Antitrust Agencies Issue Guidance To HR Professionals Regarding Hiring and Compensation Decisions

The U.S. Antitrust Agencies (the Antitrust Division of the Department of Justice and the Federal Trade Commission) recently issued a document entitled “Antitrust Guidance For Human Resource Professionals” intended to alert HR professionals to potential antitrust violations involving hiring and compensation decisions.

The Guidance states that firms that compete to hire or retain employees are competitors in the “employment marketplace,” regardless of whether they make the same products or compete to provide the same services.  It advises that it is unlawful for competitors to expressly or implicitly agree not to compete and notes that the Antitrust Agencies have taken enforcement actions against employers that have agreed not to compete for employees.  To underscore this, the Guidance briefly discusses the enforcement actions that the Antitrust Agencies have taken against entities for agreeing not to compete for employees or agreeing to uniform compensation terms, including actions against high profile technology companies.

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Brexit News: UK Judges Throw a Block in the Road of Article 50

Invoking Article 50 of the Treaty of the European Union requires participation of the UK Parliament say Lord Chief Justices Lord Sales and Lord Thomas of the Royal Courts of Justice in London who handed down their judgment today.

This is a significant step, but only a step along the way. The final outcome remains uncertain as this judgment will most likely be appealed by the Government to the Supreme Court. Hence, the uncertainty caused by Brexit to businesses remains if it is not further increased.

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Inside The EU’s Overcharge Pass-On Study

On Oct. 25, 2016, the European Commission released a “Study on the Passing-on of Overcharges” after a year-long evaluation and input process. The study will help judges, regulators and practitioners critically evaluate pass-on claims in European competition cases through both legal and economic lenses. The detailed 315-page report highlights the increasingly important role of pass-on in the EU, and compares EU law concerning pass-on with other jurisdictions, including the United States. This article gives an overview of the study’s results and predicts the effects of increasing pass-on litigation in the EU.

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“E-Commerce must live up to its promise…”

These are the words of Europe’s chief antitrust enforcer, Margrethe Vestager, introducing the Commission’s public hearing on October 6, 2016, on its preliminary findings of the e-commerce sector inquiry. The promise of e-commerce alluded to by the Commissioner for Competition means quite simply a wider choice of goods available for purchase online, at lower prices across the EU as well as cross-border access to digital content for consumers in the EU. The major concern for the Commission is that e-commerce still takes place nationally within the EU and not on a cross-border basis across the 28 Member States, because of contractual barriers erected by companies.

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On the Way to a European Digital Single Market: Whether You Sell Online or Offline – Listen Up!

The European Commission’s Directorate-General for Competition has issued a lengthy preliminary report of its ongoing sector inquiry into the e-commerce of goods and digital content. The sector-wide inquiry was launched on May 6, 2015, in the context of a wider legislative initiative by the Commission implementing its Digital Single Market strategy. The ongoing inquiry and impending future enforcement actions will have major implications on the law and enforcement of product distribution in Europe, both online and offline.

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Refusal to Sell Bulk-Size Packs, Without More, Is Not Price Discrimination – “Size is Not a Service”

Woodman’s Food Market, Inc. v. Clorox Co., No. 15-3001 (7th Cir.  August 12, 2016).

Clorox Sales Company and Clorox Company produce a range of consumer goods.  Clorox sold goods to Plaintiff Woodman’s Food Market, a local grocery store with locations in Wisconsin and Illinois.  Clorox also sold to discount warehouses such as Costco and Sam’s Club.  In 2014, Clorox unilaterally announced that it would sell its large packs only to wholesale discount clubs.  Thus, the large bulk-size packs, which had previously been sold to Woodman’s were no longer available to it by direct purchase from Clorox.

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FTC Stands Down in Latest Head-to-Head Battle Between Federal and State Oversight of Healthcare Collaborations

In what will undoubtedly be seen by all interested parties as a significant setback in the Federal Trade Commission’s active opposition to potentially anticompetitive healthcare collaborations, the FTC voted unanimously on Wednesday to dismiss its challenge to Cabell Huntington Hospital’s acquisition of St. Mary’s Medical Center – two hospitals serving patients in the Huntington area of West Virginia.  While the FTC continues to believe that the merger will result in significant anticompetitive harm, it chose to abandon the fight in light of the recent passage of West Virginia Senate Bill 597 (SB 597).

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Maximum Civil Penalties for HSR Violations to Increase to $40,000 per Day

For parties considering a merger or other transaction, the civil penalties for failing to comply with the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR Act”) are about to increase significantly.

On June 29, 2016, the Federal Trade Commission announced that the maximum civil penalty for noncompliance with the premerger filing requirements of the HSR Act will increase from $16,000 per day to $40,000 per day, effective August 1, 2016.  The current maximum penalty of $16,000 per day has been in place since 2009.  Prior to 2009, the maximum penalty was $11,000 per day.

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Brexit, Here We Come (or Go)

The UK people have voted to leave the European Union. Although there is no constitutional duty to leave the Union as a result, politically this is likely going to happen. Change will not be immediate and happen over time.

Companies are well advised to react quickly to assess the impact Brexit might have on their business and current commercial decisions involving the UK if they have not already done so.

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U.S. Department of Justice Sues North Carolina Hospital System for Insisting on Anti-Steering Provisions in Insurance Reimbursement Contracts

On June 9, 2016, the Antitrust Division of the United States Department of Justice (“DoJ”) filed a complaint against the Charlotte-Mecklenburg Hospital Authority, d/b/a Carolinas Health Care System (“CHS”) in the United States District Court for the Western District of North Carolina. (United States of America and State of North Carolina v. Charlotte Mecklenburg Hospital Authority). The complaint accuses CHS of using “contract restrictions that prohibit commercial health insurers in the Charlotte area from offering patients financial benefits to use less expensive healthcare services offered by CHS’s competitors.” (Complaint, Preamble) In effect, the complaint is attacking a type of widely used contracting provision in which acute care hospital systems seek to prohibit insurance company payors from using “steering” restrictions, which would otherwise be used to steer their insured patients to lower cost healthcare providers, including lower-cost hospitals, in exchange for lower premiums in so-called “narrow network” insurance plans. The complaint then alleges that CHS has an approximately 50% share of the market for acute inpatient hospital care in the Charlotte metropolitan area, allegedly conferring market power on CHS.

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