Trial-Tested: The Antitrust Division Maintains Its Litigation Readiness

Division Update Spring 2018

The Antitrust Division demonstrated its litigation readiness across a range of civil cases this past year. On the heels of two major trial victories in the insurance merger context in United States v. Aetna and Humana and United States v. Anthem and Cigna, the Division’s Appellate Section successfully defended the Anthem decision on an expedited appeal schedule before the United States Court of Appeals for the D.C. Circuit. The D.C. Circuit affirmed the District Court’s decision to block Anthem’s acquisition of Cigna, a $54 billion transaction which would have been the largest proposed transaction in the history of the healthcare industry.

The Division has since successfully deployed its litigators to bring challenges in several other industries, including waste management, hospitals, and aviation fuel products.

U.S. v. EnergySolutions, Inc., et al.

Toxic waste barrels

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In United States v. EnergySolutions, Inc., et al., the United States successfully blocked radioactive waste disposal provider EnergySolutions’ $367 million acquisition of rival Waste Control Specialists.

Following an investigation beginning in December 2015, the United States filed suit in November 2016, alleging that the proposed acquisition would combine the two most significant competitors for the commercial disposal of low-level radioactive waste available to customers in 36 states, the District of Columbia, and Puerto Rico.

During a ten-day bench trial in May 2017 before Judge Sue L. Robinson of the United States District Court for the District of Delaware, 13 Division attorneys put on witnesses. Judge Robinson ruled in the United States’ favor by enjoining the merger in June 2017.

U.S. v. Deere & Co., Precision Planting LLC, and Monsanto Co.

Soybean field

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The Division achieved a competition-protecting result in its litigated challenge to Deere & Company’s proposed acquisition of Precision Planting LLC from Monsanto Company when in May 2017, just a month before trial, the parties abandoned their transaction. In August 2016, the Division had sued to block the transaction between these two firms, which would have resulted in a merger-to-monopoly in high-speed precision planting systems in the United States. This innovative technology enables farmers to accurately plant corn, soybeans, and other row crops at up to twice the speed of a conventional planter.

In the months leading up to trial, the Division established not only the strength of its case, but its trial-readiness. The parties’ abandonment preserved competition in this market, and in agriculture, one of the most important sectors of the U.S. economy.

U.S. v. Parker-Hannifin Corp. and CLARCOR Inc.

Jet plane

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In United States v. Parker-Hannifin Corporation and CLARCOR Inc., the United States filed suit in September 2017 to partially unwind Parker-Hannifin Corporation’s $4.3 billion acquisition of aviation fuel filtration product rival CLARCOR Inc. Following a five-month investigation, the United States concluded that Parker-Hannifin’s acquisition of its only U.S. rival for qualified ground aviation fuel filtration systems and elements effectively created a monopoly for these critical flight safety products and deprived U.S. civilian and military customers the benefits of competition.

In the course of preparing to file its complaint, staff secured third party testimony from a number of relevant potential witnesses, positioning the Division for a successful result from the outset. The United States ultimately reached a settlement with defendants, entering into a consent decree which requires defendants to fully divest CLARCOR’s filtration business, thereby restoring the competition in the aviation fuel filtration markets eliminated by the merger.

U.S., et al. v. W.A. Foote Memorial Hospital

Hospital road sign

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Less than a month before a bench trial was scheduled to begin in United States, et al. v. W.A. Foote Memorial Hospital, D/B/A/ Allegiance Health, the United States and the State of Michigan reached a proposed settlement with Henry Ford Allegiance Health for conspiring with a rival hospital in a neighboring county to restrict Allegiance’s marketing in that rival’s county.

In anticipation of the trial, the Division engaged in extensive fact and expert discovery, filed dispositive and evidentiary motions, and responded to the Court’s request for briefing. The proposed settlement prohibits Allegiance from further engaging in anticompetitive conduct and requires Allegiance executives to receive training on the proposed settlement’s provisions and the antitrust laws. The settlement marks the end of almost three years of litigation. The Division previously settled with three other south central Michigan hospitals at the time the complaint was filed.

U.S. v. AT&T Inc., DirecTV Group Holdings LLC, and Time Warner Inc.

TV remote

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The Antitrust Division stands ready to deploy its litigators to protect competition and consumer welfare. On March 21, 2018, Director of Litigation Craig Conrath gave the opening statement on behalf of the United States in United States v. AT&T/DirecTV and Time Warner—what some in the press have dubbed the “antitrust trial of the century.” It opened the proceedings that have featured the work of many skilled lawyers, economists, and paralegals throughout the Division, and punctuated months of intense preparation by the Telecommunications and Broadband Section to bring the case quickly and efficiently to trial. Trial is expected to conclude by May.

Updated April 10, 2018

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