[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

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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

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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