Tag: Competition

The consent order settled charges that Service Corporation International’s (SCI) proposed acquisition of Alderwoods Group Inc. would likely lessen competition in 47 markets for funeral or cemetery services, leaving consumers with fewer choices and the prospect of higher prices or reduced levels of service. Under the settlement, SCI must sell funeral homes in 29 markets and cemeteries in 12 markets across the United States. In six other markets, SCI must sell certain funeral homes that it plans to acquire or end its licensing agreements with third-party funeral homes affiliated with SCI.

Nine West Group Inc. settled charges that it entered into agreements with retailers; coerced other retailers into fixing the retail prices for their shoes; and restricted periods when retailers could promote sales at reduced prices. The order, which lasts 20 years, prohibits Nine West from fixing the price at which dealers may advertise, promote or sell any product. Nine West is one of the country’s largest suppliers of women’s shoes. In 2008, Nine West petitioned to have the order modified in light of the 2007 Supreme Court decision, Leegin v. PSKS, Inc., which eliminated the per se rule for minimum resale pricing agreements.   The Commission modified the order in part to allow Nine West to enter into resale price maintenance agreements that do not unreasonably restrict competition, and requiring Nine West to provide periodic reports of any RPM agreements with retailers.

On February 10, 2004 the Commission issued an administrative complaint alleging that following Evanston Northwestern Healthcare Corporation's acquisition of Highland Park Hospital prices charged to health insurers for medical services increased and, therefore, higher costs for health insurance were passed on to consumers of hospital services in the Cook and Lake counties of Illinois. The complaint also alleged that a physicians group affiliated with both hospitals, Highland Park Independent Physician Group, negotiated prices for physicians on staff at Evanston as well as for several hundred independent physicians not affiliated with either hospital. According to the complaint, these actions constitute illegal price fixing among competing physicians or physician groups and deny consumers the benefits of competition in physician services. In an initial Decision, the Administrative law judge found that the acquisition resulted in higher prices and substantially lessened competition for acute care inpatient services in parts of Chicago’s northwestern suburbs.  The ALJ entered an order that would require the divestiture of the acquired hospital.   On appeal, the Commission ruled that the acquisition was anticompetitive, but concluded that in this “highly unusual case,” divestiture, the remedy imposed by the administrative law judge, would be too costly and potentially risky and instead imposed a conduct remedy. The Commission’s order requires Evanston to set up two separate and independent contract negotiation teams to bargain with managed care organizations to revive competition between Evanston’s two hospitals and the Highland Park hospital.

The FTC challenged a group boycott between two Connecticut chiropractic associations in which the health care providers refused to deal with a cost-saving Connecticut health plan. The Commission issued a consent order ending the agreement and preventing the involved parties from entering into such agreements in the future.

Multiple Listing Service, Inc. (MLS), a group of real estate professionals based in Milwaukee, Wisconsin, settled charges that its rules unreasonably restrained competition among real estate brokers in Milwaukee.  The complaint alleges that MLS acted anticompetitively by adopting rules and policies that limit the publication and marketing of certain sellers’ properties, but not others, based solely on the terms of their respective listing contracts. The Commission alleged that the rules were collusive and exclusionary and served to withhold valuable benefits of the MLS from brokers who did not use traditional listing contracts with their customers.  Under the terms of the December 2007 consent, MLS is barred from adopting or enforcing any rule that treats one type of real estate listing agreement more advantageously than any other, and from interfering with the ability of its members to enter into any kind of lawful listing agreement with home sellers.

The Commission charged that Schering-Plough’s proposed $14.4 billion acquisition of Organon Biosciences N.V. threatened to substantially reduce competition in the U.S. market for three popular vaccines used to treat poultry, a staple in American food markets. The November 2007 order settling the charges required the sale of assets required to develop, manufacture, and market these vaccines to Wyeth. In addition, Schering-Plough was required to sign a supply and transition services agreement with Wyeth, under which Schering will provide the vaccines for a period of two years, allowing time for the necessary FDA approvals.