The Guns of August: FTC Announces Policy Change Lowering Barrier to Monetary Relief for Anticompetitive Behavior; Action Aimed at the Pharmaceutical “Pay-For-Delay” Cases and Other Top FTC Priorities


In a signal that it may seek monetary relief from pharmaceutical companies involved in so-called “pay-for-delay” agreements and from other firms engaged in other conduct believed to be anticompetitive, the Federal Trade Commission announced that it has withdrawn an earlier policy statement on monetary relief in antitrust cases in favor of a more flexible, and potentially more aggressive, approach. Coming one week after achieving a major victory in the Third Circuit which breathed new life into the agency’s campaign against pay-for-delay settlements, the agency’s action seems especially directed at that conduct, though companies outside the pharmaceutical area should also take note.

In 2003, the FTC issued its Policy Statement on Monetary Equitable Remedies in Competition Cases. That statement outlined a framework for determining when the Commission would seek equitable monetary remedies, such as disgorgement of ill-gotten gains, in competition cases.

Specifically, the 2003 Policy Statement focused on three factors as relevant to whether the Commission would seek monetary relief: (1) whether the challenged conduct is “clear”; (2) whether there is a reasonable basis to calculate the remedial payment; and (3) whether remedies in other civil or criminal litigation are likely to accomplish fully the purposes of the antitrust laws.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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