December 20, 1999
Washington, DC

Pitofsky questions FTC’s merger restructuring role

“We are at the point of needing systematic review of how the government deals with mergers.” FTC Chairman Robert Pitofsky

The government should not be engaged in restructuring mergers if it is not prepared to litigate or if it is being asked to restructure so much of a transaction that it is in danger of creating one or more nonviable competitors, FTC Chairman Robert Pitofsky told the New York Bar Association last week.

Rather than just stand athwart …

November 22, 1999
ISSN. 0196-0016

Merger Watch

While the Exxon-Mobil merger appears on track for a negotiated settlement in the near future that will satisfy FTC antitrust concerns, BP Amocos bid for ARCO is not nearly so far along in the process.

In March, then-FTC Competition Bureau director William J. Baer told the House Commerce Committees Energy and Power Subcommittee that Exxon-Mobil would be scrutinized carefully, not only by us and by our colleagues, 21 State Attorneys General, but also by antitrust enforcers in Europe …

November 8, 1999
ISSN. 0196-0016

Bad week for Microsoft

While most of the attention to Microsoft Corp.s antitrust problem was directed to Washington, D.C. and U.S. District Judge Thomas Penfield Jacksons findings that Microsoft has behaved like a classic predatory monopolist, farther west, U.S. District Judge Dee Benson was finishing his rejection of all but one of Microsofts pre-trial summary judgment motions in Caldera, Inc. vs. Microsoft Corp. (Case No. 2:96-CV-645 B; Dist. of Utah – Central Div.)

In Caldera, the plaintiff is seeking treble damages …

October 25, 1999
ISSN. 0196-0016

FTC preparing a spicy supermarket slotting payment case

The FTC is preparing to charge the McCormick & Co., self-described as The Worlds Largest Spice Company, with illegally giving itself control of the spice shelves in U.S. supermarkets by paying the supermarkets for preferred or exclusive shelf space, FTC:WATCH has learned.

Without mentioning McCormick, FTC Competition Bureau Deputy Director Willard K. Tom last week outlined the kinds of slotting allowance practices that would lead the agency to file antitrust charges.

The …

October 11, 1999
ISSN. 0196-0016

Merger Watch

When will the FTC dispose of the two huge petroleum company mergers now pending before it pursuant to the Hart-Scott-Rodino Act?

In the case of the Exxon – Mobil deal, it is understood that if negotiations fail to produce a settlement before the end of the year, the transaction will either be abandoned or challenged in federal district court.

But that scenario seems unlikely, FTC:WATCH has learned, because this merger will likely be one of those rare cases in …

September 27, 1999
ISSN. 0196-0016

FTC eliminates two regional offices,
concentrates antitrust work in three

Faced with the fact that its antitrust resources were scattered around 10 different regional offices, each with 5 employees assigned to the antitrust mission, the FTC has reconfigured and renamed the offices, eliminating two and one-half of them and beefing up the antitrust capabilities of three.

But it wasnt easy.

Congress may have trouble year after year honoring its self-imposed spending caps and passing appropriations bills before the fiscal …

September 13, 1999
ISSN. 0196-0016

Merger watch

The FTC recently told a University of Alaska professor that it has collected approximately 20,000 boxes of documents in its investigation of BP/Amocos proposed acquisition of ARCO and the merger of Exxon and Mobil. A box generally holding 1 cubic feet of paper, the least one can say is that someone has a lot of reading and indexing to do.

The government of Alaska, meanwhile is trying to figure out how to react to the BP/Amoco-ARCO deal, which …

July 26, 1999
ISSN. 0196-0016

Merger enforcement scorecard

More than 60 percent of senior executives expect the number of mergers and acquisitions in their own firms to increase in the next six months, and 70 percent look for increased merger and acquisition activity in their own industries, says a recent Conference Board press release summarizing one of the Boards Pulse surveys.

How are the federal antitrust agencies responding to the ongoing merger wave?

In the first six months of 1999, the FTC negotiated 12 …

July 12, 1999
Washington, DC
ISSN. 0196-0016

Merger Watch – perils of prognostication

On June 30, the Reuters News Service reported that the European Commission was continuing a serious investigation of Exxons proposed acquisition of Mobil Corp., quoting EC spokesman Stefan Rating as saying, To my knowledge, no decision has been taken on any of the concerns we expressed, including in the upstream sector.

On the same day, Bloomberg reported that EU Competition Commissioner had decided that the deal posed no competition problems at all.

…

June 21, 1999

Pizza labels to gemstones to coal mining to semiconductors – its an eclectic agency

To many of the FTCs critics, the agency is the tyrannosaurus rex of business regulation. But that criticism is based only on public enforcement actions. If the critics could see how many investigations the agency closes with no actions, they might not know whether to be cheered or appalled.

Is it possible for a firm to monopolize the production of labels for frozen pizzas? The FTC thought it might be …

May 24, 1999
Washington, DC
ISSN. 0196-0016

Finding a Microsoft remedy

The consensus opinion among the antitrust lawyers with whom FTC:WATCH is in regular contact is that Judge Thomas Penfield Jackson is going to find for the Federal and state governments who have accused Microsoft Corp. of having and abusing a monopoly in personal computer operating systems.

The reasons they think Microsoft is in trouble vary. Some think that the Justice Dept.s special counsel for this trial, David Boies, has done a spectacular job of demonstrating Microsofts alleged market …

May 10, 1999

Senate FCC merger review bill amended
Mergers distinguished by HSR reporting thresholds

The Antitrust Merger Review Act (S.4670), introduced by Senators Mike DeWine (R-Ohio) and Herb Kohl (D-Wisc.) and designed to speed up FCC merger review to within 180 days [FTC:WATCH No. 521, April 26] has been amended to distinguish between mergers above and below the Hart Scott Rodino reporting threshold of $15 million.

The original bill established: 1)once parties file for a license transfer at the FCC the FCC had 30 …

Washington, DC
April 26, 1999

Is the black hole back?

There was a time during the 1980s when consent agreements, staff-proposed complaints and all manner of administrative flotsam and jetsam pending at the FTC simply vanished into what many (including your editors) took to calling a Black Hole, after the astronomical phenomena into which it is said that matter would enter never, ever to reappear.

An echo of this problem can be heard in legislation introduced by Senate Antitrust Subcommittee Chairman Mike DeWine (R-Ohio) and Ranking Democrat Herb …

April 12, 1999

Joint venture Guidelines, advertising allowance Guides delayed

Two important sets of antitrust guidance for business and industry (and their legal counsel) have been delayed, in part because of the enormous drain on resources the continuing merger wave has caused at the FTC and the Justice Dept.s Antitrust Division.

The first set, revised Guidelines on how the agencies will evaluate joint ventures under the antitrust laws, requires approval by both the FTC and the Antitrust Division. According to informed sources, this document, having been approved …

March 29, 1999
Washington, DC

FTC requires partnership and individual to pay HSR civil penalty

For the first time since the statute was enacted in 1976, the FTC has required an individual to agree to pay a civil penalty to avoid litigating charges that he failed to disclose a competitively sensitive document in certifying compliance with a request for additional information the agency issued under the Act.

Item 4(c) requires all studies, surveys, analyses and reports which were prepared by or for any officer(s) or director(s) (or, in …

March 15, 1999
Washington, DC
ISSN. 0196-0016

MERGER WATCH

Exxon-Mobil

The proposed Exxon/Mobil merger will be scrutinized carefully, not only by us and by our colleagues, 21 State Attorneys General, but also by antitrust enforcers in Europe and possibly elsewhere, FTC Competition Bureau Director William J. Baer has told the House Commerce Committees Energy and Power Subcommittee. As antitrust enforcers, we need to consider whether Exxon/Mobils size or other attributes will change for the worse the competitive dynamics of this industry.

A …

March 1, 1999

Pitofsky on high-tech/network monopolies:
break them up or make them behave?

My own tentative view, FTC Chairman Robert Pitofsky told an ABA Antitrust Section meeting last week, is that antitrust enforcers should proceed cautiously in breaking up or mandating access to an existing network, even when that network is dominant.

For the time being, until we know more about the origins and significance of network efficiencies, antitrust should probably concentrate in most situations on its traditional role of ensuring that companies achieve …

February 15, 1999

Cant beat em? Join em

Earlier in this decade, the FTC jumped several weight loss clinic chains, alleging that they were making deceptive claims about their ability to shepherd consumers successfully through diets.

Rather than fight, they elected to settle. Until one of them, Weight Watchers International, seeing that it and the others had signed essentially identical consent agreements, decided to challenge the FTCs methods. Because the agency had presented all the chains with the same consent agreements, Weight Watchers told a federal …

February 1, 1999

Merger Watch: now its Clean Sweep divestitures

It seems that it all started in 1995, when the FTC accepted a consent agreement with Schnucks Markets settling charges that Schnucks acquisition of National Holdings, Inc. illegally concentrated the supermarket business in St. Louis, Mo. Schnucks agreed to divest a number of supermarkets and to keep them in good shape until they were divested. (FTC Docket No. C-3585)

In 1997, the FTC went to court, alleging that Schnucks hadnt divested everything on time and had …

January 18, 1999
Washington, DC

Merger Watch

BP/Amoco merger complicates Exxon-Mobil deal

At years end, the FTC decided not to oblige a Senate Antitrust Subcommittee request to delay approval of the BP/Amoco merger.

Although the merger of BP and Amoco involves companies of enormous size, and there is a significant trend toward concentration in the petroleum industry, said FTC Chairman Robert Pitofsky, the operations of these two companies rarely overlap in a way that threatens competition. Where they do overlap, mainly in wholesale and retail sale of …

December 6, 1999
ISSN. 0196-0016

Merger Watch – BP Amoco-ARCO

ARCO Chairman Mike R. Bowlin says “Discussions with the FTC continue, and we believe the FTC has not reached any conclusions.”

“The merits of this transaction remain as strong today as ever. The competitive landscape in the West Coast gasoline market is not changed by this merger since there is no competitive overlap in our operations or marketing. So, in my opinion, there is no basis for an objection to the combination. Moreover, any suggestion that the …

June 7, 1999
ISSN. 0196-0016
Washington, DC

Oley, oley in free

Despite the federal antitrust agencies’ traditional and continuing keen interest in alleged anticompetitive activities in the entertainment industry, especially motion pictures, two bills now pending in the U.S. Senate would give entertainment producers and distributors an antitrust exemption so they can collaborate on some kind of violent content labeling code. [see p. 7]

The successful industry negotiation and implementation of voluntary industry self-regulation schemes in the past (e.g., beer wine, liquor, cigarettes) raises some doubt that such an …