Disney Agrees to Divest Regional Sports Networks as a Condition for Acquiring FOX Assets

Disney Agrees to Divest Regional Sports Networks as a Condition for Acquiring FOX Assets

July, 2018

Disney sought regulatory approval to acquire FOX assets, including cable networks, film and television studios, and its 30 percent stake in Hulu. The U.S. Department of Justice conditionally approved the acquisition subject to Disney divesting 22 FOX regional sports networks.

A Matrix Economics team supported an academic economist to evaluate the competitive implications of Disney’s proposed acquisition. A key concern was that Disney would have owned a substantial percentage of revenues associated with cable sports programming. The work was presented to the DOJ and undertaken on behalf of the American Cable Association.

The DOJ’s press release can be found here. The Proposed Final Judgement can be found here.

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MOL, K-Line, and NYK Line Receive DOJ Clearance for Joint Venture

April 1, 2018

Japan’s three largest shipping carriers—Mitsui O.S.K. Lines, Kawasaki Kisen Kaisha, and Nippon Yusen—sought regulatory approval for a joint venture called Ocean Network Express (ONE). The U.S. Department of Justice approved the joint venture without condition, and ONE is expected to begin operations in April 2018.

Dr. Chipty analyzed the competitive effects of the proposed joint venture. A key concern was competition along the supply chain for transporting refrigerated produce between the U.S. and Japan. Dr. Chipty’s work was presented before the DOJ on behalf of the parties in the summer of 2017.

Read more about the joint venture here.

Hillsdale Community Health Center Agrees to Cease Challenged Conduct

Early 2018

In June 2015, the U.S. Department of Justice and State of Michigan alleged that Allegiance Health agreed with its horizontal competitors, including Hillsdale Community Health Center, to allocate territories for the marketing of their services in Hillsdale County, Michigan. According to Plaintiffs, the challenged agreement was a customer allocation agreement that resulted in harm to competition and consumers. Allegiance Health was the last Defendant to settle. In early 2018, weeks before trial, Allegiance Health agreed not to communicate with competitors about their respective marketing activities and not to enter into agreements to allocate customers.

Dr. Chipty was the DOJ’s antitrust expert. Her work focused on the economics of collusion and the role of marketing in patients’ choices of hospital.

The DOJ’s press release can be found here. The Final Judgement can be found here.