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© 2005 McDermott Will & Emery LLP. McDermott operates its practice through separate legal entities in each of the countries where it has offices.

Antitrust Update for In-House Counsel ABA Section of Antitrust Law

Presented By:

McDermott Will & Emery

August 2005

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Washington Update

Presented by

Bobby Burchfield

August 2005

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FTC and DOJ Vacancies at DOJ Antitrust Division

– Assistant Attorney General Hew Pate departed June 30– Deputy AAG Thomas Barnett named Acting AAG

• Yale ’85, London School of Economics ’86, Harvard Law ’89• Clerk: 4th Circuit, Hon. Harrison Winter• As Deputy AAG managed civil enforcement division

– Deputy AAG Makan Delrahim departed August 3 • International, policy, and appellate division

William Kovacic Nominated for FTC Commission (term ends 2011)– Commissioner Thomas Leary’s appointment expires Sept. 25– Professor, George Washington Law School

• Princeton ’74, Columbia Law ’78• Clerk: District of MD, Hon. Roszel Thomsen

– General Counsel to FTC from 2001 to 2004

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FTC and DOJ

FTC / DOJ 2006 Budget Appropriations– FTC: $211 MM

• Increased merger activity expected

• Focus on healthcare and energy industries

• Consumer protection: “do not call,” Can-Spam, identity theft

– DOJ: $144 MM • Criminal Cartel Prosecution

• Merger Review

• Single Firm Conduct (Section 2 “Monopolization”)

– HSR fees: $232 MM offsets FTC and DOJ budgets

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Supreme Court Nominee, John G. Roberts Jr.

– 2003 confirmation hearings: • “My practice has not been ideological in any sense. My clients and

their positions are liberal and conservative across the board. . . . . I've argued in favor of antitrust enforcement. At the same time, I've represented defendants charged with antitrust cases. . . . . [W]hat I’ve been able to do in each of those cases is set aside any personal views and discharge the professional obligation of an advocate.”

– Antitrust practice:• Successfully argued before the Supreme Court, on behalf of the

United States (as amicus), that USA Petroleum lacked antitrust standing in a vertical price-fixing case against Atlantic Richfield

• Represented 19 states against Microsoft in the 2001 appeal before the D.C. Circuit, seeking to uphold the states’ monopolization claim

• Represented clients in five other cases, in four different circuit courts of appeal, primarily on behalf of plaintiffs

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Supreme Court Cases Accepted for October 2005 Term

– Illinois Tools Works v. Independent Ink: Whether (in a tying case) market power is presumed based solely on the existence of a patent of the tying product?

• United States amicus brief argues no economic basis for presuming economic power arises from a patent – relevant markets aren’t necessarily limited to the scope of a given patent

– Texaco / Shell v. Dagher: Whether it is illegal per se under Section 1 of the Sherman Act for a lawful, economically integrated joint venture to set the prices at which the joint venture sells its products?

• United States amicus brief argues that per se treatment is inappropriate for evaluating agreements between owners of a joint venture concerning the joint venture’s prices

• MWE drafting amicus brief on behalf of US Chamber of Commerce

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Antitrust Modernization Commission Subject to Federal Advisory Commission Act Hearings to Date

– June 27: Indirect Purchaser Rule– July 28: Robinson-Patman Act, Civil Remedies

Public Comment Period Open– Over 100 comments received from various organizations– Comments on Criminal Remedies accepted up to Sept. 30– Although comment period nominally closed, comments still accepted on other topics

Hearings Scheduled (subject to change)– September 29: Immunities and Exemptions, Exclusionary Conduct– October 26 or 27: State Enforcement Institutions, Regulated Industries– November 3: Federal Enforcement Institutions, Government Civil Remedies, Criminal

Remedies– November 8: Merger Enforcement– November 17: New Economy

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Antitrust Modernization Commission

Timetable for Recommendations

– July 2005 to January 2006: Research and information gathering period, public comment period

– March to May 2006: Commence deliberations and drafting of report with findings and recommendations

– July 2006: Complete draft report of findings and recommendations

– September 2006 to February 2007: Finalize report, with all edits, dissenting statements, etc.

– April 2, 2007: Submit final report to Congress and President

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Cartels/Horizontal RestraintsUpdate

Presented byDavid Marx

August 2005

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Criminal Developments

Two more former executives of Bayer AG, the head of Bayer’s Rubber Business Group and the head of marketing for that group, both German citizens, were indicted for conspiring to fix prices of rubber chemicals sold in the U.S. and elsewhere.

–U.S. v. Jurgen Ick, 3:05-cr-00520-PJH (N.D. Cal.)–U.S. v. Gunter Monn, 3:05-cr-00519-PJH (N.D. Cal.)

This brings the total number of individuals indicted in connection with the rubber chemicals investigation to six (four have pleaded guilty), along with Bayer AG and Crompton Corporation, which pleaded guilty and paid a total of $116 million in fines.

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Horizontal Restraints

FTC Enforcement– In the Matter of Partners Health Network, Inc., File No. 041-0100—Another in the growing line

of FTC enforcement actions against health care provider networks that purport to operate as a “messenger model” but, instead, allegedly orchestrate horizontal price-fixing agreements among competing providers, in this case the network’s physician members. The allegations in the FTC’s Complaint are remarkably similar to those in the 20+ cases filed (and with only a couple of exceptions, settled) since April 2002, to wit:

• The network, which includes a majority of the physicians in Pickens County, South Carolina, was formed to increase members’ negotiating leverage concerning payment terms with payors.

• Physician members agreed to be bound by payor contracts negotiated by the network on their behalf, unless they opted out.

• The network polled its physicians to establish a “floor” fee schedule that the network used to negotiate fees that the payor would offer for the network members’ consideration.

• The network’s board of directors had to approve any fee offer from a payor before it was presented to the physician members for review.

• The network sought to include an “exclusivity” provision in its payor contracts which limited a payor’s ability to separately negotiate with physicians who opted out of a contract proposal.

• Through its negotiations with payors, the network was able to force payors to raise fees paid to the network’s physicians.

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In the Matter of Partners Health Network, Inc., continued– The proposed settlement agreement contains the usual and customary

terms prohibiting the network from entering into or facilitating any agreement between or among any physicians: to negotiate with payors on any physician’s behalf; to deal, or not, with payors; on their terms of dealing with any payor; or not to deal indivividually, or only to deal collectively, with any payor.

– The proposed settlement does not prohibit the network from engaging in conduct that is reasonably necessary to form or operate a legitimate collaborative arrangement through which competing network providers participate in a “qualified risk-sharing joint arrangement’ or a “qualified clinically-integrated joint arrangement.”

– In short—”go forth and sin no more.”

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State Enforcement– N.Y. Attorney General Eliot Spitzer alleged that two competing BMW automobile

dealerships, Holtz House of Vehicles, Inc., located in Rochester, and Towne BMW, located in Buffalo, had engaged in conduct intended to facilitate price-fixing and customer allocation. Specifically, the Attorney General found that the two BMW dealerships had directly communicated with each other about their retail selling prices and sought to divide customers by geographic area. Both dealerships agreed to settle the investigation by paying $5,000 to the state to cover the cost of the investigation and implementing antitrust compliance programs.

– This case is another example of the continuing aggressive antitrust enforcement by certain (though not all) state attorneys general.

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Private Enforcement– North Jackson Pharmacy, Inc. v. Caremark RX, Inc., No. 04 C 5674 (N.D. Ill., Aug.

12, 2005)• In a Sherman Act Section 1 case, the district court held that the rule of reason, not the per

se rule of illegality, is the proper legal standard to be applied to an independent pharmacy’s claim that the defendant pharmacy benefits manager (PBM) was a “common agent” used by competing third-party payors of prescription drug costs to fix the prices paid to independent pharmacies for dispensing prescription drugs to the payors’ subscribers.

• The case arose in the context of a FRCP Rule 16(c) motion for an order “establishing the rule of reason as the standard of analysis applicable” to one of the plaintiff pharmacy’s claims.

• The plaintiff claimed that the alleged conspiracy between the payors and their use of the PBM (Caremark) as a common agent to effect the payors’ alleged price-fixing agreement constituted a per se unlawful horizontal price-fixing agreement.

• Caremark first argued that the alleged agreement was not horizontal, but vertical (and, therefore, subject to the rule of reason), a contention that the court rejected based upon its reading of the complaint allegations.

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– North Jackson Pharmacy, Inc. v. Caremark RX, Inc., continued• Alternatively, the PBM argued that if the conspiracy alleged in the complaint is construed to

be a horizontal agreement, the payors’ use of the PBM as a common agent was “ancillary” to a legitimate cooperative enterprise that has the potential to increase productive efficiency and, therefore, should be evaluated under the rule of reason. The court accepted this characterization of the arrangement.

• The court described the arrangement between the PBM and the payors as follows—”By negotiating prescription drug reimbursement rates on behalf of the 1,200 [payors] it represents, Caremark acts on behalf of what is essentially a cooperative purchasing group.” The court went on to state that “a cooperative purchasing agreement among competing buyers does not necessarily stifle competition” and to describe the doctrine of “ancillary restraints” as well-suited to evaluate the competitive pros and cons of group purchasing arrangements.

• Under the ancillary restraints doctrine, courts are charged with distinguishing between “naked” restraints which generally lack any redeeming value (and are treated as per se ulnawful) and “ancillary restraints” which are part of a larger endeavor whose success they promote (and, therefore, should be evaluated under the more thorough analysis afforded by the rule of reason).

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– North Jackson Pharmacy, Inc. v. Caremark RX, Inc., continued• After tracing the judicial treatment of ancillary restraints through Broadcast Music, Kartell v.

Blue Shield of Mass., Inc., Northwest Wholesale Stationers, and Addamax Corp. v. Open Software Found., Inc., the court found that the arrangement between the payors and the PBM “clearly has efficiency-enhancing potential.” Because the allegedly anticompetitive price-fixing agreement between the payors is ancillary to the cooperative purchasing arrangement between the payors and the PBM, the court held that it should be evaluated under the rule of reason, not the per se rules.

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Distribution Practices & Vertical Restraints Update

Presented byLawrence I. Fox

August 2005

www.mwe.comAugust 22, 2005

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Overview

Federal Developments in Distribution

State Developments in Distribution

E-Commerce Developments


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Federal Developments in Distribution

DOJ & FTC File Amicus Brief in Supreme Court Patent Tying Case

District Court Dismisses Sherman Act §2 Price Squeeze Case

District Court Dismisses Robinson-Patman Act §2(a) Conspiracy Claim


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DEPARTMENT OF JUSTICE AND FEDERAL TRADE COMMISSION FILE JOINT BRIEF TO THE SUPREME COURT Illinois Tool Works Inc., et al., v. Independent Ink, Inc. No. 04-1329 (U.S. Sup. Court) (08/05/05)

DOJ and FTC File Amicus Brief in Supreme Court Patent Tying Case

On August 5, the U.S. Department of Justice together with the Federal Trade Commission (“the Government”) filed a joint amicus brief in the matter of Illinois Tool Works Inc., et al., v. Independent Ink, Inc., No. 04-1329 (U.S. Sup. Court).

The Government urges the reversal of a Federal Circuit Court decision, which held that there is an exception for patented products from the requirement that an antitrust plaintiff challenging a tying arrangement under Section 1 of the Sherman Act prove that the defendant has market power in the tying product market.


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The Government’s Position:

The Government has issued guidelines specifically addressing the question presented in this case and rejecting as a matter of antitrust enforcement policy the presumption that patents confer market power. See Antitrust Guidelines for the Licensing of Intellectual Property, 4 Trade Reg. Rep. (CCH) ¶ 13,132 (1995).

The Government’s brief cites the 1995 Antitrust-IP Licensing Guidelines, Section 5.3, noting that tying arrangements may result in anticompetitive effects; however, such arrangements can also result in “significant efficiencies and pro-competitive benefits.”


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Underlying Key Facts:

Illinois Tool Works (“ITW”) manufactured ink jet print heads used by OEM manufacturers to print barcodes on product cartons. ITW’s license to OEMs required them to use only ink supplied by ITW.

Independent Ink, Inc. (“Independent”) was a distributor and supplier of printer ink and ink products. Independent sued ITW claiming that ITW engaged in unlawful tying in violation of Section 1 of the Sherman Act asserting only a per se theory of liability and also that ITW monopolized, attempted to monopolize, and conspired to monopolize the market for ink used in ITW’s print head system in violation of Section 2 of the Sherman Act.


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Lower Court Decisions:

The District Court granted ITW’s summary judgment on both the Section 1 and Section 2 claims.

The Court of Appeals for the Federal Circuit reversed the District Court’s grant of summary judgment on the Section 1 claim, stating that the prior Supreme Court decisions in the United States v. Loews Inc, 371 U.S. 38 (1962) and International Salt Co. v. United States, 332 U.S. 392 (1947) “make clear that the necessary market power to establish a Section 1 violation is presumed” where patent and copyright tying are involved therefore concluding that “there is a presumption of market power in patent tying cases.”


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Implications for In-house Counsel:

Supreme Court likely to rule no exception for patented products from the requirement that a plaintiff challenging a tying arrangement under Section 1 must prove that defendant has market power in the tying product market.

Plaintiffs likely will have a higher burden when bringing tying claims involving patented products. Defendants likely will have more flexibility in bundling patented products.


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COURT DISMISSES SECTION 2 CLAIM FOR LEVERAGING PATENTED DRUG IN PHARMA SECTOR Schor v. Abbott Laboratories, N.D. Ill., No. 05 C 1592

District Court Dismisses Sherman Act §2 Price Squeeze Case

In Schor v. Abbott Laboratories, N.D. Ill., No. 05 C 1592, Abbott Laboratories, Inc. persuaded the U.S. District Court for the Northern Distinct of Illinois to dismiss a Sherman Act Section 2 monopoly leveraging claim that accused Abbott of drastically boosting the price of is patented AIDS drug Norvir® in order to restrain competition from AIDS drugs containing Norvir.

The Plaintiff, an AIDS patient, alleged that Abbott’s pricing is anticompetitive and is designed to eliminate competition to Kaletra®, Abbott’s AIDS drug containing Norvir.


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According to the Complaint, Abbott originally marketed Norvir as a stand-alone protease inhibitor (“PI”). Norvir allegedly is not interchangeable with any other drug. Norvir causes severe side effects when used alone, but, when taken in conjunction with other PIs, it boosts the effectiveness of the other drugs. These “boosted PIs” remain effective for longer periods. Abbott sells its own boosted PI, Kaletra.

The Complaint alleged that Kaletra began to lose market share in 2003. In December 2003, Abbott raised the price of Norvir by > 400 percent, but did not incorporate this price increase into Kaletra, which, as a result, costs substantially less than the other boosted PIs.


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The Court’s Ruling:

The Court ruled that Abbott’s patents for Norvir, which cover use both as a stand-alone drug and as a booster when combined with other PIs, preclude antitrust liability.

Judge Gettleman wrote that “if the product is encompassed within the patent claims, the Sherman Act does not limit the patent holder’s refusal to license or sell that item, or limit the patent holder’s right to charge a higher price, in any market.”

Accordingly, he held that a “defendant may not be held liable for a violation of Section 2 of the Sherman Act for increasing the price of its patented product, even though that price increase may affect competition in a second market.”


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Patent holders can refuse to license, sell, or sell at lower prices their patented products without Section 2 liability, even if adverse competitive effects may result in another market.

In this instance, the district court is following the trend of other courts interpreting the Supreme Court’s decision in Trinko, which ruled that firms do not have to assist competitors as long as adequate competition exists in the market as a whole.


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COURT DISMISSES ROBINSON-PATMAN CLAIM ALLEGING CONSPIRACY TO DISCRIMINATEDrug Mart Pharm. Corp., et al. v. Am. Home Prods. Corp., et al., E.D. N.Y., No. 93-CV-5148 (ILG)

District Court Dismisses Robinson-Patman §2(a) Act Conspiracy Claim

In Drug Mart Pharmacy v. American Home Products, No. 93-CV-5148, the Court ruled that the Robinson-Patman Act does not include a cause of action for conspiracy to commit price discrimination and dismissed plaintiffs’ Section 2(a) claim.


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The Complaint alleged that defendant pharmaceutical manufacturers conspired to give discounts on brand name prescription drugs to HMOs and mail order pharmacies, but not to plaintiff independent pharmacies.

Plaintiffs already settled in principle with defendants on Sherman Act conspiracy claims.


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The Court relied on the Supreme Court’s ruling in FTC v. Henry Broch & Co., 363 U.S. 166 (1960) that stated the Robinson-Patman Act “is aimed at price discrimination, not conspiracy.”

Judge Glasser noted that the Robinson-Patman Act does not refer to “conspiracy” within its text, and allowing plaintiffs to proceed could result in double recovery due to the settlement of Sherman Act claims arising out of the same conduct.


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State Developments in Distribution

California Court of Appeal Rules In Favor of Supplier in Dual-Distribution Case

California Court of Appeal Rules Against Franchisor’s Compelled Arbitration

NY Supreme Court Dismisses Beer Distributor’s Antitrust Claim Against Competing Distributor


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INDEPENDENT EQUIPMENT SELLERS CAN NOT SUE VERIZON WIRELESS FOR UNFAIR COMPETITION People’s Choice Wireless, Inc. v. Verizon Wireless, Cal. Ct. App., 2d Dist., No. B 175179

California Court Rules In Favor of Supplier in Dual-Distribution Case

The California Court of Appeal, Second District, determined that independent dealers of cell phones cannot sue Verizon Wireless under the state’s unfair competition laws for:

– (1) imposing a holdback period on popular, new cellular telephone models; and

– (2) for discontinuing a commission structure that enabled the independents to match discounts offered by Verizon’s wholly-owned retail stores.


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The plaintiffs argued that the holdback period prevents price competition and, thus, violates Section 17200 et seq. Also, because Verizon did not change its commission structure for independent dealers, plaintiffs can not subsidize the cost of cell phones to consumers who have fulfilled less than one year of their service contract and are at a disadvantage in competing for these sales.

Plaintiffs alleged that Verizon’s commission structure reduced intrabrand competition, discriminated against the independent dealers, and amounted to unfair competition.


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With regard to the holdback, the Court said “Because we are dealing with a limited time restriction on some cellular telephones of one of many brands in a vibrant, volatile market with many consumer options, we take special heed of the warning in [Trinko] that we should be cautious about creating exceptions” to the right to refuse to deal recognized in U.S. v. Colgate & Co., 250 U.S. 300 (1919).

With regard to the discontinued commissions, the Court stated that plaintiffs’ complaint would prevent Verizon from discounting in situations where the plaintiffs cannot discount. The Court went on to declare that it was “aware of no case or statute, state or federal, which contains a policy that would force a company to either let its competitors have all of a particular category of sales, or force it to prop up its competitors financially.”


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Suppliers in California will have more flexibility on when they release new products and how they discount them to independent dealers vs. wholly-owned dealers.

In the dual-distribution context, independent dealers in California will face higher hurdles in bringing refusal to deal claims or allegations that suppliers’ policies impair intrabrand competition between the supplier owned dealership and its independent dealers.

This case and the Abbott case discussed earlier are part of an increasing trend by state and federal courts to favor supplier control of distribution over independent dealers, where dual-distribution exists, and evaluate such sales practices as vertical rather than horizontal restraints.


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DISPUTE RESOLUTION CLAUSE IN CONTRACT TO SET UP FRANCHISE WAS UNCONSCIONABLE Vlahos v. International Baking Co., Inc., Cal. Ct. App., 1st Dist., No. A102335

California Court of Appeal Rules Against Franchisor’s Compelled Arbitration

In an unpublished opinion, the California Court of Appeal rejected a motion by Sara Lee Fresh (“SLF”) to compel arbitration of a suit filed by terminated franchisees.

The Court ruled that the dispute resolution provision in the franchise agreement is both procedurally and substantively unconscionable in that SLF is seeking to enforce “a contract of adhesion that limits its own ability and significantly limits the franchisee’s ability to pursue valid claims and remedies.” The Complaint accused SFL of undertaking “a thinly disguised campaign to force them to lose or sell their distributorships.”


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DISPUTE RESOLUTION CLAUSE IN CONTRACT TO SET UP FRANCHISE WAS UNCONSCIONABLE Vlahos v. International Baking Co., Inc. Cal. Ct. App., 1st Dist., No. A102335

Underlying Key Facts and the Court’s Ruling:

In response to franchisees’ complaints of wrongful acts, SLF moved to compel arbitration pursuant to Article Nine of the franchise agreement and the California Franchise Relations Act (CFRA), Bus. & Prof. Code, Section 20040.

The Court refused to enforce all of Article Nine, stating that a contract of adhesion had been imposed on plaintiffs, and:

– (1) that it contained substantively unconscionable provisions setting short time limits for involving mediation (10 days) and arbitration (20 days);

– (2) created an irrefutable presumption in favor of SLF’s discretionary business judgment concerning the best interest of the network; and

– (3) barred punitive and exemplary damages.


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DISPUTE RESOLUTION CLAUSE IN CONTRACT TO SET UP FRANCHISE WAS UNCONSCIONABLE Vlahos v. International Baking Co., Inc. Cal. Ct. App., 1st Dist., No. A102335


Tactically wise for franchisors to have certain provisions (e.g., territory, types or timing of reports) routinely negotiated with franchisees to show negotiations have actually occurred to avoid the appearance of an adhesion contract.


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BEER DISTRIBUTOR FAILED TO ALLEGE DETAILS OF CONSPIRACY AND IMPACT ON MARKETBoening Bros., Inc., and Oak Beverages, Inc., v. Manhattan Beer Distrib., Inc., N.Y. Sup. Ct., No. 29830-04, Aug. 8, 2005

NY Supreme Court Dismisses Beer Distributor’s Antitrust Claim Against Competing Distributor

Plaintiff beer distributor sued defendant competing beer distributor after defendant secured rights to beer brands and brand extensions plaintiff claimed it was entitled to distribute.

Plaintiff brought claims based upon tortious interference with contract, tortious interference with prospective economic advantage, injurious falsehood, unfair competition, unjust enrichment, and violations of NY’s antitrust law, the Donnelly Act.


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The Court’s Ruling:The Court dismissed plaintiff’s Donnelly Act claim for failing to allege the terms of the conspiracy and the identity of the conspirators.

The Court also dismissed plaintiff’s Donnelly Act claim because plaintiff had failed to allege any impact on the relevant market, beer sold in a 14 county area in New York.

Implications for In-house Counsel: State courts are becoming more suspicious of plaintiffs’ antitrust claims in routine dealer termination cases.

BEER DISTRIBUTOR FAILED TO ALLEGE DETAILS OF CONSPIRACY AND IMPACT ON MARKETBoening Bros., Inc., and Oak Beverages, Inc., v. Manhattan Beer Distrib., Inc., N.Y. Sup. Ct., No. 29830-04, Aug. 8, 2005


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E-commerce Developments

In ABA Speech, FTC Chairman Says Data Security Critically Important

NY Enacts Law Requiring Notices of Consumer Data Security Breaches

FTC Attacks Bundling of Software without Adequate Disclosure

FTC Attacks “Free” Credit Report Offers

FTC Announces Survey Results of Compliance with CAN-SPAM Act

ISPs Affirmatively Using CAN-SPAM Act


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“REFLECTIONS ON MY YEAR,” 2005 ABA ANNUAL MEETING, CHICAGO, ILLINOIS, AUGUST 6, 2005: DEBORAH PLATT MAJORAS, CHAIRMAN, FEDERAL TRADE COMMISSION

In ABA Speech, FTC Chairman Says Data Security Critically Important

Perhaps no consumer protection issue has absorbed more time and resources this year than data security. Recent news reports about the release of consumers’ sensitive information from large commercial information services, retailers, and major banks, demonstrate that, if this data is not adequately secured, it can fall into criminals’ hands and cause serious harm to consumers. Currently, 10 million Americans are victims of identity theft each year.

The Commission has opined that Congress should consider two new proposals: – (1), whether companies that maintain sensitive consumer information should be

required to implement reasonable security procedures; and – (2) whether to require firms to notify consumers if sensitive information about them

has been breached in a way that creates a significant risk of identity theft.


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“REFLECTIONS ON MY YEAR,” 2005 ABA ANNUAL MEETING, CHICAGO, ILLINOIS, AUGUST 6, 2005: DEBORAH PLATT MAJORAS, CHAIRMAN, FEDERAL TRADE COMMISSION

Implications for In-house Counsel: Breaches becoming larger and more frequent. See e.g., DSW Shoes (1.4 million credit card accounts exposed); CardSystems (40 million credit card accounts exposed).1

This likely will be an area of priority for FTC enforcement and legislative activity at the state and federal levels.

Plaintiffs’ bar beginning to file class actions based upon negligence and failure to notify consumers.2

Companies should develop and implement safeguards for protecting consumer data, regardless of express promises to consumers to do so or not.

____________________1http://money.cnn.com/2005/04/20/technology/security_dsw_idbreach/index.htm;

http://money.cnn.com/2005/06/17/news/master_card/2 http://news.com.com/Credit+card+suit+now+seeks+damages/2100-7350_3-5777818.html


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NEW YORK JOINS 18 OTHER STATES WITH CONSUMER DATA SECURITY BREACH NOTIFICATION LAWS,A. 4254-A, signed Aug. 10, 2005

NY Enacts Law Requiring Notices of Consumer Data Security Breaches

The Information Security Breach and Notification Act Requires businesses and government agencies to notify consumers of breaches involving private information (e.g., name, SSN, driver’s license number, financial account numbers).

Grants Attorney General power to seek injunctive relief and penalties.

Gov. Pataki signed the Act on Aug. 10; will go into effect 120 days later – Dec. 8, 2005.

Implications for In-House Counsel: Companies should develop and implement safeguards for protecting data as well as methods to notify customers of a breach of security.

Additional state legislation on consumer data security is likely, while federal legislation to enact a national standard is possible.


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SOFTWARE SELLER SETTLES FTC CHARGES OF FAILING TO DISCLOSE BUNDLED ADWARE Advertising.com, Inc., FTC, File No. 042 3196, 08/03/05

FTC Attacks Bundling of Software without Adequate Disclosure

Underlying Key Facts: The FTC accused Advertising.com, Inc., (“Advertising.com”) of deceptively advertising free security software by failing to disclose that the software was bundled with adware. See In the matter of Advertising.com, Inc., FTC, File No. 042 3196. The FTC claimed that the failure to disclose this constituted a deceptive practice in violation of FTC Act §5.

Advertising.com has proposed to settle by promising to disclose clearly and prominently in future promotions any adware that is bundled with software advertised to enhance security or privacy.

Implications for In-house Counsel: Providers of goods or services should explicitly disclose any and all bundled offerings when making any sales to consumers, especially when the bundled item affects the consumer’s privacy or imposes any economic burdens.


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MARKETER OF “FREE CREDIT REPORTS” SETTLES FTC CHARGES,File No. 022 3263, Civil Action No. CV - SACV05-801 AHS (ML,Gx) (Aug. 17, 2005)

FTC Attacks “Free” Credit Report Offers The FTC alleged Consumerinfo.com, Inc., a subsidiary of Experian,

– deceptively advertised and promoted its “free reports” without disclosing it was not associated with the official free credit report program, and

– failed to disclose adequately that customers who failed to cancel a credit monitoring service were automatically billed $79.95 annually.

Consumerinfo.com settled the FTC’s charges by:– Paying redress and disgorging $950,000;– Agreeing to stop future deceptive and misleading claims; and– Agreeing to disclose terms and conditions of any future “free” offers.

Implications for In-house Counsel: Providers of goods or services should prominently and conspicuously disclose any fees, especially negative option or recurring fees that are billed unless the consumer opts out.


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FTC SURVEY FINDS MOST E-TAILERS COMPLY WITH CAN-SPAM OPT-OUT PROVISIONS

FTC Announces Survey Results of Compliance with CAN-SPAM Act

According to the FTC test for compliance announced on August 1, most of the top Internet retailers surveyed are honoring consumers’ requests to opt-out of receiving promotional or marketing messages. Eighty-nine percent honored all three of the opt-out requests made by the FTC staff and ninety-three percent complied with opt-out requests for at least some accounts.


FTC likely to continue periodic monitoring of e-commerce retailers’ compliance with CAN-SPAM Act.


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AOL GIVES SUBSCRIBERS BOUNTY SEIZED FROM SPAMMERS America Online Inv. v. Hawke, No. 1:04cv00259 (08/10/05)

ISPs Affirmatively Using CAN-SPAM Act Underlying Key Facts:

– A provision in the CAN-SPAM Act of 2003 permits ISPs to sue spammers for violations of the act. See CAN-SPAM Act of 2003, Pub. L. No. 108-187,. Section 7(g) (2003).

– In May, the U.S. District Court for the Eastern District of Virginia awarded America Online (“AOL”) $12.8 million in damages for violations of the CAN-SPAM Act committed by 3 individual defendants. AOL invoked a provision in the CAN-SPAM Act to seize the property of the spammers.

– On August 10th, AOL announced that it will sponsor a sweepstakes event to give back to its subscribers property it recovered in a successful CAN-SPAM Act lawsuit brought against a gang of spammers.

Implications for In-house Counsel:– ISPs can assert CAN-SPAM Act claims against spammers, and courts are likely to

favor strong enforcement.

www.mwe.com



Sherman Act § 2 Update

Presented byChristine White

August 2005

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Sherman Act § 2

Schor v. Abbott Labs, N.D. Ill., No. 05 C 1592, 7/12/05. The plaintiff alleged that the defendant leveraged its monopoly power in the market for its patented AIDS protease inhibitor (“PI”) anti-retroviral drug, Novir, into the market for “boosted PIs” which are used with Novir, by raising Novir’s price 400%. The district court dismissed the monopoly leveraging claim after finding that there was no allegation that the defendant’s conduct was beyond the scope of its patents, which covered the stand-alone market as well as the market for drugs containing Novir.

– The court held that “[a] defendant may not be held liable for a violation of Section 2 . . . for increasing the price of its patented product, even though that price increase may impact price in a second market.”

– The issue was one of first impression in the Seventh Circuit, but there is a division of authority elsewhere.

• Two class actions are proceeding in California against Abbott based on the Ninth Circuit case law under Kodak II, which limits a patentee’s right to exclude others, including by raising prices to exclude others.

• This case is in accord with the Federal Circuit’s decision in In re Indep. Service Organizations Antitrust Lit. CSU, L.L.C. v. Xerox, 203 F.3d 1322 (200) cert. denied, 531 U.S. 1143 (2001) (Xerox).

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Sherman Act § 2

Medical Supply Chain, Inc. v. General Elec. Co., 10th. Cir., Nos. 04-3075, 04-3102 7/26/05. The plaintiff alleged monopolization and a broad conspiracy to restrain competition in the hospital supply e-commerce market in North America. The Tenth Circuit affirmed the dismissal of the Sherman Act allegations, after finding that none of the defendants competed in the defined market.

– The district court held that GE could not be violating § 2 because it did not hold monopoly power and there was no allegation that it was attempting to gain monopoly power in the defined market.

– The court of appeals affirmed, and directed the district court to sanction the plaintiff for naming one of the defendants in his individual capacity because no allegation was made of a personal connection between that defendant and the plaintiff’s alleged injury.

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Sherman Act § 2

People’s Choice Wireless Inc. v. Verizon Wireless, Cal. Ct. App., 2 Dist, No. B 175179, 7/28/05. Plaintiffs, a group of independent Verizon Wireless dealers, asserted that the defendant violated state unfair competition laws by imposing a holdback period on popular, new cell phone models and by discontinuing a commission structure that enabled the independents to match discounts offered by Verizon’s wholly-owned retail stores. The court of appeals upheld Verizon’s demurrer without leave to amend.

– The court held that a “mere refusal to deal does not violate the spirit or policy of antitrust law, absent an abuse of monopoly power or some other exception to the sacrosanct right to refuse to deal.”

– The court distinguished Kodak– i.e., where the relevant market was defined by the Kodak brand because customers were locked in by their initial purchases and could not readily turn to a substitute.

– The court noted that the plaintiffs’ complaint was about “a diminution in intrabrand competition.”

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Sherman Act § 2

Borough of Lansdale v. PP&L Corp., E.D. Pa., No. 02-8012, 7/29/05. The district court awarded sanctions after the conduct of the plaintiffs’ counsel in the multi-million dollar antitrust case had triggered multiple discovery disputes and required several renewed depositions.

www.mwe.com



Consumer Protection Update

Presented byChristine White

August 2005

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Consumer Protection/Policy Announcements

A new FTC rule, effective Aug. 1, requires “Pre-Approved Offers” of credit or insurance to include “opt-out” notices explaining consumers’ right to opt out of receiving future solicitations and to provide the toll-free number to call to exercise that right (888-5-OPTOUT).

The FTC announced on Aug. 1 the results of a test for compliance that determined that most of the top e-tailers surveyed are honoring consumers’ requests to opt out of receiving promotional or marketing messages.

The FCC is considering 7 petitions challenging state telemarketing regulations that are more stringent than commission rules implementing the federal Telephone Consumer Protection Act.

– Industry groups want to stop states from blocking calls to telephone numbers on the national “Do Not Call” Registry when the company has an “established business relationship” with the consumer. Such calls are allowed by the FCC but are prohibited by several states.

– Several senators, consumers, advocacy groups, and state attorneys general are opposing the petitions.

– The FCC has not said when it will act on the petitions seeking state preemption.

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Consumer Protection/Deceptive Practices FTC v. Xtel Marketing, N.D. Ill., No. 04-C-07238, 8/2/05. The FTC’s Nov. 2004 complaint alleged that the defendants had deceived consumers into revealing their bank account information and had debited hundreds of dollars from their accounts. The proposed settlement bans defendants from telemarketing activities and prohibits them from making deceptive claims in advertising, promoting or selling any good or service.

– The proposed settlement bars defendants from fraudulently obtaining or attempting to obtain consumers’ financial institution account information and precludes the use or sale of confidential consumer account information fraudulently obtained by them.

– In addition to customary record keeping and reporting obligations, the proposed decree includes a $623,000 suspended judgment that would become due if the court determines in the future that the defendants have misrepresented their financial situation in connection with the settlement.

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Deceptive Practices/SPAM & Unwanted Telecommunications In re Advertising.com, Inc., FTC File No. 042 3196, 8/3/05. Advertising.com was accused of deceptively advertising free security software and failing to disclose that the software was bundled with adware, which results in the receipt of pop-up ads. The complaint charged that the failure to disclose the presence of the adware constituted a deceptive practice because this information would be material to consumers deciding whether to install the software.

– The proposed settlement requires the defendants to clearly and conspicuously disclose whether consumers will receive ads in connection with any representation about the performance, efficacy of features of any security or privacy software programs.

– In the analysis to aid public comment, the FTC noted that the limitation in the proposed order to the respondents’ security and privacy software programs “should not be read . . . to suggest that the requirement for clear and prominent disclosure is necessarily limited to those situations.”

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Deceptive Practices/SPAM & Unwanted Telecommunications Microsoft and Scott Richter and his company, OptInRealBig.com, reportedly have settled their lawsuit. Microsoft alleged that Richter and his company had violated the CAN-SPAM and Washington state anti-spam law. Richter allegedly has sent billions of unsolicited emails to consumers and has been ranked by the Spamhause Project as one of the “top spammers” in the world.

In addition to paying Microsoft $7 million, Richter and his company have agreed to comply fully with all federal and state anti-spam laws and to send email only to individuals who have confirmed their willingness to receive them.

Richter and his company have denied Microsoft’s charges.

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Deceptive Practices/SPAM & Unwanted Telecommunications White Buffalo Ventures LLC v. University of Texas at Austin, 5th Cir., No. 04-50362, 8/02/05. The plaintiff obtained a TRO from a state court preventing the defendant from blocking the plaintiff’s unsolicited email “blasts.” The defendant removed the case to federal court (asserting federal question jurisdiction), and moved for summary judgment on the question of whether the defendant, acting as an internet service provider (ISP), qualifies for the ISP exception to the state preemption under the Controlling the Assault of Non-Solicited Pornography and Marketing Act. The Fifth Circuit granted summary judgment in the defendants favor.

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Deceptive Practices/SPAM & Unwanted Telecommunications US Fax Law Center, Inc. v. iHire, Inc., Colo. No. 04-CV-00344-LTB-CBS, 6/22/05. The plaintiff alleged that defendants sent 143 unsolicited fax advertisements to 28 third parties, who assigned their rights in the faxes to the plaintiff. The plaintiff filed suit as an assignee, seeking to recover statutory damages and legal fees under the Colorado Consumer Protection Act. The CCPA claim was dismissed because the plaintiff lacks standing as an assignee and is not the real party in interest.

– The district court held that the CCPA claim is not assignable because it is penal in nature. Under Colorado law, the right to recover a penalty is not assignable, absent express statutory language to the contrary, “because the assignability of such claims encourages litigation.”

– In addition, the plaintiff does not fall into one of the specified classes of persons who is entitled to sue under CCPA.

www.mwe.com



Mergers and Acquisitions Update

Presented by

Joel Grosberg

August 2005

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Merger Update DOJ

– Sprint/Nextel investigation closed without any divestitures• Created third largest competitor behind Cingular and Verizon

in most local markets• FCC imposed minor conduct restrictions

– Waste Industries, U.S./Allied Waste Industries• Complaint alleged transaction reduced competitors from 4 to

3 in the collection of small container commercial waste in Norfolk, VA area

• Consent decree required divestiture of hauling assets and modification of customer contracts

– -Buyer up front not required

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Merger Update

FTC– “REFLECTIONS ON MY YEAR,” 2005 ABA ANNUAL

MEETING, CHICAGO, ILLINOIS, AUGUST 6, 2005: DEBORAH PLATT MAJORAS, CHAIRMAN, FEDERAL TRADE COMMISSION

• Reform of the merger review process is difficult unless merging companies improve cooperation with regulators

• Average cost of complying with a Second Request is $5 million

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Merger Update FTC/DOJ Fiscal 2004 HSR Report to Congress

– HSR filings increased by 43% as compared to 2003– Number of Second Requests (35) remained the same as

2003– Percentage of transactions resulting in second requests

declined from 3.6% in fiscal year 2003 to 2.5% in fiscal year 2004

– FTC challenged 15 transactions (10 consent orders, one administrative complaint, one litigated case, and three abandoned transactions)

– DOJ challenged 9 transactions (1 litigated case, five consent decrees, two abandoned transactions, one transaction that was restructured)

www.mwe.com



International Update

Presented by

Clive Stanbrook

August 2005

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Overview

Recent noteworthy merger clearances:

– Starwood/Meridien; Mærsk/Nedlloyd; Lockheed/Boeing JV

Modernisation of Article 82 (dominance) Public procurement and transparency Cartels: Brasserie Nationale judgment Sector Inquiries

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Mergers: Starwood/Lehman/SCG/Meridien

Commission cleared in first phase the acquisition by Starwood and SCG/Lehman of joint control over 23 LeMeridien hotels.

2 interesting and novel legal issues:– Attribution of control on the basis of management contracts even

in the absence of equity holding

– Related transactions (acquisition of IP rights by Starwood – acquisition of sole control by SCG/Lehman on other LeMeridien hotels) were deemed to be different concentrations and were thus notified in EU Member States

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Mergers: Mærsk/Nedlloyd Commission has cleared acquisition by Danish AP Møller-

Mærsk of Dutch Royal P&O Nedlloyd, the first and fourth largest shipping companies worldwide – DOJ has not opposed the merger

Main overlaps in the container shipping business Undertakings by Mærsk:

– Divestiture of Nedlloyd’s cargo shipping business between South Africa and Europe

– Nedlloyd withdraws from a number of liner conferences and consortia that currently enjoy an exemption from EU competition rules, which Commission is expected to abolish soon anyway

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Mergers: Lockheed/Boeing JV

Commission cleared in first phase and unconditionally the creation of United Launch Alliance (ULA), a JV between Lockheed Martin and Boeing

ULA will exclusively serve the market for US government space launch services

The Commission found that the creation of the JV will not affect the EEA market as: – ULA will not have a direct impact on EEA customers, and

– There will be no risk of coordination between Lockheed Martin and Boeing on the commercial market

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Modernisation of Article 82 (dominance)

Report by DG Comp’s economic advisory group on 'An economic approach to Article 82'

Arguments in favour of an economic approach:– Focus on consumers welfare rather than protecting competitors

– Focusing on the effects of practices makes circumvention of competition rules more difficult

– More consistent enforcement when based on practices’ effect

– Promotion of efficiencies and innovation, avoiding that statutory provisions unduly thwart pro-competitive initiatives

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Modernisation of Article 82 (dominance)

In the light of the expected modernisation of Article 82, the report reflects some of the thoughts that currently circulate within DG Comp – in particular with the team of the Chief Economist, who commissioned the report.

Although it cannot be expected that the Commission would adopt such radical policy reforms as suggested in the report, the latter provides ammunition to those in favour of an economic and effect-based approach

The Commission has announced it would hold a consultation on the modernisation of Article 82 and publish draft guidelines before the end of 2005.

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Public Procurement and Transparency

C-231/03, Consorzio Aziende Metano v Comune di Cingia A company located in a EU Member State must have

access to information regarding a concession contract in another Member State before it is awarded in order to give it the opportunity to express its interest in the contract

Even if EU’s public procurement directives do not apply – this is because the principles of the Right to establishment and the Freedom to provide services prohibit indirect discrimination of citizens established in another EU Member State

The Court stated that this requires a transparent process, without necessarily holding a call for tenders

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Cartels: Brasserie Nationale judgment

In 2001, European Commission fined three Luxembourg breweries a total EUR 480,000 for participating in a market-sharing cartel in 1985-2000 – geogr market is Luxembourg

The breweries had signed a convention (i) to respect each other’s exclusivity arrangements with hotels, restaurants and cafés and (ii) to help promoting each other, should an outlet consider dealing with foreign brewers

Court of First Instance has now rejected the appeals from the three companies, Brasserie Nationale, Brasserie Jules Simon and Brasserie Battin, cases T-49/02, T-50/02 and T-51/02

Two additional breweries had been part of the cartel, but were acquired by Interbrew who then blew the whistle

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Sector Inquiries - Financial services

Business Insurance: Commission is sending out questionnaires to insurance associations. Deadline for replies is 16 September.

Retail banking: Commission is sending out questionnaires to payment card networks. Deadline for replies is 15 September.

www.mwe.com 76

McDermott Will & Emery

Firm overview Antitrust overview Speaker biographies

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Firm Overview

McDermott Will & Emery is a leading international law firm with a diversified business practice.

We represent a wide range of commercial, industrial and financial enterprises and our clients include some of the world’s largest corporations.

Currently numbering over 1000 lawyers, we have offices in Boston, Brussels, Chicago, Düsseldorf, London, Los Angeles, Miami, Milan, Munich, New York, Orange County, Rome, San Diego, Silicon Valley and Washington, D.C.

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Antitrust and Competition Law Practice

McDermott Will & Emery’s Antitrust & Competition Practice Group has broad experience in all aspects of antitrust and competition law.

The Group has a sophisticated practice in U.S. antitrust law (Federal and State), EC competition law and the competition laws of other countries throughout the world.

More than 60 firm lawyers focus their practices on antitrust and competition law; in addition to Washington, DC and Brussels, the Group has lawyers with significant antitrust and competition experience in our Boston, Brussels, Chicago, Düsseldorf, London, Los Angeles, Milan, Munich, Orange County, Rome and New York offices.

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Joseph F. Winterscheid Joseph F. Winterscheid is a partner in the law firm of McDermott Will & Emery LLP based in the Washington, D.C. office. Joe is a member of the Firm’s Antitrust and Competition Practice Group, where his practice focuses on U.S. and international antitrust law, with particular emphasis on EU competition law. From 1989 to 1994, Joe was in Brussels, where his practice focused on representing clients in competition matters before the European Commission and EU Member State competition authorities.

Joe regularly advises clients on competition issues in mergers, acquisitions and joint ventures, including U.S. and international premerger notification requirements. His experience also includes counseling on matters related to pricing and distribution practices, intellectual property licensing arrangements and e-commerce initiatives. Joe’s sectoral experience has encompassed a wide range of industries, including air transport, automotive products, chemical, consumer goods, defense, health care, industrial products, pharmaceuticals, specialty metals and fabricated metal products.

Joe regularly speaks before state and national bar associations and other groups on antitrust matters. His publications include: “E.C. Merger Rules Remain Snarled” (The National Law Journal, September 1993); “Two Part Harmony: New Rules for Vertical Agreements Under EU Competition Policy” (Antitrust, Summer 2000); “Foreign Competition in U.S. Merger Analysis,” 65 Antitrust Law Journal 241 (1996); and “Antitrust Issues in Transaction Planning” (Business Laws, Inc. 1996). He also has presented testimony to the Federal Trade Commission (FTC), the Department of Justice’s International Competition Policy Advisory Committee and Organization for Economic Cooperation and Development on matters relating to international antitrust merger enforcement.

Joseph F. Winterscheid Partner, WashingtonT: 202.756.8061F: [email protected]

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Bobby R. BurchfieldBobby R. Burchfield is a partner in the law firm of McDermott Will & Emery LLP based in the Firm’s Washington, D.C. office. A member of the Trial Department, Bobby heads the department’s Complex Litigation Practice. He is also co-partner-in-charge of the Firm’s Washington, D.C. office.

Bobby has practiced in the area of complex corporate litigation since 1981. Bobby has been named by the Legal Times as one of the top trial lawyers in the D.C. area (Legal Times, June 16, 2003), is listed in Best Lawyers in America, and is highly rated by both Chambers Global (2004 ed.) and Chambers USA (2005 ed.). By appointment of President George W. Bush, he serves on the Antitrust Modernization Commission.

Bobby has been lead securities defense counsel for such companies as ENSERCH Corporation; in major antitrust litigation for such clients as United Airlines, E.I. duPont de Nemours, and the American Automobile Association; RICO defense for such clients as Tenet Healthcare Corporation f/k/a National Medical Enterprises; and corporate takeover defense for Total-Tel USA Communications, Inc. On behalf of the Republican National Committee and other political parties he argued before the United States Supreme Court in their constitutional challenge to the McCain-Feingold campaign finance law, McConnell v. Federal Election Commission, 124 S. Ct. 619 (2003).

He is admitted to practice in the District of Columbia.

Bobby R. Burchfield Partner, Washington, DCT: 202.756.8003F: [email protected]

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David Marx, Jr. David Marx, Jr. is a partner in the law firm of McDermott Will & Emery LLP based in the Firm’s Chicago office, where he serves as head of the Firm's Chicago Antitrust & Competition Practice Group. His practice focuses on civil and criminal antitrust litigation and counseling, distribution issues and trade regulation matters. He also counsels corporate and health care industry clients, and individuals who are the subjects or targets of investigations or enforcement proceedings initiated by federal or state antitrust agencies, as well as parties in private civil litigation.

Additionally, David develops, implements and monitors antitrust and trade regulation compliance programs for a variety of corporate clients.

David is listed in 2004-2005 Chambers & Partners USA's "America's Leading Business Lawyers".

David is admitted to practice in llinois and New York.

David Marx, Jr. Partner, ChicagoT: 312.984.7668F: [email protected]

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Lawrence I. FoxLawrence I. Fox is the co-chair of McDermott Will & Emery's Distribution Practices and Strategies Group and is also the chairperson of the Antitrust and Competition Practice Group of the Firm’s New York office. He represents clients in handling investigations, litigations and trials commenced by private plaintiffs as well as federal and state antitrust authorities. Larry’s litigation and counseling practice focuses primarily in the areas of antitrust, trade regulation, franchising, distribution, e-commerce and intellectual property. His distribution practice includes advising clients regarding their domestic and international activities and has been involved in a wide array of industries relating to such products as automobiles, alcoholic and non-alcoholic beverages, books and magazines, as well as medical devices and consumer products, including food, electronics and photographic equipment. Larry also served as the chairman of the Antitrust Law Section of the New York State Bar Association, and is currently on the executive committee of the Section.

Larry is admitted to practice in New York, Pennsylvania and the District of Columbia.

Lawrence I. Fox Partner, New YorkT: 212.547.5403F: [email protected]

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Christine L. WhiteChristine L. White is a partner in the law firm of McDermott Will & Emery LLP based in the New York office. She is a member of the Firm’s Antitrust and Competition Practice Group.Christine concentrates her practice in antitrust counseling, antitrust civil litigation and trade regulation matters. She provides counseling on a range of antitrust issues, including mergers, joint ventures and other collaborations among competitors, as well as counseling in matters related to pricing and distribution issues. Christine has represented clients in matters before the Federal Trade Commission (FTC), the Department of Justice, state attorneys general and federal and state courts. Her clients include corporate, trade association, and health care industry clients, including local and national health care systems, multi-institutional systems, hospital districts, third party payors, provider network organizations, physician groups and long-term care facilities.

Prior to joining the Firm, Christine was a staff member at the FTC and spent six months as an antitrust advisor to the Russian Federation. She received the FTC’s award for Outstanding Young Lawyer in 1996. Christine also spent a year working on health care issues for U.S. Representative Paul E. Kanjorski.

Christine is admitted to practice in New York.

Christine L. White Partner, New YorkT: 212.547.5545F: [email protected]

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Joel R. GrosbergJoel R. Grosberg is a partner in the law firm of McDermott Will & Emery LLP based in the Washington, D.C. office. He is a member of the Antitrust and Competition Practice Group, where he focuses his practice on defending mergers and acquisitions before the Federal Trade Commission, Department of Justice, European Commission and various international competition authorities. Joel has significant experience in the high tech, chemical, and life sciences industries. His antitrust practice also includes antitrust counseling, civil litigation and criminal defense.

Joel has defended substantive merger investigations or other investigations involving a wide variety of industries, including: computer software; biotech, semiconductors, telecommunications, chemicals, pharmaceuticals, x-ray detection equipment, health care, explosives, aerospace, metals, service industries, alcoholic beverages, refractories and aggregates. In addition, Joel has counseled clients on matters relating to mergers and acquisitions, joint ventures, Sherman Act, distribution issues, intellectual property issues and Hart-Scott-Rodino Act compliance.

Joel also has spoken before various audiences and provided training on antitrust compliance. He is the author of "Disgorgement and Mergers: Has the FTC Gone Too Far" in the Winter 2002 issue of the Clayton Act Newsletter, which discusses recent FTC rulings in favor of disgorgement as a remedy in merger/acquisition cases.

He admitted to practice in New York and the District of Columbia.

Joel R. Grosberg Partner, Washington, DCT: 202.756.8207F: [email protected]

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Clive StanbrookClive Stanbrook is a partner in the international law firm of McDermott Will & Emery/Stanbrook LLP. He works form our offices in Brussels and Washington DC. He is head of the Firm’s EU Regulatory practice and a member of the European Competition and Trade groups. He is acknowledged as a leading / recommended expert in various directories, including Chambers & Partners’ “The World’s Leading Lawyers for Business”, for his work in EU anti-trust, international trade, litigation and arbitration. He focuses in advocacy, particularly in politically sensitive cases.

Clive has extensive experience in EU merger control proceedings and in managing multi-jurisdictional notifications. He was the lead counsel in the MCI/BT, MCI WorldCom, KPMG/Ernst&Young and Ernst & Young/Cap Gemini filings. He was outside Counsel for EU anti-trust matters to MCI for seven years and has advised clients on competition compliance and strategy. He has organised competition compliance programmes and even designed and conducted a simulated dawn raid as part of a compliance exercise.

In cartel cases he has a very successful track record before the Commission and the European Court of Justice. He has acted as lead counsel and advocate on numerous cartel cases, including the Paper Pulp case and cases in the gas distribution, LDPE, chemical and vitamins sectors. He has also brought a number of successful complaint proceedings in the oil and gas sector, the software and telecommunications sector. In these cases he brings to bear his early credentials as a successful criminal barrister together with his long experience in anti-trust matters. He was lead counsel in one of the largest ICC Arbitrations relating to a competition issue in the gas distribution industry. Over the years Clive has advised on competition issues many industries, including retailing, pulp and paper, textiles, engineering, chemicals, cement and the services sectors.

Clive Stanbrook Partner, Brussels T: 32.2.282.3544F: [email protected]

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