Squeezed On: June 30, 2006

FTC Staff Sends Warning Letters to Marketers of Cosmetic Contact Lenses

The Federal Trade Commission staff took action earlier this week to increase compliance with the Contact Lens Rule by sellers of non-corrective, decorative/cosmetic contact lenses. In 2003, Congress enacted the Fairness to Contact Lens Consumers Act, which imposed new prescription release and verification requirements on prescribers and sellers of contact lenses. In July 2004, the Commission issued the Contact Lens Rule to implement the Act.

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Squeezed On: June 28, 2006

EC Announces New Antitrust Violation Guidelines

On June 28, the European Commission (“EC”) announced new guidelines that would increase fines for antitrust violations. This decision is part of an effort by the EC to more severely punish cartel leaders, repeat offenders, and companies whose large financial reserves made a mockery of the old antitrust fine scheme. The new guidelines, which will not take effect for several months, will fine companies up to 30 percent or based on a percentage of the company’s sales in whatever market the regulators found was illegally manipulated. Under the current EU rules, companies that are found to have serious antitrust offences are fined at least €20 million.

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Squeezed On: June 28, 2006

FTC Testifies on Social Networking Sites

The Federal Trade Commission today called on social networking sites to make sure children visiting their sites can stay safe and their parents can protect them. Testifying for the FTC, Commissioner Pamela Jones Harbour told the House Committee on Energy and Commerce,Subcommittee on Oversight and Investigation that there is a “need for social networking Web sites – individually, collectively, and, most importantly, expeditiously – to develop and implement safety features to protect children who visit their sites and empower parents to protect their children when they do so.” Harbour also emphasized that, “the Federal Trade Commission is committed to helping create a safer online experience for children.”

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Squeezed On: June 27, 2006

EC Launches Review of Anti-dumping Measures

European Commissioner for Trade Peter Mandelson has launched a review of the Commission’s anti-dumping measures.

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Squeezed On: June 27, 2006

Supreme Court Will Hear Telecommunication Collusion Case

On June 27, the U.S. Supreme Court agreed to hear arguments from Verizon Communications Inc., AT&T Inc., BellSouth Corp., and Qwest Communications International, Inc. in a case that may either help companies' efforts to fight off antitrust law suits, or promote consumers challenges to what appears to be illegal coordination of activities by competing companies in concentrated markets that keep prices high.

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Squeezed On: June 27, 2006

FTC/DOJ File Joint Comments with NY State Assembly on the Unauthorized Practice of Law

On June 27, the Commission authorized the filing of comments, prepared jointly with the U.S. Department of Justice’s Antitrust Division, with the New York State Assembly Committee on the Judiciary regarding proposed legislation to expand the scope of activities constituting the unauthorized practice of law.

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Squeezed On: June 27, 2006

DOJ Requires Divestiture for Knight Ridder - McClatchy Merger

On June 27, the Department of Justice announced that it will require The McClatchy Company and Knight Ridder Inc. to divest the St. Paul Pioneer Press in order to proceed with their proposed multi-billion dollar newspaper merger. The DOJ said that the transaction, as originally proposed, would have eliminated head-to-head competition between McClatchy and Knight Ridder and likely would have resulted in higher prices for advertisers and readers in the Minneapolis/St. Paul metropolitan area.

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Squeezed On: June 26, 2006

Spanish Courts Confirm Decision on Abuse of Dominant Position by Tabacalera-Altadis

In 1996, Conway (then known as McLane) submitted a complaint to the Spanish Competition, the Servicio de Defencia de la Competencia (“SDC”) authorities, alleging that the former public tobacco monopoly, Tabacalera (now known as Altadis) abused its dominant position by not allowing Conway to distribute Tabacalera tobacco brands. A 2002 SDC decision found that Tabacalera had a dominant position in the tobacco manufacturing market as well as the wholesale distribution market.

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Squeezed On: June 26, 2006

Supreme Court Rejects FTC’s Petition to Overturn Schering-Plough Decision Relating to Reverse Payments to Generics

On June 26, the United States Supreme Court declined to hear the Federal Trade Commission’s (“FTC”) appeal of the Eleventh Circuit’s decision that Schering-Plough Corp. (“Schering”) legally paid two generic drug competitors to stay out of the market as part of a settlement to patent litigation. In the past, the FTC has taken a consistently aggressive approach that a money payment from a branded drug company to a generic company that delays the entry of a generic version of a branded drug is illegal.

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Squeezed On: June 26, 2006

DOJ Subpoenas Orthopedic Device Manufacturers

On June 26, orthopedic device manufacturers revealed the issuance of federal subpoenas tied to potential violation of antitrust law from the Department of Justice. Zimmer Holdings Inc., Biomet Inc., Johnson & Johnson and Stryker Corp. all said they had received subpoenas from the Antitrust Division demanding documents related to the manufacture and sale of the companies' products, which include artificial hips and knees.

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Squeezed On: June 23, 2006

DOJ Alleges American Bar Association Violates Antitrust Consent Decree

On June 23, the DOJ filed a petition asking the U.S. District Court for the District of Columbia to hold the American Bar Association (“ABA”) in civil contempt for violating multiple provisions of a 1996 antitrust consent decree. The consent decree prohibited the ABA from misusing the law school accreditation process. The DOJ also filed a proposed order and a stipulation in which the ABA acknowledges the violations alleged in the Division's petition and agrees to reimburse the United States $185,000 in fees and costs incurred in the Division's investigation.

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Squeezed On: June 22, 2006

DOJ Requires Divestitures for Exelon - Public Service Enterprise Group Merger

On June 22, the DOJ announced that the $16 billion merger between Exelon Corp. and Public Service Enterprise Group Inc. can proceed as long as they divest six electricity generating plants, which in total provide more than 5,600 megawatts of generating capacity. The DOJ is making the companies shed two generating plants in Pennsylvania and four in New Jersey.

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Squeezed On: June 21, 2006

FCC to Act on Adelphia Deal in July

On June 21, Federal Communications Commission chairman Kevin Martin said that the agency would likely act on the acquisition of Adelphia Communications Corp. (“Adelphia”) by Time Warner Inc. (“Time Warner”) and Comcast Corp. (“Comcast”) in mid-July. Martin indicated the mid-July action in comments to reporters following the agency’s public meeting, stating “I think the commission will try to address it by the middle of July." Time Warner and Comcast have agreed to buy bankrupt Adelphia’s 5 million cable subscribers in a $16.9 billion transaction. The Federal Trade Commission approved the deal without conditions in January. The FCC has had the merger under review for 382 days, but only since June 1 has Martin had a 3-2 Republican majority. Opponents of the deal have called on the FCC to impose a host of conditions, including access to regional sports programming owned or controlled by Time Warner and Comcast.

Squeezed On: June 21, 2006

AT&T - BellSouth Merger Runs into Opposition

The American Civil Liberties Union (“ACLU”), a group of small telecommunications companies, and Sprint Nextel Corp. (“Sprint”) have joined to oppose AT&T Inc.'s (“AT&T”) bid to acquire BellSouth Corp. (“BellSouth”). In its June 5th filings with the FCC, the ACLU said it wants the commission to hold up approval of the merger until the phone companies settle allegations that they had released customer information to the National Security Agency (“NSA”). Sprint and the telecom group, meanwhile, are looking to squash the deal completely, with the group citing “irreparable harms to competition” from a combination. AT&T dismissed the claims.

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Squeezed On: June 21, 2006

Telemarketer Pays the Price for Using Unscrubbed “Lead Lists”

A Southern California-based mortgage broker will pay $50,000 under a court order filed today on behalf of the Federal Trade Commission for allegedly calling tens of thousands of consumers who are on the National Do Not Call (DNC) Registry for telemarketers and for failing to pay the annual fee required to access the DNC Registry. In addition, the company and its officers are permanently barred from violating the DNC provisions of the Telemarketing Sales Rule (TSR) and from making illegal telemarketing calls in the future.

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Squeezed On: June 21, 2006

FTC Issues Statement on Whois Databases

The Federal Trade Commission today told a meeting of the Internet Corporation for Assigned Names and Numbers that access to the Whois databases is “critical to the agency’s consumer protection laws, to other law enforcement agencies around the world, and to consumers.” Whois databases are online information directories that contain contact information about website operators. Access to the databases is in question because one of ICANN’s advisory bodies recommended limiting access to Whois data to “technical purposes only.”

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Squeezed On: June 20, 2006

Spanish Banks Push into American Market

Two Spanish banks entered the US banking market in June. Spain’s second-largest bank, Banco Bilbao Vizcaya Argentaria (BBVA), purchased two Texas-based banks -Texas Regional Bancshares and State Regional Bancshares- supplementing a southern-California based bank that it had previously acquired. This deal will give BBVA access to the lucrative market for remittances from Latin American workers in Texas to Latin America. Meanwhile, Spain’s largest bank, Banco Santander Central Hispano, has been steadily increasing its stake in Philadelphia-based Sovereign Bancorp, approaching 24.99% of outstanding shares. Several analysts have speculated that Santander will eventually make a bid for the bank as a way of expanding into the lucrative U.S. market.

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