Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, August 26, 1993 TAG: 9308260060
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
SOURCE: Associated Press
DATELINE: NEW YORK LENGTH: Medium
AT&T, split up by antitrust regulators in 1982, plans to merge with the nation's biggest cellular telephone company.
American Airlines and Wal-Mart are tangled in unfair-pricing lawsuits.
Baseball's 71-year-old antitrust exemption is challenged in court.
Health-care reform raises questions about hospital mergers.
Suddenly, antitrust is news.
Lawyers say the rash of recent cases is mostly coincidence. But it comes as the Clinton administration promises stricter enforcement of laws designed to promote free competition after 12 years of laissez-faire Republican rule.
"I think you're in a period of transition between the virtual non-enforcement of the Reagan years and what will certainly be much more active government regulation in the Clinton years," said Robert Pitofsky, a professor at Georgetown University Law Center.
"These may be very early signs, but they're reliable signs," he said.
The Justice Department has acted already: taking over an investigation of Microsoft, the computer software powerhouse, and eliminating Reagan-era guidelines that allowed manufacturers to fix prices with distributors.
First, the department in July requested documents about Microsoft from the Federal Trade Commission, which shares antitrust oversight. The FTC had examined alleged unfair business practices at Microsoft for three years but deadlocked over whether to sue.
Second, the department rescinded 1985 rules on "vertical pricing" that made it easy for suppliers to impose minimum retail prices, hurting discounters in industries such as consumer electronics and apparel. The government has brought just two price-fixing cases since 1980.
Any merger enforcement activity would mark a significant shift from the Reagan-Bush era, which saw the greatest rate of corporate combinations since the 19th century and what lawyers describe as lax enforcement. Several cases could receive close review.
American Telephone & Telegraph Co.'s planned $12.6 billion acquisition of McCaw Cellular Communications Inc. could challenge the regional Bell companies' local telephone business. AT&T's monopoly over local and long distance was broken up by the government in 1982.
Mattel Inc. and Fisher-Price plan a merger that could create the nation's biggest toy company.
The Justice Department is looking into the proposed purchase of Amax Inc. by Cyprus Minerals Co. A key concern: The deal would combine the nation's No. 1 and No. 2 miners of molybdenum, a metal used to strengthen steel.
The department recently tried, but was blocked by a federal judge, to stop Gillette Co. from buying the maker of Parker pens.
"People's antitrust antennae have been saying: expect closer evaluations, and on the close cases expect the government to sue rather than not to sue," said Irving Scher, an antitrust lawyer at Weil, Gotschal & Manges.
In the health arena, several states have relaxed antitrust regulations to permit mergers that help lower costs. A proposed merger of the three major hospitals in Portland, Maine, could be a test case.
by CNB