Criminal No-Poach Update: DOJ Seeks to Contain Fallout from Judgment of Acquittal

Magnet is trying to snatch a key irreplaceable employee from the team. Violation of the integrity of the team. Loss of morale. Intervention in the internal affairs. Find spy intruder. Luring

The Department of Justice (DOJ) continues to pursue no-poach agreements as criminal conduct despite yet another recent defeat, this time in United States v. Patel. In Patel, the DOJ alleged that employees of an aerospace company and outsourcing competitors conspired to restrict the hiring and recruiting of aerospace engineers and other employees in violation of the Sherman Act’s criminal provisions. On April 28, the U.S. District Court for the District of Connecticut granted the defendants’ motion for judgment of acquittal, finding insufficient evidence of market allocation for a reasonable jury to find beyond a reasonable doubt a per se violation of Section 1 of the Sherman Act. In particular, the court explained, the government failed to prove in its case in chief that there was a labor market allocation “to any meaningful extent” because the alleged agreement allowed frequent hiring, even calling it “commonplace.”

Continue Reading

Report from the 2023 ABA Antitrust Section Annual Conference – UK, EU, and Canadian developments

Full Complement of Executives at Management Meeting

The recent annual ABA Antitrust Spring Meeting in Washington, D.C., once again brought together enforcers and counsel from around the world to discuss the hottest topics in global antitrust enforcement.  We provide some of the key updates from enforcers and practitioners in the UK, Canada, and the EU. 

Continue Reading

Are Hospital Acquisitions with COPA Authorization Exempt from HSR Pre-Merger Notification?

The Federal Trade Commission (FTC or the Commission) has experienced multiple recent setbacks with respect to its regulatory authority. Now a new dispute raises questions about whether hospital acquisitions with Certificate of Public Advantage (“COPA”) authorization are exempt from Hart-Scott-Rodino Act pre-merger notification.

Recent FTC Setbacks

In AMG Capital Management v. FTC, the U.S. Supreme Court held that the FTC lacks authority to obtain monetary redress relief for consumers in federal court. As a consequence, to obtain such relief in consumer protection matters, the FTC would have to adjudicate the conduct in an FTC administrative proceeding.

Ironically, in Axon Enterprise Inc. v. FTC, the Court even more recently ruled that respondents need not wait until the FTC completes its administrative action to appeal. The typical process under the FTC Act allows respondents to appeal an adverse decision of an administrative law judge to the Commission. The Commission, acting as an adjudicative body, would then render a decision. If the respondent receives an adverse decision from the Commission, it can appeal that decision to a federal court of appeals of general jurisdiction. But the Supreme Court has now concluded that a respondent can bring a constitutional challenge in federal district court to the FTC’s administrative proceedings (and in a related case, the Security and Exchange Commission’s administrative proceedings).

Justice Clarence Thomas, in a concurring opinion in Axon, professed his “grave doubts” about the constitutional foundation for FTC-type administrative litigation. Illumina picked up this cudgel after the Commission ordered it to divest Grail, seeking an expedited review of Illumina’s appeal of the Commission decision. The Fifth Circuit Court of Appeals granted the expedited review.

A Challenge to HSR Pre-Merger Notification for Hospitals

The next chapter in this saga is the main subject of this note. Louisiana Children’s Medical Center v. Attorney General of the United States et al. involves a petition for a declaratory judgment that Louisiana Children’s Medical Center (LCMC) is not required to file pre-merger notification pursuant to the Hart-Scott-Rodino (“HSR”) Act. LCMC is a Louisiana nonprofit network of health care providers that operates nine hospitals and several other locations in Louisiana and Mississippi. LCMC acquired Tulane University Medical Center, Lakeview Regional Medical Center and Tulane Lakeside Hospital (the Acquisition) from HCA Healthcare, Inc. (HCA), consummating the acquisition without filing HSR premerger notifications. If the parties to an acquisition meet specified criteria, they must file such a notification, provide the required information and documents, and pay a filing fee. They also cannot consummate the transaction if the FTC (or the Antitrust Division of the Department of Justice) issues a “second request,” typically within 30 days of the notification. If the FTC issues such a request, it typically takes many months before the parties can close the transaction, assuming that the FTC does not challenge the acquisition at the end of this second waiting period.

LCMC consummated the acquisition on January 1, 2023. On March 3, the FTC’s Premerger Office asked LCMC why it had not filed the HSR notification. LCMC’s response, discussed below, did not convince the Premerger Office that the parties did not have a filing obligation. The penalty for not filing could be up to $50,120 per day for most of the period after the consummation. Filing now might not stop the penalty from mounting, given the position of the FTC that consummation is a violation of the parties’ HSR obligations.

In response to the Premerger Office’s position, LCMC sought a declaratory judgment that it has no filing obligation because, before closing, the State of Louisiana Attorney General issued a COPA authorizing the acquisition. A COPA authorizes regulatory oversight of a merged entity to replace the competition that may have been lost due to the consolidation of separate pre-merger entities. If done properly, a COPA would provide the merging parties with state action immunity from Section 7 of the Clayton Act. Section 7 bars mergers that may “substantially lessen competition.” The state action doctrine resulted from the Supreme Court’s 1943 Parker v. Brown decision, in which the Court concluded that there is “nothing in the language of the Sherman Act or in its history which suggests that its purpose was to restrain a state or its officers or agents from activities directed by its legislature.” Thirty-seven years later, the Supreme Court in California Retail Liquor Dealers Association v. Midcal Aluminumclarified that even conduct by private parties is immune from antitrust liability so long as the challenged conduct is pursuant to “clearly articulated and affirmatively expressed … state policy” and is “actively supervised” by the state. The FTC is unhappy with states using COPAs rather than competition to protect patients from higher prices or lower quality services, as we set out in another blog entry. But unhappiness alone does not undermine state action immunity. On the other hand, the state must cross its t’s and dot its i’s for the parties to obtain such immunity. See, e.g., FTC v. Phoebe Putney Health System, Inc.

One question raised by LCMC’s complaint is whether the FTC should have the opportunity to decide whether the state regulatory scheme is sufficient to provide such immunity during the waiting period after the parties have provided the premerger notification. LCMC argues that parties to a transaction do not have to file premerger notification if the transaction is “specifically exempted from the antitrust laws by Federal statute,” 15 U.S.C. § 18a(c)(5). The Parker line of cases, however, is court-made law, not supported by a specific exemption in a federal statute. Nevertheless, quoting Parker, LCMC argues that the state-action doctrine “is grounded in constitutional principles of federalism, in accordance with the ‘dual system of government in which, under the Constitution, the states are sovereign, save only as Congress may constitutionally subtract from their authority’” (emphasis added). The FTC may respond to LCMC’s argument by noting that no federal statute applicable to the acquisition specifically exempts the parties from HSR filings. LCMC might counter that the HSR Act is an antitrust law and that “Congress [did not] constitutionally subtract from [State] authority” when it passed the HSR Act. The FTC might, in turn, contend that the court should interpret the HSR Act’s reference to specific statutory exemptions from the antitrust law as limiting the carve-out from the HSR Act. That is, Congress did not intend to exempt acquisitions covered by state action from filing under HSR unless other statutes explicitly provided for such an exemption.

Not to be outdone by LCMC, on April 20, the FTC sued LCMC in the U.S. District Court for the District of Columbia, seeking to stop LCMC from integrating the three recently acquired hospitals because it did not file the required premerger notification. The FTC complaint argues that neither the FTC nor the DOJ has interpreted a COPA to exempt a party from its premerger notification obligations. After the required notifications, the FTC explained, it would investigate to decide whether the COPA shields the Acquisition from liability under Section 7 of the Clayton Act.


Businesses in all industries should take note of the FTC’s recent setbacks with respect to its regulatory authority. But we can offer no broad conclusion until we see the outcome of the two lawsuits discussed here. Stay tuned for the next blog post on this issue.

Report from the 2023 ABA Antitrust Section Annual Conference – Criminal Updates and Developments

In late March, attendees gathered in Washington, D.C., for the ABA Antitrust Law Section’s 71st Annual Spring Meeting, including officials from state, federal and international antitrust enforcement agencies. These enforcers gave updates on new policy initiatives and continued areas of focus that companies should be mindful of in their practices and in evaluating the effectiveness of their compliance programs. The major takeaway from both state and federal agencies is that antitrust violations will continue to be aggressively enforced.

Continue Reading

A Familiar Refrain: Judges Remind Lawyers and Their Experts of the Importance of Explaining Antitrust Cases in a Way Laypeople Can Understand

Key Takeaways:

  • At the ABA Antitrust Spring Meeting’s “Views from the Bench” panel discussion, Judges Richard F. Boulware of the District of Nevada, Denise L. Cote of the Southern District of New York, Paul L. Friedman of the District of Columbia and Yvonne Gonzalez Rogers of the Northern District of California repeated a common desire:  Judges wish antitrust lawyers and their experts would do a better job explaining the factual and legal issues in their cases. 
  • The panelists focused primarily on the importance of economic experts who could explain the issues clearly to a lay person.
  • There are several other important methods for clearly explaining the economic, factual, and legal issues in an antitrust case.  Parties should use their pleadings, briefs, experts, and in-court opportunities to explain complicated topics to the court in a clear and concise way, focus on the main issues, and provide citations to useful background literature, without clouding things with extraneous issues.

Panelists echoed a familiar tune at the 2023 ABA Antitrust Spring Meeting’s “Views from the Bench”:  Judges wish antitrust lawyers and their expert witnesses would do a better job of explaining and narrowing down the factual and legal issues in their cases.[1]  The problems associated with the opacity of antitrust cases come up seemingly every time generalist judges speak about antitrust law.  But while practitioners might roll their eyes at what sounds to them like a broken record, the fact is that judges continue to raise these issues because some members of the antitrust bar have not listened. 

Antitrust cases are complicated.  A former colleague once told an associate that antitrust law “is just two statutes.”  Of course, there are actually many more than “just two statutes,” and each one is accompanied by a century of dense case law and complicated balancing tests.  Antitrust law also involves a cacophony of strange legal, business, and economic terms – such as “tying arrangements,” “loyalty rebates,” “group boycotts,” “the demand curve,” and “market definition” – that, while common tongue for practitioners, are foreign and opaque to generalists.  On top of this byzantine legal framework, antitrust cases require a deep understanding of often-complex industries, products, business arrangements, economic concepts, and consumer behaviors, and involve numerous complex relationships between manufacturers, distributors, retailers, consultants, purchasers (direct and indirect), and end consumers.  Lawyers often forget that they learned the legal and factual issues of their cases through hundreds of hours of work – time that busy Article III judges do not have.

So what can antitrust practitioners do to better explain their cases to the bench so that we might finally hear a new song at our conferences?  Below are just some of the effective techniques we have used in our practice, many of which were echoed by the panelists.

Continue Reading

Dan Foix, Carl Hittinger and Tyson Herrold Author Article on Efforts to Renew Enforcement of Largely Dormant Act

Partners Dan Foix and Carl Hittinger and Counsel Tyson Herrold authored a Feb. 27, 2023, article for Westlaw Today titled “The FTC considers reviving Robinson-Patman enforcement.”

The authors write that the Federal Trade Commission, which has not attempted to enforce Robinson-Patman in decades,“will look for what it views as a clear violation that it can use to create precedent and build enforcement.” But, they add, the FTC is “unlikely to receive a warm welcome in federal court.”

Read the article.

DOJ Likely to Scrutinize Personal Device and Corporate Chat Policies of Investigation Targets

Through recent motions filed in district court and a policy memo issued last year, the U.S. Department of Justice (DOJ) has signaled that it has its sights on instant messages and personal devices as potential sources for uncovering anticompetitive or criminal information. Companies should review their personal device and corporate chat preservation policies and ensure they have the ability to preserve such information in the event of a government investigation or civil litigation.

In September 2022, the DOJ announced revisions to its corporate criminal enforcement policies and practices. The changes in policy make clear that the DOJ intends to pursue discovery and preservation abuses in connection with its cases and investigations. These changes will likely have ripple effects on private party litigation.

The DOJ stated that “[c]ompanies seeking credit for cooperation must timely preserve, collect, and disclose relevant documents located both within the United States and overseas.” In connection with that, the DOJ acknowledge that “[t]he ubiquity of personal smartphones, tablets, laptops, and other devices poses significant corporate compliance risks, particularly as to the ability of companies to monitor the use of such devices for misconduct and to recover relevant data from them during a subsequent investigation. The rise in use of third-party messaging platforms, including the use of ephemeral and encrypted messaging applications, poses a similar challenge.” Accordingly, the DOJ expects “all corporations with robust compliance programs [to] have effective policies governing the use of personal devices and third-party messaging platforms for corporate communications, . . . provide clear training to employees about such policies, and . . . enforce such policies when violations are identified.”

This policy applies to every company that could face a DOJ inquiry and is aimed at ameliorating the DOJ’s growing frustration with its inability to obtain relevant texts and instant messages from target subjects.

The DOJ is also taking a tough stance in its active cases on instant message deletion. Last month, the DOJ filed a motion against Google in its case pending in D.C. District Court for sanctions and an evidentiary hearing to determine an appropriate remedy for a policy that enforcers say resulted in Google automatically deleting most employee chats after 24 hours.

The DOJ contends that the auto-deletion policy amounted to an “intentional and repeated destruction” of written materials in violation of the Federal Rules of Civil Procedure and a discovery order entered in the case.

The motion states that Google had the ability to turn off its auto-deletion and to preserve documents for from 30 days to 18 months, but Google failed to do so. Instead, Google left it up to individual employees to take steps to preserve relevant chats beyond the 24-hour auto-deletion period. The motion says that court rules required Google to stop automatically deleting chats in mid-2019, when the company should have reasonably anticipated litigation, and because of Google’s failure, the DOJ is left with a four-year gap in relevant information.

Google has also found itself in hot water over its alleged failure to preserve chats in civil ligation pending in the Northern District of California. In that case, In re: Google Play Store Antitrust Litigation, No. 3:21-md-02981, the judge said he was open to sanctioning Google for failing to preserve employees’ online chats and failing to inform plaintiffs’ counsel that chats were deleted after 55 days unless employees turned their chat history on. Plaintiffs argued that preserved email exchanges showed that executives would switch to chat when they wanted to communicate about highly confidential information.

Reviewing corporate personal device and chat policies in connection with an antitrust compliance program would be prudent given the DOJ’s recent statements and actions targeting this area.

The Growing Threat to ESG Initiatives


On Jan. 26, 2023, twenty-four states sued the Department of Labor to block a new rule allowing retirement plans to consider environmental, social, and governance concepts (known as ESG) when administering plan assets.[1] The lawsuit, while notable for its potential impact on Employee Retirement Income Security Act regulations and the administration of retirement plans, may serve as a warning shot in the debate over ESG’s intersection with antitrust law.

ESG refers to a framework in which companies can consider environmental, social and governance issues as a potential measure of value. In practice, this might appear as actions to combat climate change, commitments to improving the community where the company is based or implementing corporate governance reforms. Many companies are now including ESG issues in their corporate disclosures, and investment firms are offering funds that invest based on ESG strategies.

Continue Reading

2023 HSR Filing Thresholds and New Filing Fee Structure Announced

US money

On Jan. 25, the Federal Trade Commission (FTC) published a notice in the Federal Register announcing the 2023 filing thresholds under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the HSR Act). The notice also announced the new HSR filing fee structure as mandated by the recently enacted Merger Filing Fee Modernization Act of 2022. The new thresholds and filing fee structure will apply to all HSR filings submitted on or after Feb. 27, 2023.

Read full alert.

FTC Seeks to Ban Non-Compete Restrictions in Employment Contracts

Federal Trade Commission

Key Takeaways

  • The FTC has proposed a new rule under Section 5 of the Federal Trade Commission Act that would significantly ban non-compete agreements between employers and workers.
  • If adopted, the Proposed Rule would supersede “inconsistent” state laws and also require employers to rescind certain existing non-compete clauses no later than 180 days after publication of the adopted rule.
  • The FTC also recently filed enforcement actions against three companies and multiple executives for imposing non-compete restrictions on workers, and obtained consent orders.

On Jan. 5, the Federal Trade Commission voted 3-1 to propose a new rule under Section 5 of the Federal Trade Commission Act that would largely ban non-compete agreements between employers and employees. If passed, the Proposed Rule would become a federal regulation making it an “unfair method of competition” for an employer “to enter into or attempt to enter into,” “maintain” or “represent to a worker that the worker is subject to a non-compete clause.” A preamble to the Notice of Proposed Rulemaking cites the harm that non-competes purportedly inflict on (i) workers whose compensation and mobility are stymied by non-competes and (ii) new business enterprises that find it difficult to break into an industry where skilled labor is locked into existing employment arrangements.

Read full alert.