Antitrust Law Daily Wrap Up, WORTH NOTING—Other Antitrust and Trade Regulation developments, (Nov 19, 2021)

By WK Editorial Staff

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

ANTITRUST NEWS: The U.S. Chamber of Commerce announced that it has submitted a series of filings and letters to the FTC “to strenuously object to the FTC’s recent egregious practices that pose a grave threat to American busin ...

By WK Editorial Staff

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

ANTITRUST NEWS: The U.S. Chamber of Commerce announced that it has submitted a series of filings and letters to the FTC “to strenuously object to the FTC’s recent egregious practices that pose a grave threat to American businesses and economic growth.” “The FTC is waging a war against American businesses, so the U.S. Chamber is fighting back to protect free enterprise, American competitiveness, and economic growth,” said Suzanne P. Clark, president and CEO of the U.S. Chamber of Commerce.

ANTITRUST NEWS: A federal district court in New York City on November 18, 2021, modified the bail conditions of Akshay Aiyer, a former currency trader convicted of conspiring to fix prices for emerging market currencies in the global foreign currency exchange (FX) market. Aiyer requested, and the government did not oppose, a modification to the conditions of Aiyer’s personal recognizance bond to permit Pretrial Services supervision via web reporting only. Under the terms of his bond, Aiyer had been required to submit to supervision by and report for supervision to the Pretrial Services Office (U.S. v. Aiyer, Case 20-3594).

ANTITRUST NEWS: The European Commission (EC) has fined Conserve Italia Soc. coop. agricola and its subsidiary Conserves France S.A. (together ‘Conserve Italia') a total of € 20 million for breaching EU antitrust rules. The EC found that, for more than 13 years, Conserve Italia participated with other market participants in a cartel for the supply of certain types of canned vegetables to retailers and/or food service companies in the European Economic Area.

ANTITRUST NEWS: The European Commission (EC) announced that it has adopted a Communication on a competition policy fit for new challenges, which frames the important role of competition policy for Europe's path towards recovery, the green and digital transitions, and for a resilient Single Market. The Communication highlights the in-built ability of competition policy to adapt to new market circumstances, policy priorities and customer needs.

ANTITRUST—S.D. Cal.: Having previously found that a sheet wave machine manufacturer adequately pleaded a claim for unlawful monopolization against its competitor Whitewater West Industries, Ltd., which holds a 97% market share, the federal district court in San Diego saw nothing in the defendant’s motion to dismiss that could persuade the court to dismiss the plaintiff Pacific Surf Designs’ antitrust claims. The defendant argued that another decision by the court denying attorney fees in related patent litigation showed that the litigation was not a sham, and thus subject to Noerr-Pennington immunity, but the court disagreed. The plaintiff alleged the defendant brought a series of suits to harm competition. A finding in one of those cases involving attorney fees did not render the complaint defective (Pacific Surf Designs, Inc. v. Whitewater West Industries, Ltd., November 16, 2021, Benitez, R.).

ACQUISITIONS & MERGERS NEWS: The U.K.’s Competition Bureau announced that it has reached an agreement to address competition concerns with the merger of two of Canada’s largest pulp and paper manufacturers - Karta Halten B.V. (Paper Excellence) and Domtar Corp. A Bureau review concluded that the proposed transaction would likely lessen competition substantially for the purchase of wood fiber – a key input in the manufacture of pulp – from the Thompson/Okanagan region of British Columbia. The Bureau determined that the proposed transaction is anti-competitive because it would provide Paper Excellence with monopsony power in a large part of southern British Columbia. This would enable Paper Excellence to pay lower than competitive prices to sawmills and other suppliers of wood fiber in a region of British Columbia where Paper Excellence already has a high concentration of pulp mills. To resolve the Bureau’s concerns, Paper Excellence agreed to sell Domtar’s pulp mill in Kamloops, BC, following its acquisition. The sale will be made to an independent purchaser to be approved by the Commissioner of Competition.

ADVERTISING—S.D.N.Y.: A putative class action complaint sufficiently alleged claims against Apple under New York General Business Law (NY GBL) sections 349 and 350 for failing to disclose a security flaw in its iPhone n iOS software that allowed iMessage correspondence and FaceTime calls to be accessed by third parties. Apple argued that the complaint did not allege Apple was aware of the security flaw at the time the named consumer in the suit purchased his iPhone, however, to the contrary, the complaint alleged two examples of Apple’s awareness. To the extent the claims were based on transactions that took place outside of New York, those claims were dismissed (Tigran Ohanian v. Apple Inc., November 16, 2021, Schofield, D.).

AGENCY NEWS: FTC Chair Lina M. Khan has announced several new additions to the FTC’s Office of Policy Planning. Olivier Sylvain will serve as Senior Advisor on Technology to the Chair, Meredith Whittaker will serve as Senior Advisor on Artificial Intelligence to the Chair, Amba Kak will serve as a Senior Advisor on Artificial Intelligence, and Sarah Myers West will serve as an Advisor on Artificial Intelligence. Sylvain, Whittaker, Kak, and Myers West will be working with the agency’s Chief Technology Officer and technologists as part of an informal AI Strategy Group and in partnership with policy experts across the agency to provide insight and advice on emerging technology issues. John Kwoka will serve as Chief Economist to the Chair and will be working with competition economists and attorneys on an updated approach to merger review policies.

AGENCY NEWS: On November 19, 20221, the House of Representatives passed H.R. 5376, the Build Back Better Act by a vote of 220-213. The bill, which is expected to be signed by President Biden, appropriates $1 billion for the Department of Justice Antitrust Division and FTC Bureau of Competition.

CONSUMER PROTECTION NEWS: The Merchants Payments Coalition called on the FTC to investigate the credit card industry, saying swipe fees charged to process transactions have contributed to increases in gasoline prices. “Card fees are up nearly 20% for gasoline retailers this year,” said Doug Kantor, NACS general counsel and MPC executive committee member . “The card industry is making more right now from gas sales than local gas station owners. That’s not right.”

RICO—4th Cir.: The U.S. Court of Appeals for the Fourth Circuit was called to review proposed class-action claims by Virginia consumers against online lenders affiliated with a federally recognized Native American tribe, certain tribal officials, and two non-members affiliated with the tribal lenders. The consumers, who had defaulted on their short-term loans from the lenders, alleged various violations of state and federal laws. Agreeing with the lower court’s rejection of the defendants’ motion to compel arbitration and that court’s refusal to dismiss most of the consumers’ claims, the Fourth Circuit: (i) determined that the pertinent arbitration provision was unenforceable as a prospective waiver of the borrowers’ federal rights; (ii) rejected the tribal officials’ invocation of “tribal sovereign immunity;” and (iii) concluded that the underlying loan agreements’ “choice of tribal law” provision was unenforceable as a “violation of Virginia’s strong public policy against unregulated lending of usurious loans.” At the same time, upholding the lower court’s ruling, the Fourth Circuit did not allow the consumers’ Racketeer Influenced and Corrupt Organizations Act (RICO) claim against the tribal officials to advance, determining that RICO does not authorize private plaintiffs to sue for injunctive relief (Hengle v. Treppa, Nov. 16, 2021, Rushing, A.).

Attorneys: Matthew W. H. Wessler (Gupta Wessler PLLC) for George Hengle. Rakesh N. Kilaru (Wilkinson Stekloff LLP) for Sherry Treppa. Kevin Hart, Eric Hoffmann, and Philip Andriole, U.S. Department of Justice, for the U.S. Martin B. Klotz (Willkie Farr & Gallagher LLP) for Akshay Aiyer. Christopher J. Rados (Oved & Oved LLP) for Tigran Ohanian. Hannah Yael Shay Chanoine (O'Melveny & Myers LLP) for Apple Inc. Brett D. Jaffe (Alston & Bird, LLP) for T-Mobile USA, Inc. James Robertson Martin (Zelle LLP) and Susan C. Wittemeier (Goodwin & Goodwin, LLP) for Pacific Surf Designs, Inc. Joshua M. Robbins (Buchalter) for Whitewater West Industries, Ltd., Flowrider, Inc. and Aquatic Development Group, Inc.

Companies: Golden Valley Lending, Inc.; Majestic Lake Financial, Inc.; Mountain Summit Financial, Inc.; Silver Cloud Financial, Inc.; Upper Lake Processing Service, Inc.; Karta Halten B.V. (Paper Excellence); Domtar Corp.; Apple Inc.; T-Mobile USA, Inc.; Pacific Surf Designs, Inc.; Whitewater West Industries, Ltd.; Flowrider, Inc.; Aquatic Development Group, Inc.; Conserve Italia Soc. coop. agricola; Conserves France S.A.

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