[Federal Register Volume 85, Number 70 (Friday, April 10, 2020)]
[Notices]
[Pages 20277-20279]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-07588]
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FEDERAL TRADE COMMISSION
[File No. 191 0177]
[Ouml]ssur Hf.; Analysis of Agreement Containing Consent Order To
Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement; request for comment.
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SUMMARY: The consent agreement in this matter settles alleged
violations of federal law prohibiting unfair methods of competition.
The attached Analysis of Agreement Containing Consent Order to Aid
Public Comment describes both the allegations in the complaint and the
terms of the consent order--embodied in the consent agreement--that
would settle these allegations.
DATES: Comments must be received on or before May 11, 2020.
ADDRESSES: Interested parties may file comments online or on paper, by
following the instructions in the Request for Comment part of the
SUPPLEMENTARY INFORMATION section
[[Page 20278]]
below. Please write: ``[Ouml]ssur Hf.; File No. 191 0177'' on your
comment, and file your comment online at https://www.regulations.gov by
following the instructions on the web-based form. If you prefer to file
your comment on paper, please mail your comment to the following
address: Federal Trade Commission, Office of the Secretary, 600
Pennsylvania Avenue NW, Suite CC-5610 (Annex D), Washington, DC 20580;
or deliver your comment to the following address: Federal Trade
Commission, Office of the Secretary, Constitution Center, 400 7th
Street SW, 5th Floor, Suite 5610 (Annex D), Washington, DC 20024.
FOR FURTHER INFORMATION CONTACT: Emily Bowne (202-326-2552), Bureau of
Competition, Federal Trade Commission, 600 Pennsylvania Avenue NW,
Washington, DC 20580.
SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34,
notice is hereby given that the above-captioned consent agreement
containing a consent order to cease and desist, having been filed with
and accepted, subject to final approval, by the Commission, has been
placed on the public record for a period of thirty (30) days. The
following Analysis of Agreement Containing Consent Order to Aid Public
Comment describes the terms of the consent agreement and the
allegations in the complaint. An electronic copy of the full text of
the consent agreement package can be obtained from the FTC website (for
April 7, 2020), at this web address: https://www.ftc.gov/news-events/commission-actions.
You can file a comment online or on paper. For the Commission to
consider your comment, we must receive it on or before May 11, 2020.
Write ``[Ouml]ssur Hf.; File No. 191 0177'' on your comment. Your
comment--including your name and your state--will be placed on the
public record of this proceeding, including, to the extent practicable,
on the https://www.regulations.gov website.
Due to the public health emergency in response to the COVID-19
outbreak and the agency's heightened security screening, postal mail
addressed to the Commission will be subject to delay. We strongly
encourage you to submit your comments online through the https://www.regulations.gov website.
If you prefer to file your comment on paper, write ``[Ouml]ssur
Hf.; File No. 191 0177'' on your comment and on the envelope, and mail
your comment to the following address: Federal Trade Commission, Office
of the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex D),
Washington, DC 20580; or deliver your comment to the following address:
Federal Trade Commission, Office of the Secretary, Constitution Center,
400 7th Street SW, 5th Floor, Suite 5610 (Annex D), Washington, DC
20024. If possible, submit your paper comment to the Commission by
courier or overnight service.
Because your comment will be placed on the publicly accessible
website at https://www.regulations.gov, you are solely responsible for
making sure that your comment does not include any sensitive or
confidential information. In particular, your comment should not
include any sensitive personal information, such as your or anyone
else's Social Security number; date of birth; driver's license number
or other state identification number, or foreign country equivalent;
passport number; financial account number; or credit or debit card
number. You are also solely responsible for making sure your comment
does not include any sensitive health information, such as medical
records or other individually identifiable health information. In
addition, your comment should not include any ``trade secret or any
commercial or financial information which . . . is privileged or
confidential''--as provided by Section 6(f) of the FTC Act, 15 U.S.C.
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)--including in
particular competitively sensitive information such as costs, sales
statistics, inventories, formulas, patterns, devices, manufacturing
processes, or customer names.
Comments containing material for which confidential treatment is
requested must be filed in paper form, must be clearly labeled
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular,
the written request for confidential treatment that accompanies the
comment must include the factual and legal basis for the request, and
must identify the specific portions of the comment to be withheld from
the public record. See FTC Rule 4.9(c). Your comment will be kept
confidential only if the General Counsel grants your request in
accordance with the law and the public interest. Once your comment has
been posted on the public FTC website--as legally required by FTC Rule
4.9(b)--we cannot redact or remove your comment from the FTC website,
unless you submit a confidentiality request that meets the requirements
for such treatment under FTC Rule 4.9(c), and the General Counsel
grants that request.
Visit the FTC website at http://www.ftc.gov to read this Notice and
the news release describing this matter. The FTC Act and other laws
that the Commission administers permit the collection of public
comments to consider and use in this proceeding, as appropriate. The
Commission will consider all timely and responsive public comments that
it receives on or before May 11, 2020. For information on the
Commission's privacy policy, including routine uses permitted by the
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.
Analysis of Agreement Containing Consent Order To Aid Public Comment
Introduction
The Federal Trade Commission (``Commission'') has accepted from
[Ouml]ssur Hf., [Ouml]ssur Americas Holdings, Inc., (collectively
``[Ouml]ssur'') and College Park Industries, Inc., (``College Park''),
subject to final approval, an Agreement Containing Consent Order
(``Consent Agreement'') designed to remedy the anticompetitive effects
that would likely result from [Ouml]ssur's proposed acquisition of
College Park. The proposed Decision and Order (``Order'') contained in
the Consent Agreement requires College Park to divest its myoelectric
elbow business to Hugh Steeper Ltd. (``Steeper'').
The proposed Consent Agreement has been placed on the public record
for thirty days for receipt of comments by interested persons. Comments
received during this period will become part of the public record.
After thirty days, the Commission will review the comments received and
decide whether it should withdraw, modify, or make final the Consent
Agreement.
Pursuant to a Stock Purchase Agreement dated July 19, 2019,
[Ouml]ssur agreed to acquire College Park (the ``Acquisition''). The
Commission's Complaint alleges that the proposed Acquisition, if
consummated, would violate Section 7 of the Clayton act, as amended, 15
U.S.C. 18, and Section 5 of the FTC Act, as amended, 15 U.S.C. 45, by
substantially lessening future competition between College Park and
[Ouml]ssur in the development, manufacturing, marketing, distribution,
and sale of myoelectric elbows. The proposed Consent Agreement would
remedy the alleged violations by preserving the competition that
otherwise would be lost in this market as a result of the proposed
Acquisition.
The Parties
Headquartered in Reykjavik, Iceland, [Ouml]ssur Hf. is engaged in
the
[[Page 20279]]
development, manufacture, sale, and distribution of upper and lower-
limb prosthetic devices. [Ouml]ssur Hf. markets and sells its
prosthetics throughout the United States through its subsidiary,
[Ouml]ssur Americas Holdings, Inc., which is headquartered in Foothill
Ranch, California. College Park, headquartered in Warren, Michigan,
also is engaged in the development, manufacture, sale, and distribution
of upper and lower-limb prosthetics.
The Relevant Product Market and Market Structure
The relevant product market in which to assess the competitive
effects of the proposed acquisition is no broader than the development,
manufacturing, marketing, distribution, and sale of myoelectric elbows.
Myoelectric, or powered, elbows use electromyographic signals and
battery-powered motors to control movement of the prosthetic.
Myoelectric elbows fit directly on the residual limb and use electrical
signals generated by muscles to move the motorized elbow componentry.
Myoelectric elbows provide substantial functional advantages over
mechanical elbows, such as being easier and more natural to control
than mechanical elbows.
The relevant geographic area in which to assess the competitive
effects of the Acquisition is the United States. The United States has
unique regulatory and reimbursement requirements that distinguish it
from other countries where myoelectric elbows are sold, and
manufacturers require U.S. sales and clinical personnel to support
their U.S. clinic customers.
The U.S. market for myoelectric elbows is highly concentrated.
Respondent College Park is a leading supplier of myoelectric elbows and
Respondent [Ouml]ssur is currently developing its own myoelectric
elbow. The only other participants in the U.S. myoelectric elbow market
are Otto Bock Healthcare North America and Fillauer LLC.
Effects of the Acqusition
Absent a divestiture, the Acquisition is likely to harm customers
of myoelectric elbows in the United States. College Park is currently a
leading manufacturer of myoelectric elbows in the United States.
[Ouml]ssur is the largest prosthetic manufacturer in the United States
that does not currently offer a myoelectric elbow, but it is developing
a myoelectric elbow to enter the market. Absent the Acquisition, the
highly concentrated myoelectric elbow market likely would benefit
significantly from [Ouml]ssur's entry and [Ouml]ssur would compete
directly for College Park's customers.
Entry
Entry into the myoelectric elbow market would not be timely,
likely, or sufficient in magnitude, character, and scope to deter or
counteract the anticompetitive effects of the proposed Acquisition. De
novo entry is unlikely to occur in a timely manner because the time
required for product development and market adoption is lengthy, and
the only passive and body-powered elbow manufacturers already sell
myoelectric elbows.
The Consent Agreement
The proposed Order would remedy the competitive concerns raised by
the proposed transaction by requiring [Ouml]ssur to divest to Steeper
the worldwide College Park myoelectric elbow business. The divestiture
package consists of the following assets and rights: all assets and
rights to research, develop, manufacture, market, and sell the College
Park myoelectric elbow products, including all related intellectual
property and other confidential business information, manufacturing
technology, and existing inventory. Steeper will also be hiring several
key College Park employees who are essential to the divested business.
Additionally, the Order requires that, at the request of Steeper,
[Ouml]ssur must provide transitional assistance for up to fifteen
months following the divestiture date (with an option to extend further
with Commission approval). These services include logistical,
administrative, and sales and marketing support. The Order also
includes other standard terms designed to ensure the viability of the
divested business. The provisions of the proposed Consent Agreement
position Steeper to become an effective competitor in the market for
myoelectric elbows in the United States.
Under the Order, College Park is required to divest its myoelectric
elbow business no later than ten days from the close of its acquisition
by [Ouml]ssur. If the Commission determines that Steeper is not an
acceptable acquirer, or that the manner of the divestiture is not
acceptable, the Order requires College Park to either unwind the sale
of rights and assets to Steeper and then divest the assets to a
Commission-approved acquirer within 180 days of the date the Order
becomes final, or modify the divestiture to Steeper in the manner the
Commission determines is necessary to satisfy the requirements of the
Order.
The Order also requires a monitor to oversee [Ouml]ssur's
compliance with the obligations set forth in the Order. If [Ouml]ssur
does not fully comply with the divestiture and other requirements of
the Order, the Commission may appoint a Divestiture Trustee to divest
the myoelectric elbow assets and perform [Ouml]ssur's other obligations
consistent with the Order. The Order also requires that [Ouml]ssur
shall not acquire, without providing advance written notification to
the Commission, any myoelectric prosthetic elbow manufacturer or
product for a period of five years from the date the Order is issued.
The purpose of this analysis is to facilitate public comment on the
Consent Agreement to aid the Commission in determining whether it
should make the Consent Agreement final. This analysis is not an
official interpretation of the proposed Consent Agreement and does not
modify its terms in any way.
By direction of the Commission.
April J. Tabor,
Acting Secretary.
[FR Doc. 2020-07588 Filed 4-9-20; 8:45 am]
BILLING CODE 6750-01-P