Tag: Nonmerger

The Commission charged that Negotiated Data Solutions LLC (N-Data) violated Section 5 of the FTC Act by engaging in unfair methods of competition. N-Data acquired patent rights originally held by National Semiconductor Corp. which were included in an IEEE industry standard for autonegotiation technology, which allows Ethernet devices made by different manufacturers to work together. Ethernet is a computer networking standard that is used in nearly every computer sold in the U.S. N-Data reneged on National Semiconductor’s commitment to charge a one-time royalty of $1000 to manufacturers or sellers of products using the IEEE standard, and demanded higher royalties from users. In a consent agreement resolving the charges, N-Data must stop enforcing the patents at issue unless N-Data has first offered a license under the original terms.

An administrative law judge upheld the administrative complaint that charged that the North Texas Specialty Physicians (NTSP), a physician group practicing in Forth Worth, Texas, collectively determined acceptable fees for physician services in negotiating contracts with health insurance plans and other third party payers; thus engaging in horizontal price fixing. On December 1, 2005, the Commission issued a unanimous decision upholding the allegations that NTSP negotiated agreements among participating physicians on price and other terms, refused to negotiate with payers except on terms agreed to among its members, and refused to submit payors offers to members if the terms did not satisfy the group’s demands. The Commission concluded that the group’s contracting activities with payors amounts to unlawful horizontal price fixing and that respondent’s efficiency claims were not legitimate and not supported by the evidence.

The respondent appealed the Commission decision to the U.S. Court of Appeals for the Fifth Circuit. The Court agreed with the Commission that the anticompetitive effects of NTSP’s practices were obvious. Per remand by the Court, the Commission modified one provision of its remedial order, issuing a Final Order in September 2008. On February 28, 2009, the U.S. Supreme Court denied NTSP's petition for review.

Under the terms of the proposed consent order, the Missouri Board of Embalmers and Funeral Directors agreed to settle charges that it deterred competitive entry in the retail sale of caskets by adopting a rule that only licensed funeral directors could sell caskets to consumers on an at-need basis. Under the proposed settlement, the Board is required to communicate to the public that it is not necessary to obtain a license from the Board to offer for retail sale caskets and other funeral merchandise to customers in Missouri.

There is a related administrative proceeding.

On March 7, 2007, the Fifth Circuit Court of Appeals heard oral arguments in the appeal by respondents of the Commission's opinion in NTSP. The Court agreed with the Commission that the anticompetitive effects of NTSP’s practices were obvious. Per remand by the Court, the Commission modified one provision of its remedial order, issuing a Final Order in September 2008. On February 28, 2009, the U.S. Supreme Court denied NTSP's petition for review.

Nine West Group Inc. settled charges that it entered into agreements with retailers; coerced other retailers into fixing the retail prices for their shoes; and restricted periods when retailers could promote sales at reduced prices. The order, which lasts 20 years, prohibits Nine West from fixing the price at which dealers may advertise, promote or sell any product. Nine West is one of the country’s largest suppliers of women’s shoes. In 2008, Nine West petitioned to have the order modified in light of the 2007 Supreme Court decision, Leegin v. PSKS, Inc., which eliminated the per se rule for minimum resale pricing agreements.   The Commission modified the order in part to allow Nine West to enter into resale price maintenance agreements that do not unreasonably restrict competition, and requiring Nine West to provide periodic reports of any RPM agreements with retailers.

The FTC challenged a group boycott between two Connecticut chiropractic associations in which the health care providers refused to deal with a cost-saving Connecticut health plan. The Commission issued a consent order ending the agreement and preventing the involved parties from entering into such agreements in the future.

Multiple Listing Service, Inc. (MLS), a group of real estate professionals based in Milwaukee, Wisconsin, settled charges that its rules unreasonably restrained competition among real estate brokers in Milwaukee.  The complaint alleges that MLS acted anticompetitively by adopting rules and policies that limit the publication and marketing of certain sellers’ properties, but not others, based solely on the terms of their respective listing contracts. The Commission alleged that the rules were collusive and exclusionary and served to withhold valuable benefits of the MLS from brokers who did not use traditional listing contracts with their customers.  Under the terms of the December 2007 consent, MLS is barred from adopting or enforcing any rule that treats one type of real estate listing agreement more advantageously than any other, and from interfering with the ability of its members to enter into any kind of lawful listing agreement with home sellers.

The Commission charged a group of optometrists in Puerto Rico with violating the FTC Act by orchestrating agreements among members of the Colegio de Optometras to refuse, or threaten to refuse, to accept vision and health care contracts except on collectively agreed-upon terms. Two leaders of the group were also charged with facilitating the agreement by urging members not to participate in the vision network. The Commission’s consent order settling these charges bars the group and the two leaders from engaging in such conduct, while allowing them to undertake certain kinds of joint contracting arrangements by which physician participants control costs and improve quality by managing the provision of services. FTC staff worked with the Office of Monopolistic Affairs of Puerto Rico’s Department of Justice on this case.

The Commission settled a September 15 2003 administrative complaint charging the South Carolina State Board of Dentistry with unlawfully restraining competition by enacting a rule that required a dentist to examine every child before a dental hygienist could provide preventive dental care – such as cleanings – in schools. The Board, which is a state regulatory agency composed primarily of practicing dentists, claimed that its actions were immune from antitrust challenge under the state action doctrine, but that argument was rejected in a 2004 Commission opinion holding that the Board’s conduct was directly contrary to state law. In 2006, the court of appeals dismissed the Board’s interlocutory petition for review for lack of jurisdiction, and the Supreme Court denied certiorari in January 2007. The FTC’s 2007 consent requires the Board to publicly support the current state public health program that allows hygienists to provide preventive dental care to schoolchildren, especially those from low-income families.

The Commission charged that a motor oil lubricant importer illegally conspired with its competitors to restrict the importation and sale of these products in Puerto Rico, which resulted in higher prices paid by consumers. According to the FTC’s complaint, during 2005 and 2006, American Petroleum joined with numerous others in the Puerto Rico lubricants industry to lobby for the delay, modification, or repeal of Puerto Rico Law 278, which imposes an environmental recovery fee of 50 cents per quart. With the effective date of the law approaching, the importers adopted a strategy of refusing to import lubricants as a means of forcing a change. The consent order settling the charges bars American Petroleum from conspiring with its competitors to restrict output, refuse to deal, or boycott any lubricant buyer or potential buyer.