Legal Library: Cases and Proceedings

The Commission required dialysis services company DaVita, Inc. to sell 29 outpatient dialysis clinics around the United States, under a settlement that resolves FTC charges that DaVita’s proposed $689 million acquisition of rival CDSI I Holding Company, Inc., also known as DSI, would be anticompetitive. The settlement preserves competition in 22 geographic markets where the FTC alleges that consumers would be harmed by DaVita’s acquisition of DSI. The settlement requires DaVita to sell the clinics to Dialysis Newco, Inc., a corporation formed by venture capital firms Frazier Healthcare and New Enterprise Associates.

In 2006, Ovation Pharmaceuticals, manufacturer of Indocin, a drug used in the treatment of patent ductus arteriosus, a congenital heart defect usually found in severely underweight premature babies, purchased the rights to the drug NeoProfen, a drug about to receive FDA approval for the treatment of the same condition which effects approximately 30,000 babies per year in the United States.  After its FDA approval, Ovation released its NeoProfen treatment, charging similar prices. According to the Commission’s complaint, Ovation’s acquisition was intended to maintain its monopoly in the market for this treatment, and the Commission sought divestiture of assets related to one of the two treatments, and also disgorgement of all unlawfully obtained profits from the sale of these two treatments. In August 2010, the district court dismissed the complaint, finding that the two drugs were in separate product markets. The Commission, along with the State of Minnesota, has appealed the court’s ruling to the Eighth Circuit. On August 19, 2011 the Eighth Circuit affirmed the district court's decision. FTC and Minnesota filed a petition for rehearing en banc on October 3, 2011, and the petition was denied.  The FTC closed its investigation.

An association representing 900 physicians in the Amarillo, Texas, area agreed to a Commission order barring it from jointly negotiating the prices it charges insurance providers. The FTC alleged in a complaint filed with the order that the association, Southwest Health Alliances, Inc., d/b/a BSA Provider Network, has violated federal law since 2000 by fixing the prices its member doctors would charge insurers. The Commission's order requires the association to cease and desist.

The Commission required Irving Oil Terminals Inc. and Irving Oil Limited to relinquish the rights to terminal and pipeline assets in Maine that Irving acquired from ExxonMobil, to maintain competition in gasoline and distillates terminaling services in the South Portland and Bangor/Penobscot Bay areas. The proposed settlement resolves the FTC’s charges that the acquisition is anticompetitive and could result in higher gasoline and diesel prices for consumers.

Under the terms of the settlement, Simon Property Group, Inc. is required to divest property and modify tenant leases to preserve outlet center competition in parts of southwest Ohio, Chicago, Illinois, and Orlando, Florida, in the wake of Simon’s purchase of Prime Outlets Acquisition Company, LLC. In addition, Simon has agreed to remove radius restrictions for tenants with stores in its outlet malls serving the Chicago and Orlando markets.