FTC International Monthly - December

FTC International Monthly: U.S. Competition, Consumer Protection and Privacy News



FTC, States To Recoup Millions in Relief for Victims Fleeced by ‘Pharma Bro’ Scheme To Illegally Monopolize Life-Saving Drug Daraprim


The FTC and its state co-plaintiffs, New York, California, Illinois, North Carolina, Ohio, Pennsylvania, and Virginia, filed an order in court that shuts down an illegal scheme masterminded by ‘Pharma Bro’ Martin Shkreli that fleeced patients dependent on the life-saving drug Daraprim.  The order, filed with the settling defendants, follows a January 2020 complaint against Shkreli, his associate Kevin Mulleady, their company Vyera Pharmaceuticals, LLC, and its parent company Phoenixus AG.  Enforcers alleged that Shkreli, currently in prison for securities fraud, and Mulleady hiked the price of Daraprim by 4000 percent and then concocted an elaborate web of restrictions to illegally block competitors from producing a cheaper option.  The order bans Mulleady from the pharmaceutical industry and requires Vyera and Phoenixus AG to provide up to $40 million in relief for victims.  Shkreli, who allegedly pioneered the scheme as Vyera’s first CEO and continued to mastermind it from prison, is set to begin trial later this month.

FTC, DOJ Antitrust Division, and European Commission Launch EU-U.S. Joint Technology Competition Policy Dialogue

EU-U.S. Joint Technology Competition Policy Dialogue

FTC Chair Khan, AAG Kanter of the DOJ Antitrust Division, and Executive Vice President Margrethe Vestager of the European Commission, launched the EU-U.S. Joint Technology Competition Policy Dialogue.  At the conclusion of the meeting, the three agencies issued a statement.  They reaffirmed their mutual interest in cooperating on competition policy and enforcement, especially in technology sectors, including through the Joint Dialogue.  The Dialogue will include high-level meetings as well as regular staff discussion focused on the shared competition enforcement and policy issues that arise in technology markets.  In addition to enhancing enforcement and policy coordination, these exchanges will help inform similar domestic efforts, potentially contributing to greater alignment on these pressing issues.

U.S. Agencies Meet with G7 Enforcement Partners on Competition in Digital Markets; FTC and DOJ Join UK Competition and Markets Authority Leadership in Statement on Margins of the G7 Meeting

FTC Chair Khan and AAG Kanter of the DOJ Antitrust Division participated in a Competition Enforcers Summit as part of the 2021 G7 Digital and Technology Track.  The Summit, hosted by the UK Competition and Markets Authority, explored how competition agencies are approaching the challenges posed by digital markets.  Delegates from the G7 competition authorities in Canada, France, Germany, Italy, Japan, the UK, and the United States participated in the Summit, along with the European Commission and competition agency invitees from Australia, India, South Africa, and South Korea.  Participants discussed common areas of interest and opportunities for potential collaboration on issues such as large digital platforms, app stores, online marketplaces, digital advertising, mobile ecosystems, cloud computing, and algorithms.  Following the meeting’s conclusion, the FTC and DOJ Antitrust Division, and the UK Competition and Markets Authority, issued a joint statement highlighting the close relationship among the three agencies, underscoring that each views this relationship as a critical element of their respective enforcement programs, and affirming the agencies’ intent to strengthen collaboration and coordination with one another.


FTC Sues To Block $40 Billion Semiconductor Chip Merger

The FTC sued to block U.S. chip supplier Nvidia Corp.’s $40 billion acquisition of U.K. chip design provider Arm Ltd.  The proposed vertical deal would give one of the largest chip companies control over the computing technology and designs on which rival firms rely to develop their own competing chips.  The FTC’s complaint alleges that the combined firm would have the means and incentive to stifle innovative next-generation technologies, including those used to run datacenters and driver-assistance systems in cars.  Throughout the investigation, Commission staff cooperated closely with staff of the competition agencies in the European Union, United Kingdom, Japan, and South Korea.

FTC Requires Generic Drug Marketers ANI Pharmaceuticals and Novitium Pharma To Divest Rights and Assets to Two Generic Products as Condition of Merger

The FTC will require generic drug marketers ANI Pharmaceuticals, Inc. and Novitium Pharma LLC to divest, to Prasco LLC, ANI’s development rights to generic sulfamethoxazole-trimethoprim oral suspension (SMX-TMP), and assets with respect to generic dexamethasone tablets, as part of a settlement resolving charges that ANI’s $210 million acquisition of Novitium likely would be anticompetitive.  Generic SMX-TMP is an antibiotic used to treat a variety of infections.  ANI is a current participant in this market, while Novitium is one of a limited number of companies well positioned to enter.  Generic dexamethasone tablets are an oral steroid product used to treat inflammation associated with a variety of conditions.  Both ANI and Novitium have products in development in this market and the FTC alleges that the acquisition would eliminate a potential entrant in an already concentrated market.  According to the complaint, without a remedy, the acquisition would likely harm future competition in U.S. markets for both of these generic products.

Expected FTC Opposition to Transaction Leads Great Outdoors Group and Rival Sportsman’s Warehouse Holdings To Abandon Plans for Proposed Merger

Following an extensive 11-month investigation by FTC staff, Sportsman’s Warehouse reported that it has terminated its proposed $785 million sale to rival specialty outdoor goods retailer, Great Outdoors.  According to a statement by Bureau of Competition Director Holly Vedova, the proposed transaction would have combined two close retail competitors selling hunting, shooting, fishing, camping, and other outdoor gear and harmed consumers through increased prices, reduced product offerings, and diminished quality and service in at least two dozen local markets throughout the United States.

Consumer Protection and Privacy

Gift cards as scam payment

FTC Data Show Major Increase in Gift Cards As Scam Payment Method

 A new FTC data spotlight shows that in the first nine months of 2021, consumers reported losing $148 million in scams where gift cards were used as the form of payment. That amount is more than was reported in all of 2020.  Nearly 40,000 consumers reported using gift cards to pay a scammer in that time frame, according to the spotlight, which draws from fraud reports submitted to the FTC by consumers.  Most often, consumers reported paying scammers who were impersonating large companies or government agencies.  One new development noted in the spotlight is the emergence of Target gift cards as the most popular choice for scammers in the reports received by the FTC.  Target gift cards accounted for about $35 million in payments to scammers, more than twice as much as any other brand of gift cards.  The median amount lost when consumers paid with Target gift cards, $2,500, was higher than any other brand of card, with nearly a third reporting losses of $5,000 or more.

FTC Issues Refunds Totaling More Than $1.8 Million to Consumers Defrauded by Lifewatch, Inc.’s Deceptive Medical Alert Telemarketing Scheme 

The FTC is sending 71,899 checks totaling more than $1.8 million to consumers, including many older Americans, tricked into paying for supposedly free in-home medical alert devices.  The money comes from a settlement with New York-based Lifewatch, Inc.  The FTC’s complaint, filed jointly with the Florida Attorney General’s Office, alleged that the defendants bombarded consumers with at least a billion unsolicited robocalls.  These pre-recorded messages claimed that reputable organizations like the American Heart Association endorsed or recommended Lifewatch’s medical alert system.  The company’s telemarketers often told consumers that a medical alert system had been purchased for them, and they could receive it “at no cost whatsoever.”  Consumers eventually learned that they were responsible for monthly monitoring fees and that it was difficult to cancel without paying a penalty.  In addition to imposing the monetary penalty to provide consumer refunds, the order settling the FTC’s charges bans the Lifewatch defendants from telemarketing and prohibits them from misrepresenting the terms associated with the sale of any product or service.

FTC Releases 2021 Do Not Call Registry Data Book Reporting Registrations and Consumer Complaints Both Increased in FY 2021

Do Not Call Data Book

The FTC released the National Do Not Call Registry Data Book for Fiscal Year 2021.  The FTC’s National Do Not Call (DNC) Registry lets consumers add their phone number and choose not to receive most legal telemarketing calls.  In the last fiscal year, nearly three million people signed up with the DNC Registry, bringing the total close to 245 million phone numbers.  Now in its thirteenth year of publication, the Data Book also provides the most recent fiscal year information available on robocall complaints, the types of calls consumers reported to the FTC, and a complete state-by-state analysis.  According to the Data Book, complaints about imposter calls again topped the list, with almost 594,000 received during the fiscal year ending on September 30, including both live calls and robocalls.  In such calls, imposters falsely pose as government representatives, such as the Social Security Administration or the IRS, legitimate business entities, or as people affiliated with them.  According to the Data Book, at the end of FY 2021, the DNC Registry contained 244.3 million actively registered phone numbers, up from 241.5 million at the end of FY 2020.  The number of consumer complaints about unwanted telemarketing calls increased, from nearly four million in FY 2020 to over five million in FY 2021.  Of those complaints, 68 percent concerned robocalls and 22 percent were about live telemarketing.

FTC, Other econsumer.gov Members Launch econsumer.gov in Portuguese


The FTC and other econsumer.gov members continue to expand and enhance econsumer.gov to make it a go-to resource for international consumer protection enforcement.  With the support of Portugal’s Consumer Directorate-General and Brazil’s national consumer agency, SENACON, econsumer.gov is now available in Portuguese, making it more accessible to consumers around the world to report international scams.  Econsumer.gov is now available in nine languages: English, Spanish, German, French, Japanese, Korean, Polish, Portuguese, and Turkish.  Contact Olivia Barney (dbarney@ftc.gov) for more information on how your agency can participate in econsumer.gov.

In Other News

FTC Chair Lina M. Khan Announces New Appointments in Agency Leadership Positions

FTC Chair Lina M. Khan announced several new additions to the FTC’s Office of Policy Planning.  Olivier Sylvain, Meredith Whittaker, Amba Kak, and Sarah Myers West will be working with the agency’s Chief Technology Officer and technologists as part of an informal AI Strategy Group and in partnership with policy experts across the agency to provide insight and advice on emerging technology issues.  John Kwoka will be working with competition economists and attorneys on an updated approach to merger review policies.  For details on the new appointees and their roles, click the headline above.

OIA Assistant Director Stacy Feuer Departs from the FTC, Laureen Kapin Is Acting Assistant Director

Stacy Feuer, OIA Assistant Director for International Consumer Protection, departed earlier this month following nearly twenty-two years of exemplary service to the FTC.  Laureen Kapin is OIA’s new Acting Assistant Director for International Consumer Protection.  

FTC Launches Inquiry into Supply Chain Disruptions

The FTC ordered nine large retailers, wholesalers, and consumer good suppliers to provide detailed information that will help the FTC shed light on the causes behind ongoing supply chain disruptions and how these disruptions are causing serious and ongoing hardships for consumers and harming competition in the U.S. economy.  In addition to helping to better understand the reasons behind the disruptions, the study will examine whether supply chain disruptions are leading to specific bottlenecks, shortages, or anticompetitive practices, or contributing to rising consumer prices.

FTC To Expand Criminal Referral Program To Stop and Deter Corporate Crime

The FTC voted to expand its criminal referral program as part of its work to stop and deter corporate crime. While the FTC’s authority is limited to civil enforcement, the policy statement adopted at the Commission’s open meeting will enhance the agency’s efforts to combat the criminal misconduct the FTC uncovers in consumer protection and antitrust investigations. The new measures outlined in the policy statement will ensure that cases are promptly referred to local, state, federal, and international criminal law enforcement agencies so that corporations and their executives are held accountable for criminal behavior.

Agency Financial Report

FTC Issues Agency Financial Report for Fiscal Year 2021

The FTC issued its Fiscal Year 2021 Agency Financial Report, which describes the agency’s strong fiscal management and key program performance during the past year.  The report highlights the FTC’s accomplishments in furtherance of its missions to protect consumers and promote competition, and reaffirms the agency’s commitment to responsible stewardship of resources and sound financial operations.  The FTC’s FY 2021 independent financial statement audit marks the agency’s 25th consecutive unmodified opinion, the highest audit opinion available.

FTC Issues Annual Report on Ethanol Market Concentration 2021

The FTC issued its 2021 Report on Ethanol Market Concentration, an annual review of market concentration in the ethanol production industry to determine whether there is sufficient competition among industry participants to avoid price-setting and other anticompetitive behavior.  As in prior years, the 2021 report concludes that “[t]he low level of concentration and large number of market participants in the U.S. ethanol production industry continue to suggest that the exercise of market power to set prices, or coordinate on price or output levels, is unlikely on a nationwide basis.”