Chapter XIII General Exemptions and Immunities

• Pages: 337-340

CHAPTER XIV

REGULATED INDUSTRIES

Introduction

Regulatory Framework

The Packers and Stockyards Act of 1921

In United States v. Cargill Meat Solutions Corp.,1 the Department of

Justice filed a complaint and simultaneously entered into a consent decree

with Cargill Inc., Sanderson Farms Inc., and Wayne Farms LLC, together

with data consulting firm Weber, Meng, Sahl and Company, and its

president, alleging a conspiracy among poultry producers to make

compensation decisions; exchange current and furture, disaggregated, and

identifiable compensation information, and suppress compeition in the

labor markets for poultry processing.2 The complaint included an

allegation that two of the poultry processors violated the Packers and

Stockyards Act by engaging in deceptive practices associated with a

tournament system to determine compensation.3

1. Complaint, United States v. Cargill Meat Sols. Corp., No. 1:22-cv-1821-

SAG (D. Md. Jul. 25, 2022), ECF No. 1. The United States’ Explanations

of Consent Decree Procedures with respect to all defendants were filed

simultaneously with the Complaint. See id., ECF No. 2 (as to defendants

Cargill Inc., Sanderson Farms Inc., and Wayne Farms LLC), ECF No. 3

(as to Weber, Meng, Sahl and Company and its presedent).

2. Complaint ¶¶ 199-207, Cargill Meat Sols., No. 1:22-cv-1821-SAG, ECF

No. 1.

3. Id. at ¶¶ 208-13.

342 2022 Annual Review of Antitrust Law Development

Mergers, Acquisitions, and Joint Ventures

In September 2022, the district court in Delaware held that the

Department of Justice failed to prove the proposed acquisition of Imperial

Sugar Company by United States Sugar Corporation was likely to

substantially lessen compeittion or tend to create a monopoloy under

Section 7 of the Clayton Act in the in the production and sale of refined

sugar.4 The court rejected the DOJ’s relevant market definition because its

“product market and geographic markets ignore the commercial realities

of sugar supply in the US,” including that “sugar flows freely and over

long distances in response to market forces.”5 The court also highlighted

the regulated nature of the sugar industry, noting that the transaction “must

be viewed against the backdrop of the [United States Department of

Agriculture’s] intimate involvement with the US sugar industry.”6 As of

January 2023, the case is currently on appeal to the Third Circuit, which

denied the DOJ’s emergency motion for an injunction pending appeal.7

Common Carriers

The Telecommunications Act of 1996

(1) The 1996 Act and Social-Media Platforms

Federal Circuit Courts have considered the question of whether social-

media platforms constitute common carriers under the

4. United States v. United States Sugar Corp., 2022 U.S. Dist. LEXIS 175817

(D. Del. 2022).

5. Id. at *62, *81.

6. Id. at *84.

7. Order, United States v. United States Sugar Corp., No. 22-2806 (3rd Cir.

Sept. 27, 2022), ECF No. 27.

Regulated Industries 343

Telecommunications Act.8 In NetChoice, LLC v. AG,9 the Eleventh Circuit

found that social-media platforms did not constitute common carriers in

part because the plain language of the Telecommunications Act “explicitly

differentiates ‘interactive computer services’—like social-media

platforms—from ‘common carriers or telecommunications services.’”10 In

contrast, the Fifth Circuit held that social-media platforms meet the

definition of common carriers under the Telecommunications Act because

they are “communications firms[] [that] hold themselves out to serve the

public without individualized bargaining, and are affected with a public

interest.”11

(2) Judicial Interpretation of the 1996 Act

In Tenny Journal Commc’ns, Inc. v. Verizon N.J., Inc.,12 the U.S.

District Court District of New Jersey found that under Section 207 of the

Telecommunications Act, a plaintiff is not entitled to a cause of action

unless the FCC determines that a particular practice constitutes an “unjust

or unreasonable” practice under the Telecommunications Act.13 The court

held that before a plaintiff may bring a cause of action under Section 207,

the FCC must first determine that a particular type of practice constitutes

an “unjust or unreasonable” practice under Section 201(b).14 In this case,

plaintiff Tenny, a competitive local exchange carrier (LEC), alleged that

it paid defendants Verizon New Jersey and Verizon Pennsylvania deposits

but did not receive service at all of the pay phones their agreement

covered.15 The court found that a carrier violates section 201(b) when it

8. See NetChoice, LLC v. AG, 2022 U.S. App. LEXIS 13852, at *44-50 (11th

Cir. 2022) (considering whether social media platforms constitute common

carriers based on Supreme Court precedent, guidance from Congress, and

the way social media platforms act); see also NetChoice, L.L.C. v. Paxton,

2022 U.S. App. LEXIS 26062, at *73-87 (5th Cir. 2022) (analyzing

whether it was permissible for the Texas legislature to consider social

media platforms common carriers).

9. 2022 U.S. App. LEXIS 13852 (11th Cir. 2022).

10. Id. at *46 (citing 47 U.S.C. § 233(e)(6) (“Nothing in this section shall be

construed to treat interactive computer services as common carriers or

telecommunications carriers.”)).

11. NetChoice v. Paxton, 2022 U.S. App. LEXIS 26062, at *73.

12. 2022 U.S. Dist. LEXIS 99431 (D.N.J. 2022).

13. See id. at 18.

14. See id.

15. See id. at 2.