Antitrust Law Daily Wrap Up, WORTH NOTING—Other Antitrust and Trade Regulation developments, (Aug 25, 2023)

By WK Editorial Staff

A periodic roundup of other items of interest to the Antitrust and Trade Regulation community.

ANTITRUST NEWS: Two military contractors were sentenced for their roles in a bid-rigging scheme involving the maintenance and repair of military tactical vehicles in Texas, the Justice Department announced. The contractors rigged bids on certain government contracts from May 2013 to January 2018 to give the false impression of competition and secure government payments. The conspirators submitted coordinated, higher-priced and non-competitive bids to ensure a designated company won each contract. Stephens and his co-conspirators rigged six different contracts for work performed for the Red River Army Depot in Texarkana, Texas. The projects included heavy military equipment work like refurbishing armor kits for military trucks and turrets for Humvees. Aaron Stephens, of Queen City, Texas, was sentenced to 18 months in prison and ordered to pay a criminal fine of $50,000. John “Mark” Leveritt, of Heath, Texas, was sentenced to six months in prison and ordered to pay a criminal fine of $300,000.

ACQUISITIONS & MERGERS NEWS: The U.K. Competition and Markets Authority has cleared global technology company Broadcom’s $69 billion purchase of software company VMware. The agency initially identified competition concerns warranting in-depth review and referred the deal to a Phase 2 inquiry. An independent panel explored concerns that the deal could harm the ability of Broadcom’s rivals to compete if the merged company were to make their products work less well (or not at all) with VMware’s server virtualization software. However, it has found that the potential financial benefit to Broadcom and VMware of making rival products work less well with VMware’s software would not outweigh the potential financial cost in terms of lost business. The panel also considered whether the deal could harm innovation. The panel looked at whether Broadcom’s rivals need to share commercially sensitive information with VMware to ensure their hardware and VMware’s software work together in computer servers, and whether there could be concerns about Broadcom potentially having access to such information following the deal. However, the panel found that this is unlikely to be a concern, in particular since information about new product adaptations only needs to be shared with VMware at a stage when it is too late to be of commercial benefit to Broadcom.

AGENCY NEWS: The FTC announced that Chair Lina Khan has appointed Henry Liu as director of the Bureau of Competition. Most recently, he was a partner in Covington & Burling LLP’s litigation and antitrust practices. The Commission approved the appointment by a 3-0 vote.

CONSUMER PROTECTION NEWS: Fairplay and the Center for Digital Democracy (CDD), the organizations that alerted the FTC to Google’s violations of the Children’s Online Privacy Protection Act (COPPA) are urging the Commission to investigate whether Google and YouTube are once again violating COPPA, as well as the companies’ 2019 settlement agreement and the FTC Act. In a Request for Investigation, Fairplay and the CDD detail new research from Adalytics, as well as Fairplay’s own research, indicating Google serves personalized ads on “made for kids” YouTube videos and tracks viewers of those videos, even though neither is permissible under COPPA.

CONSUMER PROTECTION NEWS: California-based Experian Customer Services, also known as ConsumerInfo.com, Inc., has agreed to a permanent injunction barring it from sending commercial e-mails that do not provide opt-out information and to pay a $650,000 civil penalty to settle a lawsuit filed by the Department of Justice and the FTC alleging violations of the Controlling the Assault of Non-Solicited Pornography and Marketing (CAN-SPAM) Act of 2003, the agencies announced. The U.S. District Court for the Central District of California entered the stipulated order approving the settlement agreement in a suit alleging that Experian spammed consumers with e-mails marketing other Experience services after they created accounts to allow them to freeze and unfreeze access to their Experian credit reports.

CONSUMER PROTECTION NEWS: The FTC has denied Complaint Counsel’s Motion to Partially Lift the Stay of Administrative Proceedings to Permit Dispositive Motion in the agency’s administrative action alleging that FleetCor Technologies, Inc. and its CEO, Ronald Clarke (together, the Respondents), made deceptive claims regarding consumer savings, fraud controls, and fees in connection with FleetCor’s fuel cards. On August 9, 2022, the U.S. District Court for the Northern District of Georgia granted summary judgment in favor of the FTC on all counts. And, in June 2023, the court entered a permanent injunction against Respondents and closed the case. The FTC determined that, in this unique circumstance, in which Complaint Counsel seek a Commission decision based entirely on the preclusive effect of a district court decision that has been appealed and Respondents are already subject to a permanent injunction addressing the challenged conduct, there was good cause to maintain the stay while the district court’s decision is reviewed on appeal (FTC v. FleetCor Technologies, Inc., FTC Docket No. 9043).

UNFAIR PRACTICES—N.D. Cal.: A Perishable Agricultural Commodities Act (PACA) claim was not dismissed on the ground that “a majority of the produce at issue” did not itself travel in interstate commerce. PACA’s interstate commerce requirement had been interpreted to cover circumstances “where the commodities involved are the type typically sold in interstate commerce.” Moreover, the plaintiff was in the business of moving produce across state lines (General Produce Distribution Co., LLC v. Geiger's Long Valley Market, LLC, August 21, 2023, Chhabria, V.).

Attorneys: Justin Thomas Campagne (Campagne & Campagne, A PC) for General Produce Distribution Co., LLC. Michael M. Shklovsky (Anderson Zeigler, a Professional Corp.) for Geiger's Long Valley Market, LLC and Geiger's Hopland Market, LLC.; FleetCor Technologies, Inc.

Companies: Broadcom; VMWare; Fairplay; Center for Digital Democracy; Google; Experian Customer Services; ConsumerInfo.com, Inc.; General Produce Distribution Co., LLC.; Geiger's Long Valley Market, LLC.; Geiger's Hopland Market, LLC

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