Federal Register/Vol. 66, No. 152/Tuesday, August 7
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41238 Federal Register / Vol. 66, No. 152 / Tuesday, August 7, 2001 / Notices evidence before they market a product Analysis to Aid Public Comment Warner Inc., and has its principal place for children using the name ‘‘A.D.D.’’ or describes both the allegations in the of business in New York, New York. any other name that represents that the complaint that accompanies the consent The proposed Consent Order has been product can treat or mitigate ADHD. agreement and the terms of the consent placed on the public record for thirty Finally, Part III of the proposed order order—embodied in the consent (30) days for reception of comments by prohibits Respondents from making any agreement—that would settle these interested persons. Comments received representation about the ability of any allegations. during this period will become part of food, drug or dietary supplement DATES: Comments must be received on the public record. After thirty (30) days, marketed for children to treat or cure or before August 30, 2001. the Commission will again review the agreement and the comments received, any disease or mental disorder, unless ADDRESSES: Comments should be and decide whether it should withdraw they possess competent and reliable directed to FTC/Office of the Secretary, from the agreement or make final the scientific evidence. Room 159, 600 Pennsylvania Ave., NW., agreement’s proposed Order. Part IV of the proposed order states Washington, DC 20580. that Respondents will be permitted to The Commission has not held an FOR FURTHER INFORMATION CONTACT: make claims that the FDA has approved evidentiary hearing concerning the Joseph Simons or Geoffrey Green, FTC/ pursuant to the Nutrition Labeling and complaint. By accepting this agreement, H–374, 600 Pennsylvania Ave., NW., Education Act of 1990, or pursuant to the Commission is affirming only that it Washington, DC 20580. (202) 326–3667 has reason to believe that the allegations sections 303–304 of the Food and Drug or 326–2641. Administration Modernization Act of in the complaint are well-founded. SUPPLEMENTARY INFORMATION: 1997. Pursuant The Commission’s complaint charges Part V of the proposed order states to section 6(f) of the Federal Trade that Warner has violated section 5 of the that nothing in the order constitutes a Commission Act, 38 Stat. 721, 15 U.S.C. Federal Trade Commission Act by waiver of Respondents’ First 46 and § 2.34 of the Commission’s rules agreeing with certain subsidiaries of of practice (16 CFR 2.34), notice is Amendment rights. Vivendi Universal S.A. (the ‘‘Universal hereby given that the above-captioned As set out in Part VI of the proposed Respondents’’) to fix prices and to forgo consent agreement containing a consent order, the proposed consent order will advertising. According to the order to cease and desist, having been not apply to any product sold or Commission’s complaint, the Universal filed with and accepted by the distributed to consumers by third Respondents are the successor firms to Commission, has been placed on the 1 parties under private labeling PolyGram Music Group. The Universal public record for a period of thirty (30) agreements with Respondents, provided Respondents have not signed an days. The following Analysis to Aid agreement containing a proposed Respondents do not participate in any Public Comment describes the terms of consent order, and hence the manner in the funding, preparation or the consent agreement, and the Commission’s antitrust claims against dissemination of the product’s allegations in the complaint. An the Universal Respondents will be advertising. electronic copy of the full text of the addressed in an administrative trial. The remainder of the proposed consent agreement package can be The alleged conspiracy involves audio consent order contains provisions obtained from the FTC Home Page (for and video products featuring the regarding distribution of the order, July 31, 2001), on the World Wide Web, renowned opera singers Luciano record-keeping, notification of changes at ‘‘http://www.ftc.gov/os/2001/07/ Pavarotti, Placido Domingo, and Jose in corporate status or employment, index.htm.’’ A paper copy can be Carreras—known collectively as The termination of the order, and the filing obtained from the FTC Public Reference Three Tenors. Beginning in 1990, The of a compliance report. Room, Room H–130, 600 Pennsylvania Three Tenors have come together every The purpose of this analysis is to four years at the site of the World Cup facilitate public comment on the Avenue, NW., Washington, DC 20580, either in person or by calling (202) 326– soccer finals for a combination live proposed order, and it is not intended concert and recording session. to constitute an official interpretation of 3627. Public comment is invited. Comments According to the complaint, prior to the agreement and proposed order or to should be directed to: FTC/Office of the each performance, the concert promoter modify in any way their terms. Secretary, Room 159, 600 Pennsylvania selects one (or more) of the major By direction of the Commission. Ave., NW., Washington, DC 20580. Two music/video distribution companies to Benjamin I. Berman, paper copies of each comment should distribute compact discs, cassettes, Acting Secretary. be filed, and should be accompanied, if videocassettes, and videodiscs derived 2 [FR Doc. 01–19724 Filed 8–6–01; 8:45 am] possible, by a 31⁄2 inch diskette from the master recordings. BILLING CODE 6750–01–M containing an electronic copy of the Distribution rights to the original 1990 comment. Such comments or views will Three Tenors performance, entitled The be considered by the Commission and Three Tenors, were acquired by FEDERAL TRADE COMMISSION will be available for inspection and PolyGram Music Group. Distribution copying at its principal office in rights to the follow-up performance, the [File No. 001 0231] accordance with § 4.9(b)(6)(ii) of the Three Tenors in Concert 1994, were Warner Communications Inc.; Analysis Commission’s rules of practice (16 CFR acquired by Warner Music Group. The complaint alleges that in 1997, To Aid Public Comment 4.9(b)(6)(ii)). Warner Music Group and PolyGram Analysis of Proposed Consent Order To AGENCY: Federal Trade Commission. Music Group agreed to collaborate in Aid Public Comment ACTION: Proposed consent agreement. the distribution of audio and video The Federal Trade Commission has SUMMARY: The consent agreement in this accepted, subject to final approval, an 1 PolyGram N.V. was acquired by The Seagram matter settles alleged violations of agreement containing a proposed Company Ltd. in 1998. Two years later, The Seagram Company Ltd. merged with Vivendi S.A. federal law prohibiting unfair or Consent Order from Warner and Canal Plus S.A. to form Vivendi Universal S.A. deceptive acts or practices or unfair Communications Inc. (‘‘Warner’’). 2 The concert promoter is responsible for methods of competition. The attached Warner is a subsidiary of AOL Time producing the master recordings. VerDate 11<MAY>2000 12:06 Aug 06, 2001 Jkt 194001 PO 00000 Frm 00045 Fmt 4703 Sfmt 4703 E:\FR\FM\07AUN1.SGM pfrm04 PsN: 07AUN1 Federal Register / Vol. 66, No. 152 / Tuesday, August 7, 2001 / Notices 41239 products derived from the next Three deceptive advertising and promotion for the pre-existing Three Tenors releases— Tenors World Cup concert, scheduled any audio product.3 products that were separately produced for Paris on July 10, 1998. The parties The Federal Trade Commission is and separately distributed. Restraints agreed that Warner Music Group would aware that there is a great deal of that operate on products outside of a distribute the 1998 releases in the collaborative activity among companies joint venture will be scrutinized by the United States; that PolyGram Music in the music industry (e.g., joint Commission with great care,5 Group would distribute the 1998 ventures, intellectual property licenses, particularly if the restraints are directed releases outside of the United States; sharing of artist rights and at price. Here the Commission has and that the firms would share all costs, compositions). The proposed Consent reason to believe that the alleged profits, and losses on a 50/50 basis. The Order re-affirms the Commission’s view agreement between Warner and complaint does not challenge the that participation in a joint venture is PolyGram is not reasonably related to formation or basic structure of the often pro-competitive, but that it is not the joint venture or reasonably Warner/PolyGram joint venture. a blanket excuse for price fixing or other necessary to achieve procompetitive serious restraints on competition. In this benefits of the joint venture and is According to the complaint, as the regard, The Antitrust Guidelines for therefore per se unlawful. concert approached, Warner Music Collaborations Among Competitors, One specific question involved in this Group and PolyGram Music Group issued by the Federal Trade proceeding is whether the moratorium became concerned that the audio and Commission and the U.S. Department of agreement was reasonably necessary in video products that would be derived Justice in April 2000, should not be read order to address a free-rider problem.6 from the Paris concert would not be as to suggest that all agreements ‘‘related Suppose, hypothetically, that Warner original or as commercially appealing as to’’ a joint venture will be analyzed Music Group’s investment in the earlier Three Tenors releases. In under the full rule of reason. advertising the 1998 Three Tenors order to reduce competition from these There are, however, situations in album in the United States brings earlier releases, Warner Music Group which horizontal restraints on price consumers into the record stores. and PolyGram Music Group adopted competition and advertising are Suppose further that many such what they called a ‘‘moratorium’’ permissible.