DOJ Antitrust Highlights :: Antitrust Lawyer Blog
July 23, 2008

N.J. WASTEWATER TREATMENT SUPPLY COMPANY OWNER AND A CONTRACTS ADMINISTRATOR PLEAD GUILTY TO BID RIGGING, FRAUD AND TAX OFFENSES

On July 23, 2008, JMJ Environmental Inc. (“JMJ”), a wastewater treatment company, its owner, John Drimak Jr., and Norman Stoerr, a former contracts administrator, pled guilty to various counts of bid rigging, fraud, and tax evasion. These charges were all in connection with sub-contracts for wastewater treatment services at two Environmental Protection Agency (“EPA”) designated Superfund Sites, Federal Cresote in Manville, NJ and Diamond Alkali in Newark, NJ.

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July 11, 2008

ANOTHER HOME DEPOT EMPLOYEE PLEADS GUILTY TO VENDOR KICKBACK SCHEME AND TAX EVASION IN SCHEME TO DEFRAUD HOME DEPOT

On July 11, 2008, James P. Robinson, a former Divisional Merchandising Manager for Flooring at Home Depot, pled guilty to one count of conspiracy to commit wire fraud and two counts of tax evasion related to a scheme to defraud Home Depot.

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July 3, 2008

DOJ REQUIRES DIVESTITURE IN SIGNATURE’S ACQUISITION OF HAWKER BEECHCRAFT’S FLIGHT SUPPORT SERVICE BUSINESS

On July 3, 2008, the Department of Justice (“DOJ”) entered into a settlement agreement allowing Signature Flight Support Corporation to acquire Hawker Beechcraft’s (“Hawker”) fixed based operations (“FBO”). The settlement agreement requires Signature to divest its flight support service assets.

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July 1, 2008

DOJ APPROVES NEW JERSEY ANTI-MONEY LAUNDERING CONSULTING COMPANY’S PROPOSAL

On July 1, 2008, the Department of Justice’s (“DOJ”) Antitrust Division decided to allow External Compliance Officer Inc., a New Jersey based anti-money laundering consulting company, to create a database that would allow money transmitters to better understand the backgrounds of prospective agents. A money transmitter is a company that provides electronic money transfer services to individuals. An agent receives and processes money from senders and distributes the funds to recipients.

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July 1, 2008

VISA REVOKES DEBIT CARD RULE AS RESULT OF DOJ ANTITRUST INVESTIGATION

On July 1, 2008, Visa Inc. rescinded a rule that required merchants to treat Visa-branded debit cards differently when used as a PIN-debit card (and processed via non-Visa networks) from the same cards when used as signature debit cards and processed on the Visa network. The rule was rescinded in response to the Department of Justice’s (“DOJ”) Antitrust Division’s investigation. Rescinding the rule allows affiliated banks to provide merchants the option of waiving the entry of a PIN for most non-Visa debit transactions initiated from Visa branded debit cards. Before the investigation, Visa prohibited banks from allowing its merchants to waive the PIN, even for “small ticket” transactions ($25 or less) from a non-Visa PIN network. The DOJ’s Antitrust Division began investigating the effects of this regulation on competition in the debit card industry.

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June 30, 2008

FORMER HOME DEPOT EMPLOYEE PLEADS GUILTY TO DEFRAUDING HOME DEPOT IN VENDOR KICKBACK SCHEME AND TAX EVASION

On June 30, 2008 Anthony M. Tesvich, a former employee of Home Depot, pled guilty to one count of conspiracy to commit wire fraud and three counts of tax evasion, in connection with a scheme to defraud Home Depot.

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June 26, 2008

MAJOR INTERNATIONAL AIRLINES PLEAD GUILTY AND AGREE TO PAY FINES FOR THEIR ROLE IN MAJOR CONSPIRACY TO FIX AIR CARGO RATES

On June 26, 2008, five major international airlines including Socit Air France (Air France), Cathay Pacific Airways Limited (Cathay), Koninklijke Luchtvaart Maatschappij N.V. (KLM Royal Dutch Airlines), Martinair Holland N.V. (Martinair), and SAS Cargo Group A/S (SAS) pled guilty and agreed to pay fines for their role in a major international conspiracy to fix prices for cargo shipments to and from the United States.

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June 20, 2008

COURT ALLOWS DOJ LAWSUIT AGAINST DAILY GAZETTE AND MEDIANEWS TO CONTINUE

On June 20, 2008, the U.S. District Court in Charleston, WV, issued an opinion and order to allow the U.S. Department of Justice (“DOJ”) to proceed with a lawsuit against the Daily Gazette Company (“Daily”) and MediaNews Group Inc. (MediaNews).

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June 17, 2008

CINCINNATI ICE COMPANY PLEADS GUILTY TO CUSTOMER AND TERRITORY ALLOCATION CHARGE

On June 17, 2003, Home City Ice Company pled guilty to conspiracy in allocating packaged-ice customers and territories among its co-conspirators. The DOJ alleged that Home City along with its co-conspirators suppressed competition by allocating customers and territories in the Detroit Metropolitan area and southeastern Michigan amongst themselves. This conspiracy took place between January 2001 and July 2007.

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June 10, 2008

DOJ REQUIRES DIVESTITURES IN VERIZON’S ACQUISTION OF RCC

On June 10, 2008 the Department of Justice (“DOJ”) along with the State of Vermont entered into a settlement agreement that would allay their concerns that Verizon Communication Corp.’s (“Verizon”) acquisition of Rural Cellular Corp. (“RCC”) for $2.7 billion as proposed is anticompetitive. To resolve antitrust concerns, the DOJ required Verzion to divest assets in six different geographic locations in Vermont, New York and Washington. Verizon and RCC provide service to approximately 60 percent of the consumers in those areas. The Department said that the transaction as originally proposed would have substantially lessened competition to the detriment of consumers of mobile wireless telecommunications services in those areas, potentially resulting in higher prices, lower quality and reduced network investments.

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June 5, 2008

DOJ APPROVES JOINT VENTURE BETWEEN SABMILLER PLC AND MOLSON COORS BREWING COMPANY

On June 5, 2008, the Department of Justice (“DOJ”) approved a joint venture between SABMiller plc and Molson Coors Brewing Company which combined their operations in the United States and Puerto Rico. While the transaction combined two of three largest U.S. brewers in the United States, the DOJ’s Antitrust Division did not find any evidence that this joint venture would reduce competition.

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May 28, 2008

DOJ ALLOWS CENGAGE TO ACQUIRE HM COLLEGE

On May 28, 2008, the Department of Justice blocked a proposed $750 million acquisition of Houghton Mifflin Harcourt Publishing Company's College Division (“HM College”) by Cengage Learning, Inc (“Cengage”). The DOJ required the divestiture of Cengage’s assets related to the textbooks and education materials of 14 of its college level courses. The textbooks ranged from topics on foreign languages to business.

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May 27, 2008

DOJ SETTLES WITH NATIONAL REALTORS ASSOCIATION

On May 27, 2008, the Department of Justice (“DOJ”) reached a settlement with the National Realtors Association (“NAR”) that requires NAR to allow internet-based real estate brokers to compete with traditional real estate brokers. NAR is a trade association of 1.2 million real estate members.

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May 2, 2008

DOJ FILES LAWSUIT AGAINST CONSOLIDATED MULTIPLE LISTING SERVICES CHARGING THAT ITS RULES ARE ANTICOMPETITIVE

On May 2, 2008, the Department of Justice (“DOJ”) filed a civil antitrust lawsuit against the Consolidated Multiple Listing Services (“CMLS”) of Columbia, SC. The lawsuit, filed at the U.S. District Court in Columbia, SC, alleges that the CMLS’s rules regarding who can be a member and how those brokers must conduct their business stifles competition. These rules prevent local real estate brokers as well as rival brokers from outside of Columbia from providing innovative options that would provide better services to consumers.

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April 29, 2008

DOJ REQUIRES DIVESTITURES IN PROPOSED MERGER BETWEEN REGAL CINEMA AND CONSOLIDATED THEATERS

On April 29, 2008, the DOJ required the divestiture of assets of Regal Cinema (“Regal”) and Consolidated Theatres Holding GP (“Consolidated”) in three metropolitan areas in North Carolina in order for the $210 million merger between the companies to proceed. The DOJ believes that the transaction would have resulted in less competition and higher ticket prices at the Crown Point 12 Cinema in Charlotte, the Raleigh Grand in Raleigh, the Town Square 10 in Garner (a suburb of Raleigh) and Hollywood 14 in Asheville, NC.

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April 16, 2008

JAPAN AIRLINES ADMITS INVOLVEMENT IN AIRLINE CARTEL THAT FIXED CARGO RATES TO AND FROM THE UNITED STATES AND ELSEWHERE

On April 16, 2008, Japan Airlines International Co. Ltd.