COVID-19 and Antitrust Risks: How Businesses Should Respond

Broadcast Date: Tuesday, June 16, 2020 from 3:00 pm to 4:30 pm (ET)

Overview:

The Coronavirus Disease 2019 (COVID-19) pandemic has significantly distressed the global market today. Companies suffer from interrupted supply chains and income losses as a result of paralyzed business operations. Practitioners think that this consequential business disruption may lead companies to collaborate with competitors in the hopes of keeping them afloat amidst the troubled economy. However, this move can also potentially violate the competition law.

The Department of Justice (DOJ) Antitrust Division and the Federal Trade Commission (FTC) recently released guidance on certain types of coordinated activities permissible by antitrust laws and warned businesses about price-fixing arrangements, market allocations, and other unlawful collaborations. The antitrust agencies have stressed that antitrust enforcement remains a priority. States are also closely monitoring companies’ pricing activities with particular focus on price gouging which involves illegally increasing prices beyond competitive levels during an emergency. Thus, businesses need to be abreast of any emerging regulatory development and must ensure efficient, flexible, and compliant business practices to be able to quickly adapt to regulatory changes and avoid legal liability.

Join antitrust experts Jeffrey Klenk (Berkeley Research Group, LLC) and Allison Smith (Wilson Sonsini Goodrich & Rosati) as they provide an in-depth discussion of the evolving landscape of antitrust law amidst the COVID-19 pandemic. Speakers will also present significant issues and challenges faced by businesses and offer best compliance practices to avoid pitfalls in this changing regulatory climate.

This LIVE Webcast will discuss the following:

Antitrust Developments Amidst Covid-19 Pandemic
Covid-19 Implications on Competition Law
Recent Enforcement Actions
Critical Issues and Compliance Challenges
Best Compliance Practices
What Lies Ahead

Agenda:

SEGMENT 1:
Jeffrey Klenk, Director
Berkeley Research Group, LLC

Price Gouging
- Prices are determined by supply & demand
- For many products, demand has increased significantly and supply has decreased significantly; this suggests prices must rise by some amount
- Fine line between raising prices to account for changing industry conditions and to bring supply & demand into equilibrium versus profit-seeking behavior
- Intent matters; also need to document bona fide economic reasons underlying any price increases
- Not offering discounts is an easy way to effect a price increase
Price Fixing
- Historically, many price-fixing conspiracies used shocks to supply chains as a pretext for implementing coordinated price increases
- Risks of price-fixing may also be enhanced by some suppliers dropping out of the marketplace, thus leaving greater concentration among remaining suppliers
- Price-fixing is per se illegal; no justification for coordinating with competitors on prices or other competitively-sensitive information; conspirators can face jail time for their conduct
- What might constitute coordinated behavior with a competitor
Mergers & Acquisitions
- Likely going to be a coming wave of industry consolidation
- Two failing firms might combine as a way to save costs
- Other potential acquisition targets include firms that have low stock valuations relative to their fundamental or firms that have good medium-term prospects but a near-term need for cash
- Cash-rich firms (e.g., tech) might consider acquisitions they otherwise would not have
- Antitrust implications to keep in mind when considering a merger

SEGMENT 2:
Allison Smith, Associate
Wilson Sonsini Goodrich & Rosati

The DOJ and FTC issued a joint statement on expedited review for business review letters/advisory opinions for firms proposing collaborative relationships to respond to covid-19 related health and safety concerns. But they intend to be vigilant for firms taking unlawful advantage of the crisis.
Suppliers should be cautious in working with competitors to address supply chain disruptions and efforts to continue to serve customers.
Purchasers should also analyze new joint purchasing arrangements for potential Section 1 issues.
Competitors engaging in permissible collaborative arrangements must end the collaborations when the crisis has passed.

Who Should Attend:

Antitrust Lawyers
Legal and Regulatory Teams
Risk Managers
Compliance Officers
Senior Executives
In-House and Outside Counsel

Jeffrey Klenk Director Berkeley Research Group, LLC

Jeffrey Klenk is an economist who focuses his practice on the analysis of alleged anticompetitive conduct, as well as on …

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Allison Smith Associate Wilson Sonsini Goodrich & Rosati

Allison B. Smith represents clients in a range of antitrust and competition matters, with a focus on litigation. Allison has …

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Course Level:
Intermediate

Advance Preparation:
Print and review course materials

Method of Presentation:
On-demand Webcast

Prerequisite:
General knowledge of antitrust laws

Course Code:
149131

NY Category of CLE Credit:
Areas of Professional Practice

Total Credits:
1.5 CLE

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About Berkeley Research Group, LLC

Berkeley Research Group (BRG) provides to counsel, corporations, and governments throughout the world independent and objective testimony in matters involving antitrust litigation, mergers and acquisitions, and agency competition reviews. BRG’s antitrust litigation experience includes analyzing claims of price fixing; examining the competitive effects of alleged actual or attempted monopolization such as claims of predatory pricing, anticompetitive tying or bundling, exclusionary practices, and abuse of a dominant position; and investigating other competition issues such as those related to alleged price discrimination. BRG experts combine a deep understanding of actual market behavior with relevant economic theory and sound empirical research. They have provided testimony and made presentations concerning antitrust issues in both state and federal courts and in meetings and hearings before the Federal Trade Commission, the U.S. Department of Justice, the European Commission, and other tribunals; and also before sector-specific regulators.

Website: https://www.thinkbrg.com/

About Wilson Sonsini Goodrich & Rosati

Wilson Sonsini is the premier legal advisor to technology, life sciences, and growth enterprises worldwide, as well as the venture firms, private equity firms, and investment banks that finance them.

We represent companies from entrepreneurial start-ups to multibillion-dollar global corporations at every stage of development. The firm's attorneys collaborate across a comprehensive range of practice areas and industry groups to help the management, boards of directors, shareholders, and in-house counsel of our clients address their most pressing challenges and pursue their most promising opportunities.

The firm is nationally recognized for providing high-quality services to address the legal solutions required by its enterprise and financial institution clients. Our services include corporate law and governance, antitrust counseling and litigation, public and private offerings of equity and debt securities, mergers and acquisitions, securities class action litigation, intellectual property litigation, joint ventures and strategic alliances, technology licensing and other intellectual property transactions, tax, and employee benefits and employment law, among other areas.

Website: https://www.wsgr.com/en/