On August 8, 2025, the U.S. Department of Justice (DOJ) announced a landmark proposed settlement with Greystar Management Services LLC, the largest landlord in the United States, to address allegations of anticompetitive practices in the rental housing market. This settlement targets Greystar’s use of algorithmic pricing schemes that allegedly stifled competition and drove up rents for millions of American renters. This blog post explores the background of the lawsuit, the details of the settlement, and the key lessons learned from this significant enforcement action.

Background on the Lawsuit

Greystar, headquartered in Charleston, South Carolina, manages nearly 950,000 rental units across the country, making it the largest residential property manager in the U.S. The DOJ’s Antitrust Division, alongside several state attorneys general, filed a lawsuit accusing Greystar and five other major landlords of engaging in algorithmic price-fixing through the use of RealPage’s revenue management software. The complaint alleged that these landlords shared competitively sensitive data, such as pricing strategies and rental rates, to generate pricing recommendations that aligned competitors’ rents, effectively reducing competition.

The lawsuit highlighted how RealPage’s algorithms incorporated anticompetitive features, enabling landlords to coordinate pricing strategies and avoid lowering rents, even in softening markets. This practice, according to federal prosecutors, led to artificially inflated rents, with one apartment complex reportedly boasting a 25% rent increase in a single year by using RealPage’s system. The DOJ argued that such coordination, whether through direct communication or algorithms, violated antitrust laws by harming consumers through higher rental costs.

The Settlement

The proposed consent decree, filed on August 8, 2025, in the U.S. District Court for the Middle District of North Carolina, outlines several key requirements for Greystar to restore competitive practices in the rental market. If approved, Greystar must:

• Cease Using Anticompetitive Algorithms: Greystar is prohibited from using any pricing algorithms that rely on competitors’ sensitive data or incorporate anticompetitive features.
• Stop Sharing Sensitive Information: The settlement bans Greystar from exchanging competitively sensitive information with other landlords.
• Accept Monitoring for Third-Party Algorithms: If Greystar uses a third-party pricing algorithm, it must be certified as compliant with the settlement terms, and a court-appointed monitor will oversee its use.
• Avoid RealPage-Hosted Competitor Meetings: Greystar is barred from participating in RealPage-hosted meetings with competing landlords to prevent further coordination.
• Cooperate with DOJ’s Case Against RealPage: Greystar is required to assist the DOJ in its ongoing monopolization claims against RealPage, the software provider central to the alleged scheme.

The settlement, pending court approval following a 60-day public comment period as required by the Tunney Act, also aligns with a separate class-action lawsuit settlement Greystar reached with renters, which includes “significant” monetary damages to be presented for court approval as early as October 2025. Greystar has denied wrongdoing but agreed to the settlements to clarify legal standards and focus on its business operations.

Lessons Learned

This settlement marks a pivotal moment in addressing the impact of technology on market competition, particularly in the housing sector. Several key lessons emerge:

1. Algorithmic Accountability: The case underscores the growing scrutiny of algorithms in business practices. While technology can optimize operations, its misuse to coordinate pricing or suppress competition can lead to significant legal and financial consequences.
2. Consumer Protection in Housing: The DOJ’s action reflects a broader commitment to protecting working-class Americans from practices that inflate essential costs like rent. As Attorney General Pamela Bondi emphasized, free-market competition is critical to making housing affordable.
3. Collaboration Between Regulators and Industry: Greystar’s cooperation with the DOJ’s case against RealPage highlights the importance of industry players working with regulators to address systemic issues, potentially leading to broader reforms in rental pricing practices.
4. Transparency and Oversight: The requirement for a court-appointed monitor for third-party algorithms signals the need for robust oversight to ensure compliance with antitrust laws, particularly as technology becomes more embedded in business operations.
5. Impact on Renters: While the settlement does not quantify the direct relief for renters, the class-action settlement’s promise of monetary damages suggests that affected tenants may see some financial recourse, emphasizing the role of collective action in addressing widespread harm.

Conclusion

The DOJ’s proposed settlement with Greystar is a significant step toward curbing anticompetitive practices in the U.S. rental market. By targeting algorithmic price-fixing, the settlement aims to restore competition and protect renters from inflated costs. As the case against RealPage and other landlords continues, this action sets a precedent for how regulators will address the intersection of technology and market fairness. For renters, industry stakeholders, and policymakers, this settlement serves as a reminder that competition, not coordination, should drive affordability in housing.

Andre Barlow

202-589-1838

abarlow@dbmlawgroup.com

The decision followed a bench trial that began in September 2024 and lasted 15 days, with closing arguments in November 2024. It marks the second major antitrust loss for Google in less than a year, following a separate ruling on its search monopoly.

Remedy Trial Timeline

The remedies phase, which will determine how to address Google’s anticompetitive behavior, is scheduled to begin as a bench trial on September 22, 2025, in the same court before Judge Brinkema. Both parties proposed this date shortly after the liability ruling, and it was confirmed by the court in early May 2025. The trial is expected to focus on evidence and arguments for specific remedies, with a decision potentially following in the months after.

Proposed Remedies to Resolve the Judge’s Concerns

The remedies aim to dismantle Google’s integrated ad tech monopoly, restore competition, and prevent future anticompetitive practices as outlined in the ruling (e.g., tying, exclusive deals, auction manipulation, and data advantages). Proposals from the U.S. Department of Justice (DOJ) and plaintiff states are more aggressive, emphasizing structural changes, while Google’s counterproposals focus on behavioral adjustments. Key proposals include:

• DOJ and States’ Proposals (Structural and Behavioral Remedies):
  • Divestiture of Key Assets: Force Google to sell off significant portions of its ad tech business, such as Google Ad Manager (which includes the DFP ad server and AdX exchange). This would break up the “walled garden” that gives Google end-to-end control over ad transactions.
  • Data and Bidding Restrictions: Ban Google from using first-party data from its own products (e.g., YouTube, Search, or Android) to gain unfair advantages in ad bidding or pricing. This addresses concerns about Google’s ability to leverage its ecosystem for preferential treatment.
  • Auction and Pricing Reforms: Prohibit manipulative practices like “last look” advantages in auctions (where Google could adjust bids after seeing competitors’) and require fair, non-discriminatory auction rules to prevent rigging.
  • Interoperability and Non-Exclusivity: Mandate that Google’s tools be compatible with rivals’ products, end exclusive contracts with publishers and advertisers, and allow easier switching to competitors.
  • Oversight and Compliance: Implement monitoring by a court-appointed trustee for up to 10 years, with potential fines for violations.
• Google’s Counterproposals (Primarily Behavioral):
  • Avoid divestitures, arguing they exceed the scope of the ruling and could harm innovation and users. Instead, propose tweaks to auction mechanics (e.g., “rigging ad auctions a little less”) and limited changes to product tying without breaking up assets.
  • Focus on transparency enhancements, such as better data sharing with competitors or minor adjustments to fee structures, to mitigate monopoly effects without structural separation.

The DOJ argues that behavioral remedies alone have proven insufficient in past cases (e.g., Microsoft’s antitrust settlement), necessitating divestitures to fully resolve the integration that fueled Google’s monopoly. The court will weigh these during the September trial, with potential appeals likely regardless of the outcome.

According to the New York Times, the smaller rivals, which have largely been publicly quiet until the hearing, finally stepped up to the plate and sounded off on big tech at a hearing in Boulder, Colorado.  The Congressional subcommittee heard stories of technology giants wielding their massive footprints and platforms as weapons, allegedly copying smaller competitors’ features or tweaking their algorithms in ways that stifle competition.

The pleas for regulatory relief resonated with lawmakers, led by Rep. David N. Cicilline (Democrat – Rhode Island), the chairman of the House’s antitrust subcommittee. Cicilline noted that “it has become clear these firms have tremendous power as gatekeepers to shape and control commerce online.”

The executives sounded off on big tech and the bipartisan committee encouraged them to testify about their stories.  The founder and CEO of PopSockets, explained how his company clashed with Amazon over policies that made it hard to sell his products on his preferred terms and prices.

Executives at Sonos, a high-end audio company, and Basecamp, which makes web-based product management tools allege that Google undermines smaller rivals. Sonos has sued Google, alleging patent infringement.  David Heinemeier Hansson the co-founder of Basecamp explained that its competitors have been purchasing ads on Google against the company’s own name, meaning people who search for Basecamp see rivals unless they scroll down their results page.  In other words, Hansson says that Google requires companies “to pay protection money” — or risk obscurity.

Tile makes Bluetooth trackers that can be attached to your personal possessions to help you keep track of them.  A Tile executive explained how Apple rolled out the “Find My” device tool — built into its operating system — that resembled Tile’s app used to find devices making it more difficult for Tile to compete.  From Tile’s perspective, it created a helpful tool for consumers, which was then copied by Apple and then Apple made its app the default on its devices, purposely hurting Tile’s business by making it more difficult for iPhone users to change their default settings, thus creating hurdles for Tile’s app that does not apply to Apple’s app. Tile wants a level playing field.

Along the lines of Tile wanting Apple to simplify what it claims is a too-complicated process right now, Apple shared a statement as part of the congressional hearing suggesting that a fix to this is coming soon. Per the statement shared by a CNBC reporter, Apple noted that:  “When setting up a new device, users can choose to turn on Location Services to help find a lost or misplaced device with ‌Find My‌ ‌iPhone‌, an app that users have come to rely on since 2010. Customers have control over their location data, including the location of their device. If a user doesn’t want to enable these features, there’s a clear, easy to understand setting where they can choose exactly which location services they want enabled or disabled. “…We’re currently working with developers interested in enabling the ‘Always Allow’ functionality to enable that feature at the time of setup in a future software update.”

Democrats and Republicans at the hearing sympathized with the executives.  There was little push back against the testimony of the small rivals.  Indeed, small rivals are encouraged to approach the DOJ Antitrust Division, FTC, and Congress about how the tech giants have used their powerful positions in search, e-commerce, online ads and smartphones to squeeze them out.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

What is a no-poach agreement? 

A no-poach agreement is essentially an agreement between two companies not to compete for each other’s employees, such as by not soliciting or hiring them. No-poach agreements, or agreements not to approach other companies’ employees to hire, are generally considered illegal under the antitrust laws.  When companies make agreements not to compete for each other’s employees, they are restraining commerce because they are not allowing working people to freely change jobs to potentially make more money or move to another location if they wish to. It is illegal for companies or other entities to make these agreements, but it happens more often than you would think – just like the case with Seaman v. Duke University.

 What happened in Seaman v. Duke University?

Dr. Seaman is an assistant professor at Duke University’s (Duke) medical school. Duke made an anti-poaching agreement with its competitor, the University of North Carolina (UNC). Dr. Seaman and others, who were faculty at Duke and UNC medical schools, filed a class action lawsuit against Duke claiming that Duke violated the Sherman Act when it entered into the agreement to “prevent lateral hiring of certain medical employees in order to eliminate competition and suppress compensation.” See Seaman v. Duke University and Duke University Health System, Case No. 1:15-cv-000462-CCE-JLW (M.D.N.C.).

In March, the Department of Justice (DOJ) got involved in the case by filing a Statement of Interest. This allowed the DOJ to intervene to influence and actually enforce an outcome that prevents anti-poaching agreements in the future.

In the end, the parties settled the case. In the settlement agreement, it was decided that Duke would pay Dr. Seaman and faculty members $54,500,000, along with attorney’s fees, reimbursement for costs, and a service award. What is interesting is that the federal district court in North Carolina presiding over the case went a step further and allowed the DOJ to enforce the injunctive relief provisions of the settlement agreement. The injunctive relief provisions of the settlement agreement prohibit Duke from entering into any anti-poaching agreements for five years and require Duke to take steps to ensure this does not happen in the future. Such steps include enacting notification and compliance policies within the University.

Lessons Learned:

The DOJ continues to scrutinize no poaching agreements.  Given the DOJ’s focus on no poach agreements, it has become increasingly important for employers in all industries to learn about the risks of entering into agreements that limit their competition for employees.  In its ability to enforce these provisions, the DOJ will be keeping a close eye on Duke, while simultaneously using Duke as an example to other companies and entities. The DOJ’s goal is to be proactive in enforcing antitrust laws that prohibit these kinds of agreements between employers and to protect the American worker.  The courts and the DOJ are sending clear signals to employers that they are cracking down on anti-poaching agreements.  It is important for employers to make sure they are not making employment contracts that break the law.  Employers need to take anti-poaching agreements seriously.  It is time for employers to sort through and re-examine contracts and make sure they are legal.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

On the same day, Assistant Attorney General Makan Delrahim of the Antitrust Division of the U.S. Department of Justice (“DOJ”) said the DOJ is working with a group of more than a dozen state attorneys general as it investigates the market power of major technology companies.  Delrahim said at a tech conference that the government is studying acquisitions by major tech companies that were previously approved as part of a broad antitrust review announced in July of major tech firms with significant market power.  “Those are some of the questions that are being raised… whether those were nascent competitors that may or may not have been wise to approve,” he said.

On July 23, the DOJ said it was opening a broad investigation into whether major digital technology firms engaged in anticompetitive practices, including concerns raised about “search, social media, and some retail services online.”  The investigations appear to be focused on Alphabet Inc.’s Google, Amazon.com, Inc. and Facebook, Inc. (“Facebook”), as well as potentially Apple Inc.

More than a dozen states are expected to announce in the coming weeks that they are launching a formal probe.  “I think it’s safe to say more than a dozen or so state attorneys general (that) have expressed an interest in the subject matter,” Delrahim said.  In July, eight state AGs met with U.S. Attorney General William Barr to discuss the effect of big tech companies on competition, and various antitrust actions.

On August 19, the New York Attorney General’s office said it is continuing to “engage in bipartisan conversations about the unchecked power of large tech companies.”  North Carolina Attorney General Josh Stein is also “participating in bipartisan conversations about this issue,” his office said.  The DOJ is looking not only at price effects, but also at innovation and quality, and the next steps in its broad antitrust review would be seeking documents and other information.  Delrahim also said that after the July announcement, the companies under investigation “immediately reached out to work with us in a cooperative manner to provide information that we need as far as the investigation.  In June, the FTC told Facebook it had opened an antitrust investigation.  Last month, the FTC resolved a separate privacy probe into Facebook’s practices after the company agreed to pay a $5 billion penalty.

Thoughts

The states joining the DOJ’s and FTC’s investigations are not a surprise.  As many as 39 states have been raising antitrust concerns about the big tech firms with both the DOJ and FTC.  They have similar concerns regarding big tech as the federal antitrust agencies.  The issues relate to whether the markets for online advertising, search, social media, app sales and certain retail sectors are currently competitive.  The state AGs involvement in these investigations adds another layer of complexity for Google, Facebook, and Amazon.  This action by the state AGs should remind everyone that sound antitrust enforcement is not just a federal affair.  Indeed, many of the seminal antitrust cases including cases creating key principles of monopolization and merger law were brought by state attorneys generals.

State attorneys generals use the power under federal and their own state statutes to protect consumers against anticompetitive and fraudulent conduct in credit card, pharmaceutical, computer and many other markets crucial to consumers.

States have significant advantages over federal enforcers.  They are closer to the market and consumers and recognize the direct harm to consumers.  They have the ability to secure monetary damages.  States are often customers and victims of anticompetitive behavior.  State enforcers can bring combined antitrust and consumer protection cases.  And although each state has limited antitrust and consumer protection resources, states increasingly are using multi-state task forces to investigate and prosecute unlawful conduct.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

Background

On October 2, 2017, Shire sued Allergan for its bundling and exclusive dealing arrangements with Medicare Part D plans that deny patients access to Xiidra® – Shire’s best-in-class, breakthrough drug to treat DED.

DED occurs when the eye does not produce enough tears or when tears are not of the correct consistency. The disease is evidenced by inflammation and damage to the ocular surface, resulting in blurry or fluctuating vision and eye fatigue. About one million Americans receive prescription drug treatment for DED. Shire’s Xiidra® and Allergan’s Restasis® are the only FDA-approved prescription drugs on the market for treatment of DED. There are no reasonable over-the-counter substitutes for treating DED. The FDA approved Shire’s Xiidra for treatment of both the symptoms and signs of DED. Restasis® was approved only for treatment of a specific symptom of DED—reduced tear fluid volume—which affects only 10 percent of those with DED.

Shire alleged that Allergan economically coerced Medicare Part D prescription drug plans to exclude Xiidra and maintain Restasis on a preferred formulary tier through financial incentives including rebates bundled across several Allergan Glaucoma drugs including Lumigan, Combigan, and Alphagan P.  These drugs have FDA approval for the treatment of high eye pressure in patients with glaucoma or ocular tension.

Medicare Part D is a prescription drug program for senior citizens. Participants in Part D can choose from a variety of health insurance plans. The list of drugs covered by a Medicare Part D plan is called the plan’s “formulary.” Formularies offer drugs in tiers that dictate the patient’s copayment. Drug manufacturers routinely provide rebates to obtain a preferred position on a plan’s formulary.  If a drug is not listed on a formulary, then it is considered “not covered” under the Medicare Part D plan.

Xiidra is approved to treat more signs and symptoms of dry eye disease than Allergan’s Restasis and also does not need to be used in conjunction with a topical steroid, which Allergan’s Restasis often does.  Shire also alleged that many patients using Restasis had adverse reactions or did not improve.

Despite the advantages of Xiidra, Shire alleged that payors did not have the economic incentive to switch to the new drug because they would lose rebates not just on Restasis, but on the rest of Allergan’s bundled drug portfolio that included glaucoma drugs.  As one plan told Shire, “You could give [Xiidra] to us for free, and the numbers still wouldn’t work.”

Shire also alleged that Allergan engaged in an exclusive dealing contract with another plan which barred the plan from offering Shire’s DED drug on its formulary. These contracting practices allowed Allergan’s Restasis to maintain a roughly 90% market share despite the entry of a new and improved drug. In a nutshell, the conditional rebates gave Allergan’s Restasis protection from competition and allowed Allergan to maintain its monopoly.

District Court Dismisses Shire’s Lawsuit

The federal district court, however, dismissed Shire’s lawsuit for two reasons. First, the district court held that Shire failed to plead a proper relevant market because the Medicare Part D dry eye disease market is “unduly narrow because it excludes others, notably commercial payers, to whom Plaintiff can sell Xiidra”. Second, Shire’s allegations that Allergan had agreements where it bundled its DED medication with other drugs and entered into exclusive agreements were insufficient to make out a case of anticompetitive conduct. Shire failed to allege that Allergan has “monopoly power over the” glaucoma drugs it allegedly bundled with Restasis or that Shire “did not have other available products that it could offer … as part of a bundled rebate” to Medicare Part D plans. As a result, Shire’s Sherman Act claims were dismissed.

 Thoughts:

Rebates offered across multiple prescription drugs to obtain preferred or exclusive position on a drug formulary can create a barrier to competition known as a rebate wall or trap.  Rebate walls block competition by coupling volume-based discounts across multiple products with punitive measures.  Contracts between drug manufacturers and payors that include bundling can be extremely effective at blocking competition and limiting formulary access to newer and more innovative therapies. However, as the district court put it, a fact sensitive analysis is required because “neither bundled rebates nor exclusive dealing contracts are inherently anticompetitive. In fact, both can be procompetitive.”  The judge is correct that the general rule is that bundled discounts are procompetitive, but the product in question relates to prescription drugs where patient choice is paramount.  Any threat to withhold rebates on the condition that Part D plans exclude Xiidra entirely from formularies would appear to be unlawful exclusionary conduct.  There is no procompetitive justification for the payment of rebates by a first-tier drug manufacturer for the complete exclusion of a competing drug from the formulary.

Prohibiting rebate walls is critical to providing seniors with access to more affordable medication that may be more efficacious.  Ultimately, patients lose access to choices of superior and more effective prescription drugs and, in some cases, are being delayed or denied the opportunity to obtain the most effective treatments for their individualized needs.  In addition, the district court judge was not impressed with the relevant product market.  But certainly, the sale of DED drugs to Medicare Part D plans is an important market to protect.  Competition in the Part D market is critically important as it serves a vulnerable population, our nation’s seniors, many of whom are on fixed incomes.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

The first day of hearings was broken into three panel discussions which broadly discussed the current landscape of antitrust law, U.S. economic competitiveness, and consumer protection and data privacy. The discussions focused on process and substance and how best to reframe FTC priorities to deal with complex 21^st century issues.

Panelists drew lines in the sand when it came to whether the FTC is successfully navigating the landscape in an era of mega-mergers. Some panelists took the “populist” view that FTC’s merger guidelines are unhealthy for the overall economy and consumer welfare. The FTC has been guided by the “consumer welfare standard” when it comes to mergers, and has accommodated mergers that increase efficiencies and provide benefits in the form of lower prices to consumers.  Those in favor of the consumer welfare standard want to avoid a ‘big is bad’ mentality while keeping the interests of consumers in mind.  Proper antitrust enforcement is about protecting consumers, and protecting the competitive process, not about protecting competitors.  Some panelists argued, however, that the consumer welfare standard has failed to take into account important social concerns like privacy, rising social and income inequality, and decreased economic competition and dynamism. They pointed to recent studies seeming to vindicate the view that the FTC needs to reorient its enforcement procedures because the economy appears to be more concentrated and less dynamic than it used to be.

The key issue of divergence for the panelists was whether the growth of large firms would allow the accumulation of data so vast as to widen the chasm between incumbent firms and new entrants. This line of argument goes like this: firms, particularly tech firms, grow so large and are able to aggregate more data, which in turn provides those companies competitive advantages. Think about Amazon: its acquisition of companies in different sectors will allow it to accumulate vast and unique data about consumer habits, which it can then use to provide more personalized services and competitive variable pricing. While good for the consumer in the near-term, such an inherent advantage is a barrier to entry that new competitors simply cannot overcome. The jury is still out on whether data collection will provide diminishing returns or whether machine learning will ensure increasing returns for a firm that accumulates data. If the latter turns out to be true, then the largest firms will create a barrier that will bar new entrants from competing with incumbents. While the antitrust agencies have approved a number of mega-mergers recently, the FTC is now openly asking questions and allowing debate on whether it must reconsider its enforcement priorities and return to ‘big-is-bad’ enforcement style of early antitrust.

Related to data accumulation was the role of the FTC in protecting consumer privacy. Nearly every consumer device can be connected to the internet in order to provide data about consumer habits. Smart watches, cell phones, and even items like “smart” sneakers, can collect intimate details about an individual. This, in turn, requires the government to consider safeguards in order to ensure that such personal details are protected. The FTC does not have a clear principled policy for relief from harm done in these types of data breaches, for example in the case of Cambridge Analytica or the Ashley Madison breach; however, the discussion marked a clear understanding that the FTC is going to take privacy concerns seriously. Privacy law in the United States is a patchwork of various federal and state laws that do not offer a clear principle for protecting consumers. Panelists discussed how the federal government could model privacy protection laws based on Europe’s General Data Protection Regulation (“GDPR”) and California’s Consumer Privacy Act (“CCPA”). The key issue, as always, is the ability to enforce such commitments.

These inquiries proceed when suspicious conduct can be identified. But in doing so, let us avoid a ‘big is bad’ mentality and let us truly have the interests of consumers in mind. We learned long ago that proper antitrust enforcement is about protecting consumers, and protecting the competitive process, not about protecting competitors. We must not forget that guiding principle. Indeed, that principle is especially important in markets subject to large economies of scale, whether those scale economies are based on traditional production economies or based on network effects, which are often important in the tech sector.

The next hearing is currently slated to take place on September 21, 2018 at the FTC Constitution Center.

The panelists included representatives from Association for Accessible Medicines (Jeff Francer), Mylan (Marcie McClintic Coates), Patients for Affordable Drugs (David Mitchell), and AARP (Leigh Purvis).  Watch the briefing here:  https://www.youtube.com/watch?v=9K3RQHB-oTE

They explained how one of most promising areas of drug research is the creation of generic biologic medicines, or biosimilars.  These drugs have great potential and often offer the best treatments for serious diseases such as cancer, multiple sclerosis, rheumatoid arthritis, and others.  Yet, today, there are only four biosimilars on the market in the United States.

What exactly are biologic medicines and biosimilars? Biologics are medicines extracted from a variety of natural sources–from humans, animals, or microorganisms. They include a great number of products such as vaccines, blood components, gene therapy, tissues, and recombinant therapeutic proteins. Biologics are fast becoming the future of pharmaceuticals.  Biologics make up 40% of drug spending in the United States and 70% of all drug price increases from 2010-2015.  This statistic demonstrates the growing importance of biologics and just how expensive they are.  Indeed, biologics are the cutting edge of current research, but they are often costly, sometimes as much as thousands of dollars per treatment. That renders them unaffordable even for those with comprehensive health insurance.

Enter biosimilars–biologic medicines that are approved by on data showing they are very similar to existing brand name biologics (called the reference products). Companies that make biosimilars must prove that their new drugs are just as safe and effective as the reference products. Some biosimilars can be designated as interchangeable with the reference products, which means they can be substituted for the brand name biologics.  And since biosimilars rely on information from the original drugs and don’t have to go through expensive new clinical trials, they are far less expensive than the original brand biologics.

The President’s Blueprint to lower prescription drug prices underscores the importance of expediting competition for generic and biosimilars to increase patient’s access to more affordable drugs.  The renegotiation of NAFTA, however, threatens to create new barriers and delay biosimilars from entering and competing in the United States.  Today, the United States has a 12-year market exclusivity period for brand name biologics, during which a biosimilar cannot be approved.  A biosimilar cannot be filed within the first four of those years.  The U.S. Federal Trade Commission has even found that exclusivity for biologics is unnecessary because biologics continue to keep most of their market share and price even after patent expiration.  Thus, there has been a push to reduce the exclusivity period in the United States so that patients could gain access to these important drugs sooner.  But, it has come to light that the renegotiation of NAFTA could very well create a situation that continues to delay generic and biosimilar access and may even alter companies’ decisions to pursue biosimilar markets altogether.  USTR recently announced an agreement with Mexico that would provide 10 years of data protection for biologics and an expanded scope of products eligible for protection.  The panelists claimed that the international trade agreement would set a floor in the United States.  The key to lowering drug prices for patients is by increasing competition through more access to safe, affordable generics, and biosimilars in the United States and around the world.  An international trade agreement with a 10 year exclusivity period would limit Congress’ ability to increase competition and reduce the costs of biologic drugs in the future.

Congress must vote to approve a revised NAFTA. Contact lawmakers now to oppose the inclusion of monopoly protections for brand-name drugs that keep prices for patients higher for longer and delays competition from more affordable generics and biosimilars.

Click on the link to take action.  https://p2a.co/5bmfkK5

Andre Barlow

The DOJ has indicated its review will take into account the changes in the identity of movie theatre owners, the increased number of movie theaters in a geographic area, the increased number of screens in movie theaters, and increased number of viewing platforms available to consumers.  The review is part of the Antitrust Division’s initiative to terminate long-standing antitrust judgment, including many that have no termination date.

“The Paramount Decrees have been on the books with no sunset provisions since 1949. Much has changed in the motion picture industry since that time,” Makan Delrahim, the DOJ’s antitrust chief, said in a statement. “It is high time that these and other legacy judgments are examined to determine whether they still serve to protect competition.” 

If the DOJ terminates the Paramount Decrees, it could lead to vertical integration of studios and theaters.  The result would be ironic given that the DOJ is currently appealing its loss in its attempt to prevent AT&T from vertically integrating with Time Warner.

As part of the review, the DOJ is interested in comments to the following issues:

• Do the Paramount Decrees continue to serve important competitive purposes today?  Why or why not?
• Individually, or collectively, are the decree provisions relating to (1) movie distributors owning movie theaters; (2) block booking; (3) circuit dealing; (4) resale price maintenance; and (5) overbroad clearances necessary to protect competition? Are any of these provisions ineffective in protecting competition or inefficient? Do any of these provisions inhibit competition or cause anticompetitive effects?
• What, if any, modifications to the Paramount Decrees would enhance competition and efficiency? What legal justifications would support such modifications, if any?
• What effect, if any, would the termination of the Paramount Decrees have on the distribution and exhibition of motion pictures?
• Have changes to the motion picture industry since the 1940s, including but not limited to, digital production and distribution, multiplex theaters, new distribution and movie viewing platforms render any of the Consent Decree provisions unnecessary?
• Are existing antitrust laws, including, the precedent of United States vs. Paramount, and its progeny, sufficient or insufficient to protect competition in the motion picture industry?

Third parties have a 60-day period for public comment. The deadline for comments is October 4, 2018.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

She said that antitrust enforcers adopted the Chicago School principles, which narrowed the scope of the antitrust laws and allowed mega-mergers to proceed resulting in many concentrated industries.  She believes that antitrust enforcers already have the tools to reduce concentrated markets and that they simply must start enforcing the law again.

Senator Warren’s recommendations included stronger merger enforcement, cracking down on anticompetitive conduct and increasing agency involvement in defending competition.

Senator Warren called for the blocking of mergers instead of negotiating weak settlements that allow deals to go through:

• The DOJ and the FTC need to block any mergers that “choke off competition” and take to court any large company that is impeding competition and innovation.
• “If we’re going to begin a new era of antitrust enforcement, we need to demand a new breed of antitrust enforcers. We need enforcers with steel spines who will stand up to companies with the best-dressed lobbyists, the craftiest lawyers, and the highest-paid economists.  Enforcers who will turn down papier-mache settlement agreements and actually take cases to court.”
• “To revive competition in our economy, vertical mergers, particularly mergers in already concentrated industries, should be viewed with the same critical eye that’s needed for mergers between direct competitors.”

Senator Warren called for a crack down on anticompetitive conduct:

• The DOJ and FTC should bring lawsuits against companies using anti-poaching and non-competition agreements among companies and franchises that prevent employees from obtaining jobs that could increase their pay.
• The DOJ and FTC need to “[g]row a spine and enforce the law.  No-poach agreements are a reminder that corporate concentration not only affects consumers by limiting choices and driving up prices. It also affects workers who can’t get the salary they would be able to get in a competitive economy.  It’s time to hold those corporations accountable for these competition-killing practices. And let’s be clear: holding everyone accountable means everyone….There is no exception in antitrust laws for big tech.”

Senator Warren called for all government agencies to participate in the protection of competition:

• “Sure, DoJ is law-enforcer-in-chief, but all government agencies should defend competition” and reduce monopoly power where they have the power to do so.  The FCC should enforce strong net neutrality rules.  The FDA can reign in pharmaceutical monopolies as it controls which drugs come to market and when.  The Federal Reserve and FDIC could make sure that banks are not to big to fail. The DOD could inject more competition in its defense contracting process by not limiting the number of bidders.

According to TCH, it claims that it will create and operate the Real Time Payment system (“RTP”) – a new payment rail that will provide for real-time funds transfers between depository institutions – and in turn, RTP will allow depository institutions to enable faster fund transfers for their end-user customers.

According to TCH, RTP will not interfere with the continued use and operation of existing payment rails, including automated clearing house, wire, and check clearing houses.  RTP will also incorporate additional features that existing payment rails do not offer, such as enhanced messaging capabilities.

In a letter written by Acting Assistant Attorney General Andrew Finch, the DOJ declared that it does not presently intend to challenge the TCH’s proposed new payment rail because the intent appears to be introduce a new, faster payment rail would benefit consumers and competition.  The DOJ believes the RTP could result in procompetitive benefits.

Observations

The DOJ issues a business review letter whenever a person concerned about the legality under the antitrust laws of a certain business practice requests a statement from the DOJ about its current enforcement intentions with respect to that business conduct.  Given the information provided and representations made to the Antitrust Division, the DOJ is fine with a joint venture between 24 banks as long as it results in procompetitive effects.  The business review letter, however, is not a blanket OK because the DOJ reserves the right to challenge the proposed action if the actual operation of the proposed conduct proves to be anticompetitive in the future.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

On November 2, 2016, the DOJ’s Antitrust Division filed suit alleging that DirecTV was the ringleader of a series of unlawful information exchanges between DirecTV and three of its competitors – namely, Cox Communications Inc. (“Cox”), Charter Communications Inc. (“Charter”) and AT&T (before it acquired DirecTV) – during the companies’ negotiations to carry the SportsNet LA “Dodgers Channel.”

SportsNet LA holds the exclusive rights to telecast almost all live Dodgers games in the Los Angeles area.  According to the complaint, DirecTV’s Chief Content Officer, Daniel York, unlawfully exchanged competitively-sensitive information with his counter-parts at Cox, Charter and AT&T while they were each negotiating with SportsNet LA for the right to telecast the Dodgers Channel.  Specifically, the complaint alleges that DirecTV and each of these competitors agreed to and exchanged non-public information about their companies’ ongoing negotiations to telecast the Dodgers Channel, as well as their companies’ future plans to carry – or not carry – the channel. The complaint also alleges that the companies engaged in this conduct in order to unlawfully obtain bargaining leverage and to reduce the risk that they would lose subscribers if they decided not to carry the channel but a competitor chose to do so. The complaint further alleges that the information learned through these unlawful agreements was a material factor in the companies’ decisions not to carry the Dodgers Channel. The Dodgers Channel is still not carried by DirecTV, Cox or AT&T. The DOJ allegations make out a buyer conspiracy case that violate Section 1 of the Sherman Act.  The DOJ further claims that the illegal information sharing corrupted the competitive bargaining process and likely contributed to the lengthy blackout.

The settlement is designed to ensure that when DirecTV and AT&T negotiate with providers of video programming, including negotiations to telecast the Dodgers Channel, they will not illegally share competitively-sensitive information with their rivals. The settlement also requires the companies to monitor certain communications their programming executives have with their rivals, and to implement antitrust training and compliance programs.

Lesson Learned:

The DOJ’s settlement demonstrates its resolve to prevent pay-television providers and specifically AT&T and DirecTV from engaging in illegal conduct that thwarts the competitive process. Moreover, the enforcement action indicates that the DOJ will take information that it learns regarding illegal activity through its antitrust review of a merger and pursue it.  So, the lesson is that the DOJ will bring civil and/or criminal actions against illegal conduct discovered during merger reviews.  Executives should understand that texting and emailing competitors to share competitively and strategically sensitive information to avoid competing is illegal.  While most of us would agree that the Dodgers may be holding out for too much money, the pay tv providers cannot engage in illegal conduct that thwarts the competitive process.  Fortunately, for DirecTV, the DOJ did not bring a criminal case rather it treated the conduct as a civil matter.  But, executives should be mindful that this type of conduct could potentially result in criminal as well as civil penalties.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

CON laws typically require hospitals to obtain government approval before undergoing expansion projects or purchasing major assets, including hospital equipment.  Virginia is known to have one of the most restrictive CON laws in the country, and the antitrust enforcement agencies recently have addressed the possible negative effects such laws have on competition, stating that CON laws may impede on healthcare providers’ abilities to provide efficient and effective services for consumers and may hinder competition by creating barriers to entry, limiting consumer choice, and stifling innovation.

In the joint statement, the enforcement agencies cited several studies that show that CON laws have not been effective at controlling costs or improving quality for consumers and indicated that more targeted measures might better address such goals.  While Virginia has an established working group tasked with addressing the issues surrounding CON laws, no final decisions have been made on the status of the state’s current CON law.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

In their letter, the senators noted that there has been a shortage of saline solution in the United States since 2013 and that the three companies that provide all the saline solution for the United States, Baxter, Hospira, and B. Braun, have failed to end the shortage.  The senators further claim that such activity may be the result of collusive behavior by the manufacturing companies to exploit the shortage of saline solution to increase their own profits and that this activity has resulted in higher costs to hospitals, patients, and the overall healthcare system.  The letter also states that hospitals have reported that Baxter, Hospira, and B. Braun have each imposed greater price increases (200-300%) since the shortage began.  The senators also state that the manufacturers on saline solution customers who do not also purchase additional non-saline products, effectively claiming that the manufacturers may be illegally tying the products.

Given the rising costs of healthcare, the FTC should ensure that anticompetitive conduct does not further increase those costs.  Therefore, the senators urge the FTC to investigate the troubling allegations to determine whether the saline suppliers’ apparent anticompetitive conduct is harming consumers and running afoul of the antitrust laws.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

President Obama lists four bright-line rules:

• No blocking. If a consumer requests access to a website or service, and the content is legal, your ISP should not be permitted to block it. That way, every player — not just those commercially affiliated with an ISP — gets a fair shot at your business.
• No throttling. Nor should ISPs be able to intentionally slow down some content or speed up others — through a process often called “throttling” — based on the type of service or your ISP’s preferences.
• Increased transparency. The connection between consumers and ISPs — the so-called “last mile” — is not the only place some sites might get special treatment. So, I am also asking the FCC to make full use of the transparency authorities the court recently upheld, and if necessary to apply net neutrality rules to points of interconnection between the ISP and the rest of the Internet.
• No paid prioritization. Simply put: No service should be stuck in a “slow lane” because it does not pay a fee. That kind of gatekeeping would undermine the level playing field essential to the Internet’s growth… I am asking for an explicit ban on paid prioritization.

President Obama also stated that he believes the FCC should take strong steps to protect net neutrality by reclassifying consumer broadband services under Title II of the Telecommunications Act, and then forbearing from applying certain burdensome regulation available under that Title.

Obviously, the cable and phone companies will have a lot to say about this if Chairman Wheeler pushes through rules that require more regulation over the internet.  President Obama appears to be sending a message to Chairman Wheeler, but at the same time, acknowledges that it is the FCC’s decision on how to handle net neutrality.  While Chairman Wheeler’s more balanced middle of the road plan leaked a couple of weeks ago indicated that he does not mind if Comcast, AT&T or Verizon charge Netflix for using more bandwidth, President Obama’s plan would go further because he wants everyone on the internet treated equally.  President Obama’s call to ban internet fast lanes and block service providers’ ability to charge content providers for faster content delivery will certainly meet heavy resistance.  Indeed, Verizon warns that intense regulation of the internet would threaten harm to an open internet, competition, and innovation.  As the net neutrality regulation debate heats up, the Antitrust Division and the FCC are currently reviewing three of the big four gatekeepers that are involved in acquisitions:  Comcast’s acquisition of Time Warner Cable and AT&T’s acquisition of DirecTV. President Obama’s statements are direct at net neutrality and do not mention the transactions.  No matter whether Chairman Wheeler implements his proposed plan or President Obama’s plan, the FCC will likely be challenged in court.  Chairman Wheeler is in a difficult position, but he has to figure out a way to resolve the net neutrality regulation debate in a fair and balanced manner to avoid a court challenge.  Is more regulation the answer or should we rely on the antitrust laws to protect us?

To see President Obama’s statement: WH.gov/Net-Neutrality

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

“I speak for the entire AAI Board of Directors in enthusiastically welcoming Diana as our new President and CEO as of this coming January. She is ideally positioned to build on Bert’s powerful 17-year legacy and to take the AAI in new directions over the years ahead,” said Robert Skitol, Chairman of the AAI Board of Directors.

Dr. Moss was selected from a pool of prestigious candidates after a national search.  “I am honored, and grateful to the AAI Board for the opportunity to lead this really exceptional organization,” said Moss. “We’re moving into the next AAI “generation” with a talented staff and valuable, respected advisors that have helped us promote a unique and successful advocacy, research, and education agenda,” she added.

Outgoing President and CEO Bert Foer said of the transition and leadership handoff, “Diana has been my trusted right hand for 14 years.  She is a skilled competition advocate with strong connections in the antitrust and regulatory communities and has been instrumental in helping build the AAI into a leading, progressive competition advocacy organization.”

Moss, an economist, joined the AAI shortly after its creation, bringing with her public- and private-sector experience in antitrust and regulation.  At the AAI, Moss has effectively developed and expanded advocacy channels and strategies, and strengthened communications with enforcers, Congress, other advocacy groups, and the media. As Vice President since 2002, Moss has also extended the AAI’s competency in a number of industries that are a major antitrust focus, including energy, transportation, agriculture, telecommunications, and healthcare.

With the transition to new leadership, Mr. Foer will step into a new half-time role with a focus on international competition advocacy and competition culture.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

·            Brad Burnham – Managing Partner, Union Square Ventures

·            Ruth Livier – Writer, Independent Producer, and Actress

·            Robert McDowell – Former Commissioner, Federal Communications Commission (FCC)

·            Jeffrey Eisenach – Visiting Scholar, American Enterprise Institute Center for Internet, Communications and Technology Policy

·            Nuala O’Connor – President and CEO, Center for Democracy and Technology

Members of the Senate Judiciary Committee disagreed about the need for the FCC to enact net neutrality rules.  Some, such as Sen. Orrin Hatch (R-UT) and Sen. Ted Cruz (R-TX), argued that additional regulation would inhibit the ongoing growth of the Internet and limit the freedom the Internet represents.  Other senators, such as Chairman Patrick Leahy (D-VT) advocated for the net neutrality rules to prevent the “paid-prioritization” of network traffic by a handful of “corporate gatekeepers” from turning the Internet into a “system of ‘haves and have-nots’.”

The witnesses disagreed with each other.  Mr. Burnham’s solution would be to classify last mile broadband access as a telecommunications service, which would give the FCC the authority to protect open access to the Internet without overly burdensome government regulation.  Ms. Livier also preferred reclassification as a telecommunication service to provide a basis for permanent regulation. She testified that an open Internet empowers minority communities, promoting better representation in media and in professional and creative settings.  Mr. McDowell disagreed. He testified that as a Commissioner, he voted against earlier attempts to enact net neutrality and continues to oppose net neutrality because, among other reasons, there is no evidence there is anything wrong in the Internet access market that needs fixing. He is concerned that regulation of fixed broadband would spill over into other areas, including wireless broadband, harming competition and innovation.

Dr. Eisenach also opposed net neutrality in his testimony. He saw net neutrality as protecting the status quo financial benefits to private parties rather than benefitting consumers or public interest.  Dr. Eisenach stated that existing antitrust laws are better able to preserve competition and to check anticompetitive behavior because they have exhibited the flexibility to address market power abuses. Ms. O’Connor expressed support for a light regulatory hand.  She testified that existing antitrust laws would be insufficient in the absence of net neutrality.

While opinions differ, no one disagrees that debate regarding net neutrality matters.  As the FCC determines how it will regulate the internet going forward in an effort to keep the internet open to everyone, various stakeholders and industry players will lobby and potentially litigate in an effort to keep the status quo.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

The Standard Merger and Acquisition Reviews Through Equal Rules Act (SMARTER Act), H.R. 5402, introduced by Rep. Blake Farenthold (R-TX), would codify certain recommendations included in a 2007 report by the Antitrust Modernization Commission. Under existing law, the rules for reviewing a merger or acquisition differ depending on whether the FTC or the DOJ reviews the merger. The SMARTER Act would reduce differences in the merger review process.

The proposed legislation would streamline merger reviews and various other antitrust procedures that, under current law, differ between whether the DOJ or FTC is conducting the review.  The legislation would amend the Clayton Act and the Federal Trade Commission Act to provide the antitrust agencies with consistent processes when moving to block a merger.  Officials are looking to extend the same powers held by the DOJ to the FTC.  The bill also eliminates the FTC’s power to initiate an administrative proceeding to challenge a merger; that power would be preserved in other contexts, but in regards to a merger the FTC would need to file a complaint in federal district court to block a deal, the same process currently followed by the DOJ.

Specifically, H.R. 5402 would amend the Clayton Act and the Federal Trade Commission Act to provide the antitrust enforcement agencies with consistent authority and processes when seeking to prevent a proposed merger or acquisition by first extending to the FTC the same authority that DOJ presently possesses under the Clayton Act. Second, the SMARTER Act would remove the FTC’s authority to initiate an administrative proceeding challenging “a merger, acquisition, joint venture or similar transaction subject to Section 7 of the Clayton Act.” The FTC would retain the ability to initiate administrative proceedings as an enforcement tool in other contexts. However, in the context of a merger, acquisition or joint venture, the Commission’s sole enforcement avenue under the SMARTER Act would be similar to DOJ’s: filing a complaint in federal district court.

The SMARTER Act would otherwise preserve each agency’s authority to challenge monopolistic transactions or practices that would substantially lessen competition and would not affect the judicial remedies available to address them.

While the legislation is a step in the right direction, the prospects for enactment of this bill in Congress remain unlikely any time soon because the Senate Judiciary Committee is not prepared as of yet to act on similar legislation. That being said, the action taken by the House Judiciary Committee sets the stage for additional consideration going forward.

Andre Barlow
(202) 589-1834
abarlow@dbmlawgroup.com

Chairman Wheeler explained that access to a 25 Mbps connection is becoming essential (or “table stakes”) to consumers with a majority of Americans having access to 100 Mbps or higher connections. However, “just because most Americans have access to next-generation broadband doesn’t mean they have competitive choices.”  Indeed, Chairman Wheeler believes that most Americans really have no competitive choices.  Chairman Wheeler applauded Google and AT&T’s introductions and plans to introduce gigabit broadband to markets around the country, but worried that characterizing competition in many markets as a duopoly “overstates the case” because of the lack of competitive opportunities open to consumers.

To address these concerns, Chairman Wheeler explained the FCC’s Agenda for Broadband Competition, which includes four broad principles: (i) protect existing competition; (ii) encourage greater competition where possible; (ii) create competition where it does not exist in a meaningful way; and (iv) promote broadband deployment where competition cannot be expected to exist.  Through the application of these principles, Chairman Wheeler hopes to improve broadband performance, promote competition, and encourage innovation.

For more information see: Tom Wheeler, Chairman, Federal Communications Commission, The Facts and Future of Broadband Competition, (Sept. 4, 2014), available at http://transition.fcc.gov/Daily_Releases/Daily_Business/2014/db0904/DOC-329161A1.pdf.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com

The settlement ending an investigating into Verizon’s alleged misuse of customer information. The FCC’s Enforcement Bureau was investigating Verizon’s alleged failure to notify approximately two million new customers of their privacy rights.  Specifically, Verizon allegedly failed to provide to  new customers instructions for how to opt-out from alleged Verizon’s use of their personal information for marketing purposes.  As part of the settlement, Verizon must inform all new customers of their opt-out rights on every bill for three years.

The $7.4 million settlement is the largest in FCC history for a settlement of an investigation related solely to the privacy of telephone customers’ personal information.

For more information see Press Release, Federal Communications Commission, Verizon to Pay $7.4 million to Settle Consumer Privacy Investigation (Sept. 3, 2014), available at http://www.fcc.gov/document/verizon-pay-74m-settle-privacy-investigation-0

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com