Legal Library: Cases and Proceedings

A New Mexico physician organization settled charges that it and its members entered into agreements to fix prices and to refuse to deal with third party payers and other health care plans except on collectively agreed-upon terms.

The Commission authorized staff to file a motion for a preliminary injunction to block the proposed acquisition of Vivendi Universal S.A.’s Seagram Wine and Spirits Business on grounds that the transaction, would combine the second- and third-largest rum producers in the U.S. eliminating actual competition between the firms, leading to higher prices for rum. The Commission charged that Diageo and Bacardi together would control 95 percent of all U.S. premium rum sales, and that Diageo would have access to highly sensitive business information about Seagram's Gin, Chivas Regal Scotch whisky, The Glenlivet Scotch, and Martell Cognac, products with which Diageo is in significant competition.  If Diageo were to acquire these brands, it would maintain (or have a financial interest in) virtually all popular gin sales, virtually all deluxe Scotch whisky sales, 32 percent of all single malt Scotch whisky sales, and 63 percent of all Cognac sales in the United States.  Those brands, which compete directly with other brands marketed by Diageo in the United States (including Gordon's Gin, Classic Malt Scotch whiskies, Johnnie Walker Black Scotch, and Hennessy Cognac), are Seagram's Gin, Chivas Regal Scotch whisky, The Glenlivet Scotch whisky, and Martell Cognac.  The parties settled the charges and by consent order, Diageo was required to divest the Malibu rum business worldwide to a Commission-approved buyer.  The order also prevented Diageo from obtaining or using any competitively sensitive business information related to Seagram's Gin, Chivas Regal Scotch whisky, The Glenlivet Scotch whisky, or Martell Cognac.

The consent order permits the acquisition of Hughes Space and Communications, a subsidiary of General Motors Corporation, but prohibits Boeing from providing systems engineering and technical assistance (SETA) to the U.S. Department of Defense for a specific classified program. According to the complaint, Boeing is the sole supplier of SETA programs and Hughes is one of two competing contractors.