Tag: Consumer Goods (Non Food & Beverage)

Nestle settled antitrust charges that its $10.3 billion proposed acquisition of Ralston Purina Company would substantially lessen competition in the United States market for dry cat food through the elimination of direct competition between the two firms and increase the likelihood that the combined firm could unilaterally exercise market power. The order requires the divestiture of Ralston's Meow Mix and Alley Cat brands to J.W. Childs Equity Partners II,L.P.

The Commission issued an administrative complaint against Warner Communications, Inc., and several subsidiaries of Vivendi Universal S.A., charging them with illegally agreeing to fix prices for audio and video products featuring The Three Tenors.  A settlement with Warner barred future agreements to fix prices or restrict advertising.  After an administrative trial against Vivendi, an ALJ found that the agreement, while made in association with an otherwise legal joint venture between the companies, violated Section 5 of the FTC Act by illegally reducing competition in the U.S. market for the audio and video products cited.  The Commission upheld the ruling of an administrative law judge and prohibited PolyGram from entering into any agreement with competitors to fix the prices or restrict the advertising of products they have produced independently. In July 2005, the U.S. Court of Appeals for the District of Columbia Circuit affirmed the Commission’s decision in Polygram Holding Inc., validating the Commission’s approach to analyzing horizontal conduct among competitors.

The Commission authorized staff to seek a preliminary injunction to block the proposed acquisition of National Tobacco Company, L.P. on grounds that the $165 million acquisition would lessen competition in the market for loose leaf chewing tobacco and that Swedish Match’s market share would increase to 60 percent. On December 14, 2000, the U.S. District Court for the District of Columbia issued a 42-page opinion granting the Commission’s motion for the injunction. On December 22, 2000, the parties abandoned the transaction.

The FTC charged that five distributors of recorded music illegally required retailers to advertise compact discs at or above the minimum advertised price (MAP) set by the distribution company in exchange for substantial advertising payments for various types of media including television, radio, newspaper and signs and banners within the retailers own stores. Time-Warner Inc., Bertlesmann, Universal Music and Video Distribution Corporation and UMG Recordings, Inc., EMI Music Distribution, and Sony Music Entertainment represent approximately 85 percent of all CD’s purchased in the United States. According to the complaint, the MAP policies violated the antitrust laws in two respects. First, when considered together, the arrangements constitute practices that facilitate horizontal collusion among the distributors, and, when viewed individually, each distributor's arrangement constitutes an unreasonable vertical restraint of trade under the rule of reason.  In separate settlements, each distributor agreed to stop linking promotional funds to the advertised prices of their retailer customers for the next seven years. For the next 13 years after that, each company was prohibited from conditioning promotional money on the prices contained in advertisements they do not pay for, or terminating relationships with any retailer based on that retailer's prices.

Conso International Corporation, owner of the Simplicity brand of home sewing patterns, abandoned its proposed acquisition of McCall Pattern Company after the Commission filed a motion for a preliminary injunction in the United States District Court for the Southern District of New York. The complaint charged that the acquisition would reduce the number of United States sewing pattern designers and producers from three to two, creating a firm with more than 75% of the domestic unit sales of domestic home sewing patterns.

The FTC accepted a consent agreement that allowed Reckitt & Colman plc to acquire all of the voting securities of Benckiser N.V. from NRV Vermogenswerwaltung GmbH, while ensuring that competition in two highly concentrated household cleaning product markets is maintained. According to the complaint, the markets for hard surface bathroom cleaners and fine fabric wash products are highly concentrated, and the proposed acquisition was likely to substantially increase the concentration in each market. Under the agreement, Benckiser's Scrub Free® and Delicare® businesses would be divested to Church & Dwight, Inc., which also produces household cleaning products, selling items under the Arm & Hammer® brand name.

A consent order prohibits fourteen Bakersfield, California pool construction contractors from entering into any agreement or conspiracy to substantially raise and set swimming pool construction prices. The order also prohibits the contractors from refusing to deal with owner-builders or home construction contractors or developers.

Consent order settles charges that Johnson's acquisition of Dow brands would adversely affect competition and potentially raise the prices consumers pay for soil and stain removers and glass cleaners. The consent order requires the divestiture of Dow's "Spray 'n Starch", "Spray 'n Wash", and "Glass Plus" businesses to Reckitt & Colrnan.

Final consent order preserves competition in the sale of commemorative class rings to graduating high school and college students. The order requires restructuring of the purchase agreement to exclude Gold Lance, Inc. from the proposed plans to acquire Class Rings, Inc. The new acquisition plan is limited to the class ring business of Town & Country Corporation and CJC Holdings, Inc.