“The FTC with a cavalier attitude is weighing in on areas that are outside its authority and deciding issues on subjective means…. I can’t support a massive increase for the Commission’s budget, especially given the FTC’s recent track record and given the nation’s current fiscal outlook.” Steve Womack (R-AR)
When a Chairman opens
Last week, the Federal Trade Commission revealed what it meant when it vowed to be more than an antitrust and consumer protection agency. It announced a proposal to regulate virtually every labor and service relationship in the United States and make it more lucrative for people to quit.
The new rule is predicted to boost wages and salaries for millions of Americans at every income level, with CEOs getting some of the largest raises. According to the FTC’s analysis, the rule is likely to reduce on-the-job training, shorten job tenure, and generate more resignations. It might also spur litigation if employees spill trade secrets in their new posts.
In measures both simple and sweeping, the rule would ban certain terms of service and regulate others. Categorically banned would be non-compete clauses (or NCCs) in agreements between companies and workers or contractors. Any agreement that prevents a person from quitting a job and working for a competitor or starting a competing business would be illegal, no matter how important it might be to protect trade secrets and competitive strategies of the employer.
Potentially prohibited would be non-disclosure, non-solicitation, and non-recruitment agreements. These would be deemed functional NCCs if they effectively preclude someone from quitting a job and joining a competitor. Agreements requiring workers to pay employers for training would also be deemed functional NCCs if the payments not reasonably related to the cost of the training prevent workers from quitting.
Continue Reading FTC Proposes to Regulate Virtually Every Labor Relationship in the United States
On January 14, so called Pharma Bro Martin Shkreli was found personally liable for antitrust claims brought by the FTC and 7 State AGs. His company Vyera raised the price of medication Daraprim by 4000% after it purchased the drug. The parasitic brain infection the drug treats is especially deadly and according to doctors could only be treated with Daraprim. Shkreli then worked to prevent manufacturers from successfully competing in the generic drug market.
Although Shkreli’s prison sentence began in 2017, the court said he continued to exert his influence over the company, which in December agreed to pay $40 million for its part. The former CEO is now banned from the pharmaceutical industry for life. While a lifetime ban may seem like an extreme remedy, be mindful that State AGs don’t reserve this punishment for those in prison, and have imposed industry bans in other actions and industries. Shkreli has also been ordered to pay disgorgement to the states in $64.6 million. As part of his criminal judgment, he had already lost several assets including his prized Wu-Tang Clan album, a source inspiration for General James’ words of condemnation in her victory press release. Another executive Kevin Mulleady also settled, paying $10 million.
State AGs have been extremely active in the pharmaceutical antitrust space in recent years, including when it comes to generic drug pricing. Specifically, State AGs have alleged that generic drug manufacturers of topical products conspired to inflate prices and reduce competition. Most of the State AGs have been investigating the practice since 2016, with defendants now numbering in the dozens in their 3rd Amended Complaint. The states are caught up in an MDL, but their bellwether trial on dermatology treatments will be the first up.
Continue Reading Once Upon a Time in Federal Court
Commissioners Cut Procedures, Rescind Policy, Empower Staff, Target Tech
With an unprecedented attack on policies the Federal Trade Commission had long embraced, the new majority of Democratic Commissioners revealed a bold enforcement agenda that would circumvent Supreme Court decisions and avoid Congressional limits.
It was a meeting like none the Federal Trade Commission has ever held. On one week’s notice, the Commission adopted new rules to impose civil penalties on substandard Made-in-USA claims, removed judges and safeguards from rulemaking proceedings, rescinded its 2015 enforcement policy statement on unfair methods of competition, and granted staff more authority to issue subpoenas and civil investigative demands. The vote on every issue followed party lines. Republican Commissioners, Noah Phillips and Christine Wilson, voted against all, and the Democratic Commissioners, Chopra, Khan, and Slaughter, rejected all amendments. Chair Khan announced that public meetings will become regular events at the FTC.
Continue Reading Chopra, Khan, Slaughter Take Control of the Federal Trade Commission
The Decision
1-800-Contacts is one of the largest sellers of contacts online. One of the principal ways consumers shop for contacts is through key word searches. In the past, certain 1-800-Contacts competitors purchased the keyword “1-800-Contacts.” That would place their advertisements at the top of the list of results. 1-800-Contacts sued these companies for trademark
Displaying bipartisanship seldom seen on Capitol Hill, the Antitrust Subcommittee of the House Judiciary Committee held a hearing yesterday on Reviving Competition in which Democrats and Republicans appeared to agree on crucial issues.[1] Subcommittee Chairman David Cicilline and Ranking Member Ken Buck echoed one another on the need for reforms, while many members of
Partner Aaron Burstein edited the Fall 2020 issue of Antitrust magazine with Janis Kestenbaum. If you’re looking to get up to speed on some of the most pressing regulatory issues surrounding personal data, this is the place to start — and the ABA is making free to access through the end of January.
Product and Earnings Claims in the Time of COVID-19
On Wednesday, July 8, we will be holding a webinar for anyone who is currently making or plans to make product claims or earnings claims, anyone new to claims or in need of a refresher.
The FTC has recently sent warning letters to hundreds of companies
Bill MacLeod and other panelists representing antitrust and consumer protection bureaus from across the country discussed recent enforcement activities and the ongoing missions of state enforcement agencies during the American Bar Association’s Antitrust Section Virtual Spring Meeting.
Watch the replay here.
Yesterday, Christine Wilson was sworn in as FTC Commissioner. Commissioner Wilson – the fifth and final Trump appointee – joins the FTC from Delta Airlines and assumes former Commissioner Maureen Ohlhausen’s seat. Commissioner Ohlhausen announced her departure on Tuesday – the day her term ended, concluding over six years of service as Commissioner, including a
