Antitrust Law Blog

NOTICE: The Sheppard Mullin Antitrust Law Blog has been updated with current antitrust regulatory and litigation matters published by the Antitrust Practice Group, based in the Washington, D.C. office of Sheppard, Mullin, Richter & Hampton LLP.

On December 14, 2005, the European Court of First Instance ("CFI") denied the application of General Electric Company ("GE") and Honeywell International ("Honeywell") for annulment of the merger prohibition issued by the European Commission ("Commission") of July 3, 2001.¹ There, the Commission declared that the acquisition of the assets of Honeywell by GE would be a "concentration incompatible with the common market". A concentration which creates or strengthens a dominant position as a result of which effective competition would be significantly impeded in the common market, or a substantial part thereof, is declared incompatible with the common market. ²

In Walker Process Equip Co., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172 (1965), the Supreme Court held that the enforcement of a fraudulently procured patent may violate Section 2 of the Sherman Act assuming the other elements of a Section 2 violation are also proved. In recent years, such Walker Process claims have become commonplace, and often asserted as counterclaims in patent infringement cases. The parties asserting such claims, however, are normally those who manufacture competing and potentially infringing products and the damage remedy is normally lost profits.

The two antitrust agencies are enacting some minor changes to the Hart-Scott-Rodino ("HSR") Notification Rules that impacts all companies that are required to file HSR Notification Forms in connection with their deals.

Effective antitrust enforcement in an increasingly global economy depends on close governmental cooperation and coordination as well as respect of the decisions other nations. But how should United States antitrust enforcement agencies react when increased dialogue and communication with foreign antitrust agencies which is meant to reduce misunderstanding, and over time, reveal areas of agreement, actually leads to a divergence in the application of antitrust policies?

The United Kingdom's Office of Fair Trading ("OFT"), the primary UK government agency for enforcing laws protecting competition and consumer welfare, will no longer provide confidential guidance and informal advice on potential mergers not yet made public, it announced last November.¹ Previously, competition counsel representing merging parties could obtain, free of charge, a view from the OFT, before the merger was made public, on whether a transaction presented competition issues and whether it would be referred to the UK's Competition Commission for a second stage, in-depth investigation. The announcement cited scarcity of resources due to heightened expectations at a time of increased caseload as the primary reason for the change.