A View from Constantine Cannon’s London Office

By James Ashe-Taylor and Ana Rojo Prada

Debate continues over Google’s settlement offer in search and advertising investigation as European Commission indicates that more is needed.

Google and Rupert Murdoch’s News Corp have traded blows publicly following comments by the European Commission indicating that it would reopen its antitrust investigation into Google’s search and advertising business.

Outgoing Competition Commissioner Joaquin Almunia has indicated in interviews over the last week that Google’s proposals to settle the investigation do not fully address the Commission’s concerns.

In an open letter to Almunia, News Corp Chief Executive Robert Thomson called Google “a platform for piracy and malicious networks.”  He also alleged that Google deliberately made it difficult to “access information independently and meaningfully,” and that its sudden changes to the ranking and display of search results prejudiced small companies.

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By Rosa M. Morales

Signs continue to accumulate that antitrust regulators are on the lookout for innovative anticompetitive tactics by pharmaceutical companies seeking to delay entry of lower-priced generic drugs.

This growing interest by federal and state regulators in policing the anticompetitive suppression of generic drugs was the subject of a recent post on this blog by Ankur Kapoor.  Among the antitrust enforcement actions analyzed was a reverse-payment case filed earlier this month by the New York State Attorney General against Actavis and its recently acquired, wholly-owned subsidiary Forest Laboratories.

In recent comments, Eric Stock, chief of the Antitrust Bureau of the New York State Attorney General’s Office shed light on what antitrust enforcers may be looking at when he discussed “forced switching” – one of the anticompetitive tactics used by the pharmaceutical companies that is attracting the interest of antitrust enforcers.  “Forced switching” occurs when pharmaceutical companies “force” the use of new branded drugs by either pulling older branded versions from the market or reducing their supply.

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By Ankur Kapoor

Antitrust enforcers returned to their offices after Labor Day, refreshed and ready to tackle what they view to be anticompetitive practices by pharmaceutical companies to delay entry of lower-priced generic drugs.

In addition to recent enforcement efforts by antitrust regulators, two federal courts have issued opinions supporting the theory underlying the enforcers’ new efforts to police so-called “reverse payments.”

On September 8, 2014, the Federal Trade Commission (FTC) filed an antitrust complaint in the U.S. District Court for the Eastern District of Pennsylvania against AbbVie Inc. (a spinoff of Abbott Laboratories’ portfolio of proprietary pharmaceutical and biologic drugs) and generic giant Teva Pharmaceuticals. FTC v. AbbVie Inc. is the FTC’s first action against “reverse-payment” or “pay-for-delay” agreements between patent-holders and generic competitors since the FTC’s 2013 Supreme Court victory in FTC v. Actavis, Inc., which held that such agreements could run afoul of the antitrust laws under certain circumstances.

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A View from Constantine Cannon’s London Office

By Irene Fraile

The European Commission has imposed fines totaling 138 million euros on smart card chips producers Infineon, Philips and Samsung for breaching European Union antitrust laws that prohibit cartels.

According to the Commission, from September 2003 to September 2005, the companies engaged in a cartel to restrain competition relating to the smart card chips used in mobile telephone SIM cards, bank cards, identity cards, passports, pay TV cards, and various other applications.  The cartel used a network of bilateral contacts in order to coordinate responses to customers’ requests to lower prices and, ultimately, keep prices up.  The companies discussed and exchanged sensitive commercial information on pricing, customers, contract negotiations and production capacity, thereby damaging competition by reducing uncertainty concerning future behavior in the market.

Although some of the cartelists took measures to conceal the collusion, one of them – Renesas (a joint venture between Hitachi and Mitsubishi) – finally blew the whistle and revealed the existence of the cartel to the antitrust authorities under the Commission’s Leniency Programme.  As a result, Renesas received full immunity and avoided a fine of more than 51 million euros.  Samsung, which also cooperated with the investigation, received a 30 percent reduction in the level of its fine in return for its cooperation.

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By David Golden

On Thursday, Judge Denise Cote of the U.S. District Court for the Southern District of New York refused to dismiss a class-action antitrust lawsuit involving the $21 trillion credit default swap (“CDS”) market, permitting the case to proceed to discovery.

The plaintiffs in In re Credit Default Swaps Antitrust Litigation allege that some of the largest investment banks in the United States – including Bank of America, Citibank, Goldman Sachs, JPMorgan and Morgan Stanley – conspired to prevent price transparency and competition in the CDS market.  The individual plaintiffs are groups of CDS investors, including several public pension funds.

A CDS is a financial tool to hedge credit risk.  The buyer of a CDS purchases the seller’s promise to pay if a “credit event,” such as a credit default, occurs during a specified time period.  In effect, a CDS is an insurance policy.

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