Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Drug testing services provider settles FTC invitation-to-collude allegations, (Dec 14, 2015)

By Linda O’Brien, J.D., LL.M.

Drug Testing Compliance (DTC) Group, LLC, an Idaho-based company that provides drug and alcohol testing services to commercial trucking companies and their drivers, has agreed to settle FTC charges that it illegally invited one of its competitors to enter into a customer allocation agreement, the Commission announced today (In re Drug Testing Compliance Group, LLC, FTC File No. 151 0048).

DTC Group markets an array of services to commercial drivers and commercial trucking firms that facilitate compliance with regulations administered by the Department of Transportation and the Federal Motor Carrier Safety Administration, including regulations relating to drug and alcohol testing, safety audits, and driver qualifications. The company primarily utilizes telemarketing and the Internet to market and sell its services. DTC Group competes with several firms throughout the United States offering similar services.

In its complaint, the FTC alleged that in 2014, DTC Group’s president, David Crossett, complained to a competitor that its salespeople had persuaded a DTC Group customer to switch service providers. According to the complaint, Crossett then met with the principals of the competitor and proposed that the companies agree not to solicit or compete for each other’s customers. Specifically, Crossett purportedly proposed that DTC Group and the competitor should both agree not to sell or attempt to sell a service to a customer if the other company has already sold the same service to that customer. Crossett informed the competitor that such an agreement would allow each company to sell its services to customers without fearing that its rival would later undercut it with a lower price offer.

Crossett’s communication to the competitor was an attempt to arrange a customer allocation agreement between the two companies. The invitation, if accepted, would have been a per se violation of the Sherman Act, according to the analysis to aid public comment.

The proposed consent order would prohibit DTC Group from communicating with competitors about rates or prices. The settlement also prohibits the company from soliciting, entering into, or maintaining an agreement with any competitor to divide markets, allocate customers, or fix prices; and from urging any competitor to raise, fix, or maintain prices, or to limit or reduce service.

Companies: Drug Testing Compliance Group, LLC

News: Antitrust FederalTradeCommissionNews