February 27, 2017

The Antitrust Week In Review

Here are some of the developments in antitrust news this past week that we found interesting and are following.

Should SCOTUS Review Nixed $7.2 Billion Credit-Card Antitrust Settlement?  Depending on which side you believe, when the U.S. Court of Appeals for the Second Circuit rejected the biggest antitrust class action settlement in history last June, the appeals court either: drastically misread U.S. Supreme Court precedent in a way that will make it much more difficult and expensive to resolve big cases requesting both money damages and an injunction; or squelched a novel strategy that served the interests of the defendants while cutting off the rights of unrepresented future plaintiffs.  Thomas Goldstein and Eric Citron of Goldstein & Russell make a strong argument for the second option in their just-filed Supreme Court brief for objectors to the $7.2 billion settlement killed by the 2nd Circuit – a deal for cash and injunctive relief between the credit card companies Visa and MasterCard and merchants who accept the cards.

Food Industry May Follow the Brewers’ Merger Frenzy.  As millennials became old enough to hang out in bars about 15 years ago, the likes of Budweiser and Miller started to taste flat.  Fancier drinks and craft beers cut into the brewing giants’ market shares.  A gusher of mergers followed, culminating in the $104 billion acquisition of SABMiller by Anheuser-Busch InBev.  Kraft Heinz’s $143 billion bid for Unilever last week, although quickly aborted, is a sign that the attention of millennials and the potential for mergers have shifted to the food industry.  In any such deals, antitrust regulators may force asset sales.

EU Regulators Set to Clear Dow, DuPont Deal: Sources.  Dow Chemical and DuPont are set to win EU antitrust approval for their $130 billion merger, two people familiar with the matter said on Wednesday, one of three mega deals in the agrochemicals industry.  The deal, which still needs approval from U.S. and other regulators, has faced intense scrutiny from the European Commission.  Of particular concern is combining the two companies’ agricultural businesses which sell seeds and crop protection chemicals, including insecticides and pesticides.

U.S. Judge Dismisses Most of Euribor-Rigging Lawsuit.  A U.S. judge on Tuesday dismissed most of an investor lawsuit accusing several major banks of conspiring to manipulate the benchmark European Interbank Offered Rate, or Euribor, and related derivatives.  In a 100-page decision, U.S. District Judge Kevin Castel in Manhattan said several claims in the proposed class action must fail because of a lack of evidence that the defendants conspired to restrain trade or because they involved foreign conduct.

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Categories: Antitrust Litigation, General, International Competition Issues

    February 20, 2017

    The Antitrust Week In Review

    Here are some of the developments in antitrust news this past week that we found interesting and are following.

    Anthem Sues Cigna to Block Termination of Merger.  Anthem on Wednesday won a temporary restraining order that blocks smaller rival Cigna from officially terminating their proposed $54 billion merger, a transaction already rejected by U.S. antitrust regulators.  The deal would have created the largest U.S. health insurer.  Rivals Aetna and Humana had sought their own merger, representing an unprecedented consolidation among U.S. health insurers.  In separate rulings, federal judges struck down both deals as anticompetitive, at the request of the Justice Department.  Aetna and Humana said on Tuesday they were ending their deal, but Anthem filed an appeal of its ruling.

    Top Antitrust Senators Call for Sessions to Scrutinize AT&T-Time Warner Merger.  The top senators on the  Senate Judiciary Committee’s antitrust panel are urging the U.S. Department of Justice to scrutinize the proposed AT&T-Time Warner merger for the possibility that it leads to anticompetitive practices.  The subcommittee’s chair, Sen. Mike Lee (R-Utah), and Ranking Member Amy Klobuchar (D-Minn.) wrote a letter to Attorney General Jeff Sessions pointing to aspects of the deal that they find troubling.

    U.S. Antitrust Obstacles Seen for T-Mobile, Sprint Deal.  Japan’s SoftBank Corp Group may have renewed interest in combining its Sprint Corp with Deutsche Telekom AG’s T-Mobile US Inc., but a deal between the No. 3 and No. 4 U.S. wireless carriers may not make it past U.S. regulators, antitrust experts and industry watchers said.  SoftBank is prepared to give up control of Sprint to T-Mobile, people familiar with the matter told Reuters on Friday.  The companies are expected to begin negotiations in April after the Federal Communications Commission’s auction of airwaves concludes.

    Kraft Heinz Offers to Buy Unilever in $143 Billion Deal.  The world’s grocery carts could soon be filled with more and more products from one global colossus.  Food, beverage and consumer-goods companies have been seeking merger partners to obtain greater scale and efficiencies as consumers, particularly younger shoppers, eschew the boxed and jarred foods of their parents’ generation.  Now, one such recently merged giant, Kraft Heinz, has set its sights on the biggest target to date: Unilever, the home of Dove soap and Axe body spray, Ben & Jerry’s ice cream and Hellmann’s mayonnaise.  But a merger would be certain to draw antitrust reviews by regulators from many countries.

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    Categories: Antitrust Litigation, Antitrust Policy, General

      May 9, 2016

      The Antitrust Week In Review

      Here are some of the developments in antitrust news this past week that we found interesting and are following.

      Cigna Says Anthem Deal Could Close in 2017; Anthem Sticks to 2016.  Health insurer Cigna Corp, which announced plans to be bought by larger Anthem Inc 10 months ago, on Friday said the deal may close in 2017 rather than 2016 due to the complexity of the regulatory process, according to a filing with the Securities and Exchange Commission.  The U.S. Department of Justice is currently reviewing the Cigna-Anthem deal, which raises serious antitrust issues given that it would create the nation’s largest health insurer.

      Halliburton and Baker Hughes Call Off $35 Billion Merger.  For a year and a half, Halliburton and Baker Hughes, two big oil field services companies, had been focused on their $35 billion merger.  That distraction, even as commodity prices deteriorated and their peers cut costs to survive, is finally over.  The two companies announced that they would terminate the merger after an excruciatingly long regulatory review process that culminated in a lawsuit last month by the Justice Department to block the deal on antitrust grounds.

      Bankers Say U.S. Antitrust Concerns Weigh on Deal Activity.  Antitrust concerns are preventing corporations from pursuing mergers more than other broad regulatory or economic issues, several senior investment bankers said during a panel on Tuesday at the Milken Institute’s Global Conference.  “It’s that increasingly high bar that we’re seeing from an anti-trust perspective,” said Paul Stefanick, Deutsche Bank AG’s head of corporate and investment banking in the Americas.  Stefanick said doubts about whether deals can pass muster with antitrust regulators are a bigger barrier to deals than uncertainties like the outcome of November’s U.S. election.

      FCC Confirms Approval of Charter, Time Warner Cable Merger.  The U.S. Federal Communications Commission confirmed on Friday that it had voted to approve Charter Communications Inc’s acquisitions of Time Warner Cable Inc and Bright House Networks.  The deals, which would create the second-largest U.S. broadband provider and third-largest video provider, now need approval from regulators in California.

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      Categories: Antitrust Enforcement, Antitrust Litigation, General

        January 4, 2016

        The Antitrust Week In Review

        Here are some of the developments in antitrust news this past week that we found interesting and are following:

        RadioShack Antitrust Lawsuit: Sony, Samsung, Toshiba And Others Accused Of Illegal Price-Fixing Conspiracy.  The liquidation trustee for the former retail giant RadioShack is accusing five of the world’s largest consumer electronics companies of illegally conspiring to create an intricate price-fixing scheme that artificially inflated the cost of optical disk drives, a common component present in many devices, computers and appliances.  In a federal antitrust lawsuit filed Wednesday in Northern California, the trustee accused Sony Corporation, Toshiba Corporation, Samsung, Philips Electronics and Light-On IT Corp. of participating in a “six-year price-fixing conspiracy,” which allegedly took place from January 2004 until at least January 2010.

        Dow and DuPont will merge in a $130-billion megadeal, then split 3 ways.  Industrial giants Dow Chemical Co. and DuPont Co. said Friday that they had agreed to merge and form a chemicals and agricultural powerhouse valued at $130 billion.  After the all-stock merger, the new company — to be called DowDuPont —plans to split again into three publicly traded companies, with one focused on agriculture, another on materials and plastics and a third on specialty products.  Given the proposed new company’s size, the deal is expected to receive antitrust scrutiny.

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        Categories: Antitrust and Price Fixing, General

          September 21, 2015

          The Antitrust Week In Review

          Justice department seeks more information on Aetna, Humana deal.  The U.S. Department of Justice is asking health insurer Aetna Inc. for more information about its pending $37 billion acquisition of Humana Inc.  The Justice Department’s “second request” will delay by 30 days the expiration of the waiting period under the Hart–Scott–Rodino antitrust act, Aetna said in a regulatory filing.  Aetna’s offer to buy Humana and rival health insurer Anthem Inc.’s $48 billion offer for Cigna Inc. are expected to face close scrutiny from regulators due to concerns that the two deals could lead to higher insurance prices.

          Antitrust Nod for Expedia to Buy Orbitz.  The Justice Department will not try to block the acquisition of travel booking site Orbitz by its larger rival Expedia, clearing the way for the companies to complete their $1.3 billion merger.  Hotel companies, along with some consumer advocates and lawmakers, have raised concerns over the potential market power of the combined company, which would control about 75 percent of the domestic market for third-party online booking.  However, the Justice Department’s antitrust enforcers concluded that the acquisition is unlikely to harm competition and consumers.

          Petco begins merger talks with PetSmart – sources.  Petco Holdings Inc. is exploring the possibility of being acquired by PetSmart Inc., according to sources.  Such a merger could result in a company with some 30 percent of U.S. pet specialty supplies stores.

          GE among bidders for Halliburton’s assets: Bloomberg.  General Electric Co. is bidding for pieces of Halliburton Co.’s drilling services and drilling bits businesses, as the latter seeks regulatory approval to buy Baker Hughes Inc., according to Bloomberg.  U.S. antitrust enforcers are concerned that the proposed $35 billion deal for Halliburton to acquire smaller rival Baker Hughes would lead to higher prices and less innovation in the oilfield services industry.

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          Categories: Antitrust Enforcement, General

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