Antitrust Unit

The Antitrust Unit investigates complaints alleging violations of state and federal antitrust laws within the State of Rhode Island. Because of their complexity and the large amount of anticipated discovery, the Attorney General investigates many matters as a member of various multistate working groups.

The Rhode Island Antitrust Act gives the Attorney General the statutory authority to institute suit against persons, corporations and other legal entities that are in violation of state or federal antitrust laws. The General Assembly enacted the Antitrust Act in 1979 and it applies to every type of economic activity having an impact on trade or commerce in Rhode Island adequate to support the jurisdiction of the Superior Court. The Act contains analogues to Sections 1 and 2 of the Sherman Act and Section 3 of the Clayton Act.

During 2012 the Attorney General actively participated in litigation that included: In re: Dynamic Random Access Memory (DRAM) Antitrust Litigation, U.S.D.C. for the Northern District of California MDL 1986 and United States, et al. v. American Express Company, et al., U.S.D.C. for the Eastern District of New York, No. 10-CV-4496.

The Attorney General also participated in multistate investigations of possible antitrust violations in the pharmaceutical industry, the healthcare industry, the office information technology industry, the agricultural industry, matters involving the rights of indirect purchasers, industries that use vertical restraints, the credit rating industry, and the gasoline industry. The Attorney General, in cooperation with other states and the Federal Trade Commission, also participated in investigations of proposed mergers in the pharmaceutical industry, and the retail store industry.

The Attorney General participated in multistate investigations of issues brought to his attention through appeals to the United States Supreme Court by private parties. These cases have given the Attorney General the opportunity to participate in amicus briefs concerning antitrust issues important to the residents of the State of Rhode Island. One such amicus brief to the United States Supreme Court is the matter of FTC v. Watson Pharmaceuticals, Inc., et al. (AndroGel) This appeal concerns agreements between (1) the manufacturer of a brand-name drug on which the manufacturer asserts it holds a patent, and (2) potential generic competitors who, in response to patent-infringement litigation brought against them by the manufacturer, defended on the grounds that their products would not infringe the patent and that the patent was invalid. The patent litigation culminated in a settlement through which the seller of the brand-name drug agreed to pay its would-be generic competitors tens of millions of dollars annually, and those competitors agreed not to sell competing generic drugs for a number of years. Federal competition law generally prohibits an incumbent firm from agreeing to pay a potential competitor to stay out of the market. The patent settlements containing that combination of terms are commonly known as “reverse payment” agreements. The Circuits have split on whether or not these settlements aid in creating a monopoly. The Attorney General has taken the position that these settlements do aid in creating such a monopoly.