toys to discount club stores had induced manufacturers to agree to stop supplying some toys to club stores in violation of the antitrust laws.  In October 1998, the Commission issued its decision that Toys "R Us had orchestrated horizontal and vertical agreements with and among toy manufacturers to restrict the availability of popular toys to warehouse clubs, and ordered the company to stop pressuring manufacturers to limit supply or otherwise refuse to sell to discount club stores. Toys "R" Us appealed to the Seventh Circuit, and in August 2000, the appellate court upheld the Commission's order.

In April 2014, on a petition from Toys "R" Us, the Commission modified its order to set aside certain provisions that restricted the company's ability to enter into certain conditional supply relationships, finding that Toys "R" Us is no longer the largest toy retailer.

The FTC preserved competition in the North American market for alumina wear tile by imposing conditions on Keystone Holdings, LLC and Compagnie de Saint-Gobain in a settlement involving Keystone’s planned acquisition of Saint-Gobain’s Advanced Ceramics Business. According to the FTC’s complaint, the deal as originally structured would have reduced competition in the relevant markets by eliminating direct competition between CoorsTek – the Keystone subsidiary that manufactures its tiles – and Saint-Gobain. In addition, the deal would increase CoorsTek’s market share substantially, eliminate CoorsTek’s most significant alumina wear tile competitor in North America, allow the combined company to raise prices for alumina wear tile, and increase the likelihood that the remaining firms could act together to raise prices for alumina wear tile.