A customer-allocation conspiracy has been put on ice by the U.S. Department of Justice in a plea deal reached in Cincinnati federal district court.

Arctic Glacier International, Inc., a packaged-ice company located in St. Paul, has agreed to plead guilty to violating the Sherman Act and to pay a $9 million fine for allocating customers in the Detroit area.  Three former executives from the company have also pled guilty to charges related to the conspiracy, and Arctic Glacier has agreed to cooperate in the ongoing investigation.

This deal, along with the massive fine, underscores the perils and increasingly large penalties associated with antitrust violations.   It also highlights the importance of seeking sound legal advice when undertaking joint business actions involving other companies.  Maximum penalties for violations of the Sherman Antitrust Act can carry penalties of up to 10 years in jail, $1 million fines for individuals, and $100 million fines for corporations.

This investigation by the DOJ and the FBI has also frozen another company in its tracks for alleged participation in similar activities.  Home City Ice Company pleaded guilty on June 17, 2008, to conspiring to allocate customers.

A group of California pharmacies seeking to block Pfizer’s proposed buyout of Wyeth has already filled the prescription for an amended complaint in response to last week’s dismissal of their suit alleging the deal would be unhealthy for competition and jobs.

U.S. District Judge Maxine Chesney in San Francisco had given the pharmacies until Nov. 6 to cure their complaint, which she dismissed for failing to show in which product markets the acquisition would eliminate competition.  The deal has already received FTC approval.

One representative of the California Pharmacists Association claimed the acquisition would “create the largest pharmaceutical company in the world,” thus giving it power to raise drug prices.  A Pfizer representative countered that the suit was “without merit.” click here for more »

While the antitrust class action is historically an American enforcement tool, the European Union is on the verge of pressing this powerful hammer into the hands of its member states.

Under a draft EU Directive, state bodies and nonprofit organizations appointed by national governments would be able to bring class actions in national courts against companies that fix prices or abuse their dominant market share.  Victims would automatically be included in the class action unless they opt out.  The draft Directive allows victims at least two years to take legal action to recover actual losses and lost profit after a final court ruling on a company’s liability.

European Competition Commissioner Neelie Kroes is expected to present the proposed Directive to fellow commissioners in the next few weeks.  If adopted as a Directive by the European Commission, EU Member States would be required to implement it or face heavy fines. click here for more »

Antitrust practitioners that pass on the upcoming opportunity to comment on revising the 1992 Merger Guidelines will be missing an opportunity that comes once in a generation.

For 17 years now, the Horizontal Merger Guidelines jointly developed by the U.S. Department of Justice and Federal Trade Commission have been one of a few doctrinal pillars of the faith among antitrust practitioners, most notably with respect to market definition.  Since their promulgation in 1992, the Guidelines have survived two full presidential administrations that were diametrically opposed in their philosophies of merger and unilateral conduct enforcement, a remarkable testament to the Guidelines’ intellectual underpinnings and continuing relevance. 

On September 22, 2009, the DOJ and FTC announced that they would jointly hold workshops in the coming months for the purpose of evaluating whether to revise the Guidelines and, if so, how.  In her speech to the Third Annual Georgetown Law Global Antitrust Enforcement Symposium, Assistant Attorney General and Head of the DOJ’s Antitrust Division, Christine Varney, stated that the workshops would likely discuss at least three broad topics:  market definition, market concentration, and competitive effects. click here for more »