Legal Library: Cases and Proceedings

The consent order requires Shell Oil and its Tejas Energy, LLC, subsidiary, to divest parts of the ANR pipeline system in Oklahoma and Texas to settle charges that its acquisition of gas gathering assets of The Coastal Corporation would lead to anticompetitive increases in gas gathering rates and an overall reduction in gas drilling and production in the two states.

A consent order requires Albertson's to divest eight supermarkets in Montana and seven in Wyoming in order to settle FTC charges and maintain competitive grocery pricing in 11 communities following its acquisition of the Buttrey Food and Drug Store Company. Under the consent agreement, 13 of the supermarkets would be sold to Smith's Food and Drug Centers, Inc. and two supermarkets would be sold to Supervalu Holdings, Inc.

Exxon will divest its viscosity index improver business to Chevron Chemical Company LLC to settle allegations that its proposed joint venture with Royal Dutch Shell to develop, manufacture and sell their fuel and lubricants additives would reduce competition and lead to collusion among the remaining firms in the market.

Consent order settles charges that the acquisition of Petroleum Information Corporation could create a monopoly for production and well history data used by geologists and petroleum engineers to find additional oil and gas reserves. The settlement requires Dwight to license a complete set of well history to HPDI, an independent competitor, or another Commission-approved licensee.

An association of 25 automobile dealerships settled charges that they agreed to boycott Chrysler if the manufacturer continued to allocate vehicles based on total sales. Competing dealers marketed vehicles offering lower prices on the Internet and were taking substantial sales from other dealers in the Northwest. The consent order prohibits the dealers from threatening to enter into any boycott or refusal to deal with any automobile manufacturer or consumer.

Consent order prohibits the association from entering into agreements that restrict its members from posting or advertising room rates for lodgings in the South Lake Tahoe area of Northern California and Nevada.

Nortek, Inc., agreed to settle FTC charges that its $242.5 million acquisition of NuTone, its closest competitor in the hard-wired residential intercom business, would violate federal antitrust laws by creating a dominant firm that could drive up prices in the market.  Nortek, based in Providence, Rhode Island, controls 31 percent of the market for hard- wired residential intercoms, through its M & S subsidiary. NuTone is the leading seller of residential intercoms, with about 56 percent of the market. Together, the merged firm would control about 87 percent of U.S. hard-wired residential intercom sales.To settle the FTC charges, Nortek agreed to divest M & S, its wholly-owned subsidiary and the second-largest seller of hard-wired residential intercoms in the United States.

A group of physicians in the area of Lake Charles, Louisiana settled charges that they illegally conspired to fix the prices for professional services by engaging in joint price negotiations with third-party payers. The final consent order prohibits such practices but does allow the MDP to engage in legitimate joint conduct.

Columbia MCA paid a $2.5 million civil penalty to settle charges that it failed to divest the Davis Hospital and Medical Center in Layton, Utah, the Pioneer Valley Hospital in West Valley City, Utah and the South Seminole Hospital in Florida as required by a 1995 consent order. The complaint and settlement were filed in the U.S. District Court for the District of Columbia.

The FTC charged that Fastline Publications, Inc., a Kentucky publisher, and Mid-America Equipment Retailers Association, an Indiana trade association representing farm equipment dealers harmed competition when the publisher entered into agreements with the dealers to ban price advertising for new equipment in an attempt not to disclose those dealers who offered discounted prices.  According to the FTC, the agreements reduced competition among farm equipment dealers and deprived consumers of truthful and nondeceptive price information. The agreement to settle the charges prohibited Fastline and Mid-America from restricting the advertising of prices for farm equipment in the future.

The Commission authorized staff to file separate motions in federal district court to block the mergers of the nation's four largest drug wholesalers into two wholesale distributors of pharmaceutical products. The Commission charged that Cardinal 's proposed acquisition of Bergen Brunswig Corporation and McKesson Corporation's proposed acquisition of AmeriSource Health Corp. would substantially reduce competition in the market for prescription drug wholesaling and lead to higher prices and a reduction in services to the companies' customers --hospitals, nursing homes and drugstores --and eventually to consumers. Two separate motions for preliminary injunctions were filed in the U.S. District Court for the District of Columbia March 6, 1998. On July 31, 1998, the District Court granted the Commission's motions enjoining both proposed mergers. The parties abandoned their respective merger plans soon after the decision.

Global Industrial Technologies, Inc. agreed to restructure its proposed acquisition of AP Green Industries, Inc. to resolve FTC allegations that the merger would likely substantially reduce competition by combining the two largest domestic producers of glass-furnace silica refractories in the United States. Under the terms of a settlement, Global divested AP Green’s silica refractories business to a Commission-approved buyer.

Consent order settles charges that Cablevision's acquisition of certain cable operations in northern New Jersey and in New York from Tele-Communications Inc. would result in higher prices and lower quality of cable television services for residents of Paramus and Hillsdale, New Jersey. The settlement requires divestiture of TCI's cable systems in the two cities.

Shell Oil and Texaco settled allegations that their proposed joint venture would reduce competition and could raise prices for gasoline in Hawaii, California, and Washington and the price of asphalt in California. The consent order requires Shell to divest a package of assets, including Shell's Anacortes, Washington refinery; a terminal and retail gasoline stations in Oahu, Hawaii and retail gas stations, and a pipeline in California.

Consent order settles allegations that Urological Stone Surgeons, Parkside Kidney Stone Centers, Urological Services. Ltd and two physicians engaged in a price-fixing conspiracy to raise the price for professional urologist services for lithotripsy procedures in the Chicago metropolitan area. The complaint alleges that the parties agreed to use a common billing agent, established a uniform fee for lithotripsy services, prepared and distributed fee schedules, and negotiated contracts with third party payers on behalf of all urologists using the Parkside facility. The consent order prohibits such practices in the future and requires the parties to notify the Commission at least 45 days before forming or participating in an integrated joint venture to provide lithotripsy professional services.