More on Whole Foods
As we have reported here before, the D.C. Circuit recently overturned the district court’s ruling in FTC v. Whole Foods, holding that it was legal error to consider only marginal customers in assessing whether the FTC had met its burden for a preliminary injunction, since “core customers,” under the Brown Shoe practical indicia, could form a submarket for purposes of Section 7 Clayton Act.
Whole Foods has now filed a motion for rehearing en banc. In its motion, Whole Foods argues that the D.C. Circuit panel, particularly the majority of Judges Brown and Tatel, erred in three respects:
- The standard that an injunction should be granted unless the FTC “entirely failed” to show a likelihood of success on the merits conflicts with D.C. Circuit precedents, as well as with other decisions of other circuits;
- The analysis of the standard for product markets was wrong; and
- The D.C. Circuit should have considered Whole Food’s arguments regarding the transaction’s likely effect on competition.
Whole Foods earlier this week filed another motion, “to disqualify the Commission as administrative law judge and to appoint a presiding official other than a Commissioner.”
The motion for rehearing en banc is here, and the motion for another administrative law judge is here.
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August 28th, 2008 at 1:25 pm
The Whole Foods motion to disqualify Commr. Rosch and the other commissioners from sitting as ALJ is must reading. When you read it, think about whether the arguments would be any different if applied to the FTC as decision-maker on appeal from the ALJ (since the ALJ only recommends facts, and only the FTC “finds” them), and consider further the implications for future FTC appeals in 13(b) cases to a court of appeals. The WF arguments, if accepted, would go a long way towards putting the FTC out of business. But Justice Scalia aside, the ability of agencies to act both as prosecutor and judge seems well established, the contrary arguments here notwithstanding.