Tag: Manufacturing

The FTC accepted a consent order settling charges that Charlotte Pipe and Foundry Company’s 2010 purchase of Star Pipe Products, Inc.’s cast iron soil pipe (CISP) business was anticompetitive. To help restore competition in CISP markets in the United States, the order prohibits Charlotte Pipe from enforcing a confidentiality and non-compete agreement with Star Pipe, ensures that Charlotte Pipe will publicly disclose its prior acquisitions of other CISP importers, and requires Charlotte Pipe to notify the Commission before making future acquisitions in this industry. CISP products are important components of pipeline systems used to transport wastewater from buildings to municipal sewage systems, to vent plumbing systems, and to transport rainwater to storm drains.

Houghton International, Inc., the leading North American provider of hot rolling oil used to process aluminum, agreed to sell some of the assets it acquired in 2008 through its purchase of D.A. Stuart GmbH, a transaction that included multiple product markets. The FTC’s investigation found that Houghton’s acquisition of D.A. Stuart GmbH combined the two largest suppliers of aluminum hot rolling oil (AHRO) in North America, giving the combined firm control of almost 75 percent of the North American market. The FTC’s complaint alleges that, through its purchase of Stuart, Houghton could unilaterally raise AHRO prices to U.S. consumers. The complaint also alleges that the acquisition could decrease innovation for this vital input into aluminum manufacturing. Under the order settling the FTC’s charges, Houghton will sell Stuart’s AHRO business to Quaker Chemical Corporation.

Graco, Inc. settled FTC charges that it violated the antitrust laws by buying Gusmer Corp. (Gusmer) in 2005 and GlasCraft, Inc. (GCI) in 2008, its two closest competitors in the North American market for fast set equipment (FSE) used by contractors to apply polyurethane foams and polyurea coatings. The consent order settling the FTC’s charges is designed to restore competition to the FSE market that was lost as a result of Graco’s acquisitions. It incorporates a private litigation settlement between Graco and Polyurethane Machinery Corp. (Gama/PMC) that requires Graco to license certain technology to Gama/PMC. The consent order also contains provisions that provide Gama/PMC and other competitors easier access to distributors, so they can distribute competing FSE products effectively in the North American market.

The FTC approved an order settling charges that Robert Bosch GmbH’s acquisition of the SPX Service Solutions business of SPX Corporation would have given it a virtual monopoly in the market for air conditioning recycling, recovery, and recharge devices for vehicles. Under a settlement with the FTC, Bosch agreed to sell its automotive air conditioner repair equipment business, including RTI Technologies, Inc., to automotive equipment manufacturer, Mahle Clevite, Inc. Bosch also agreed to resolve allegations that, before its acquisition by Bosch, SPX harmed competition in the market for this equipment by reneging on a commitment to license key, standard-essential patents (SEPs) on fair, reasonable and non-discriminatory (FRAND) terms. The FTC alleged that SPX reneged on its obligation to license on FRAND terms by seeking injunctions against willing licensees of those patents. Bosch has agreed to abandon these claims for injunctive relief. 

The FTC required bleach producer and seller Oltrin Solutions, LLC to release its competitor, JCI Jones Chemicals, Inc. from an agreement not to sell bleach in North Carolina and South Carolina. This non-compete agreement was part of a 2010 transaction between the two firms that the FTC alleges violated antitrust laws. The FTC’s settlement with Oltrin and JCI will restore competition between these two producers and sellers of bulk bleach, which is primarily used to disinfect water.  The FTC contends that the deal between the two firms eliminated substantial competition between Oltrin and JCI in the relevant geographic market; substantially increased the market concentration for bulk bleach sales in the relevant geographic market; and increased Oltrin’s ability to raise bulk bleach prices. The FTC order requires Oltrin to release JCI from the non-compete agreement, transfer a minimum volume of its bulk bleach contracts back to JCI, and provide a short-term backup supply agreement that will facilitate JCI’s re-entry into the bulk bleach market in North Carolina and South Carolina.

The FTC issued an administrative complaint  challenging electronics component manufacturer Integrated Device Technology, Inc.’s proposed $330 million acquisition of PLX Technology, Inc., a deal that allegedly would give the combined firm a near-monopoly in the market for a type of integrated computer circuits called PCIe switches, which perform critical connectivity functions in computers and other electronic devices widely used by American consumers and businesses. The Commission also authorized the staff to seek a preliminary injunction in federal district court or other relief necessary to stop the deal pending a full administrative trial, but theparties abandoned the transaction and the Commission later dismissed the complaint.

Magnesium Elektron, a leader in the production of magnesium plates used for photoengraving, settled FTC charges that its acquisition of rival plate manufacturer Revere Graphics Worldwide, Inc. was anticompetitive and a violation of the antitrust laws. The FTC's order restores the competition eliminated by the merger by requiring Magnesium Elektron to sell necessary intellectual property and technical know-how used to manufacture magnesium plates for photoengraving applications to Kansas-based Universal Engraving.  While Universal Engraving does not currently manufacture or sell magnesium plates, it is uniquely positioned to become an effective competitor in this market because it already sells other metals used in the photoengraving process to customers affected by the merger.

The FTC required Corning, Inc. to transfer assets and to supply some of its laboratory products to another company, under a settlement that resolves charges that Corning’s proposed acquisition of Becton, Dickinson and Company’s Discovery Labware Division would otherwise be anticompetitive. Under the FTC settlement, Corning will provide assets and assistance to enable life science company Sigma-Aldrich Co., LLC to manufacture Corning’s line of tissue culture treated (TCT) dishes, multi-well plates, and flasks in a manner substantially similar to Corning’s process. Until Sigma Aldrich develops its own manufacturing capabilities for these products, Corning will supply them to Sigma Aldrich to be marketed under Sigma Aldrich’s own brand, allowing Sigma Aldrich to immediately replace the competition lost as a result of Corning’s acquisition of Discovery Labware.

The FTC required specialty metals manufacturer Carpenter Technology Corporation to sell assets involved in producing two metal alloys used in the aerospace industry, under a settlement resolving charges that Carpenter's proposed $410 million acquisition of Latrobe Specialty Metals, Inc. would harm competition in the U.S. markets for these alloys.The FTC's complaint alleges that the deal – a merger to monopoly – likely would lead to higher prices for consumers of the two alloys.  The order requires Carpenter to divest assets necessary for manufacturing the two alloys – MP159 and Aerospace MP35N – to another metals manufacturer, Eramet S.A.

The Commission challenged Dow Chemical’s $18.8 billion proposed acquisition of Rohm & Haas Company as anticompetitive in the markets for various acrylics and other industrial chemicals used to make coated paper products, paints, and adhesives. According to the Commission’s complaint, the product markets in question include acrylic monomers, used in goods ranging from hygiene products to paints and industrial coatings, hollow sphere particles, used in paper products, and acrylic latex polymers, used in traffic paints. Given the high concentration in each of the product markets, the proposed acquisition would have represented a merger to monopoly. To remedy its anticompetitive concerns, the Commission required Dow to divest assets to Hager Pacific Acquisitions LLC.

The FTC filed separate complaints against the three largest U.S. suppliers of ductile iron pipe fittings, which are used in municipal water systems around the United States. The FTC charged that the three companies, McWane, Inc., Star Pipe Products, Ltd., and Sigma Corporation, illegally conspired to set and maintain prices for pipe fittings, and that McWane illegally maintained its monopoly power in the market for U.S.-made pipe fittings by implementing an exclusive dealing policy. Sigma settled the FTC's charges prior to litigation (final order dated Feb. 27, 2012); Star settled soon after (final order dated May 8, 2012).  The complaint against McWane was heard before an administrative law judge and later appealed to the Commission; see Docket No. 9351.