November 28, 2010
The U.S. Department of Justice has issued an update on recent activities of the Antitrust Division.
Some of the highlights include:
Cartels. The DoJ says that investigating and prosecuting cartels remains a top priority and that during its fiscal year 2010, the Antitrust Division filed 60 criminal cases obtaining fines exceeding $550 million. Interesting, in contrast to Canada, the DoJ reports that of the individual defendants sentenced, 76% were sentenced to imprisonment (with an average sentence of 30 months). According to the DoJ, it brought cases against defendants in the air transportation, liquid crystal display panel, financial services, Internet services, packaged ice and environmental services industries, among others. Like Canada, the DoJ emphasized its continued reliance on its Leniency Program, calling it its “single most important investigative tool for detecting cartel activity.”
Civil Non-merger Enforcement. The DoJ reports that it filed four non-merger civil cases in 2010, with four negotiated consent decrees obtained in 2010: US v. Smithfield Foods, US v. Idaho Orthopedic Society, US v. Adobe Systems, Inc. and US v. KeySpan Corporation. The Antitrust Division has also filed two civil challenges in fiscal year 2011: Blue Cross Blue Shield of Michigan (a complaint alleging that MFN provisions in Blue Cross’s agreements with hospitals raise hospital prices, prevent other insurers from entering the market and discourage hospital discounts) and a second case against American Express, MasterCard and Visa (challenging certain merchant restraints, so-called “anti-steering rules”, that the DoJ alleges impede merchants from promoting or encouraging the use of a competing credit or charge card with lower card acceptance fees). Both cases challenge vertical agreements that, according to the DoJ, are aimed at suppressing horizontal competition in upstream markets.
Mergers. According to the DoJ, 1166 HSR filings were made, 55 merger investigations were commenced, 22 second requests were issued (about 1.9%) and 19 mergers were challenged in 2010. The DoJ also notes that in 2009, HSR merger filings were down to 716, about one-third of their level of 2,201 in 2007. The DoJ also comments on its recent revision of the DoJ/FTC Horizontal Merger Guidelines, which include an expanded discussion of market definition, an expanded discussion of unilateral effects (including in the context of differentiated products) and raise the previous HHI thresholds. The DoJ’s update also discusses two recent merger cases in light of the updated Merger Guidelines (United Airlines/Continental Airlines and Baker Hughes/BJ Services).
For a copy of the paper see: Update from the Antitrust Division.
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