Attorneys at the law firm of Gallop, Johnson & Neuman, L.C. are advising companies considering mergers, tender offers, acquisition transactions and joint ventures of any size to carefully examine any potential antitrust risks prior to closing the business deal.  

That is because the Department of Justice (DOJ) and the Federal Trade Commission (FTC) are increasing scrutiny of transactions that could potentially lessen competition or create a monopoly, even when those transactions do not warrant mandatory review under the Hart-Scott-Rodino Act’s (Hart-Scott) jurisdictional and filing-fee thresholds for transactions triggering mandatory antitrust review.  

Glenn E. Davis, chair of the Antitrust Practice Group at Gallop, Johnson & Neuman, said, “Identifying potential antitrust issues prior to closing a deal could save companies considerable effort and expense in litigating against a federal antitrust agency over a relatively modest transaction, or permit proactive planning to structure deals to avoid or minimize risk.”

On January 19, 2010, the FTC announced that for the first time it was lowering the Hart-Scott jurisdictional and filing-fee thresholds for transactions that prompt mandatory antitrust review. The 2010 revisions decreased the basic notification threshold for all transactions from $65.2 million to $63.4 million.

Amy K. Mistler, attorney in the Antitrust Practice Group at Gallop, Johnson & Neuman, said, “While Hart-Scott only requires federal notification for transactions exceeding $63.4 million, this year the U.S. Department of Justice and Federal Trade Commission have significantly increased antitrust review of transactions falling below the Hart-Scott threshold as well.”  

“The FTC and DOJ are keeping an especially close watch on mergers and acquisitions that result in one company gaining a substantial share of its relevant market,” Davis noted. For example, in January of 2010 the DOJ filed suit against Dean Foods Co., the country’s largest processor and distributor of dairy products, for antitrust violations in its $35 million acquisition of two Wisconsin dairy-processing plants from a local dairy cooperative.  The DOJ alleged that the deal was likely to substantially lessen competition in milk sales to schools and convenience stores in Wisconsin, Illinois and Michigan.

In March of 2010, the DOJ challenged a $5 million merger between the country’s two largest providers of voting machine equipment because the deal gave one company control over more than 70 percent of the voting-machine market. After filing suit to challenge the merger, the DOJ reached a settlement agreement with Election Systems & Software, Inc.  

In May 2010, the FTC filed suit against Dun & Bradstreet Corp. because the database company’s $29 million acquisition of competitor Quality Education Data (QED) gave it more than 90 percent of the market for K-12 education data.  When the suit was filed, Richard Feinstein, Director of the FTC’s Bureau of Competition, announced: “Despite its relatively low dollar value, this transaction dramatically decreased competition in the marketplace…When Dun & Bradstreet acquired QED, it bought its closest competitor and created a monopoly. That’s going to get the FTC’s attention every time.”

For more information, contact Glenn E. Davis or Amy K. Mistler at 314.615.6000 with questions or concerns regarding federal antitrust policy or review. A complete list of the 2010 adjusted thresholds can be accessed via the FTC website at http://www.ftc.gov/os/fedreg/2010/january/1001218claytonact7a.pdf. 

Gallop, Johnson & Neuman, L.C., a full service law firm of 80 attorneys, has provided legal services to clients in diverse industries since 1976 and is one of the largest law firms in St. Louis. The firm serves public corporations; privately-held companies; entrepreneurs and start-up enterprises; individuals and families; trustees and trust beneficiaries; charities; and non-profit entities. 

For more information about Gallop, Johnson & Neuman, contact Lois A. LaDriere, Director of Marketing, at 314.615.6000 or see the website http://www.gjn.com.

The Milwaukee-based law firm of Gonzalez Saggio & Harlan LLP, recognized as one of the nation’s largest minority-owned law firms, said Tuesday that it has opened an Atlanta office.

The June 1 opening in the Atlanta Financial Center in Buckhead, Ga., becomes the firm's 15th location and extends the law firm’s national presence.

Joining the firm in Atlanta are a founding partner and two attorneys from the Atlanta office of another minority-owned law firm, Adorno & Yoss. Two other administrative personnel also left the Miami-based firm for Gonzalez Saggio & Harlan.

Although Gonzalez Saggio & Harlan formed in Milwaukee in 1989. In the late 1990s, the firm expanded when it opened an office in Des Moines, Iowa, and then grew further, opening offices in Cincinnati, Cleveland and Columbus, Ohio; Indianapolis; and Chicago.

More recently, it added offices on the East and West coasts, opening a New York City office in 2007 and a Los Angeles office a year ago.

Other office locations include Las Vegas.; Nashville, Tenn.; Phoenix; Washington, D.C., and Wayne, N.J.

Gonzalez Saggio has minority-owned certification from the National Minority Supplier Development Council, a required designation for companies that use minority-certified vendors and recognizes minority-owned businesses with nationwide proven capability.

The presiding judge in the Rohm & Haas/Dow Chemical cancer cluster trial, which had been scheduled to begin on June 7, has set September 20 as the new trial date.

Philadelphia Court of Common Pleas Judge Allan Tereshko, in ordering the new schedule in the first of 31 related cases, cited “issues attendant to a trial of this magnitude and complexity,” including pending appeals filed by the defendant of pre-trial motions. The plaintiff in the trial is Joanne Branham on behalf of her deceased husband, Franklin Delano Branham, from McCullom Lake, Illinois.

All the plaintiffs (ten have died since the suits were filed) assert that Philadelphia-based Rohm & Haas, a wholly-owned subsidiary of Dow, poisoned the air and groundwater in the McCullom Lake community with vinyl chloride (among other toxic chemicals) discharged from its chemical-manufacturing plant into an unlined waste pit near their homes. They allege that prolonged exposure caused them to contract rare malignant brain cancers and brain tumors.

Mr. Branham was diagnosed with glioblastoma, a lethal form of brain cancer, in 2004, just a few years after he and Joanne relocated to Apache Junction, Arizona, near Phoenix. He died just one month after brain surgery. 

Contacts:
Aaron J. Freiwald, Esq.
ajf@layserfreiwald.com
215.875.8000
Stephan Rosenfeld (for Layser & Freiwald)
215.514.4101
steph@idadvisors.com

Attorneys Say Clients Left in Limbo

Yet again, the U.S. Senate reached a dead-end this week on a possible solution to the expired estate tax. Unless action is taken soon, the federal tax -- temporarily phased completely for this year only -- will jump to a 55 percent rate with a $1 million per spouse exemption in January.

“Hope was in sight,” said Boston area attorney Hank Whittenberg, a tax and estate planning specialist, "but Congressional bickering blocked a reasonable solution. It seems that each party will continue using this as political fodder until after the mid-term elections -- and then it might be too late to take any action before the end of the year."

Members of the Senate appeared to be in general agreement of a proposal to eliminate a retroactive estate tax increase and reduce the tax to 35 percent while raising the exemption to $5 million. However, following a policy luncheon this week, key finance leaders disclosed any such agreement no longer existed.

Meanwhile, the current House proposal resurrects the 2009 estate taxes retroactively to January 1, 2010, allowing for a $3.5 million per person exemption and a flat rate of 45 percent. That proposal is exempt from the Pay-As-You-Go rules, while the lower Senate proposal would not be exempt from the Pay-Go rules.

"Either proposal is better than the limbo our clients are being left in," Whittenberg said. "Without clear indications of whether a retroactive tax will be instituted for 2010, how much of an exemption will be allowed, or what tax rates will be, those pursuing even the most basic planning face a number of uncertainties. We're still able to help families establish effective plans, but the situation could be so much better and more streamlined. Estate attorneys across the nation join me in calling on Congress to simply address this issue once and for all. Action is long overdue." 

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Serving clients throughout the Northeast region, attorneys at Whittenberg Knudsen, LLP focus primarily on estate planning, business law, and probate and trust administration and litigation. Attorney Whittenberg is recognized nationally for expertise in estate and tax planning. He is a partner of Whittenberg Knudsen, LLP, a founding member of WealthCounsel (a national attorney organization of approximately 1,500 estate and wealth strategies attorneys), and a former elected board member of the Member Advisory Board of the National Network of Estate Planning Attorneys.

CDC, COUNTY AND ILLINOIS STATE HEALTH DEPARTMENT REPORTS ARE “INADMISSIBLE,” JUDGE RULES;

A state court judge is barring from evidence studies by the U.S. Centers for Disease Control (CDC), Illinois Department of Health, and the McHenry County Health Department in what is believed to be the largest brain cancer cluster cases in the U.S. courts. The first trial in the group of 31 cases is to begin here on June 7.

Court of Common Pleas Judge Allan Tereshko last week ruled against Rohm & Haas/Dow Chemical, the defendant, deciding that the public health epidemiological studies are “irrelevant” to the case and “can only serve as a source of confusion and misdirection.”

The brain cancer cluster victims from McCullom Lake, Illinois, are asserting that Philadelphia-based Rohm & Haas, a wholly-owned subsidiary of Dow, poisoned the air and groundwater in the McCullom Lake community with vinyl chloride (among other toxic chemicals) discharged from its chemical-manufacturing plant into an unlined waste pit near their homes. The Plaintiffs allege that prolonged exposure caused them to contract rare malignant brain cancers and brain tumors; 10 of the victims have died.

The first three brain cancer victims – next-door neighbors who were each diagnosed with malignant brain cancer within the same year – filed suit in April 2006.  Less than a month later, the McHenry Health Department, using outdated cancer-rate data (based on zip codes) for the area that includes McCullom Lake, told local residents there was no epidemiological evidence of a brain cancer cluster.  McCullom Lake’s population is only about 1,000 people; the population of its zip-code region is roughly 50,000.   Later, the state Department of Health announced that more recent data showed that there was no epidemiological evidence of a brain cancer cluster in McHenry County – population more than 300,000.  Under public pressure, the county government then asked the CDC to review the analyses of the two health departments. 

The Court’s order comes after attorneys for Rohm and Haas/Dow have claimed in pre-trial proceedings and in the news media that no public agency has found a brain cancer cluster in McCullom Lake.  Their statements rely on the flawed studies that the judge has now ruled inadmissible, according to Aaron J. Freiwald, lead trial attorney for the plaintiffs.

“The studies cited by the defendant were about as valid in this case as if you did a study of brain cancer rates in the entire state of Illinois or in all of the Western Hemisphere,” Freiwald said.  “They, too, wouldn’t tell you anything about brain cancer rates in McCullom Lake. When you do the math, using reliable, objective data, there is no escaping the fact there was and is a cancer cluster in McCullom Lake Village.”

The trial Court, in granting Plaintiff’s Motion to Preclude evidence of the studies, noted that the studies supported by the defendants “do not attempt to discretely address the pattern of brain cancer represented in the significantly smaller subset which is the Village.”

The first brain cancer cluster case to go to trial will be on behalf of Joanne Branham, who lived with her husband Franklin Delano Branham in McCullom Lake for 30 years.  Mr. Branham was diagnosed with glioblastoma, a lethal form of brain cancer, in 2004, just a few years after he and Joanne relocated to Apache Junction, Arizona, near Phoenix. He died just one month after brain surgery. 

Jury selection is scheduled for June 3rd. 

Contacts:
Aaron J. Freiwald, Esq.
ajf@layserfreiwald.com
215.875.8000
Stephan Rosenfeld (for Layser & Freiwald)
215.514.4101
steph@idadvisors.com