Posts Tagged: "Federal Trade Commission"

Federal Trade Commission (FTC)  Chair Lina Khan announced yesterday that there will be a Special Open Commission Meeting held on April 23 to vote on whether to issue a final version of the January 2023 proposed rule that would ban employers from using noncompete clauses for their employees. “The proposed final rule being considered would generally prevent most employers from using noncompete clauses,” said the Open Commission Meeting’s event description. “As the Notice of Proposed Rulemaking explained, noncompetes are a widespread and often exploitative practice that suppresses wages, hampers innovation, and blocks entrepreneurs from starting new businesses.”

The protection of privilege in communications between clients and lawyers is a very important one under U.S. law. The basic rule is that when a client seeks legal advice from a lawyer, the communication between the client and the lawyer is confidential and cannot be discovered during litigation. An important purpose of this rule is to encourage clients to communicate fully and freely with lawyers in the process of seeking legal help. The lawyers here include both external lawyers and in-house lawyers.

On October 7, the Federal Trade Commission (FTC) sent letters to 10 pharmaceutical companies notifying them of the agency’s intent to challenge allegedly improper patent listings in the U.S. Food and Drug Administration’s (FDA) Orange Book. While the FTC argues that improperly listed patents can delay consumer access to affordable generics, some have questioned whether the FTC’s regulatory action could slow the development of new treatments, which would in turn delay access to new generics.

Just about everyone bundles. It’s about as American as apple pie: if you buy more, you get a better price. Most of the time, that’s a good thing. Consumers benefit from lower prices. The question is, can bundling violate the antitrust laws? It can. So, the real question is, how do we determine when a generally good thing – bundling – should be condemned under the sledgehammer that is antitrust? In cases where usually beneficial conduct is challenged as anticompetitive, clear standards and tests are critically important so that a good thing is not stifled by uncertainty.

The U.S. House of Representatives’ Committee on the Judiciary yesterday held a hearing featuring Federal Trade Commission (FTC) Chair Lina Khan, who has recently come under fire from the Republican-led House leadership. Judiciary Committee Chair Jim Jordan (R-OH) repeatedly grilled Khan about testimony from the independent assessor for Twitter, Ernst & Young, in the Commission’s recent investigation into the social media platform, which Jordan characterized as “targeted harrassment.”

On June 28, a group of 16 individuals filed a class action complaint in the Northern District of California against generative artificial intelligence (GAI) developer OpenAI on several alleged violations of federal and state law on privacy, unfair business practices and computer fraud. The class action lawsuit’s discussion on property interests in consumer data underscores the intellectual property issues that have arisen since the advent of generative AI platforms like ChatGPT, which scrapes personal data and IP-protected material to train its GAI systems.

The Chairman of the House of Representatives’ Committee on Oversight and Accountability, James Comer (R-KY), announced an investigation this week into accusations raised by former Federal Trade Commission (FTC) Commissioner Christine Wilson in her resignation against the conduct of FTC Chair Lina Khan. Wilson sent a letter to President Joe Biden in March claiming that his appointment of Khan as Chair brought “an abrupt halt” to Biden’s promised “return to normalcy” for the agency. She said that Khan “scorned and sidelined” knowledgeable career staff, in part by imposing a gag order on staff “that prevented them from engaging in consumer and business education — a vote of no confidence in our staff and a disservice to those we serve.”

In January 2023, the Federal Trade Commission (FTC) unveiled a proposed ban on non-compete clauses that prohibits employees from joining or forming competitive firms following the termination of their employment. According to the FTC, non-compete clauses unfairly and unnecessarily stifle employees’ ability to pursue better employment opportunities. While this criticism may ring true in the case of lower-wage workers, such as restaurant and warehouse employees, even the staunchest critics of non-compete clauses will typically acknowledge that they can — and often do — play a legitimate role in the protection of trade secrets. This is why the FTC’s proposed rulemaking is causing consternation in the intellectual property community.

When Adam Smith spoke about an “invisible hand,” he was talking about a good thing – the way that free markets harness the laws of competition, supply and demand and self-interest to improve the economy. But he also could have been thinking of another law. The law of unintended consequences: that actions of people, and especially of governments, always have unanticipated effects. Sometimes these effects can be perverse, reflecting a profound failure of “second-order thinking” (in other words, thinking ahead about “how could this possibly go wrong?”). On January 5, 2023 – a day that may go down in IP infamy – we saw two bold actions. First, the “Protecting American IP Act” became law; and second, the Federal Trade Commission (FTC) proposed a new rule that would invalidate noncompete agreements across the United States. But wait, you might say, that actually sounds great! What’s the problem with protecting American IP, and making the rest of the country join California in unleashing talent to go where it likes? Well, don’t be too hasty. Stay with me on this, and you will see just how shortsighted our government can be.

The U.S. Court of Appeals for the Seventh Circuit agreed with a district court earlier this week that neither a settlement agreement between AbbVie and a number of generic biologics companies, nor the 132 patents owned by Abbvie covering its blockbuster drug, Humira, violate the Sherman Antitrust Act. This holding, which is significant in its own right, also has broader implications for patent-antitrust analysis.

On May 17, 2022, the Federal Trade Commission (FTC) submitted to Lisa Barton, Secretary of the International Trade Commission (ITC), a statement they believed was relevant to the public interest considerations before the Commission in a matter involving certain UMTS and LTE cellular communication modules (337-TA-1240). The ITC in many cases will invite statements on the Public Interest, and the FTC is often invited to make a submission. It should be noted, however,  “Public Interest” in the ITC is a matter of statute, and there are four public interest factors which are statutory. Any statement in the Public Interest must address one or more of those factors. Other matters not within the statute are not public interest factors.

Last summer, I lamented how the Department of Justice – Antitrust Division (DOJ), without Senate confirmed leadership, was hastily pushing through policies that augmented the already-enormous power of Big Tech and benefitted China’s interests. Similarly, I uncovered how the App Association, a Big Tech-funded advocacy organization masquerading as a group of small app developers, was able to trick the Federal Trade Commission (FTC) into inviting it to speak at its July 2021 Commission meeting alongside legitimate small businesses. This is the same association that supported Apple in its litigation against (real) app developers, issued a June 2021 press release against the House bills aimed at regulating Big Tech, and misses no opportunity to support Big Tech interests.

From consumer goods to cutting-edge industries like blockchain and crypto, consumers want more environmentally-friendly solutions. And advertisers, in response, are rushing to tout their sustainability-focused corporate missions and product solutions. In recent decisions, Butterball, Georgia-Pacific, and Everlane, the National Advertising Division (NAD) of BBB National Programs provided useful and detailed guidance on how advertisers can support sustainability claims and avoid making unqualified general environmental benefit claims that could mislead consumers. In addition to marketing lawyers, brand owners and trademark counsel alike should also be on the lookout for overreaching environmental marketing claims.

On Tuesday, January 11, the United States District Court for the District of Columbia denied Facebook’s motion to dismiss a complaint brought against it by the U.S.  Federal Trade Commission (FTC), holding that the FTC had stated a plausible claim for relief under Section 2 of the Sherman Act. The FTC filed a complaint on December 9, 2020, asserting one count of monopoly maintenance under Section 2 of the Sherman Act. Facebook moved to dismiss both this case, and a related state case. The district court dismissed the Commission’s complaint but granted the FTC the opportunity to amend. Following a leadership change from when the complaint was initially filed, the FTC filed an amended complaint in August of 2021. L