USCIB - United States Council for International Business

06/18/2019 | News release | Distributed by Public on 06/18/2019 11:52

USCIB Urges Reversal of 1-800 Contacts FTC Ruling

USCIB filed an amicus brief with regards to a 1-800 Contacts, Inc. case to highlight the challenges American businesses would face under the recent Federal Trade Commission's (FTC) decision's approach an antitrust liability for trademark settlements, and explain the potential negative impacts the decision would have on businesses, consumers and competition if left to stand.

USCIB General Counsel Nancy Thevenin led the process for USCIB. 'The Commission's decision creates substantial uncertainty regarding the enforcement and settlement of intellectual property rights, increases the risk of arbitrary enforcement against even routine settlements, and potentially exposes settlements to such risk for decades,' warned Thevenin. 'The decision should be reversed.'

Earlier this year, the FTC filed an administrative complaint charging that 1-800 Contacts, the largest online retailer of contact lenses in the U.S., unlawfully orchestrated a web of anticompetitive agreements with rival online contact lens sellers that suppress competition in certain online search advertising auctions and that restrict truthful and non-misleading internet advertising to consumers. According to the complaint, 1-800 Contacts entered into bidding agreements with at least 14 competing online contact lens retailers that eliminate competition in auctions to place advertisements on the search results page generated by online search engines, such as Google. The complaint alleges that these bidding agreements unreasonably restrain price competition in internet search auctions, and restrict truthful and non-misleading advertising to consumers, constituting an unfair method of competition in violation of federal law.