On 1 December 2023, the US Court of Appeals for the Fourth Circuit reversed a Sherman Act conviction of a former executive of an aluminum products manufacturer for failure to state a per se antitrust offense. While DOJ is considering en banc review of this opinion, if upheld the decision could have lasting implications for how the DOJ proceeds with indictments involving parties that engage in dual distribution. We will continue to monitor for future developments in this case as it moves forward.
Last year, we warned that the Federal Trade Commission was starting to go after directors, owners and private equity firms in control of entities that violated American antitrust laws. That has now proven true.
On 21 September, the FTC filed a 106-page complaint in the US District Court for the Southern District of Texas against US Anesthesia Partners Inc. and its private equity investor, Welsh Carson Anderson & Stowe XI LP.
On 4 October 2023, Deputy Attorney General Lisa Monaco of the U.S. Department of Justice announced a new DOJ-wide policy that seeks to provide greater certainty as to the potential benefits to acquirers that uncover criminal conduct at a target company. The DOJ’s Mergers & Acquisitions Safe Harbor Policy for voluntary self-disclosures provides greater certainty to acquirers who self-report within the safe harbor period, fully cooperate with the DOJ in its investigation, and engage in requisite, timely, and appropriate remediation, pay restitution, and disgorge any ill-gotten gains.
On 21 September 2023, the Federal Trade Commission (FTC) announced that it was suing US Anesthesia Partners, Inc. (USAP) and its private equity owner Welsh, Carson, Anderson & Stowe (WCAS) in the US District Court for the Southern District of Texas. The lawsuit targets a common private equity strategy known as a “roll-up.” A roll-up merger typically occurs when a private equity company acquires several small companies in the same market and subsequently merges those companies.
A federal judge granted six individual defendants’ joint motion for judgment of acquittal in a criminal antitrust trial involving allegations that the defendants conspired to allocate the labor market for aerospace industry employees. The ruling was issued mid-trial before the jury was asked to deliberate. This ruling marks another loss for the Department of Justice in a series of no-poach and wage-fixing criminal prosecutions and is significant because the court held that the alleged no-poach agreement did not constitute a per se market allocation violation as a matter of law.
On 13 April 2023, the Federal Trade Commission (FTC) issued a letter containing a Notice of Penalty Offenses Concerning Substantiation of Product Claims to approximately 670 advertisers, putting each company on notice that deceiving consumers with advertisements that make unsubstantiated product claims could subject the company to civil penalties of up to USD 50,120 per violation under 15 U.S.C. § 45(m)(1)(B).
On 22 March 2023, four defendants were acquitted of criminal wage-fixing and no-poach charges, resulting in yet another loss by DOJ’s Antitrust Division in its criminal pursuit of no-poach agreements.
On 22 February 2023, the US Department of Justice announced a new voluntary self-disclosure policy for corporate criminal enforcement in all 94 United States Attorneys’ Offices across the country. This new voluntary self-disclosure policy is a response to Deputy Attorney General Lisa Monaco’s 15 September 2022 Memorandum insisting all DOJ divisions develop a self-disclosure policy, to the extent one does not already exist. Other DOJ components, including the Criminal Division, have already taken steps to issue or update their own policies on this topic.
On 22 February 2023, the US Department of Justice (DOJ) announced a new voluntary self-disclosure policy for corporate criminal enforcement in all 94 United States Attorneys’ Offices (USAOs) across the country.
This new voluntary self-disclosure policy is a response to Deputy Attorney General Lisa Monaco’s 15 September 2022 Memorandum (“Monaco Memo”) insisting all DOJ divisions develop a self-disclosure policy, to the extent one does not already exist. Other DOJ components, including the Criminal Division, have already taken steps to issue or update their own policies on this topic.
On 27 January 2023, the Eleventh Circuit Court of Appeals issued its unanimous (3-0) decision in FTC v. Simple Health Plans, LLC, et al., No. 21-13116. This matter stemmed from an individual defendant’s emergency motion to dissolve a preliminary injunction that a district court had issued under Sections 13(b) and 19 of the FTC Act. The district court denied the emergency motion, and the defendant appealed.