As this year’s roundtable of enforcers demonstrated, big business is probably antitrust enforcers’ greatest fear. Spring in Washington means Cherry blossoms and antitrust. And last week, 3,700 antitrust lawyers and government officials from around the globe descended on Washington to visit the Cherry blossoms and discuss how they need more government intervention to make the economy work for everybody and need to bring ever more “plausible” cases in order to nudge and push the courts along.
Proposed New York Price Gouging Rules Expand Coverage and Provide Clarity
New York Attorney General Letitia James announced new price gouging rules intended to clarify New York’s price gouging law, N.Y. Gen. Bus. Law §396-r, earlier this month. The proposed rules seek to address many of the perceived limitations of the statute exposed during the COVID-19 pandemic and subsequent economic turbulence triggered by supply chain bottlenecks and record inflation. Public comments on the proposed rules are due May 1, 2023.
FTC Announces 2023 Thresholds Under HSR Act and Clayton Act New Filing Fee Schedule Implemented
The Federal Trade Commission has announced revisions to HSR Act and Clayton Act Section 8 thresholds, which are indexed annually in alignment with prior year economic activity. As is our annual practice, the alert below identifies the adjustments that are likely to be the most relevant to our clients, and
Amazon’s Most Favored Nations Policies Scrutinized Under Sherman Act
Antitrust claims in a class action case filed against Amazon in U.S. Federal District Court will largely proceed, after the Court allowed most of the consumers’ pricing claims to survive a motion for summary judgment. The Court dismissed a Sherman Act claim, but allowed most other claims to proceed. Of particular note, Amazon’s “most favored nation” (MFN) policy will continue to be under scrutiny, despite the fact that courts typically do not find MFNs to be anticompetitive. It is widely recognized that MFNs, in fact, often serve procompetitive purposes.
Prices and Profits Dominating the News
While states continue to lift their COVID related states of emergency, new price gouging claims are being made and ongoing price gouging litigation continues to wind through the courts. The federal government also now appears more poised than ever to intervene in price gouging issues.
Three Notable Antitrust & Tech Updates That May Have Flown Under Your Radar
Antitrust and tech is in the legal news almost daily, and often multiple times a day. Here are a few recent developments with notable implications that may have flown under the radar: 1) renewed focus on gig economy issues; 2) potential enforcement efforts regarding director overlaps; and 3) challenges to MFN pricing.
“Unconscionable” Standard Need Not be Clean Cut: NY Appellate Court Reverses Lysol Price Gouging Case
One of the bellwether price gouging cases from the early days of the COVID-19 pandemic was recently reversed and remanded by New York’s First Judicial Department of the Appellate Division.
New York Attorney General Letitia James announced in May 2020 that her office had filed a lawsuit against a wholesale grocery distributor – Quality King Distributors – and its CEO for price gouging. The lawsuit alleged that between January 2020 and April 2020, Quality King raised the price of Lysol when its costs had not increased, “dramatically boost[ing] its gross profit margins for Lysol Spray, almost quintupling them over its pre-crisis margins.” Quality King sold 46,104 cans of Lysol during the time in question, and “each time one of these [] cans of Lysol was sold at retail for an inflated price – and each time a person bought any other Lysol product whose price Quality King had inflated – Quality King’s price-gouging caused injury to a consumer,” the lawsuit stated. The Attorney General seeks, among other relief, disgorgement of all profits from the illegal practice and a civil penalty of $25,000.
New York AG Files Suit to Compel Tyson to Comply with Price Gouging Subpoena
New York State Attorney General Letitia James has filed a petition to compel Tyson Foods to comply with a subpoena in connection with ongoing price gouging investigations by the state. New York’s price gouging statute imposes civil penalties on sellers of essential goods charging unconscionably excessive prices during an abnormal disruption of the market. The subpoena requests information relating to prices, dates of sale, purchasers, costs, and profit margin for Tyson’s meat products sold in New York from December 1, 2019 through April 2022.