Tag: FTC

Tempur Sealy Acquisition of Mattress Firm: A Vertical Bridge Too Far for the FTC?

In a deal announced on May 9, Tempur Sealy International, Inc., the world’s largest mattress manufacturer, has agreed to acquire Houston-based Mattress Firm Group, Inc., the largest U.S. brick-and-mortar bedding retailer, with more than 2,300 locations and a robust e-commerce platform. The companies hope to finalize the $40 billion deal in the second half of 2024.

Following pre-merger notification of the deal last October, the FTC is reportedly taking a deep dive into the mattress industry to assess whether the transaction is likely to harm competition. The depth of the investigation itself signals a departure from the antitrust agencies’ traditional approach to “vertical” mergers in which firms in the same industry but in non-overlapping market segments (such as manufacturing and retailing the same product category) benefit from a soft presumption of legality. Customarily, vertical integration was perceived to be benign, if not somehow “efficiency enhancing.”

Whatever the merits of applying such leniency to traditional supply chains of widgets, it does not serve competition policy well in an economy dominated by technology-driven platforms that serve several enormous groups of customers at once. In today’s markets, non-overlapping vertical arrangements can severely affect whether rival firms can gain access to inputs, markets, or prospective customers.

Evidence of the FTC’s awareness of the potential for vertical mergers to cause competitive harm abounds. On September 15, 2021, the FTC withdrew the FTC/Department of Justice 2020 Vertical Merger Guidelines and Commentary. The Commission’s majority said that the 2020 Guidelines included a “flawed discussion of the purported procompetitive benefits (i.e., efficiencies) of vertical mergers, especially its treatment of the elimination of double marginalization” and by failing to address “increasing levels of consolidation across the economy.”

Mattresses and Widgets

A course correction is borne out by the Commission’s recent challenges to several proposed vertical mergers, including Nvidia Corp.’s attempted acquisition of Arm Ltd., Lockheed Martin Corporation’s attempted acquisition of Aerojet Rocketdyne Holdings, Inc., Microsoft Corp.’s acquisition of Activision Blizzard Inc., and Illumina, Inc.’s acquisition of GRAIL, Inc. After the parties abandoned the Nvidia/Arm acquisition, the FTC’s press release was effusive: “This result is particularly significant because it represents the first abandonment of a litigated vertical merger in many years,” the Commission said.

Enter the Tempur Sealy/Mattress Firm transaction, a vertical acquisition in a product category whose markets resemble widgets more than online merchandising or payment networks. Tempur Sealy became the world’s largest mattress manufacturer in 2012, when Tempur-Pedic acquired Sealey Corp. for $1.3 billion. The company currently earns revenues of $5 billion a year, almost a third of the $17 billion U.S. mattress market. Mattress Firm, the largest mattress retailer in the U.S. with annual revenues of $2.5 billion a year, has been owned since 2016 by German retail holding company Steinhoff International Holdings NV. The firm filed for Chapter 11 bankruptcy protection in October 2018, but quickly emerged the following month after closing 700 stores.

The merging parties are no strangers to one another, having engaged in a commercial relationship for the past 35 years. In 2017, Tempur Sealy sued Mattress Firm for selling mattresses that infringed on the Tempur-Pedic line-up, but in 2019, after its emergence from bankruptcy, Mattress Firm and Tempur Sealy struck a long-term partnership agreement. A merger of the two firms has been under discussion in one form or another for most of the past decade.

Public statements by the parties stress the complementarity of the deal, which they describe as combining “Tempur Sealy’s extensive product development and manufacturing capabilities with vertically integrated retail.” The merged entity will end up with about 3,000 retail stores, 30 e-commerce platforms, 71 manufacturing facilities, and 4 R&D facilities around the world. It is the kind of combination of complementary businesses that not long ago might not have even earned a Second Request from the antitrust agencies.

The FTC, which at least since last December has been investigating the potential effects on the mattress industry of a merger between the two market leaders, issued a Second Request earlier this month. By February, the Commission had already interviewed executives from the top 20 mattress manufacturers, according to a report in Furniture Today (February 2, 2023).

Disruptors and Goliaths

The FTC is likely to discover a large and growing global industry undergoing significant changes in how mattresses are designed, marketed, and sold in reaction to changing consumer preferences.

Several online mattress-in-a-box companies have disrupted the industry. Today, nearly half of all consumers purchases are online. They will also find fairly low barriers to entry into both brick-and-mortar and online retailing and mattress manufacturing. Their review of the Tempur Sealy/Mattress Firm transaction will also encounter two players in the market with a long history of cooperation.

With 20 manufacturers significant enough to interview, the Commission would appear to be faced with a fairly competitive market – one in which little or no foreclosure of rivals to the ability to obtain inputs or the availability of channels of distribution to reach consumers will result from the proposed transaction. Additional competitive pressure comes from Amazon, which began selling its own mattresses in 2018 as part of the Amazon Essentials line, and Walmart, which introduced its own mattress-in-box brand, Allswell, available online and in stores.

On balance, the acquisition of Mattress Firm by Tempur Sealy would not appear to raise significant antitrust issues. A challenge to this transaction by the FTC may be a vertical bridge too far. That is no doubt the assessment reached by Scott Thompson, chairman and CEO of Tempur Sealy, who expressed confidence in clearing the FTC’s antitrust review, “either in the traditional sense or through litigation.”

© MoginRubin LLP

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How to Succeed in Environmental Marketing Claims

Environmental marketing claims often present something of a Catch-22—companies that are doing actual good for the environment deserve to reap the benefits of their efforts, and consumers deserve to know, while at the same time, heightened scrutiny from the Federal Trade Commission (FTC), the National Advertising Division (NAD), state regulators and the plaintiffs’ bar have made such claims increasingly risky.

In 2012, the FTC issued the Green Guides for the use of environmental marketing claims to protect consumers and to help advertisers avoid deceptive environmental marketing. Compliance with the Green Guides may provide a safe harbor from FTC enforcement, and from liability under state laws, such as California’s Environmental Marketing Claims Act, that incorporate the Green Guides. The FTC has started a process to revise the Green Guides, including a request for comments about the meaning of “sustainable.” In the meantime, any business considering touting the environmental attributes of its products should consider the following essential takeaways from the Green Guides in their current form:

    • Substantiation: Substantiation is key! Advertisers should have a reasonable basis for their environmental claims. Substantiation is the support for a claim, which helps ensure that the claim is truthful and not misleading or deceptive. Among other things, substantiation requires documentation sufficient to verify environmental claims.
    • General benefit claims: Advertisers should avoid making unqualified claims of general benefit because substantiation is required for each reasonable interpretation of the claim. The more narrowly tailored the claim, the easier it is to substantiate.
    • Comparative claims: Advertisers should be careful and specific when making comparative claims. For example, a claim that states “20% more recycled content” begs the question: “compared to what?” A prior version of the same product? A competing product? Without further detail, the advertiser would be responsible for the reasonable interpretation that the product has 20% more recycled content than other brands, as well as the interpretation that the product has 20% more recycled content than the advertiser’s older products.
    • General greenwashing terms: Advertisers should be very cautious when using general environmental benefit terms such as “eco-friendly,” “sustainable,” “green,” and “planet-friendly.” Those kinds of claims feature prominently in many complaints alleging greenwashing, and they should only be used where the advertiser knows and explains what the term means, and can substantiate every reasonable interpretation of the claim.

Putting it into Practice: Given the scrutiny that environmental claims tend to attract, advertisers should exercise care when making environmental benefit claims about their products and services. They should narrowly tailor their claims to the specific environmental attributes they want to promote, and perhaps most important, they should ensure they have adequate backup to substantiate their claims. While the FTC Green Guides are due for a refresh (which we will surely report on), for the time being, they will continue to serve as important guidance for advertisers seeking to inform consumers without exposing their business to FTC scrutiny or class action litigation.

FTC Launches New Office of Technology

On February 17, 2023, the Federal Trade Commission announced the launch of their new Office of Technology. The Office of Technology will assist the FTC by strengthening and supporting law enforcement investigations and actions, advising and engaging with staff and the Commission on policy and research initiatives, and engaging with the public and relevant experts to identify market trends, emerging technologies and best practices. The Office will have dedicated staff and resources and be headed by Chief Technology Officer Stephanie T. Nguyen.

Article By Hunton Andrews Kurth’s Privacy and Cybersecurity Practice Group

For more privacy and cybersecurity legal news, click here to visit the National Law Review.

Copyright © 2023, Hunton Andrews Kurth LLP. All Rights Reserved.

The FTC Announces First Health Breach Notification Rule Enforcement Action

On February 1, the Federal Trade Commission (“FTC”) announced enforcement action for the first time under its Health Breach Notification Rule[1]. The complaint against telehealth and prescription drug discount provider GoodRx Holdings Inc. (“GoodRx”), alleges its failure to notify consumers and others of its unauthorized disclosures of consumers’ personal health information to Facebook, Google and other companies.

In a first-of-its-kind proposed order, filed by the Department of Justice on behalf of the FTC, GoodRx will be prohibited from sharing user health data with applicable third parties for advertising purposes, and has agreed to pay a $1.5 million civil penalty for violating the rule. The proposed order must be approved by the federal court to go into effect. The Health Breach Notification Rule requires vendors of personal health records and related entities, which are not covered by the Health Insurance Portability and Accountability Act (HIPAA), to notify consumers and the FTC of unauthorized disclosures. In a September 2021 policy statement, the FTC warned health apps and connected devices that they must comply with the rule.

According to the FTC’s complaint, for years GoodRx violated the FTC Act by sharing sensitive personal health information with advertising companies and platforms—contrary to its privacy promises—and failed to report these unauthorized disclosures as required by the Health Breach Notification Rule.  Specifically, the FTC claims GoodRx shared personal health information with Facebook, Google, Criteo and others. According to the FTC, since at least 2017, GoodRx deceptively promised its users that it would never share personal health information with advertisers or other third parties. GoodRx repeatedly violated this promise by sharing sensitive personal health information—such as including its users’ prescription medications and personal health conditions.

The FTC also alleges GoodRx monetized its users’ personal health information, and used data it shared with Facebook to target GoodRx’s own users with personalized health and medication-specific advertisements on Facebook and Instagram.

The FTC further alleges that GoodRx:

  • Failed to Limit Third-Party Use of Personal Health Information: GoodRx allowed third parties it shared data with to use that information for their own internal purposes, including for research and development or to improve advertising.
  • Misrepresented its HIPAA Compliance: GoodRx displayed a seal at the bottom of its telehealth services homepage falsely suggesting to consumers that it complied with the Health Insurance Portability and Accountability Act of 1996 (HIPAA), a law that sets forth privacy and information security protections for health data.
  • Failed to Implement Policies to Protect Personal Health Information: GoodRx failed to maintain sufficient policies or procedures to protect its users’ personal health information. Until a consumer watchdog publicly revealed GoodRx’s actions in February 2020, GoodRx had no sufficient formal, written, or standard privacy or data sharing policies or compliance programs in place.

In addition to the $1.5 million penalty for violating the rule, the proposed federal court order also prohibits GoodRx from engaging in the deceptive practices outlined in the complaint and requires the company to comply with the Health Breach Notification Rule. To remedy the FTC’s numerous allegations, other provisions of the proposed order against GoodRx also:

  • Prohibit the sharing of health data for advertising: GoodRx will be permanently prohibited from disclosing user health information with applicable third parties for advertising purposes.
  • Require user consent for any other sharing: GoodRx must obtain users’ affirmative express consent before disclosing user health information with applicable third parties for other purposes. The order requires the company to clearly and conspicuously detail the categories of health information that it will disclose to third parties.  It also prohibits the company from using manipulative designs, known as dark patterns, to obtain users’ consent to share the information.
  • Require the company to seek deletion of data: GoodRx must direct third parties to delete the consumer health data that was shared with them and inform consumers about the breaches and the FTC’s enforcement action against the company.
  • Limit Retention of Data: GoodRx will be required to limit how long it can retain personal and health information according to a data retention schedule. It also must publicly post a retention schedule and detail the information it collects and why such data collection is necessary.
  • Implement a Mandated Privacy Program: GoodRx must put in place a comprehensive privacy program that includes strong safeguards to protect consumer data.

© 2023 Dinsmore & Shohl LLP. All rights reserved.

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FOOTNOTES

[1] 16 CFR Part 318

Privacy Tip #359 – GoodRx Settles with FTC for Sharing Health Information for Advertising

The Federal Trade Commission (FTC) announced on February 1, 2023 that it has settled, for $1.5M, its first enforcement action under its Health Breach Notification Rule against GoodRx Holdings, Inc., a telehealth and prescription drug provider.

According to the press release, the FTC alleged that GoodRx failed “to notify consumers and others of its unauthorized disclosures of consumers’ personal health information to Facebook, Google, and other companies.”

In the proposed federal court order (the Order), GoodRx will be “prohibited from sharing user health data with applicable third parties for advertising purposes.” The complaint alleged that GoodRx told consumers that it would not share personal health information, and it monetized users’ personal health information by sharing consumers’ information with third parties such as Facebook and Instagram to help target users with ads for personalized health and medication-specific ads.

The complaint also alleged that GoodRx “compiled lists of its users who had purchased particular medications such as those used to treat heart disease and blood pressure, and uploaded their email addresses, phone numbers, and mobile advertising IDs to Facebook so it could identify their profiles. GoodRx then used that information to target these users with health-related advertisements.” It also alleges that those third parties then used the information received from GoodRx for their own internal purposes to improve the effectiveness of the advertising.

The proposed Order must be approved by a federal court before it can take effect. To address the FTC’s allegations, the Order prohibits the sharing of health data for ads; requires user consent for any other sharing; stipulates that the company must direct third parties to delete consumer health data; limits the retention of data; and implement a mandated privacy program. Click here to read the press release.

Article By Linn F. Freedman of Robinson & Cole LLP

For more privacy and cybersecurity legal news, click here to visit the National Law Review.

Copyright © 2023 Robinson & Cole LLP. All rights reserved.

Future of Non-Competes Up in the Air

Future of Non-Competes Up in the Air

The FTC recently announced its proposal to ban non-compete clauses in employment agreements. That proposal is currently in a 60-day period of public comment, and employers are (understandably) nervous. While many employers rely on these provisions to manage competition and protect their IP and confidential information, companies across the country may soon find themselves in the shoes of California employers, having to work around restrictions on non-competes to maximize protection within the increasingly narrow confines of the law.

Employers are not without options in responding to the potential changes should they become law–more aggressive retention incentives, intelligent data security, and stricter confidentiality agreements should all be part of the conversation. Even deferred compensation could be on the table, as noted in the article, though beware of the tax implications. Employers should also keep in mind that the FTC proposal, should it become law, will doubtless be subject to legal challenges and could be tied up in the courts for a while before becoming effective.

“Observers on both sides say that limitations on the clauses will compel employers to get more creative about how they retain talent, using everything from compensation to career advancement to keep workers engaged and loyal to the company. Some companies use deferred compensation—such as retention bonuses or rolling stock options that vest after, say, three years—to give people incentives to stay.”

©1994-2023 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.

FTC Starts Long-Awaited Green Guides Review

  • On December 14, 2022, at an open meeting of the Federal Trade Commission (“FTC” or “Commission”), FTC commissioners voted unanimously to publish a Notice in the Federal Register announcing a Request for Public Comments on potential amendments to the Commission’s Guides for the Use of Environmental Marketing Claims (“Green Guides” or “Guides”).
  • The FTC solicits comments on the ongoing need for the Guides and on specific claims addressed in the Guides, including “recyclable,” “recycled content,” “degradable,” “compostable,” and more. It also asks if it should initiate a rulemaking process and address claims it declined to consider during the last review, such as “organic” and “sustainable.”
  • Importantly, given the growth in some state laws that purport to restrict claims, the FTC asks for input on whether the Guides conflict with federal or state laws. This proceeding is expected to garner significant input.
  • Once the Notice is published in the Federal Register (which the FTC anticipates will be in mid-January 2023), interested stakeholders will have 60 days from the date of the Notice to submit comments to the FTC, unless an extension is granted.
  • For more information about the FTC Notice, please read our report here.

© 2022 Keller and Heckman LLP

For more Energy and Environmental Law news, click here to visit the National Law Review.

USDA Focused on Accurate “Made in the USA” Beef Labeling

  • In response to industry concerns for mislabeled beef products, U.S. Agriculture Secretary Tom Vilack recently said that the “Product of the USA” label on meat products should undergo a full-scale review. Vilack maintains that he is “committed to ensuring that the ‘Product of USA’ label reflects what a plain understanding of those terms means to U.S. consumers.” In March, we reported that the Tenth Circuit dismissed lawsuits based on meat producer’s use of allegedly deceptive and misleading “Product of the USA”  labels on their beef products that did not originate from cattle born and raised in the United States.
  • The issue of country-of-origin beef labeling (“COOL”) continues to be a source of debate. Earlier this week, the FTC finalized a rule that is intended to tighten the use of the Made in the USA standard. The FTC said that this update would benefit small businesses who lack the resources to defend their products from foreign imitators. However, the FTC rule does not require USDA action. In response, the beef industry is demanding Congress to act swiftly.
  • R-CALF, a group of USA-based cattle ranchers, has been pushing hard for reforms on COOL. On September 22, R-CALF released a poll that shows staggering support for mandatory COOL legislation by the American public. R-CALF reports that 86 percent of American voters support the American Beef Labeling Act that reinstates mandatory country of origin labeling for beef, and 90 percent of voters are concerned that foreign importers of beef can legally put a “Product of USA” sticker on a package containing beef that was born, raised, and harvested outside the United States.
  • Currently, Congress is working through prospective beef labeling legislation that would require USDA oversight of COOL. The American Beef Labeling Act (S.2716) is a bipartisan bill that was introduced in the Senate in 2021; however, the bill has languished without action in the U.S. Senate Agriculture Committee. In March 2022, a bipartisan companion bill was introduced in the U.S. House (H.R.7291), which has also seen little to no progress in the House Agriculture Committee. Keller and Heckman will continue to monitor these legislative developments and USDA action.

For more Food and Drug Law news, click here to visit the National Law Review.

© 2022 Keller and Heckman LLP

FTC Commercial Surveillance and Data Security Forum Highlights Industry and Consumer Perspectives

On September 8, 2022, the Federal Trade Commission hosted a virtual public forum on its Advanced Notice of Proposed Rulemaking (“ANPR”) concerning “commercial surveillance and lax data security.” The forum featured remarks from FTC Chair Lina Kahn, Commissioner Rebecca Kelly Slaughter and Commissioner Alvaro Bedoya, as well as panels with industry leaders and consumer advocates.

Remarks from Chair Khan and Commissioners Slaughter and Bedoya focused on the need for public participation in the rulemaking process and the FTC’s role in privacy regulation in the absence of comprehensive federal legislation. Commissioner Slaughter noted that, until such federal legislation is passed, the FTC will continue to use its Section 5 authority to regulate unfair and deceptive practices related to privacy and data security.

The industry panel was moderated by FTC Senior Advisor Olivier Sylvain and focused in part on how the FTC should structure a potential rule. Multiple industry panelists emphasized the need for rules that limit out-of-context data use or tracking, while still allowing in-context use to as consumers expect. Industry panelists also highlighted the need for heightened rules for “dominant” industry players and financial penalties for bad behaviors.

The consumer advocate panel focused on issues surrounding meaningful consumer consent and the negative effects of commercial surveillance on consumers, such as one-click background checks and demographic-tailored advertising that disproportionately affects minority groups in negative ways. Similar to the industry panel, consumer advocate panelists also highlighted out-of-context data use and dominant industry actors as some of the major issues the FTC should address in its rulemaking.  The FTC will receive public comments on the ANPR until October 21, 2022.

Article By Privacy and Cybersecurity Practice Group of Hunton Andrews Kurth

For more antitrust and FTC legal news, click here to visit the National Law Review.

Copyright © 2022, Hunton Andrews Kurth LLP. All Rights Reserved.

DOJ Forces $85M End to “Long-Running Conspiracy” to Suppress Poultry Wages

Three poultry processors and a consulting firm that circulated wage information among them have entered a consent decree with the Department of Justice to end a “long-running conspiracy to exchange information about wages and benefits for poultry processing plant workers and collaborate with their competitors on compensation decisions,” a violation of the Sherman Antitrust Act. The poultry companies — Cargill Inc. and Cargill Meat Solutions Corp., Sanderson Farms Inc., and Wayne Farms LLC – agreed to pay nearly $85 million. In addition to the payment, the producers must submit to antitrust monitoring for 10 years.

The decree brings a halt to the exchange of compensation information and deceptive conduct toward chicken growers designed to lower their compensation. The DOJ charged two of the poultry processors – Sanderson Farms, which was just acquired via joint venture between Cargill and Continental Grain Co., and Wayne Farms, owned by Continental – with violating the Packers and Stockyards Act. The companies engaged in deceptive practices via a “tournament system” which pit chicken growers against each other to determine their compensation. Jonathan Meng, meanwhile, president of the data firm Webber, Meng, Sahl & Company, is banned from the industry for his role as information broker for the producers.

Cargill is a privately held, multinational corporation based in Minnetonka, Minn. The corporation’s major businesses are trading, purchasing and distributing grain and other agricultural commodities. In 2021, Cargill generated revenue of about $134.4 billion. In the meat and poultry processing industry, Cargill’s $20 billion in revenue in 2021 put it in third place behind Tyson Foods Inc. ($43 billion) and JBS USA Holdings, Inc. ($39 billion) and one notch ahead of Sysco Corp. ($18 billion).

Just days before the settlement, Bloomberg Law reporter Dan Papsucn wrote, Sanderson Farms was acquired for $4.5 billion via joint venture between Cargill and Continental Grain Co. Wayne Farms was already owned by Continental. The acquisition combined the third and sixth-largest companies in U.S. chicken production to form the new Wayne-Sanderson Farms company. Before they were merged, Sanderson Farms and Wayne Farms annually were generating approximately $3.56 billion and $2.2 billion, respectively.

The DOJ’s investigation continues into the activities of several unnamed co-conspirators.  The government’s suit was filed in federal court in Maryland (U.S. v. Cargill Meat Solutions Corp., et al., No. 1:22-cv-01821 D. Md.).

Increased Federal Attention

The poultry industry case demonstrates that the antitrust law enforcers at DOJ, in addition to those at the Federal Trade Commission, remain dedicated to increasing competition in such concentrated labor markets. Worker mobility is something President Biden has promised to protect. FTC Chairwoman Lina Khan is considering new regulations to ban non-competes and to target them with enforcement actions, according to Wall Street Journal reporters Dave Michaels and Ryan Tracy.

Agreements entered without the cloak of legitimate competitive concerns by employers are called “naked” agreements. In 2016 DOJ and FTC jointly declared that naked wage-fixing or no-poaching agreements were per se illegal under antitrust laws. If the agreement is separate from or not reasonably necessary to achieve a larger legitimate collaboration between the employers, the agreement is deemed illegal without any inquiry into its competitive effects. Legitimate joint ventures (including, for example, appropriate shared use of facilities) are not considered per se illegal under antitrust laws. For these legitimate ventures the DOJ advocates the “rule of reason” or “quick-look analysis.” Also in 2016, DOJ said it would proceed with criminal actions against naked wage-fixing or no-poaching agreements.

Of course, support for the legitimacy of non-competes and no-poaching agreements splits along party lines. Sometimes the issue isn’t whether the agreements should be eliminated, but who should eliminate them. The question becomes: Is this the purview of the federal government or is it up to state legislatures?

Private Litigation

Private actions are another consideration for employers. Auto repair chain Jiffy Lube, which is owned by Shell Oil Company, recently agreed to pay $2 million to settle claims that it used illegal no-poaching agreements which prevented franchise owners from hiring current or recent employees of other Jiffy Lube franchises. The settlement will be shared among 1,250 hourly workers in the Philadelphia metropolitan area in Pennsylvania, New Jersey and Delaware.

According to the class action complaint, Jiffy Lube used these agreements to suppress wages and prevent workers from achieving better terms of employment. Employees had to wait six months after leaving one Jiffy Lube shop before attempting to work at another, according to the terms. Workers sued claiming this was a violation of the Sherman Antitrust Act.

The case was filed in U.S. District Court for the Eastern District of Pennsylvania (Victor Fuentes v. Royal Dutch Shell PLC, et al., Case No. 2:18-cv-05174, E.D. Pa.).

Employers Beware

As these cases demonstrate, many employers don’t realize (or may not care) that these types of arrangements can be considered anticompetitive or that their employment agreements can create substantial antitrust liabilities. In addition to public and private litigation, restrictive employment agreements can tank business deals. Imagine your M&A deal craters when a buyer discovers you have a no-poach agreement with competitors.  You might not have seen it as problematic until your prospective buyer walks away because of the risk and your once promising deal is over.

Employers and business owners who wish to protect themselves when employees leave for new positions need to be careful how they go about building their defenses because doing it wrong can mean both civil and criminal charges against corporations and individuals, as these cases illustrate. Critical questions need to be answered in employment agreements and business deals. Is the employer – such as a franchisor – trying to stop intramural poaching within its own system, effectively causing vertical restraint? Or is it trying to legitimately protect itself from losing employees to competitors, or horizontal restraint? These are questions best addressed by counsel with a sophisticated understanding of antitrust law, employment agreements, and mergers and acquisitions.

Article By Jennifer M. Oliver of MoginRubin

For more antitrust legal news, click here to visit the National Law Review.

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