Antitrust Law Daily Wrap Up, TOP STORY: FTC, Antitrust Division fully operational, for now, (Oct 17, 2013)

By Jeffrey May, J.D.

It was back to work today for employees of the FTC and Department of Justice Antitrust Division who were furloughed during the partial government shutdown over the last 16 days.

The first government shutdown in 17 years was ended last night when federal lawmakers reached a compromise to fund the government for 90 days and to increase in the debt limit to avoid a default. The “Continuing Appropriations Act, 2014” (H.R. 2775), which provides fiscal year 2014 appropriations for the federal government through January 15, 2014, and extends the nation’s debt limit through February 7, 2014, was signed into law today.

Certain “excepted employees” had continued to work during the lapse of appropriations. Notably, merger trials proceeded involving both federal antitrust agencies. The Antitrust Division’s trial in its case against Bazaarvoice, Inc. over its 2012 acquisition of competitor PowerReviews, Inc. moved forward in the federal district court in San Francisco. The FTC, along with the State of Idaho and complaining hospitals, continued a challenge to St. Luke’s Health System, Ltd.’s acquisition of Saltzer Medical Group—the largest physician practice in the state. The FTC motion to stay that action was denied by the federal district court in Boise, Idaho. The agencies also had limited staff on hand to accept Hart-Scott-Rodino premerger filings.

In addition, pursuant to a contingency plan announced prior to the shutdown, excepted employees at the Antitrust Division continued to support ongoing criminal trials and proceedings. During the shutdown, new bid rigging charges were filed against Japanese seat belt manufacturer Takata Corporation and California real estate investor Kuo Hsuan “Chuck” Chang. Approximately 40 percent of the Antitrust Division staff was excepted from the furlough.

In a letter to Justice Department employees, U.S. Attorney General Eric Holder said today that he was grateful to have the nearly 115,000 employees back at work. “My top priority now is to ensure that each of you is able to fully resume your work as quickly as possible,” Holder noted.

At the FTC, the commissioners, as Presidential appointees, were exempt from furlough. Under the FTC’s shutdown plan, the agency expected to retain “as many as 248 employees necessary to protect life and property through the prosecution of enforcement actions” during the lapse in appropriations. The FTC estimates that it has 1,178 employees currently.

Prior to the shutdown, the FTC issued stays in administrative proceedings. Those matters are expected to resume in five business days.

FTC lawyers continued to appear in federal court in some consumer protection matters during the shutdown. For instance, the FTC continued to pursue its case against infomercial pitchman Kevin Trudeau in the federal district court in Chicago this week.

The FTC’s website was operational once again today. During the shutdown, users were frustrated to find that they were unable to use the site. Visitors to the FTC website were redirected to a page with the following statement: “Unfortunately, the FTC is closed due to the government shutdown.”

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