Congratulations to Stacey Anne Mahoney who joined Gibson, Dunn & Crutcher from Constantine Cannon.  Ms. Mahoney is the current Chair of the Antitrust Section of the New York State Bar Association.  According to the press release:

Mahoney focuses her practice on antitrust litigation and counseling. She regularly represents clients before the Federal Trade Commission and Antitrust Division of the Department of Justice and counsels clients on competitor collaborations, distribution practices and pricing policies. Her antitrust experience covers a wide variety of industries, including retail electronics sales, standard setting, glass manufacturing, automobile sales and repair, lightning protection and ready-to-eat cereals.

Blawg Review #158 is now available at The Mommy Blawg.

Here are the slides from a recent presentation on antitrust issues in mergers and acquisition in Scottsdale, AZ.

Congratulations to Marc G. Schildkraut who returned to Howrey from Heller Ehrman.  According to the press release:

Howrey LLP announced today that Marc G. Schildkraut has rejoined its global Antitrust Practice in Washington, D.C.  Schildkraut had been with Howrey from 1993 to 2005, prior to which he spent 17 years at the Federal Trade Commission in various roles, including Assistant Director for the Bureau of Competition.  Until recently, he led the Antitrust and Trade Regulation practice at Heller Ehrman.

Blawg Review #157 is now available at the Thoughts From A Management Lawyer blog.

Following up on this earlier post, here is a more detailed analysis of the Rambus case that I co-authored.

Here is the complete set of slides from my Fall 2007 course on Antitrust and Innovation at the Benjamin N. Cardozo School of Law. I posted the slides as the course progressed, but these ones contain some updates and bugfixes. As always, the slides are licensed under a Creative Commons Attribution-Noncommercial 3.0 United States License, so feel free to use whatever you like.

Note that using these and other materials at conferences or for presentations is non-commercial use in my book, even though the conferences may be for profit and the presentations may be paid for (e.g., a PowerPoint for a client). What I have in mind with “commercial use” is, for example, printing and selling the slides. I don’t know if this interpretation is consistent with the current thinking at the Creative Commons, but I find that a broad reading of “non-commercial” would negate the benefits of the CC license — at least for me.

Deception in the standard setting process is anticompetitive if the deception leads to increased market power. In other words, the conceptual sequence of events is as follows:

1. Deception:
2. Reliance by the SSO on the deception in the standards-adoption decision
3. Market power gain through inclusion in the standard.

Critically, the post-adoption market power is greater than the pre-adoption market power. The D.C. Circuit, relying on NYNEX v. Discon, invokes a different narrative. Namely:

1. Market power
2. Deception
3. Higher prices as a result of the deception

Here, post-deception market power is no greater than pre-deception market power. As a result, the deception may be actionable as a tort, breach of contract, etc., but it lacks the distinctive feature of exclusionary conduct under the antitrust laws, namely increased market power.

The question is whether the Rambus facts better fit the FTC’s “first deception, then market power” or the D.C. Circuit’s “first market power, then deception” narrative. Strictly speaking, the D.C. Circuit’s opinion requires that the deception netted Rambus no additional market power from deceiving the SSO at all. All of the market power that could be gained came from the patent grant itself. The FTC’s position is softer in comparison. It does not require that the patent grand conferred no market power onto Rambus. All it requires is that some incremental market power was gained from the adoption of the standard.

It will be interesting to see how the FTC responds to this challenge, in particular because the D.C. Circuit did not only rely on the somewhat technical point in NYNEX, but also questioned the FTC’s findings of fact. One statement in dicta seems particularly apropos: “[T]he more vague and muddled a particular expectation of disclosure, the more difficult it should be for the Commission to ascribe competitive harm to its breach.”

On Wednesday, a former Bristol-Myers Squibb vice-president was indicted by the United States Department of Justice one count for making a false statement to the FTC.  The New York Times reports:

Andrew G. Bodnar, a doctor, had made a false statement to the Federal Trade Commission in describing a 2006 agreement between Bristol-Myers and Apotex, a Canadian maker of generic drugs. Dr. Bodnar had led negotiations to stop Apotex from selling its own version of Plavix, a blood thinner that is Bristol-Myers’s top-selling drug.

Dr. Bodnar would not comment on Wednesday, but his lawyer, Elkan Abramowitz, said he would plead not guilty. “All I can say is that we will vigorously contest these charges; we think they are baseless,” Mr. Abramowitz said.

…

The indictment stems from a federal investigation that led, in part, to the ouster of the previous Bristol-Myers chief executive, Peter R. Dolan, in September 2006.

Earlier that year, Apotex was threatening to sell its own generic version of Plavix before expiration of a patent that gave Bristol-Myers and its partner, Sanofi-Aventis, exclusive rights to the brand-name drug until 2011. The threat by Apotex, which had filed a lawsuit challenging the validity of that patent, was viewed as a serious problem for Bristol-Myers. In 2005, Plavix generated about $3.5 billion in United States sales.

Mr. Dolan dispatched Dr. Bodnar to Toronto to negotiate a settlement. During those meetings, in May 2006, the indictment charges, Dr. Bodnar made secret assurances to Apotex that Bristol-Myers would not issue its own generic version of the drug to compete with Apotex.

At the time, Bristol was bound by a federal consent order requiring it to submit such agreements to the Federal Trade Commission for clearance. The F.T.C. would have been looking for any deals that restrained competition and led to higher prices.

According to the indictment, Bristol-Myers never disclosed that part of the Apotex agreement to the F.T.C. And the indictment contends that after the investigation had begun, Dr. Bodnar certified to the F.T.C. that there had been no such secret deal.

The Department of Justice press release is available here.

Congratulations to H. Stephen Harris, Jr. has joined Jones Day from Alston & Bird.  According to the press release:

He has been widely recognized as a leading U.S. and international antitrust litigator, has considerable experience in Asia competition law and regimes, and currently serves as the International Officer of the ABA Section of Antitrust Law. With that background he will help coordinate the interface of the Firm’s global competition law practice with the Firm’s Asia competition law practices.

Mr. Harris comes to Jones Day from the Atlanta Office of Alston & Bird, where he chaired that firm’s antitrust practice. He has handled numerous complex civil and criminal antitrust cases, including class actions and multidistrict litigation, in federal courts throughout the United States.

Congratulations to John S. Gibson has joined Winston & Strawn’s Los Angeles office from Paul, Hastings, Janofsky & Walker LLP.  According to the press release:

Gibson’s practice focuses on the representation of Fortune 500 companies in complex civil litigation, including antitrust and unfair competition litigation, post-trial litigation, class actions, commercial purchase disputes, lender-liability defense litigation and real estate litigation in arbitration and state and federal courts throughout the U.S.

…

Gibson, a former summer league teammate of Earvin “Magic” Johnson, is also a youth basketball coach for the Amateur Athletic Union.

Here is the opinion. After a quick read, we’re convinced this is a big one and probably headed for the Supreme Court. The D.C. Circuit applies NYNEX, which puts into question several harm-through-deception theories for conduct in standards-setting organizations.

BBspot reports:

… Bill Gates faced antitrust investigations in the US and abroad as CEO of Microsoft, and now the Bill and Melinda Gates Foundation may be coming under scrutiny for monopolistic charity practices.

Donations are down at charities like the United Way, Red Cross and Catholic Charities of America, and the organizations are finding the outlets for charitable giving have narrowed.

Red Cross Chairman Greg Coburn points to the exclusive deals the Gates Foundation has signed with many African nations as his biggest complaint. “These deals make the Gates Foundation the ’sole charity provider’ and lock out our organizations from giving. That leads to donations drying up for us,” said Coburn.

In countries where they don’t have an exclusive arrangements reports show that the Gates Foundation has been giving away its charity for free. “They just swoop in and give it away for free,” said Coburn. “It’s very hard for us to compete with that.”

…

Another concern for charities was the exclusive contract Bono signed with the Gates Foundation. “If we can’t have access to Bono, how can we be effective in our giving,” said the Pope.

The US Justice Department has refused to look into the Gates Foundation practices, saying that it doesn’t investigate charities, but the European Union has levied a preemptive fine of $300 million before launching their investigation.

Technorati Tags: antitrust, Gates Foundation, satire

Blawg Review #156 is now available at Virtually Blind.

The oral argument for the appeal in FTC v. Whole Foods Market, Inc. (D.C. Cir. 07-5276) is scheduled for Wednesday, April 23rd, at 9:30. Whole Foods is the third case on the docket that morning. Judges: Tatel, Brown, and Kavanaugh.

See you there.