Archive for the 'Competition Law' Category
Telemarketing Update: CRTC Refuses to Vary Do Not Call List Penalty Imposed on Telemarketing Company
On February 13, 2012, the CRTC denied an application by Les Distributions Triple A Inc. (“Triple A”) to review an earlier decision imposing a $6,000 administrative monetary penalty (“AMP”).
In the earlier decision, the Commission imposed a total $6,000 AMP for violations of the Unsolicited Telecommunications Rules, in relation to calls to consumers registered on the National Do Not Call List (“DNCL”) and for failing to pay applicable DNCL subscription fees.
Triple A sought to have the earlier decision annulled on several grounds, including that it only initiates calls for market research and the AMP imposed was a substantial amount for a small business.
In reviewing Triple A’s application, the Commission considered the criteria for reviewing, rescinding or varying Commission decisions, relying on Telecom Public Notice 98-6 to find that applicants must show that there is a “substantial doubt as to the correctness” of the original decision due to, for example, an error in law in fact, a fundamental change in circumstances or facts or a failure to consider a basic principle raised in the original proceeding (or a new principle arising from the decision).
The American Bar Association Section of Antitrust Law has recently published the 2nd edition of its Franchise and Dealership Termination Handbook (see: ABA – Franchise and Dealership Termination Handbook).
From the ABA:
“The Franchise and Dealership Termination Handbook provides practical guidance for lawyers as they counsel their clients and navigate the difficult issues that often arise when a franchise or dealership ends. Termination is often the last thing parties consider when they first enter into a franchise or dealership relationship, but it is a critical event for all parties involved, and can give rise to significant duties and liabilities. A thorough understanding of the contractual relationship between the parties, and the common law and statutory landscape of franchise and dealership termination, is critical to protecting the rights and interests of all involved.
The American Bar Association Section of Antitrust Law has recently published the most recent edition of its Antitrust Law Journal (see: Antitrust Law Journal (Volume 77, Issue 3)).
The current issue includes articles on antitrust and innovation (Herbert Hovenkamp, B. Zorina Khan, Tom Nicholas), patent tying, price discrimination and innovation (Christopher R. Leslie), licensing negotiations in standard-setting organizations (Richard J. Gilbert), patent holdup (George S. Cary, Mark W. Nelson, Steven J. Kaiser and Alex R. Sistla) and several antitrust and IP articles.
The National Competition Law Section of the Canadian Bar Association will be holding a teleconference on February 29, 2012 entitled: “Criminal Conspiracy or Legitimate Competitor Collaboration? Tips for In-House Counsel”
From the Canadian Bar Association:
“Authorities have recently noted their first conviction under Canada’s amended conspiracy law, commenting: “[This investigation] highlights the Bureau’s reinvigorated mandate to stop consumer harm caused by price-fixing, and to secure significant fines for these serious criminal offences.”
In-house counsel practising competition law are often asked to evaluate the competition law risks associated with activities such as joint selling initiatives, joint ventures, buying groups, participation in trade associations, and merger transactions. As such, in-house counsel are an organization’s first line of defence to identify potential illegal arrangements to fix prices, allocate markets or restrict output, that create risks of criminal investigation and prosecution; and that can result in significant fines, imprisonment, damage to an organization’s reputation, and civil damage claims.
The line between criminal conspiracies and pro-competitive strategic alliances among competitors, however, can at times be difficult to detect. It is critical that in-house counsel have the tools necessary to distinguish benign or pro-competitive activity from potentially criminal conduct.”
The Antitrust Law Section of the American Bar Association recently announced the publication of Antitrust Law Developments (Seventh). Antitrust Law Developments is the seminal general U.S. text on antitrust law, a landmark of scholarship and reflects the collective efforts of many leading antitrust law practitioners and scholars.
From the American Bar Association:
“Antitrust Law Developments (Seventh) is the seminal comprehensive review of federal antitrust law, with reports on current case law and administrative and legislative developments current through 2011.
This 2-volume set updates you on key decisions in the courts, and developments at the enforcement agencies, keeping you current in every area of antitrust practice. Each edition of Antitrust Law Developments is designed to improve upon, as well as update, prior editions, and to ensure consistency with everchanging developments in this dynamic area of law.
This new seventh edition addresses important developments, including the Supreme Court’s decisions in Twombly, Leegin, American Needle, linkLine, and Weyerhaeuser and their treatment in the lower courts. Developments in the courts of appeals relating to bundled discounts and the antitrust-intellectual property interface all receive comprehensive treatment. The chapter on mergers and acquisitions has been substantially revised to reflect the new DOJ/FTC Horizontal Merger Guidelines and new foreign merger control regimes, and the discussion of the misuse doctrine in the chapter on intellectual property has been reorganized and revised.
Antitrust Law Developments (Seventh) is the product of an enormous team effort of Antitrust Section members and is a “must have” for every antitrust practitioner.
On January 6, 2012 the Competition Bureau announced its first cartel case under Canada’s amended Competition Act (partially brought under the new section 45 of the Competition Act).
In this case, two companies pleaded guilty of fixing the price of polyurethane foam and were fined a total of C $12.5 million (see: Cartels Update: Bureau Announces $12.5 Million Fine in First Price-fixing Case Under Amended Competition Act and Competition Bureau Sends Signal to Price-Fixers with $12.5 Million Fine).
In making the announcement, believed to be one of a number of new cartel cases currently being investigated, the Bureau said:
“’Yesterday’s guilty plea is the first conviction under Canada’s amended conspiracy law,’ said Melanie Aitken, Commissioner of Competition. ‘This investigation highlights the Bureau’s reinvigorated mandate to stop consumer harm caused by price-fixing, and to secure significant fines for these serious criminal offences.’
The charges are the first to arise from the Bureau’s investigation into price-fixing cartel in the polyurethane foam industry. Anyone with information relating to this investigation is encouraged to contact the Competition Bureau.
The Bureau’s investigation benefitted from cooperation under the Bureau’s Immunity and Leniency Programs, which create incentives for parties to address their criminal liability by cooperating with the Bureau in its ongoing investigation and prosecution of other alleged cartel participants.
Under the Competition Act, an agreement between competitors to fix prices, allocate markets or restrict output in Canada is a criminal offence. In March 2010, amendments to the conspiracy provision of the Act came into force.”
The Bureau also recently confirmed that it is investigating potential effects in Canada from the alleged global LIBOR-TIBOR bank cartel (see: Cartel Update: Competition Bureau Investigates Alleged Interbank Lending Rate Coordination), that it continues to receive guilty pleas in the Quebec gasoline price-fixing case, which was the largest such investigation in the Bureau’s history (see: Cartels Update: Seven More Individuals Plead Guilty in Criminal Quebec Gasoline Price-fixing Cartel) and that it remains focused on both maintaining and increasing its cooperation with global enforcement agencies in the detection and enforcement of cartels.
Last week, the Competition Bureau announced that Construction G.T.R.L. (1990) Inc., Acoustique JCG Inc. and Enterprises de Construction OPC Inc. pleaded guilty to bid-rigging in Quebec Superior Court in relation to the expansion of the Chicoutimi Hospital in 2003 (see: Quebec Construction Companies Plead Guilty to Rigging Bids for the Chicoutimi Hospital).
In making this announcement, the Bureau said:
“The court ordered Construction G.T.R.L. to pay a fine of $50,000, and Acoustique JCG and Entreprises de Construction OPC to pay a fine of $25,000 each. The companies are subject to a court order for a period of 10 years.
‘Bid-rigging harms everyone but the criminals who cheat the system for their own financial gain,’ said Melanie Aitken, Commissioner of Competition. ‘In this case, the bid-rigging scheme ultimately harmed the Chicoutimi Hospital and Saguenay residents, by preventing the hospital from obtaining a competitive price for its renovation.’”
The construction industry has long been a target of competition/antitrust regulators. For example, some of the construction related cases in Canada, many of which have also involved trade associations (and have gone back about a century), have included building contractors, corrugated metal pipe manufacturers, electrical contractors, gypsum dealers and manufacturers, plumbing contractors, among many others.
There have also been a number of recent bid-rigging cases in Canada, many of which have involved construction and construction supply related companies.
For example, see: Guilty Plea and $425,000 Fine for Bid-rigging in Montreal, Charges Laid in Residential Construction Bid-rigging Scheme in Montreal, Competition Bureau Exposes Sewer Services Cartel in Quebec, Competition Bureau Obtains Court Order Against the Saskatchewan Roofing Contractors Association.
Theodore Banks (from the firm Schoeman Updike Kaufman & Scharf) has published an interesting new article on competition/antitrust compliance entitled “Antitrust Compliance – It’s All About the Culture”.
Summary:
“What does it take to develop an antitrust compliance program that works? There are a lot of pieces. The employees must be presented with materials that are directly relevant to each of their jobs. It must be done in a way that is easily understandable. It must be ubiquitous, so that little or no effort is needed to gain access to information. There should also be business controls so that violations are not easy to accomplish-or difficult to detect.
We’ve known these things for a long time. In antitrust, which in many ways is the grandfather (or perhaps the godfather) of corporate compliance programs, we’ve had detailed policies, handbooks, training courses, videos, slides. No shortage of information-yet the violations continue. The Justice Department seems to have given up on compliance when it comes to antitrust. Their main method to control cartel behavior is not to encourage prevention (i.e., compliance), but to encourage confession (i.e., the amnesty program). In fact, they are apparently so disgusted with the sorry state of compliance that they got a carve-out from the Federal Sentencing Guidelines when it comes to antitrust. If convicted of a violation of any other federal criminal law, the company can get credit for good intentions if its compliance program met the definition of an “effective” program. But not true for antitrust.”
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