In an October surprise, the DOJ and FTC (collectively, the “Agencies”) released guidance for HR professionals on the application of the antitrust laws to employee hiring and compensation. The Agencies’ October 20, 2016 release, Antitrust Guidance for Human Resource Professionals, announced that “naked” agreements among employers not to poach each other’s employees and to fix wages and other terms of employment are per se illegal. Critically, for the first time, the Agencies warn that such agreements could result in criminal prosecution against individual HR professionals, other company executives, as well as the company. This Guidance, coupled with repeated requests to approach the Agencies to report such agreements, signals a significant shift in enforcement focus for the Agencies, including a further move to individual prosecutions, particularly when taken together with last year’s DOJ Yates Memorandum calling for more emphasis on individual executive liability.
A litigator and former enforcer at both the Federal Trade Commission and DOJ Antitrust Division, Alex offers clients insightful counseling and advocacy before federal and state antitrust authorities. Alex focuses on technology, energy, and finance, but his work extends to many other important sectors of the economy.
Alex divides his practice between transactions, counseling, and litigation. From 2012-2015, Alex served as antitrust and competition advisor to FTC Commissioner Maureen Ohlhausen, counseling her on the agency's numerous investigations, enforcement actions, and policies. He also engaged with enforcers outside the United States on key policy issues, including the proper role of antitrust analysis in intellectual property disputes. Earlier, from 2010-2012, Alex was a trial attorney at the DOJ Antitrust Division focused on technology and finance.
In addition to his government work, Alex has more than a decade of experience in private practice. He has defended the transactions of domestic and international technology, media, and energy clients before antitrust agencies and represented class action defendants in federal and state court litigation around the United States. Before law school, Alex co-founded and sold an online technology company.
SELECTED EXPERIENCE (includes representations prior to joining the firm)
Technology and Media
- VTech. Represented VTech in the FTC investigation of its acquisition of Leapfrog.
- AVG Technologies. Represented AVG in its $1.3 billion sale to Avast Software, maker of antivirus and security software.
- Photomask Manufacturer. Represented semiconductor photomask manufacturer in the DOJ review of its acquisition by another manufacturer.
- National Radio Network. Represented Spanish-language radio network in its $3 billion acquisition by the nation's largest Spanish-language television network.
- National Radio Network. Defended radio network in the DOJ review of multi-station acquisition.
- Government Experience. Numerous transactions reviewed at DOJ and FTC, including Google/ITA (online travel software), Universal/EMI (music distribution), and dozens of additional deals in these sectors.
- Technology Equipment Company. Defended leading home equipment technology company in class actions alleging monopolization for exercise of intellectual property rights.
- Semiconductor Manufacturer. Defended semiconductor company against claims of price fixing in
federal court class action.
Energy and Infrastructure
- Plastics Distributor. Represented US plastics distributor in the FTC investigation of its 2016 acquisition of another major plastics distributor.
- Midstream Energy Services Company. Represented company in FTC review of the company's $13 billion acquisition of a midstream services provider; negotiated a consent decree involving divestitures.
- Midstream Energy Services Company. Defended company before the FTC review in its review of an acquisition of assets in Texas and Oklahoma.
- Renewable Power Generator. Representing renewable energy generator in structuring a joint venture for generation and transmission services.
- Oil Producer. Represented oil producer in negotiating a joint venture arrangement for pipeline services.
- Government Experience. While at the FTC, advised on numerous proposed transactions, including pipeline sales, as well as retail and industrial manufacturing and distribution deals. Drafted Commission opinions on multiple transactions (restaurant food and supplies distribution, office supply stores and glass bottle manufacturers). Advised on the Commission’s decisions and drafted opinions and statements in the administrative case involving allegations of price fixing and exclusive dealing, In re McWane; the decision was upheld on review at the Eleventh Circuit and certiorari denied by the U.S. Supreme Court.
- National Bank. Defended bank against group boycott allegations in multi-year case involving credit card payment networks.
- National Bank. Defended bank against allegations of price fixing involving the merchant interchange rate for credit card payment networks.
- Government Experience. As a trial attorney at DOJ, investigated the proposed merger of the New York Stock Exchange and Deutsche Borse, the proposed takeover of NYSE by NASDAQ, and many other deals involving financial exchanges and related businesses.
Health Care and Life Sciences
- Branded Pharmaceutical Company. Represented branded drug maker in the negotiation of a licensing agreement.
- Regional Hospital System. Representing a health care provider in an investigation into a clinical integration program and joint venture.
- National Hospital System. Presented concerns of a third party to the FTC regarding a proposed health care merger.
- Government Experience. As an FTC advisor, reviewed many transactions in life sciences, medical devices, and hospitals, as well as the resolution of agency concerns.
In addition, worked on the agency’s appellate and
Supreme Court strategy pre-Actavis and its amicus briefs and staff
enforcement recommendations post-Actavis. At the DOJ, litigated the lawfulness of most favored nations clauses imposed by a health
insurer on health care providers.
- National Discount Air Carrier. Presented proposed deal to the federal antitrust agencies for an acquisition of airport slots.
- Global Air Carrier. Defended a major Asian air carrier in federal district and appellate courts against class actions alleging price fixing of passenger air fares. See In re Korean Air Lines Co. Antitrust Litig., 567 F. Supp. 2d 1213 (C.D. Cal. July 23, 2008), aff’d in part, vacated in part, 642 F.3d 685 (9th Cir. 2011).
- National Discount Air Carrier. Defended an air carrier against allegations of predatory pricing.
- Government Experience. Investigated the purchase and sale of airport slots between two major airlines while at DOJ.
Posts by: Alex Okuliar
Partners Jay Jurata and Alex Okuliar recently published a chapter on IP and Antitrust in The Antitrust Review of the Americas 2017 published by Global Competition Review. They note that antitrust and competition law is being wielded as an increasingly effective weapon to diminish patent rights in the US. Follow the link to the chapter.
For years, a debate has swirled in Washington and around the country about the role and economic value of “patent assertion entities” – often referred to derisively in the press as “patent trolls.” Some of these PAEs have been known to blanket small businesses with threatening letters claiming infringement of sometimes questionable patents hoping to receive a quick payout. The Federal Trade Commission just recently published a long-awaited Patent Assertion Entity Activity Study that analyzes the structure, organization, and behavior of PAEs, hoping to inform the debate about these entities. Using responses from a sample of 22 PAEs and more than 2,500 PAE affiliates and related entities, the study analyzes PAE acquisitions, litigation, and licensing practices over a six-year period. The findings in the study are extensive and are likely to provoke further discussion and debate. The Commission’s key findings and recommendations are discussed below. READ MORE
Partners Alex Okuliar and Jim Tierney recently published a piece in the National Law Journal entitled Are Patent Rights Poised for a Resurgence? They argue that after several years of retrenchment, economic trends in the US and China, as well as developments at the federal agencies and US courts, could signal a return to stronger protections for patent owners. Follow the link to the article.
After several turbulent years of litigation and policy wrangling, many have asked whether the federal antitrust agencies should rewrite their two-decade old Antitrust Guidelines for the Licensing of Intellectual Property (“Guidelines”). Should they provide clearer guidance regarding thorny questions about licensing standard essential patents (SEPs), patent assertion entities (PAEs), reverse payment settlements, or other matters that have prompted new guidelines from other enforcers around the world? On August 12, the Federal Trade Commission and US Department of Justice’s Antitrust Division responded with modest updates to the Guidelines, likely setting themselves up for considerable commentary in the weeks to come.
The Second Circuit recently held that under Federal Rule of Civil Procedure 23, a district court judge can decertify a class after a jury verdict in favor of the class but before entering judgment, upholding a Southern District Court of New York decision granting defendants’ post-verdict motion to decertify the class. Joseph Mazzei v. The Money Store, TMS Mortgage Inc., HomEq Servicing Corp., No. 15-2054 (2d Cir. July 15, 2016). The Second Circuit’s decision confirms that after a court certifies a class, defendants should continue to develop evidence to seek to decertify the class even after a jury verdict in favor of the class.
On July 6, 2016, Judge Leonard P. Stark, of the federal district court in Delaware, ordered a $3 million punitive monetary sanction, and an adverse inference jury instruction, against antitrust defendant Plantronics after finding that a top executive at the company had deleted thousands of potentially relevant emails. This case is noteworthy both because of the severity of the sanction and the court’s decision to impute the conduct of an employee to the company even though numerous preservation practices were in place and the employee was instructed not to destroy information.
Where is the line drawn between acquisitions of securities made “solely for the purpose of investment” on one hand, and influencing control, thereby requiring regulatory approval, on the other hand? That is the central cautionary question that was reinforced by the July 12, 2016, Department of Justice (“DOJ”) settlement with ValueAct Capital. The well-known activist investment firm agreed to pay $11 million to settle a suit alleging that it violated the premerger reporting and waiting period requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR Act”). ValueAct purchased more than $2.5 billion of shares in two oil companies, Baker Hughes Inc. and Halliburton Co., after they announced they would merge. The DOJ alleged that ValueAct used its ownership position to influence the proposed merger and other aspects of Baker Hughes and Halliburton, and thus could not rely on the exemption.
On June 14, 2016, U.S. District Judge Jorge Alonso, of the Northern District of Illinois, denied a motion for preliminary injunction by the Federal Trade Commission (“FTC”) and the Attorney General for the State of Illinois, seeking to block the proposed merger between Advocate Health Care and the NorthShore University Health System (“NorthShore”) in the Chicago metropolitan area. According to Judge Alonso’s opinion released on June 20, the Plaintiffs failed to prove a relevant geographic market, the lack of which the Court deemed fatal to the Plaintiffs’ case.
This loss could be a blow for the FTC’s health care competition enforcement program. It is the agency’s second loss in district court this year in a hospital merger challenge. Additionally, as we noted in our May 13, 2016 blog post concerning the FTC’s earlier loss on the Hershey merger—now on appeal to the Third Circuit—both cases reflect push-back by courts against what to this point have been highly successful FTC market definition and consumer harm arguments in hospital merger cases.
On June 1, 2016, FTC Commissioner Maureen Ohlhausen delivered remarks in Hong Kong, pushing back on recent news reports implying that the United States currently suffers from a “monopoly problem” causing a reduction of competition in the marketplace. Recent articles and opinion pieces in The Economist and The New York Times suggest that the consolidation of market power, and lack of antitrust enforcement preventing such consolidation, are having a noticeable effect and harming consumers and innovation. Indeed, the precursor to these reports—an April 14, 2016 report from the Council of Economic Advisers (“CEA”), entitled “Benefits of Competition and Indicators of Market Power,” argues there has been a decline of competition in certain parts of the U.S. economy due the concentration of monopoly power in the hands of a select few players in certain industries (e.g., airlines, cable, networking). The CEA report suggests U.S. agencies should explore how certain factors—the use of Big Data, increased price transparency, and common stock ownership—affect competition. As a result of the CEA report, President Obama issued an Executive Order on April 15, 2016, directing antitrust enforcement agencies to use their authority to “promote competition.”
On May 9, 2016, U.S. District Judge John Jones III, of the Middle District of Pennsylvania, rejected a motion for preliminary injunction by the Federal Trade Commission (“FTC”) and the Pennsylvania Attorney General to halt the proposed merger between Penn State Hershey Medical Center (“Hershey”) and PinnacleHealth System (“Pinnacle”). The Court’s decision represents a potential setback for the FTC’s enforcement against hospital consolidation around the country. The opinion raises further questions about recent analyses endorsed by the agency and other federal courts when reviewing hospital mergers. The Court has extended the temporary restraining order in effect until May 27, 2016, to allow the FTC and the Attorney General to seek relief from the 3d Circuit.
Members of Orrick’s Life Sciences practice with experience addressing pharmaceutical industry antitrust and IP issues recently published an article analyzing the recent decision of the U.S. Court of Appeals for the Federal Circuit in In re Loestrin, No. 14-2071 (1st Cir. Feb. 22, 2016). In that decision—only the second appellate decision applying the Supreme Court’s seminal 2013 decision in FTC v. Actavis , the First Circuit addresses a few of the antitrust issues surrounding so-called “reverse-payment” settlements of patent infringement litigation between branded and generic drug manufacturers. To read the published article, please click here.
For the first time in its 101-year history, the Federal Trade Commission yesterday issued a policy statement outlining the extent of its authority to police “unfair methods of competition” on a “standalone” basis under Section 5 of the Federal Trade Commission Act. In a terse Statement of Enforcement Principles, the Commission laid out a framework for its Section 5 jurisprudence that was predictably tethered to the familiar antitrust “rule of reason” analysis but also sets forth a potentially expansive approach to enforcement. Indeed, the Commission’s approach could encompass novel enforcement theories premised on acts or practices that “contravene the spirit of the antitrust laws” as well as those incipient acts that, if allowed to mature or complete, “could violate the Sherman or Clayton Act.” Commissioner Ohlhausen’s lone dissent recognizes these potentially disconcerting developments for private industry. READ MORE