Tuesday, December 26, 2006

Antitrust Division Shows Increased Enforcement Activity in 2006

The year 2006 saw the Department of Justice Antitrust Division obtain its second highest amount of criminal fines in its history, experience a drastic increase in merger filings and challenges, implement an improved merger review process, pursue civil non-merger conduct, participate in a number of U.S. Supreme Court antitrust cases, and remain active in international enforcement and cooperation, according to an announcement issued December 21.

“The Division’s achievements reflect the hard work of its staff, who are committed to aggressive, yet balanced, antitrust enforcement,” said Thomas O. Barnett, Assistant Attorney General in charge of the Antitrust Division.

Cartel Enforcement

The Division continues to give the highest enforcement priority to challenging anticompetitive conduct by criminal cartels. For the fiscal year ending on September 30, 2006, the Division obtained criminal fines totaling more than $473,445, 000. This amount represented a 40 percent increase over the previous year. The Division filed 33 criminal cases, many involving multiple defendants. In fiscal year 2006, there were 5,383 jail days imposed for price fixing, bid rigging, obstruction, fraud, and related anticompetitive conduct.

Merger Enforcement

Premerger transaction filings under the Hart-Scott-Rodino Act increased 8.9 percent over fiscal year 2005 to 1860 filings. Ten merger enforcement actions were initiated, and another six transactions were restructured in response to Division investigations. The percentage in Hart-Scott-Rodino transactions resulting in a “second request” dropped from 1.5 percent to 1 percent, with the duration of the “second request” investigations continuing to decline.

Improved efficiency and transparency in reviewing mergers was attributed to the issuance of the DOJ/FTC joint Commentary on the Horizontal Merger Guidelines (CCH Trade Regulation Reporter ¶50,208) and the amendments to the 2001 Merger Review Process Initiative, which was announced December 15.

U.S. Supreme Court Advocacy

The Division assisted the Solicitor General in submitting the views of the United States as amicus curiae in several cases. In all three antitrust opinions handed down earlier this year, the Supreme Court reached the decision advocated by the United States: Texaco v. Dagher (applying the rule of reason to pricing decisions by joint venturers); Illinois Tool Works Inc. v. Independent Ink, Inc. (holding that market power is not presumed in a patented product for tying purposes); and Volvo Trucks North America, Inc. v. Reeder-Simco GMC, Inc. (clarifying standards for secondary-line price discrimination under the Robinson-Patman Act).

The Division also assisted in briefs filed in pending Supreme Court cases: Weyerhaeuser Co. v. Ross Simmons Hardwood Lumber Co. Inc. (the standard for predatory pricing claims); Bell Atlantic Corp. v. Twombly (pleading standards for antitrust conspiracy claims); and Credit Suisse First Boston Ltd. v. Billing (the standard for implying antitrust immunity to conduct in the securities industry).


The Division continues to be active on the international front by participating in international cooperative efforts in competition law, according to the announcement.

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