In re Blue & Gold and Red & White Fleets Merger, Cal. PUC applications No. 95-12-071 (approved June 11, 1997)c
Challenge to merger of tour boats of San Francisco Bay resolved by divestiture of ships, a dock and signage.
United States and North Carolina v. Charlotte-Mecklenburg Hospital Authority d/b/a Carolinas Healthcare System
North Carolina and USDOJ filed suit alleging that Atrium Health, formerly known as Carolinas HealthCare System illegally reduced competition in the health care market in Charlotte and limited consumers’ ability to shop around for better deals on health care. Atrium is based in Charlotte and operates Carolinas Medical Center and nine other hospitals in the Charlotte area. It dominates the hospital market in the Charlotte region with a 50 percent share of the market and approximately $8.7 billion in annual revenues. The state alleged that Atrium acted unlawfully to preserve its dominance in the Charlotte health care market by using its market power to require steering restrictions in its contracts with every major insurer. These provisions have prevented insurers from, among other things, introducing health plans that encourage patients to use medical providers that offer lower priced, higher-quality services. The plaintiffs sought injunctive relief and attorneys fees. After the court denied defendants’ motion to dismiss, the parties settled. Under the terms of the settlement, Atrium is prohibited from using anticompetitive steering restrictions in contracts between commercial health insurers and its providers in the Charlotte, North Carolina metropolitan area. These steering restrictions prevented health insurers from promoting innovative health benefit plans and more cost-effective healthcare services to consumers.
In re Natixis Funding Corp., Agreement, Feb. 18, 2016)
Plaintiff states entered into settlement agreement with Natixis Funding Corp. for fraudulent and anticompetitive conduct in municipal bond derivative transactions with state and local government entities and nonprofits across the country. Natixis will pay $29,950,000 as part of a coordinated 22-state and private class settlement. The funds will mostly be applied to restitution for municipalities, counties, government agencies, school districts and nonprofits that the states allege were harmed when they entered into municipal derivatives contracts with Natixis. In 2008, the plaintiff states, in parallel with the U.S. Department of Justice and federal regulatory agencies, began their investigation of the municipal bond derivatives market. In these markets, tax exempt entities such as municipalities, school districts, and nonprofit organizations issue municipal bonds and reinvest the proceeds until the funds are needed or enter into contracts to hedge interest rate risk. These investigations revealed anticompetitive and fraudulent conduct involving individuals at a number of large financial institutions, including Natixis, and certain brokers with whom they had worked. Certain Natixis employees and their counterparts at other institutions rigged bids, submitted noncompetitive courtesy bids and fraudulent certificates of arms-length bidding to government agencies. The misconduct led local and state governments, as well as nonprofits, to enter into municipal derivatives contracts on less advantageous terms than they would have otherwise. Natixis agreed to pay $23.4 million into a settlement fund and $1.5 million to the attorneys general as an additional payment. Natixis also agreed not to submit non-competitive bids or refrain from bidding on, or coordinate the preparation of bids for municipal derivatives and to cooperate with ongoing investigations.
In re Societe Generale S.A., Agreement
Plaintiff states entered into settlement agreement with Societe Generale for fraudulent and anticompetitive conduct in municipal bond derivative transactions with state and local government entities and nonprofits across the country. Societe Generale agreed to pay $26,750,000 as part of a coordinated 22-state and private class settlement. Pursuant to the settlement, this money will mostly be applied to restitution for municipalities, counties, government agencies, school districts and nonprofits that the states allege were harmed when they entered into municipal derivatives contracts with Societe Generale. In 2008, plaintiff states, in parallel with the U.S. Department of Justice and federal regulatory agencies, began their investigation of the municipal bond derivatives market. In these markets, tax exempt entities such as municipalities, school districts, and nonprofit organizations issue municipal bonds and reinvest the proceeds until the funds are needed or enter into contracts to hedge interest rate risk. These investigations revealed anticompetitive and fraudulent conduct involving individuals at a number of large financial institutions, including Societe Generale, and certain brokers with whom they had worked. Certain Societe Generale employees and their counterparts at other institutions rigged bids, submitted noncompetitive courtesy bids and fraudulent certificates of arms-length bidding to government agencies. The misconduct led local and state governments, as well as nonprofits, to enter into municipal derivatives contracts on less advantageous terms than they would have otherwise. Societe Generale agreed to pay $25.1 million into a settlement fund to provide restitution for injured parties and $1.4 million to the attorneys general as an additional payment. Societe Generale also agreed not to submit non-competitive bids or refrain from bidding on, or coordinate the preparation of bids for municipal derivatives and to cooperate with ongoing investigations.
Oregon ex rel. rosenblum v. AU Optronics Corp.
Following guilty pleas to criminal price-fixing by several LCD manufacturers, and a conviction after trial of another, Oregon filed suit against LCD manufacturers, alleging that top executives of several companies held numerous secret meetings from at least 1999 through at least 2006 for the purpose of exchanging information and setting prices on LCD panels. According to the complaint, companies such as Dell, Apple, and Hewlett Packard were among those targeted by the manufacturers’ price-fixing scheme. According to the lawsuit, the illegal overcharges were ultimately borne by state consumers and state government purchasers. The suit also alleges fraudulent concealment of the conspiracy. The lawsuit seeks monetary damages, civil penalties and injunctive relief under the Sherman Act and state antitrust statutes. A number of states filed in the MDL, but Oregon filed originally in federal district court in Oregon, and was transferred, with its consent, to the MDL. Oregon reached individual settlements with many defendants, totaling $21 million (Hitachi Displays, $565,000; Chi Mai, $1,634,600; Epson, $105,000; LG Display, $6,975,000; Sharp, $1,950,000; Samsung, $4.5 million; AU Optronics, $4.25 million; Toshiba, $525,000; HannStar, $1 million)
United States and Michigan v. Hillsdale Community Health Center et al., No. 2:15-cv-12311 (E.D. Mich. June 25, 2015)
The United States and Michigan filed suit in federal court against four Michigan hospital systems, alleging that for years they unlawfully agreed to allocate territories for marketing. The complaint alleged Hillsdale, Allegiance, Branch and ProMedica’s Bixby and Herrick Hospitals, the only hospitals in their respective counties, each competed through marketing to attract patients, including advertising, direct mailings to patients, outreach to physicians and employers, conducting health fairs and offering free health screenings. The complaint alleges that Hillsdale curtailed this competition for years by entering into agreements with Allegiance, Branch and ProMedica to limit the marketing of competing healthcare services. Three of the systems, Hillsdale Community Health Center, Community Health Center of Branch County, Michigan, and ProMedica Health System Inc., agreed to settle the charges in 2015. The settlement prohibits Hillsdale, Branch and ProMedica from agreeing with other healthcare providers, including hospitals and physicians, to limit marketing or to divide any geographic market or territory, prohibits communications among the defendants about their marketing activities and requires the hospitals to implement compliance measures tailored to prevent the recurrence of these types of anticompetitive practices in the future. The parties paid $5,000 each to Michigan for costs and attorneys’ fees. W.A. Foote Memorial Hospital, doing business as Allegiance Health, settled in 2018. The Allegiance settlement expands on the terms of the previous settlements, specifically, the proposed settlement prevents Allegiance from engaging in improper communications with competing providers regarding their respective marketing activities and entering into any improper agreement to allocate customers or to limit marketing. It explicitly prevents Allegiance from continuing to carve out Hillsdale County from its marketing and business development activities. Allegiance must report any violations and must annually certify compliance with the terms of the final judgment. Allegiance must also submit to compliance inspections at the Department’s request. Allegiance must also pay $40,000 to the state and the US to reimburse costs.
People v. Pratibha Syntex Ltd., No. BC499751 (Cal. Super. Ct., LA Cty. Dec. 10, 2015)
Plaintiff state filed suits against international apparel manufacturer for gaining an unfair competitive advantage over American companies by using pirated software in the production of clothing imported and sold in California. The complaint alleged that the foreign apparel manufacturer, based in India, who did not paid software licensing fees has a significant cost advantage in the low-margin business of apparel manufacturing, shipment and sales. The company did not pay licensing fees for software products manufactured by Adobe, Microsoft, Symantec and others. Since 2010, Pratibha shipped approximately 19,000 pounds of apparel products into California. The complaint alleges that the company obtained an unfair advantage because it can redirect money saved by using pirated software to hire employees and to expand their facilities and their research and development efforts. Furthermore, American companies that are developing software, particularly software that is used in the garment industry, are discouraged from investing in new technology and products if they know their software will be used illegally. In December 2015, a settlement was reached, the first time a state has secured a legally enforceable judgment against an international company for these types of violations. The settlement requires Pratibha Syntex to pay $100,000 in restitution within 30 days. The settlement prohibits Pratibha Syntex from using unlicensed software or reproducing any part of a copyrighted software program without the permission of the legitimate copyright holder, and further requires the company to perform four complete audits of the software on their computers and fix any violations within 45 days. In addition, Pratibha Syntex must draft an information technology policy statement regarding the use of licensed software and distribute this policy to all employees
Florida et al. v. Dollar Tree, Inc., No. 1:15-cv-01052 (D.D.C. July 2, 2015)
Eighteen plaintiff states and the FTC challenged the merger of Dollar Tree, the largest chain of “dollar” stores (deep discount stores) and Family Dollar Stores, the nation’s third largest dollar store chain. The complaint claimed the proposed acquisition would substantially lessen competition in numerous markets by: (1) eliminating direct and substantial competition between Dollar Tree and Family Dollar; and (2) increasing the likelihood that Dollar Tree will unilaterally exercise market power. This, according to the complaint, would violate Section 7 of the Clayton Act and each state’s applicable antitrust and consumer protection laws. The states sought a permanent injunction to prevent the merger, along with costs and attorney fees. The parties reached a settlement under which 330 stores in the 18 states would be divested to Sycamore partners and run as a new dollar store chain, Dollar Express. The agreement also required the defendants to report future acquisitions in any of the affected markets and to pay over $865,000 to reimburse the costs and fees of the plaintiff states.
Pennsylvania v. Arclight Energy Partners Fund VI et al., No. 1:15-CV-2493 Jan. 4, 2016)
Pennsylvania filed suit, alleging the proposed merger of two of the largest gasoline and distillate terminaling services in the state, ArcLight and Gulf Oil would violate both the Clayton Act and Pennsylvania state law by lessening competition in three markets, Altoona, Harrisburg and Scranton. The state sought injunctive relief and attorneys’ fees. The state and the parties entered into a settlement in which the defendants would agree to divest their terminal assets in Pennsylvania – located in Altoona, Pittston, Mechanicsburg and Williamsport – to New York-based Arc Logistics within 20 days of the acquisition being finalized. After the divestiture, ArcLight is further bound to assist Arc Logistics by providing transitional assistance at a reasonable cost for one year, serve as a customer of the divested terminals for two years and supply ethanol and biodiesel fuels and related terminaling services for five years. The settlement also allows any ArcLight petroleum terminal customer to sever its contract with the company without penalty or charge for six months after the divestiture date, and for ArcLight to provide them with notice of the right to do so. The FTC had previously entered into a settlement with the parties.
United States and Connecticut v. AMC Entertainment Holdings, Inc., No. 1:15-cv-02181 (D.D.C. Dec. 15, 2015)
U.S. and Connecticut filed complaint and proposed settlement with AMC Entertainment Holdings, Inc. (AMC) and SMH Theaters, Inc. (Starplex Cinemas) to resolve concerns that AMC’s purchase of a Connecticut Starplex theater would substantially harm competition for Connecticut consumers. AMC is the second largest commercial movie exhibitor in the United States, with two theaters in Connecticut. Starplex Cinemas is an independent, privately held commercial movie exhibitor operating 33 theaters with 346 screens in 12 states, including two theaters in Connecticut. In their complaint, Connecticut and the DOJ allege that the Berlin market is concentrated and that AMC and Starplex Cinemas are the other’s most significant competitor, given their close proximity. The agreement with Connecticut and the DOJ requirew that the Berlin 12 theater in Berlin be sold as part of the acquisition, which will help to maintain a competitive market and the best-possible service for Connecticut consumers. The agreement also requires the divestiture of a theater in New Jersey.
