Category Archives: Competition

Philly.Com: Comcast-TWC Back on Capitol Hill for Deal Scrutiny Read

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“Comcast executive vice president David Cohen testified for the company, and his voice grew hoarse over time.

The strongest comments against the deal came from Allen P. Grunes, a former federal antitrust investigator and now a Washington, D.C., attorney. He said the Clayton Antitrust Act of 1914 says a deal would be anti-competitive if it “may substantially lessen competition or tend to create a monopoly.”

A merged Comcast and Time Warner Cable could thwart online video competition because of its large share of the residential broadband market, Grunes said. He also was concerned about Comcast/Time Warner Cable’s economic power in local cable-TV advertising markets and regional sports networks that could be used as leverage against pay-TV competitors.”


Read more at http://www.philly.com/philly/business/20140509_Before_a_House_committee__Comcast_exec_fields_more_questions_on_Time_Warner_merger.html#8mSQgBfTjUyS2Hj3.99

Comcast-TWC Back on Capitol Hill for Deal Scrutiny Read more at http://www.philly.com/philly/business/20140509_Before_a_House_committee__Comcast_exec_fields_more_questions_on_Time_Warner_merger.html#8mSQgBfTjUyS2Hj3.99

Washington Post: Three things expected from Comcast-TWC merger hearing

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The Washington Post

“Three things to expect from Thursday’s Comcast-TWC merger hearing” by Brian Fung

#3:
Revisiting the NBC Universal merger: Allen Grunes, a former Justice Department antitrust lawyer, is expected to say that the conditions that applied to Comcast’s acquisition of NBC Universal — such as a commitment to respect net neutrality and to help promote media diversity — won’t be enough to ensure adequate competition in a Comcast deal. “The most comprehensive study to date has shown that merger-specific regulation, like regulation as a whole, often does not work,” Grunes says in his prepared testimony.

Today 9:30 am: Allen Grunes Testimony Before House Judiciary Committee, Subcommittee on Regulatory Reform, Commercial and Antitrust Law: Oversight Hearing on “Competition in the Video and Broadband Markets: The Proposed Merger of Comcast and Time Warner Cable”

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Allen Grunes to Testify Before House Judiciary Committee, Subcommittee on Regulatory Reform, Commercial and Antitrust Law:  Oversight Hearing on “Competition in the Video and Broadband Markets:  The Proposed Merger of Comcast and Time Warner Cable.”

Hearing date:  May 8, 2014 9:30 am

Link to live hearing: http://judiciary.house.gov/index.cfm/live-video-feed

More information here: http://judiciary.house.gov/index.cfm/hearings?ID=301C520F-5B9E-4E43-B2B5-B131B3B88951

Justice Department Forces eBay to End “No Poach” Hiring Agreements

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Settlement Preserves Competition for High Tech Employees

The Department of Justice announced today that it has reached a settlement with eBay Inc. that prevents the company from entering into or maintaining agreements with other companies restraining employee recruitment and hiring.  The department’s Antitrust Division filed the proposed settlement in the U.S. District Court for the Northern District of California in San Jose.   If approved by the court, the settlement would resolve the department’s competitive concerns and the original lawsuit filed on Nov. 16, 2012.
In its lawsuit, the department alleged that senior executives and directors of eBay and Intuit entered into an agreement, beginning no later than 2006, that prevented each firm from recruiting employees from the other and that prohibited eBay from hiring Intuit employees that approached eBay.

In the high technology sector, employees with advanced or specialized skills are highly valued and sought after.   Companies often heavily recruit and hire experienced and capable employees of other technology firms, offering significantly better job opportunities or pay.   The agreement between eBay and Intuit diminished important competition between the firms to attract highly skilled technical and other employees to the detriment of affected employees who had less access to better job opportunities and higher pay.
“eBay’s agreement with Intuit served no purpose but to limit competition between the two firms for employees, distorting the labor market and causing employees to lose opportunities for better jobs and higher pay,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division.   “The proposed settlement resolves the department’s antitrust concerns and ensures that eBay will not engage in similar conduct in the future.”

Previously, in denying eBay’s motion to dismiss the case, the district court found that the agreement alleged by the department, if proven, would constitute a naked horizontal market allocation agreement that was manifestly anticompetitive and lacking in any redeeming virtue, and thus could be found per se unlawful.

The proposed settlement would prohibit eBay from entering or maintaining anticompetitive agreements relating to employee hiring and retention for five years.   It would broadly prohibit eBay from entering, maintaining or enforcing any agreement that in any way prevents any person from soliciting, cold calling, recruiting, hiring or otherwise competing for employees.  eBay will also implement compliance measures tailored to these practices. Intuit is already subject to a similar consent decree, and for that reason was not a defendant in this case.

Today, the California Attorney General’s Office also filed a settlement in its related case, The People of the State of California v. eBay Inc., based on the same facts alleged in the department’s complaint.

This case and the proposed settlement arose out of a series of Antitrust Division investigations into employee recruitment practices at a number of high tech companies.   In September 2010, the Antitrust Division filed a civil antitrust lawsuit against six high tech firms– Adobe Systems Inc., Apple Inc., Google Inc., Intel Corporation, Intuit Inc. and Pixar–for antitrust violations arising from “no cold call” agreements.   In December 2010, the Antitrust Division filed a civil antitrust lawsuit against Lucasfilm Ltd. alleging antitrust violations involving similar activities restraining competition for employees.   In both cases, settlements were filed at the same time the lawsuits were filed resolving the department’s competitive concerns.   Today’s proposed settlement with eBay is substantially the same as the court-approved settlements in the two prior cases.

eBay Inc. is a Delaware corporation with its principal place of business in San Jose, Calif.

The proposed settlement, along with the department’s competitive impact statement, will be published in The Federal Register, as required by the Antitrust Procedures and Penalties Act.  Any person may submit written comments concerning the proposed settlement within 60 days of its publication to James J. Tierney, Chief, Networks & Technology Enforcement Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street N.W., Suite 7100, Washington D.C. 20530.   At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.

Japanese Automotive Parts Manufacturer Agrees to Plead Guilty to Price Fixing and Bid Rigging on Automobile Parts Installed in U.S. Cars

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Showa Corp., an automotive parts manufacturer based in Saitama, Japan, has agreed to plead guilty and to pay a $19.9 million criminal fine for its role in a conspiracy to fix prices and rig bids for pinion-assist type electric powered steering assemblies installed in cars sold in the United States and elsewhere, the Department of Justice announced today.

According to a one-count felony charge filed today in the U.S. District Court for the Southern District of Ohio in Cincinnati, Showa engaged in a conspiracy to suppress and eliminate competition in the automotive parts industry by agreeing to rig bids for, and to fix, stabilize and maintain the prices of, certain pinion-assist type electric powered steering assemblies sold to Honda Motor Co. Ltd. and certain of its subsidiaries in the United States and elsewhere.  In addition to the criminal fine, Showa has agreed to cooperate with the department’s ongoing investigation.  The plea agreement will be subject to court approval.

“Today’s guilty plea marks the 27th time a company has been held accountable for fixing prices on parts used to manufacture cars in the United States,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division.  “The Antitrust Division and its law enforcement partners remain committed to prosecuting illegal cartels that harm U.S. consumers and businesses.”

According to the charge, Showa and its co-conspirators carried out the conspiracy through meetings, conversations and communications in which they discussed and agreed upon bids and price quotations on pinion-assist type electric powered steering assemblies to be submitted to Honda.  Showa then submitted quotations in accordance with those agreements and sold pinion-assist type electric powered steering assemblies at collusive and noncompetitive prices.  Showa and its co-conspirators monitored adherence to the agreed-upon bid-rigging and price-fixing scheme.  The conspirators kept their conduct secret by using code names and meeting at remote locations, among other things.  Showa’s involvement in the conspiracy lasted from at least as early as 2007 until as late as September 2012.

Showa manufactures and sells pinion-assist type electric powered steering assemblies.  These devices provide power to the steering gear pinion shaft from electric motors to assist the driver to more easily steer the automobile.  Pinion-assist type electric powered steering assemblies include an electronic control unit and link the steering wheel to the tires but do not include the column, intermediate shaft, steering wheel or tires.

Including Showa, 27 companies and 24 executives have pleaded guilty or agreed to plead guilty in the division’s ongoing investigation into price fixing and bid rigging in the auto parts industry and have agreed to pay a total of $2.3 billion in criminal fines.

Showa Corp. is charged with price fixing and bid rigging in violation of the Sherman Act, which carries maximum penalties of a $100 million criminal fine for corporations.  The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Today’s charge is the result of an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by the Antitrust Division’s criminal enforcement sections and the FBI.  Today’s charge was brought by the Antitrust Division’s Chicago Office and the FBI’s Cincinnati Field Office with assistance from the U.S. Attorney’s Office for the Southern District of Ohio.  Anyone with information on price fixing, bid rigging and other anticompetitive conduct related to other products in the automotive parts industry should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258, visit www.justice.gov/atr/contact/newcase.html or call the FBI’s Cincinnati Field Office at 513-421-4310.

Forbes Magazine: DoJ Flexing Muscle On Price Fixers Worldwide

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DoJ Flexing Muscle On Price Fixers Worldwide:

“There are going to be fewer places to hide,” said Robert Connolly…

http://www.forbes.com/sites/mergermarket/2014/04/23/doj-flexing-muscle-on-price-fixers-worldwide/

Bridgestone Corp. Executive Agrees to Plead Guilty for Fixing Prices and Rigging Bids on Auto Parts Installed in U.S. Cars

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A former Bridgestone Corp. executive has agreed to plead guilty and to serve 18 months in a U.S. prison for his role in an international conspiracy to fix prices and rig bids of automotive anti-vibration rubber parts sold in the United States and elsewhere, the Department of Justice announced today.

According to the one-count felony charge filed today in the U.S. District Court for the Northern District of Ohio in Toledo, Yusuke Shimasaki, along with co-conspirators, engaged in a conspiracy to allocate sales of, to rig bids for, and to fix, raise and maintain the prices of automotive anti-vibration rubber parts sold to Toyota Motor Corp., Nissan Motor Co. Ltd., Fuji Heavy Industries Ltd. – more commonly known by its brand name, Subaru – and certain of their subsidiaries, affiliates and suppliers, in the United States and elsewhere.

According to the charge, Shimasaki participated in the anti-vibration rubber conspiracy from at least as early as January 2001 until at least December 2008.  During that time period, he was employed by Bridgestone as a sales manager, an executive vice president at Bridgestone APM Co., in Findlay, Ohio, and as a general sales manager.  According to the plea agreement, in addition to serving time in prison, Shimasaki has also agreed to pay a $20,000 criminal fine and to cooperate in the department’s investigation.  The plea agreement is subject to court approval.

“The charge today once again demonstrates the Antitrust Division’s vigorous commitment to hold individuals accountable for engaging in anticompetitive conduct,” said Brent Snyder, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program.  “The division’s ongoing investigation has resulted in more than two dozen executives serving prison time for their participation in illegal conspiracies involving auto parts.”

Bridgestone manufactures and sells a variety of automotive parts, including anti-vibration rubber parts, which are comprised primarily of rubber and metal, and are installed in suspension systems and engine mounts as well as other parts of an automobile.  They are installed in automobiles for the purpose of reducing road and engine vibration.  On Feb. 13, 2014, the Department of Justice announced that Bridgestone had agreed to plead guilty and to pay a $425 million criminal fine for its role in the conspiracy.  On April 15, 2014, Yasuo Ryuto, Isao Yoshida, two former executives of Bridgestone Corp., and Yoshiyuki Tanaka, a current executive, were indicted  their roles in a conspiracy to fix prices of automotive anti-vibration rubber parts.

To date, 33 individuals have been charged in the government’s ongoing investigation into price fixing and bid rigging in the auto parts industry.  Additionally, 26 companies have pleaded guilty or agreed to plead guilty and have agreed to pay a total of more than $2.29 billion in fines.

Shimasaki is charged with price fixing and bid rigging in violation of the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million criminal fine for individuals.  The maximum fine for an individual may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Today’s charge is the result of an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by each of the Antitrust Division’s criminal enforcement sections and the FBI.  Today’s charge was brought by the Antitrust Division’s Chicago Office and the FBI’s Cleveland Field Office, with the assistance of the FBI headquarters’ International Corruption Unit and the U.S. Attorney’s Office for the Northern District of Ohio.  Anyone with information on price fixing, bid rigging and other anticompetitive conduct related to other products in the automotive parts industry should contact the Antitrust Division’s Citizen Complaint Center at (888) 647–3258, visit  www.justice.gov/atr/contact/newcase.html or call the FBI’s Cleveland Field Office at (216) 522-1400.

GeyerGorey LLP’s Allen Grunes regarding Comcast Merger on Bloomberg TV

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Please click the link below:

GeyerGorey LLP’s Allen Grunes regarding Comcast Merger on Bloomberg TV

GeyerGorey LLP, as Pro Bono Counsel, Represents AAI in Asking District Court to Overturn Airline Merger Settlement (United States v. US Airways Group)

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GeyerGorey LLP, serving as pro bono counsel, represents AAI in Asking District Court to Overturn Airline Merger Settlement (United States v. US Airways Group)

FORMER ALABAMA REAL ESTATE INVESTOR INDICTED FOR CONSPIRACY TO COMMIT MAIL FRAUD

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WASHINGTON — A federal grand jury in Mobile, Ala., returned a one-count indictment  against a former real estate investor, charging him with conspiracy to commit  mail fraud as part of a scheme related to   public real estate foreclosure auctions held in southern Alabama, the  Department of Justice announced today.

The indictment, returned on March 27, 2014, and entered today in the  U.S. District Court for the Southern District of Alabama, charges former real  estate investor Chad E. Foster, of Theodore, Ala., with conspiracy to commit  mail fraud affecting a financial institution.  The department alleged that the scheme defrauded  financial institutions, homeowners and others with a legal interest in selected  foreclosure properties, for the unlawful purpose of obtaining money and  property through fraudulent pretenses, representations or promises.

The indictment charges Foster with conspiring with others to, among other  things, conduct secret, second auctions open only to members of the conspiracy,  to make payoffs to and receive payoffs from co-conspirators and to divert money  away from financial institutions, homeowners and others with a legal interest  in selected properties.  Several  financial institutions suffered actual monetary losses as a result of the  conspiracy.  According to the charge, Foster  participated in the mail fraud conspiracy beginning at least as early as  February 2005 and continuing until at least January 2007.

“Conspiring to defraud financial  institutions and distressed homeowners  is a crime the Antitrust Division takes seriously,” said Bill Baer, Assistant  Attorney General in charge of the Department of Justice’s Antitrust Division.  “The division will vigorously prosecute those who subvert the competitive process for their own gains.”

“The public demands that the  integrity of our nation’s financial institutions and processes be free from  fraud and deceit,” said Stephen E. Richardson, FBI Special Agent in Charge  of the Mobile Field Office.  “These indictments in this investigation  reflect the FBI’s unwavering commitment to protecting the citizen’s reliance on  those processes.”

To date, nine individuals and two companies have pleaded guilty in  connection with the department’s ongoing investigation into bid rigging and  fraudulent schemes in the Alabama real estate foreclosure auction industry.

The charge of conspiracy to commit mail fraud affecting a  financial institution carries a maximum penalty of 30 years in prison, five  years of supervised release, and a $1 million fine.

Today’s charge stems from an ongoing investigation being conducted  by the Antitrust Division’s new Washington Criminal II Section and the FBI’s  Mobile Field Office, with the assistance of the U.S. Attorney’s Office for the  Southern District of Alabama.  Anyone  with information concerning bid rigging or fraud related to public real estate  foreclosure auctions in Alabama should call the Antitrust Division at 404-331-7116, or visit www.justice.gov/atr/contact/newcase.htm.

Today’s charges were brought in connection with the President’s  Financial Fraud Enforcement Task Force.  The  task force was established to wage an aggressive, coordinated and proactive  effort to investigate and prosecute financial crimes.  With more than 20 federal agencies, 94 U.S.  attorneys’ offices and state and local partners, it’s the broadest coalition of  law enforcement, investigatory and regulatory agencies ever assembled to combat  fraud.  Since its formation, the task  force has made great strides in facilitating increased investigation and  prosecution of financial crimes; enhancing coordination and cooperation among  federal, state and local authorities; addressing discrimination in the lending  and financial markets and conducting outreach to the public, victims, financial  institutions and other organizations.  Over  the past three fiscal years, the Justice Department has filed nearly 10,000  financial fraud cases against nearly 15,000 defendants including more than  2,900 mortgage fraud defendants.  For  more information on the task force, please visit www.StopFraud.gov.