Damon Corporation

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IN THE MATTER OF DAMON CORPORATION CONSENT ORDER, ETC., IN REGARD TO ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT AND SEC. 7 OF THE CLAYTON ACT Docket C-2916. Complaint, Feb. 28, 1978 — Decision, Feb. 23, 1978 This consent order, among other things, bars a Needham Heights, Mass. operator of a chain of medical laboratories from acquiring, for a period of ten years, any independent medical laboratory located in, or doing 25% or more of its business in given markets, without prior Commission approval. Further, the order requires the firm to cease furnishing any means of compensation to physicians or others for referring specimens for testing to Damon laboratories, rather than to those of its competitors. Appearances For the Commission: Andrew G. Stone and Randolph B. Sim. For the respondent: Shearman & Sterling, New York City. Complaint The Federal Trade Commission, having reason to believe that the party respondent named above, as hereinafter more particularly designated and described, has violated and is now violating the provisions of Section 7 of the Clayton Act (15 U.S.C. 18) and Section 5 of the Federal Trade Commission Act (15 U.S.C. 45), and it appearing to the Commission that a proceeding in respect thereof would be in the public interest, hereby issues its complaint pursuant to the provisions cf Section 11 of the Clayton Act (15 U.S.C. 21) and Section 5 of the Federal Trade Commission Act (15 U.S.C. 45), stating its charges as follows:

DEFINITIONS 1. For the purpose of this complaint, the following definitions shall apply:

a. Medical Laboratory Tests: Tests or examinations performed on specimens drawn or otherwise taken from the human body, or on other organic material, for the purpose of assisting in the diagnosis of disease or assessment of medical condition or state of body condition; not including autopsies, x-ray and other radiographic examinations, and electrocardiographic and other electrographic examinations.

b. Medical Laboratory Test Services: The services performed by 3025 1 1 1 1 2 1036 272 164 26 96.832771 FEDERAL5 1 1 1 1 3 1216 271 121 26 96.451340 TRADES 1 1 1 1 4 1354 269 230 28 96.676025 COMMISSIONS 1 1 1 1 5 1602 260 188 36 95.802261 DECISIONS2 1 2 0 0 0 1332 350 738 43 -1 3 1 2 1 0 0 1332 350 738 43 -1 4 1 2 1 1 0 1332 350 738 43 -1 5 1 2 1 1 1 1332 350 161 43 96.781548 Complaints 1 2 1 1 2 1930 353 31 26 92.154068 915 1 2 1 1 3 1981 353 89 26 87.481171 F.T.C.2 1 3 0 0 0 753 438 1322 1287 -1 3 1 3 1 0 0 753 438 1322 392 -1 4 1 3 1 1 0 753 438 1318 43 -1 5 1 3 1 1 1 753 441 200 33 96.451630 businesses5 1 3 1 1 2 970 441 215 40 96.650749 performing5 1 3 1 1 3 1201 451 39 22 96.530235 or5 1 3 1 1 4 1256 440 192 39 96.421944 arranging5 1 3 1 1 5 1462 440 55 32 96.182846 for5 1 3 1 1 6 1533 439 61 32 96.465736 thes 1 3 1 1 7 1611 439 242 40 96.565292 performances 1 3 1 1 8 1869 439 38 32 96.610565 of5 1 3 1 1 9 1919 438 152 33 96.895363 Medical4 1 3 1 2 0 754 488 1315 44 -1 5 1 3 1 2 1 754 491 214 41 96.847328 Laboratory5 1 3 1 2 2 984 491 98 33 96.180992 Tests5 1 3 1 2 3 1098 491 38 32 96.709496 in5 1 3 1 2 4 1151 491 206 32 96.394936 connections 1 3 1 2 5 1373 489 86 33 96.428841 with5 1 3 1 2 6 1474 489 62 33 96.428841 thes 1 3 1 2 7 1552 489 242 40 96.413078 performances 1 3 1 2 8 1809 489 38 32 96.914055 of5 1 3 1 2 9 1859 488 87 33 96.461159 such5 1 3 1 2 10 1960 488 109 38 96.780724 Tests,4 1 3 1 3 0 754 538 1317 43 -1 5 1 3 1 3 1 754 542 115 32 96.574409 which5 1 3 1 3 2 884 542 149 32 96.574409 services5 1 3 1 3 3 1048 551 82 30 96.138359 may5 1 3 1 3 4 1145 540 139 33 96.037666 includes 1 3 1 3 5 1298 539 65 33 96.037666 but5 1 3 1 3 6 1377 550 61 22 96.267181 ares 1 3 1 3 7 1454 542 62 30 96.465469 not5 1 3 1 3 8 1531 539 136 32 96.177269 limited5 1 3 1 3 9 1682 541 46 30 97.003510 to:5 1 3 1 3 10 1744 539 175 39 96.520943 provisions 1 3 1 3 11 1935 538 38 33 96.822525 of5 1 3 1 3 12 1984 538 87 33 96.500031 such4 1 3 1 4 0 754 588 1317 44 -1 5 1 3 1 4 1 754 592 205 40 95.763321 equipments 1 3 1 4 2 970 591 71 32 96.934341 ands 1 3 1 4 3 1053 591 154 40 96.506081 supplies5 1 3 1 4 4 1219 600 40 23 95.909813 as5 1 3 1 4 5 1272 600 60 23 95.909813 ares 1 3 1 4 6 1345 599 187 30 96.446747 necessary5 1 3 1 4 7 1543 591 37 30 96.718353 to5 1 3 1 4 8 1591 588 121 33 96.893158 obtains 1 3 1 4 9 1725 589 203 39 95.845245 specimens;5 1 3 1 4 10 1942 588 129 40 96.326241 pickup4 1 3 1 5 0 754 638 1321 43 -1 5 1 3 1 5 1 754 642 40 32 96.466599 of5 1 3 1 5 2 819 642 203 39 95.954811 specimens;5 1 3 1 5 3 1054 641 216 39 96.521957 performing5 1 3 1 5 4 1299 650 40 22 96.521957 or5 1 3 1 5 5 1368 639 193 40 96.821815 arranging5 1 3 1 5 6 1589 638 54 33 95.577087 for5 1 3 1 5 7 1673 638 61 33 96.591629 thes 1 3 1 5 8 1764 638 242 39 96.487823 performances 1 3 1 5 9 2036 638 39 32 96.854843 of4 1 3 1 6 0 755 687 1315 44 -1 5 1 3 1 6 1 755 691 151 34 96.683243 Medical5 1 3 1 6 2 928 691 213 40 96.574127 Laboratory5 1 3 1 6 3 1162 690 109 38 96.742165 Tests;5 1 3 1 6 4 1294 689 296 33 96.407898 communications 1 3 1 6 5 1612 689 39 31 96.812073 of5 1 3 1 6 6 1669 688 129 32 96.611938 results5 1 3 1 6 7 1819 691 37 29 96.611938 to5 1 3 1 6 8 1878 687 192 33 96.499367 interested4 1 3 1 7 0 755 737 1320 45 -1 5 1 3 1 7 1 755 742 141 40 96.373169 parties;5 1 3 1 7 2 911 740 70 33 96.864059 ands 1 3 1 7 3 993 741 119 40 96.896011 giving5 1 3 1 7 4 1124 740 192 33 96.618004 assistance5 1 3 1 7 5 1329 741 37 30 96.819427 to5 1 3 1 7 6 1379 739 201 40 96.786812 physicians5 1 3 1 7 7 1593 738 37 32 95.990906 in5 1 3 1 7 8 1644 738 95 32 96.809814 theirs 1 3 1 7 9 1751 737 272 40 96.441650 interpretations 1 3 1 7 10 2035 737 40 33 96.872955 of4 1 3 1 8 0 754 788 1139 42 -1 5 1 3 1 8 1 754 791 63 33 97.007500 thes 1 3 1 8 2 828 791 167 39 96.195724 meanings 1 3 1 8 3 1005 790 38 33 96.483704 of5 1 3 1 8 4 1051 790 61 33 96.948494 thes 1 3 1 8 5 1123 789 130 33 96.756813 results5 1 3 1 8 6 1264 789 39 32 96.864273 of5 1 3 1 8 7 1310 788 76 33 96.446602 said5 1 3 1 8 8 1397 788 152 33 96.540016 Medical5 1 3 1 8 9 1561 788 214 39 96.339729 Laboratory5 1 3 1 8 10 1785 788 108 31 96.754936 Tests.3 1 3 2 0 0 755 836 1315 590 -1 4 1 3 2 1 0 796 836 1273 45 -1 5 1 3 2 1 1 796 851 28 22 89.886047 c.5 1 3 2 1 2 866 840 237 41 82.118401 Independents 1 3 2 1 3 1116 839 155 33 96.422768 Medical5 1 3 2 1 4 1285 838 221 40 96.444313 Laboratory:5 1 3 2 1 5 1522 838 81 39 96.871872 Any5 1 3 2 1 6 1617 836 270 33 93.295479 establishments 1 3 2 1 7 1902 836 167 40 92.483543 perform-4 1 3 2 2 0 755 886 1314 44 -1 5 1 3 2 2 1 755 891 61 39 95.778137 ings 1 3 2 2 2 831 890 150 33 95.778137 Medical5 1 3 2 2 3 997 889 213 41 96.502769 Laboratory5 1 3 2 2 4 1225 889 99 32 96.590317 Tests5 1 3 2 2 5 1340 887 77 34 96.540504 ands 1 3 2 2 6 1426 887 157 33 96.892387 Services5 1 3 2 2 7 1599 889 123 38 96.550087 excepts 1 3 2 2 8 1738 887 53 32 96.690285 for5 1 3 2 2 9 1805 887 62 31 96.692940 thes 1 3 2 2 10 1882 886 187 40 96.435623 following:4 1 3 2 3 0 755 935 1313 46 -1 5 1 3 2 3 1 755 951 71 30 96.955139 any5 1 3 2 3 2 841 940 199 40 96.666916 laboratory5 1 3 2 3 3 1054 950 40 22 96.490700 or5 1 3 2 3 4 1109 938 228 34 96.490700 laboratories5 1 3 2 3 5 1352 936 220 34 96.231781 maintained5 1 3 2 3 6 1585 936 73 33 96.891861 ands 1 3 2 3 7 1673 935 165 40 96.895004 operated5 1 3 2 3 8 1852 935 45 41 96.631325 by5 1 3 2 3 9 1912 935 156 38 96.028992 Federal,4 1 3 2 4 0 755 985 1314 44 -1 5 1 3 2 4 1 755 992 102 35 96.445694 state,5 1 3 2 4 2 875 992 129 37 95.719505 county5 1 3 2 4 3 1019 999 39 23 95.719505 or5 1 3 2 4 4 1075 987 191 41 96.723358 municipal5 1 3 2 4 5 1282 989 240 38 96.622887 government;5 1 3 2 4 6 1540 997 71 29 96.875069 any5 1 3 2 4 7 1627 986 199 40 96.722679 laboratory5 1 3 2 4 8 1843 995 39 22 93.296951 or5 1 3 2 4 9 1897 985 172 32 91.922348 laborato-4 1 3 2 5 0 756 1035 1314 42 -1 5 1 3 2 5 1 756 1040 69 32 95.633377 ries5 1 3 2 5 2 859 1038 217 34 95.633377 maintained5 1 3 2 5 3 1108 1038 70 33 96.530464 ands 1 3 2 5 4 1211 1037 166 40 96.474945 operated5 1 3 2 5 5 1409 1036 110 41 96.537270 solely5 1 3 2 5 6 1552 1036 53 32 95.867805 for5 1 3 2 5 7 1638 1035 163 33 96.385559 research5 1 3 2 5 8 1833 1045 40 23 95.492920 or5 1 3 2 5 9 1905 1035 165 39 95.492920 teaching4 1 3 2 6 0 756 1084 1313 46 -1 5 1 3 2 6 1 756 1099 176 31 96.356117 purposes;5 1 3 2 6 2 951 1099 70 30 96.356117 any5 1 3 2 6 3 1037 1088 201 40 96.634636 laboratory5 1 3 2 6 4 1255 1085 165 42 96.205086 operated5 1 3 2 6 5 1437 1085 45 40 96.506393 by5 1 3 2 6 6 1499 1096 22 22 96.429756 a5 1 3 2 6 7 1539 1085 182 40 96.429756 physicians 1 3 2 6 8 1738 1094 40 22 96.284134 or5 1 3 2 6 9 1794 1084 148 32 96.479187 medical5 1 3 2 6 10 1959 1094 110 30 96.703720 group4 1 3 2 7 0 756 1134 1313 45 -1 5 1 3 2 7 1 756 1139 161 40 96.860672 practice,5 1 3 2 7 2 937 1137 164 42 96.630112 provided5 1 3 2 7 3 1120 1137 86 33 96.838623 such5 1 3 2 7 4 1225 1136 201 40 96.163200 laboratory5 1 3 2 7 5 1444 1136 30 31 96.203705 is5 1 3 2 7 6 1493 1134 167 40 96.655670 operated5 1 3 2 7 7 1679 1134 109 40 96.426567 solely5 1 3 2 7 8 1806 1135 38 32 96.811813 in5 1 3 2 7 9 1863 1134 206 32 96.427803 connection4 1 3 2 8 0 755 1184 1314 44 -1 5 1 3 2 8 1 755 1189 87 33 96.842094 with5 1 3 2 8 2 864 1189 61 32 96.422691 thes 1 3 2 8 3 946 1188 175 40 96.339256 diagnosis5 1 3 2 8 4 1143 1187 71 33 96.998535 ands 1 3 2 8 5 1236 1187 194 31 96.405151 treatments 1 3 2 8 6 1451 1185 39 33 96.405151 of5 1 3 2 8 7 1508 1185 56 32 96.190079 his5 1 3 2 8 8 1586 1194 78 23 96.410362 owns 1 3 2 8 9 1687 1193 40 23 96.410362 or5 1 3 2 8 10 1747 1184 61 32 93.116722 thes 1 3 2 8 11 1830 1186 140 37 91.475861 group’s5 1 3 2 8 12 1992 1193 77 22 96.408516 own4 1 3 2 9 0 756 1232 1314 47 -1 5 1 3 2 9 1 756 1239 164 40 96.585243 patients;5 1 3 2 9 2 935 1248 70 30 96.976242 any5 1 3 2 9 3 1020 1237 200 39 96.895332 laboratory5 1 3 2 9 4 1234 1235 219 33 96.559364 maintained5 1 3 2 9 5 1468 1235 36 31 96.299385 in5 1 3 2 9 6 1520 1244 22 22 96.943382 a5 1 3 2 9 7 1556 1233 153 40 96.795334 hospitals 1 3 2 9 8 1724 1233 69 33 96.840202 ands 1 3 2 9 9 1808 1232 166 41 96.134430 operated5 1 3 2 9 10 1988 1232 46 41 96.083992 by5 1 3 2 9 11 2047 1243 23 23 96.762283 a4 1 3 2 10 0 755 1282 1315 46 -1 5 1 3 2 10 1 755 1288 162 40 96.464012 hospital;5 1 3 2 10 2 949 1287 70 33 96.250839 ands 1 3 2 10 3 1048 1297 70 29 96.849907 any5 1 3 2 10 4 1148 1286 200 40 96.288582 laboratory5 1 3 2 10 5 1378 1283 220 34 96.473831 maintained5 1 3 2 10 6 1628 1283 71 33 96.643532 ands 1 3 2 10 7 1729 1282 165 41 96.180840 operated5 1 3 2 10 8 1924 1282 46 41 96.564743 by5 1 3 2 10 9 1999 1293 71 30 96.811043 any4 1 3 2 11 0 756 1332 1313 45 -1 5 1 3 2 11 1 756 1338 188 33 96.234871 industrial5 1 3 2 11 2 960 1337 248 40 96.640999 organization,5 1 3 2 11 3 1225 1335 54 33 96.310432 for5 1 3 2 11 4 1294 1335 62 32 96.797470 thes 1 3 2 11 5 1372 1334 72 32 96.570381 soles 1 3 2 11 6 1460 1343 150 31 96.820335 purposes 1 3 2 11 7 1627 1333 39 32 96.868576 of5 1 3 2 11 8 1678 1333 130 39 96.667801 testing5 1 3 2 11 9 1823 1332 39 33 96.341431 of5 1 3 2 11 10 1873 1332 196 39 96.535767 specimens4 1 3 2 12 0 756 1386 452 40 -1 5 1 3 2 12 1 756 1389 90 31 96.875809 from5 1 3 2 12 2 859 1388 44 31 96.617722 its5 1 3 2 12 3 915 1398 77 21 96.034019 owns 1 3 2 12 4 1003 1386 205 40 96.034019 employees.3 1 3 3 0 0 755 1431 1318 192 -1 4 1 3 3 1 0 797 1431 1272 46 -1 5 1 3 3 1 1 797 1437 31 33 93.014900 d.5 1 3 3 1 2 871 1436 247 41 95.778893 Metropolitan5 1 3 3 1 3 1136 1434 252 40 96.509834 Philadelphia5 1 3 3 1 4 1406 1434 105 31 96.897697 Area:5 1 3 3 1 5 1532 1431 254 40 96.237297 Philadelphia,5 1 3 3 1 6 1808 1431 124 37 93.290443 Bucks,5 1 3 3 1 7 1954 1431 115 33 92.541183 Mont-4 1 3 3 2 0 755 1481 1318 46 -1 5 1 3 3 2 1 755 1497 151 30 91.385551 gomery,5 1 3 3 2 2 929 1486 146 32 96.661339 Chester5 1 3 3 2 3 1096 1484 70 34 96.673065 ands 1 3 3 2 4 1189 1484 181 32 96.839439 Delaware5 1 3 3 2 5 1391 1483 158 32 96.713463 counties5 1 3 3 2 6 1570 1482 38 32 96.667091 in5 1 3 3 2 7 1630 1482 62 31 96.667091 thes 1 3 3 2 8 1714 1481 299 32 96.317635 Commonwealth5 1 3 3 2 9 2034 1481 39 31 96.956375 of4 1 3 3 3 0 756 1531 1312 45 -1 5 1 3 3 3 1 756 1536 267 40 95.798508 Pennsylvania;5 1 3 3 3 2 1043 1534 70 33 96.635780 ands 1 3 3 3 3 1131 1534 213 36 96.106667 Gloucester,5 1 3 3 3 4 1364 1532 156 33 96.063225 Camden5 1 3 3 3 5 1539 1531 70 33 96.324249 ands 1 3 3 3 6 1627 1531 209 39 96.248917 Burlington5 1 3 3 3 7 1855 1531 158 32 96.684776 counties5 1 3 3 3 8 2032 1531 36 32 96.991692 in4 1 3 3 4 0 755 1584 457 39 -1 5 1 3 3 4 1 755 1587 62 32 96.890930 thes 1 3 3 4 2 829 1585 98 33 96.648369 States 1 3 3 4 3 939 1586 38 31 96.391289 of5 1 3 3 4 4 984 1585 86 32 96.312241 News 1 3 3 4 5 1080 1584 132 39 95.846756 Jersey.3 1 3 4 0 0 756 1629 1315 96 -1 4 1 3 4 1 0 797 1629 1274 46 -1 5 1 3 4 1 1 797 1646 29 22 91.482590 e.5 1 3 4 1 2 868 1634 247 41 94.555222 Metropolitan5 1 3 4 1 3 1148 1633 150 40 96.819580 Chicago5 1 3 4 1 4 1326 1632 105 32 96.327271 Area:5 1 3 4 1 5 1462 1631 103 37 96.099564 Cook,5 1 3 4 1 6 1599 1631 104 36 95.662781 Lake,5 1 3 4 1 7 1736 1630 190 39 95.958961 McHenry,5 1 3 4 1 8 1960 1629 111 37 96.579163 Kane,4 1 3 4 2 0 756 1678 1015 47 -1 5 1 3 4 2 1 756 1686 149 39 96.299950 DuPage5 1 3 4 2 2 916 1684 69 33 96.668930 ands 1 3 4 2 3 997 1683 80 33 96.175491 Will5 1 3 4 2 4 1089 1683 157 33 96.175491 counties5 1 3 4 2 5 1258 1683 36 31 96.156441 in5 1 3 4 2 6 1306 1682 62 32 96.621384 thes 1 3 4 2 7 1380 1680 99 33 96.655373 States 1 3 4 2 8 1490 1680 39 33 96.360916 of5 1 3 4 2 9 1537 1680 142 33 92.739113 Illinois.2 1 4 0 0 0 1247 1780 327 26 -1 3 1 4 1 0 0 1247 1780 327 26 -1 4 1 4 1 1 0 1247 1780 327 26 -1 5 1 4 1 1 1 1247 1782 72 24 96.184105 THES 1 4 1 1 2 1341 1780 233 25 96.511177 RESPONDENT2 1 5 0 0 0 756 1852 1313 741 -1 3 1 5 1 0 0 756 1852 1313 239 -1 4 1 5 1 1 0 799 1852 1270 47 -1 5 1 5 1 1 1 799 1860 28 31 95.743874 2.5 1 5 1 1 2 871 1857 231 42 95.743874 Respondent,5 1 5 1 1 3 1123 1857 135 32 96.665253 Damon5 1 5 1 1 4 1277 1852 229 43 96.319420 Corporations 1 5 1 1 5 1526 1854 231 39 93.250084 (hereinafter5 1 5 1 1 6 1776 1854 202 39 91.987526 “Damon”),5 1 5 1 1 7 1998 1853 29 31 96.851418 is5 1 5 1 1 8 2046 1863 23 21 96.955727 a4 1 5 1 2 0 757 1902 1312 46 -1 5 1 5 1 2 1 757 1909 219 39 96.242447 corporations 1 5 1 2 2 999 1906 193 41 95.932831 organized,5 1 5 1 2 3 1216 1906 152 38 96.378761 existing5 1 5 1 2 4 1390 1905 71 32 96.378761 ands 1 5 1 2 5 1484 1904 105 39 96.556992 doing5 1 5 1 2 6 1612 1903 160 32 96.225647 business5 1 5 1 2 7 1795 1902 112 33 96.949257 under5 1 5 1 2 8 1930 1902 70 33 96.736366 ands 1 5 1 2 9 2023 1902 46 40 96.736366 by4 1 5 1 3 0 756 1952 1312 40 -1 5 1 5 1 3 1 756 1959 116 32 96.899811 virtues 1 5 1 3 2 888 1958 38 32 96.294884 of5 1 5 1 3 3 937 1958 61 32 96.250809 thes 1 5 1 3 4 1015 1957 84 32 96.479073 laws5 1 5 1 3 5 1115 1956 38 33 96.479073 of5 1 5 1 3 6 1165 1956 61 32 96.556435 thes 1 5 1 3 7 1243 1954 98 34 96.409172 States 1 5 1 3 8 1357 1954 38 32 96.721970 of5 1 5 1 3 9 1407 1954 191 36 95.829430 Delaware,5 1 5 1 3 10 1615 1953 87 32 96.253693 with5 1 5 1 3 11 1717 1953 46 32 96.727249 its5 1 5 1 3 12 1778 1952 172 40 96.480469 principals 1 5 1 3 13 1966 1952 102 32 96.686264 office4 1 5 1 4 0 757 2001 1309 47 -1 5 1 5 1 4 1 757 2008 70 33 96.725021 ands 1 5 1 4 2 842 2008 97 40 95.981812 places 1 5 1 4 3 953 2007 39 33 96.188560 of5 1 5 1 4 4 1000 2007 160 32 96.809753 business5 1 5 1 4 5 1174 2004 136 34 96.209442 located5 1 5 1 4 6 1323 2007 38 30 96.209442 at5 1 5 1 4 7 1377 2004 62 32 96.918106 1155 1 5 1 4 8 1452 2004 134 32 93.288704 Fourths 1 5 1 4 9 1600 2003 94 37 91.381561 Ave.,5 1 5 1 4 10 1711 2002 181 33 96.815056 Needham5 1 5 1 4 11 1907 2001 159 40 96.642403 Heights,4 1 5 1 5 0 757 2053 1198 49 -1 5 1 5 1 5 1 757 2053 285 49 96.745155 Massachusetts.3 1 5 2 0 0 757 2101 1311 145 -1 4 1 5 2 1 0 799 2101 1269 41 -1 5 1 5 2 1 1 799 2108 28 32 95.189110 3.5 1 5 2 1 2 872 2108 135 32 95.542160 Damon5 1 5 2 1 3 1038 2106 29 33 96.368988 is5 1 5 2 1 4 1098 2116 22 22 96.619728 a5 1 5 2 1 5 1150 2105 265 32 96.398445 manufacturers 1 5 2 1 6 1445 2103 39 33 96.197762 of5 1 5 2 1 7 1511 2103 188 32 95.371178 electronics 1 5 2 1 8 1729 2102 172 40 96.141754 products.5 1 5 2 1 9 1933 2101 31 32 96.141754 It5 1 5 2 1 10 1994 2101 74 32 96.601166 also4 1 5 2 2 0 757 2150 1311 50 -1 5 1 5 2 2 1 757 2157 168 41 96.609604 produces5 1 5 2 2 2 946 2156 69 33 96.897865 ands 1 5 2 2 3 1036 2156 82 44 95.859467 sells5 1 5 2 2 4 1138 2154 222 33 96.496498 educational5 1 5 2 2 5 1381 2153 191 36 96.667358 materials,5 1 5 2 2 6 1595 2151 147 33 96.101906 medical5 1 5 2 2 7 1763 2152 213 39 96.486992 equipment,5 1 5 2 2 8 1998 2150 70 32 96.153336 anda 1 5 2 3 0 757 2202 321 44 -1 5 1 5 2 3 1 757 2207 148 33 96.586433 medical5 1 5 2 3 2 917 2202 161 44 96.777748 supplies.3 1 5 3 0 0 757 2250 1312 343 -1 4 1 5 3 1 0 799 2250 1269 43 -1 5 1 5 3 1 1 799 2257 29 32 93.696297 4.5 1 5 3 1 2 872 2257 40 32 93.958618 In5 1 5 3 1 3 930 2256 91 37 93.958618 1969,5 1 5 3 1 4 1038 2256 136 31 96.216858 Damon5 1 5 3 1 5 1189 2253 145 33 95.810455 entered5 1 5 3 1 6 1350 2253 74 32 96.284508 into5 1 5 3 1 7 1440 2262 22 22 96.290840 a5 1 5 3 1 8 1477 2261 163 31 96.290840 programs 1 5 3 1 9 1656 2251 38 32 96.499756 of5 1 5 3 1 10 1706 2251 180 39 93.300308 acquiring5 1 5 3 1 11 1901 2250 167 40 92.090393 Indepen-4 1 5 3 2 0 757 2299 1312 42 -1 5 1 5 3 2 1 757 2307 85 33 96.663948 dents 1 5 3 2 2 876 2305 149 34 96.319969 Medical5 1 5 3 2 3 1060 2304 241 33 96.225433 Laboratories5 1 5 3 2 4 1334 2302 87 33 96.277512 with5 1 5 3 2 5 1454 2302 62 32 96.557159 thes 1 5 3 2 6 1550 2311 150 30 96.352165 purposes 1 5 3 2 7 1734 2301 37 32 96.852165 of5 1 5 3 2 8 1801 2299 213 40 96.509354 assembling5 1 5 3 2 9 2046 2310 23 22 96.704979 a4 1 5 3 3 0 757 2349 1311 40 -1 5 1 5 3 3 1 757 2355 212 34 96.065842 nationwide5 1 5 3 3 2 985 2355 104 33 96.637215 chains 1 5 3 3 3 1107 2355 38 32 96.755814 of5 1 5 3 3 4 1158 2353 237 33 96.597252 laboratories.5 1 5 3 3 5 1414 2351 103 33 96.278725 Since5 1 5 3 3 6 1533 2351 81 32 96.278725 that5 1 5 3 3 7 1630 2352 85 31 96.802147 times 1 5 3 3 8 1732 2351 136 32 96.157204 Damon5 1 5 3 3 9 1884 2350 65 32 96.157204 has5 1 5 3 3 10 1966 2349 102 33 96.728714 made4 1 5 3 4 0 758 2400 1310 44 -1 5 1 5 3 4 1 758 2417 97 23 96.789909 more5 1 5 3 4 2 883 2407 87 32 96.654518 than5 1 5 3 4 3 999 2405 39 32 96.597595 505 1 5 3 4 4 1066 2404 226 40 96.220779 acquisitions5 1 5 3 4 5 1320 2403 38 31 96.044350 of5 1 5 3 4 6 1382 2401 241 40 96.118629 Independents 1 5 3 4 7 1650 2401 149 32 96.845871 Medical5 1 5 3 4 8 1826 2400 242 32 96.021507 Laboratories4 1 5 3 5 0 758 2450 1309 44 -1 5 1 5 3 5 1 758 2456 135 34 96.186630 located5 1 5 3 5 2 915 2455 69 33 96.045212 ands 1 5 3 5 3 1006 2455 139 39 96.045212 servings 1 5 3 5 4 1166 2454 62 31 96.728668 thes 1 5 3 5 5 1249 2452 117 41 96.751945 public5 1 5 3 5 6 1387 2452 38 32 96.751945 in5 1 5 3 5 7 1447 2452 62 31 96.763397 thes 1 5 3 5 8 1530 2451 178 39 96.682838 following5 1 5 3 5 9 1727 2450 207 40 96.282776 geographic5 1 5 3 5 10 1956 2459 111 27 96.282776 areas,4 1 5 3 6 0 758 2499 1309 47 -1 5 1 5 3 6 1 758 2516 129 30 96.435410 among5 1 5 3 6 2 909 2506 126 32 96.680199 others:5 1 5 3 6 3 1059 2504 193 36 96.763245 Anderson,5 1 5 3 6 4 1277 2502 111 33 96.527985 South5 1 5 3 6 5 1411 2501 175 38 96.729614 Carolina;5 1 5 3 6 6 1610 2500 251 39 96.843697 Birmingham,5 1 5 3 6 7 1885 2499 182 38 95.878838 Alabama;4 1 5 3 7 0 758 2549 1311 44 -1 5 1 5 3 7 1 758 2557 210 36 96.428917 Bradenton,5 1 5 3 7 2 988 2554 148 39 96.496063 Florida;5 1 5 3 7 3 1156 2552 252 40 96.236435 Metropolitan5 1 5 3 7 4 1427 2551 150 39 96.236435 Chicago5 1 5 3 7 5 1597 2550 103 39 96.795357 Area;5 1 5 3 7 6 1720 2549 197 37 93.276878 Columbus,5 1 5 3 7 7 1937 2549 132 32 92.560959 Missis- DAMON CORP. 303 301 Complaint sippi; Detroit, Michigan; Ft. Lauderdale, Florida; Huntsville, Alabama; Los Angeles, California; New York, New York; Orlando, Florida; Parkersburg, West Virginia; Metropolitan Philadelphia Area; Phoenix, Arizona; Santa Barbara, California; Tampa, Florida; Topeka, Kansas; Ventura, California; Washington, D. C. By 1974, Damon’s network of Independent Medical Laboratories had become one of the largest in the world.

5. Damon’s total annual sales have risen from $15,709,000 in fiscal 1968 to $141,311,000 in fiscal 1974. Damon’s sales of Medical Laboratory Tests and Services have grown from zero in fiscal 1968 to more than $50 million in fiscal 1974, or 40 percent. of total annual sales.

6. At all times relevant herein, Damon has been a corporation engaged in commerce within the meaning of the Clayton and Federal Trade Commission Acts.

CounrT I 7. The allegations of Paragraphs One through Six, inclusive, of this complaint are incorporated herein by reference. LINE OF COMMERCE 8. For purposes of this Count, the relevant service market is the provision of Medical Laboratory Tests and Services by Independent Medical Laboratories. Such Laboratories fill a unique and critical role in the nation’s health care delivery system by providing a wide variety of Medical Laboratory Tests and ancillary Services at competitive rates to physicians and other medical practitioners, to clinics, and to governmental, industrial, and other institutions which administer health care services. Independent Medical Laboratories also provide Medical Laboratory Tests and Services to hospitals and nursing homes which care for patients confined to such institutions. No other health care institution provides such a variety of Medical Laboratory Services for the benefit of the public at large. 9. The relevant geographic markets for purposes of this Count are the Metropolitan Philadelphia and Metropolitan Chicago Areas. THE ACQUISITIONS 10. Damon has acquired the following Independent Medical Laboratories in the Metropolitan Philadelphia Area: a. On April 10, 1969, Damon acquired substantially all of the assets and properties of Lawndale Laboratory Company (hereinafter “Lawndale”). Prior to and until April 10, 1969, Lawndale was a f Complaint 91 F.T.C.

corporation organized, existing and doing business under the laws of the Commonwealth of Pennsylvania with its principal place of business located in Philadelphia, Pennsylvania. At the time of its acquisition, Lawndale was the second largest Independent Medical Laboratory in the Metropolitan Philadelphia Area. b. On April 17, 1969, Damon acquired all of the outstanding capital stock of Rhodes Laboratories, Inc., d/b/a Medical Arts Laboratories (hereinafter “Rhodes”). Prior to and until April 17, 1969, Rhodes was a corporation organized, existing and doing business under the laws of the Commonwealth of Pennsylvania with its principal place of business located in Willow Grove, Pennsylvania. At the time of its acquisition, Rhodes was the largest Independent Medical Laboratory in the Metropolitan Philadelphia Area.

c. On July 12, 1969, Damon acquired all of the outstanding capital stock of Rosoff Laboratories, Inc. (hereinafter “Rosoff”’). Prior to and until July 12, 1969, Rosoff was a corporation organized, existing and doing business under the laws of the Commonwealth of Pennsylvania with its principal place of business located in Philadelphia, Pennsylvania.

d. On August 5, 1969, Damon acquired substantially all of the assets and properties of Elmcon, Inc., d/b/a Northeast Medical Center Laboratory (hereinafter “Elmcon”). Prior to and until August 5, 1969, Elmcon was a corporation organized, existing and doing business under the laws of the Commonwealth of Pennsylvania with its principal place of business located in Philadelphia, Pennsylvania. e. On September 30, 1969, Damon acquired substantially all of the assets and properties of Claude P. Brown Associates, Inc. (hereinafter “Brown”). Prior to and until September 30, 1969, Brown was a corporation organized, existing and doing business under the laws of the State of Delaware with its principal place of business located in Philadelphia, Pennsylvania.

f. On July 1, 1970, Damon acquired substantially all of the assets and properties of E. Philip Halpern & William Ball, co-partners d/b/a Park Laboratories (hereinafter “Park”). Prior to and until July 1, 1970, Park was a partnership organized, existing and doing business under the laws of the Commonwealth of Pennsylvania with its principal place of business located in Philadelphia, Pennsylvania. g. On May 19, 1972, Damon acquired substantially all of the assets and properties of Pathology Consultants, Inc. (hereinafter “Pathcon”), and its subsidiary, KNS Laboratories, Inc. (hereinafter “DAMON ‘CORP. : 305 301 | Complaint “KNS”). Prior to and until May 19, 1972, Pathcon was a corporation organized, existing and doing business under the laws of the ~ Commonwealth of Pennsylvania, with its principal place of business “located in Narberth, Pennsylvania. KNS was a corporation organized, existing and doing business under the laws of the State of New J ersey, with its principal place of business located in Woodbury, New Jersey.

_h. On April 2, -1978, Damon acquired assets of Biomedical : Resources Corporation (hereinafter “BMR”), including substantially ~ all of BMR’s assets in the Metropolitan Philadelphia Area. Prior to and until April 2, 1973, BMR was a corporation organized, existing ~ and doing business under. the laws of the State of New York, with its 7 principal place of business located in New York, New York. 11. As a consequence of these acquisitions, by 1973, Damon had acquired approximately a 33 percent. share of the Independent Medical Laboratory service market in the Metropolitan Philadelphia Area, and had become by far the largest Independent Medical Laboratory in that Area. The four largest Independent Medical Laboratories in the Area provided approximately 55 percent of such services in the Area in 1973.

12.. Damon has acquired the following’ Independent Medical Laboratories in the Metropolitan Chicago Area: ~ a. On December 7; 1970; Damon acquired substantially all of the assets and properties of Mason-Barron Pathology Laboratories, S. C. (hereinafter “Mason-Barron”). Prior to and until December 7, 1970, Mason-Barron was a corporation organized, existing and doing business under the laws of the State of Illinois, with its principal place of business located in Chicago, Illinois. At the time of its acquisition, Mason-Barron was the largest Independent Medical Laboratory in the Metropolitan Chicago Area. b. On December 10, 1970, Damon acquired all of the outstanding ‘capital stock of Pasco Medical Laboratories, .Inc. (hereinafter _ “Pasco”). Prior to and until December 10, 1970, Pasco was a corporation organized, existing and doing business under the laws of the State of Delaware, with its principal place of business located in - Hinsdale; Illinois. At the time of its acquisition, Pasco was the second largest Independent Medical Laboratory in the Metropolitan Chicago Area.

c. On December 10, 1973, Damon acquired substantially all of the assets and properties of Aurora Clinical Laboratory, Inc. (hereinafter “Aurora”). Prior to and until December 10, 1973, Aurora was a corporation organized, existing and doing business under the laws of Complaint 91 F.T.C.

the State of Illinois, with its principal place of business located in Aurora, Illinois.

d. On August 1, 1974, Damon acquired substantially all of the assets of Omega Medical Laboratories, Inc. (hereinafter “Omega”). Prior to and until August 1, 1974, Omega was a corporation organized, existing and doing business under the laws of the State of Illinois with its principal place of business located in Downers Grove, Illinois.

13. As a consequence of these acquisitions, by 1973, Damon had acquired approximately a 25 percent share of the Independent Medical Laboratory service market in the Metropolitan Chicago Area, and had become by far the largest Independent Medical Laboratory in that Area. The four largest Independent Medical Laboratories in the Area provided approximately 35 percent of such services in the Area in 1973.

COMMERCE 14. At all times relevant, Lawndale, Rhodes, Rosoff, Elmcon, Brown, Pathcon, BMR, Mason-Barron, Pasco, Aurora and Omega were corporations engaged in commerce, as that term is used in Section 7 of the Clayton Act, as amended, (15 U.S.C. 18), and in Section 5 of the Federal Trade Commission Act, as amended, (15 U.S.C. 45): Park was a partnership, also engaged in commerce as that term is used in Section 5 of the Federal Trade Commission Act, as amended, (15 U.S.C. 45). Each of these acquisitions affected commerce, as that term is used in Section 5 of the Federal Trade Commission Act, as amended, (15 U.S.C. 45). VIOLATIONS CHARGED 15. The effect of Damon’s acquisitions of the stock and assets of Lawndale, Rhodes, Rosoff, Elmcon, Brown, Pathcon, and BMR in the Metropolitan Philadelphia Area, and of the stock and assets of Mason-Barron, Pasco, Aurora, and Omega in the Metropolitan Chicago Area, separately and cumulatively, may be substantially to lessen competition or to tend to create a monopoly in the Independent Medical Laboratory service market in the Metropolitan Philadelphia Area and in the Metropolitan Chicago Area in violation of Section 7 of the Clayton Act, as amended, (15 U.S.C. 18); and, the acquisitions by Damon of the stock and assets of the aforesaid corporations and Park, a partnership, separately and cumulatively, together with the subsequent use of such assets were and are to the prejudice and injury of the public and constitute unfair moth-7- -° DAMON CORP. 307 301 Complaint competition and unfair acts in or affecting commerce in violation of Section 5 of the Federal: Trade Commission Act, as amended, (15 U.S.C. 45); in the following ways, among others: a. Actual competition and potential competition among and between the aforesaid corporations and partnership has been eliminated in the relevant markets.

b. Actual competition and potential competition between Damon and the aforesaid corporations and partnership has been eliminated in the relevant markets.

c. The trend toward concentration in the relevant markets has been accelerated.

d. The level of concentration in the relevant markets has been increased. , e. Damon has established itself as a dominant factor in the relevant markets by means of said acquisitions. Count II 16. The allegations of Paragraphs One through Six, inclusive, of this complaint, are incorporated herein by reference. RESPONDENT’S PRACTICES 17. In the course and conduct of its operation of Independent Medical Laboratories, Damon, through its subsidiaries and agents, has engaged in the practice, in various sections of the country, of ‘making payments and/or granting other things of value, and/or causing intermediaries to make such payments and grants, to physicians and others ordering or arranging for Medical Laboratory Tests to be performed on behalf of patients by or through Damon or its subsidiaries. Said payments and grants, which were made during a period extending at least from 1971 until mid-1975, were intended by Damon and its subsidiaries to induce said persons to refer specimens, or to arrange for specimens to be referred, to Damon rather than its competitors, and to compensate said persons for so doing. More specifically, Damon has engaged in the following practices, among other things:

a. Damon has engaged in the practice of making payments, sometimes termed “handling fees” or “phlebotomy fees” and calculated either on the basis of a specific amount per test, or per specimen, or per patient, or as a specific amount per month, to physicians, and to nurses and other agents of physicians, to induce said persons and/or said physicians to arrange for submission of Complaint 91 F.T.C Medical Laboratory Tests to Damon rather than to its competitors and to compensate said persons for so doing. . b. Damon has also engaged in the practice of causing intermedi aries to make payments of the type described in sub-paragraph (a) above, to physicians, to induce said physicians to arrange foi submission of Medical Laboratory Tests to Damon rather than to its competitors, and to compensate said persons for so doing. c. Damon has also engaged in the practice of making payments equivalent to a percentage of amounts billed by or due to Damon fo Medical Laboratory Tests submitted by physicians and medica’ clinics, to said physicians and to owners and managers of said medical clinics, and to their agents, to induce said persons to arrange for the submission of Medical Laboratory Tests to Damon rather than to its competitors, and to compensate said persons for so doing. In certain instances these payments have been termed “specimen collection fees,” “handling fees,” “rental fees,” “maintenance fees” or “consultant fees.”

d. Damon has also engaged in the practice of writing off charges and/or. foregoing collection of all or part of amounts due from physicians for Medical Laboratory Tests to induce said physicians tc refer Medical Laboratory Tests chargeable to patients and other parties to Damon rather than to its competitors, and to compensate said physicians for so doing.

e. Damon has also engaged in the practice of granting volume discounts to physicians with the intent that the benefit derived from said discounts would inure to said physicians, to induce’ said physicians to refer Medical Laboratory Tests to Damon rather than to its competitors, and to compensate said physicians for so doing. VIOLATIONS CHARGED 18. The aforesaid acts and practices of Damon and its subsidiaries and agents have had the tendency unduly to restrict and restrain competition and have injured, hindered, suppressed, lessened or eliminated actual or potential competition, are to the prejudice and injury of the public, and constitute unfair methods of competition in or affecting commerce and unfair or deceptive acts and practices in or affecting commerce, in violation of Section 5 of the Federal Trade Commission Act (15 U.S.C. 45), for the following reasons, among others:

a. Physicians have been induced to order Medical Laboratory Tests on the basis of payments or things of value offered or received rather than on the basis of patients’ welfare. DAMON CORP. 309 301 Decision and Order Laboratory Tests on the basis of payments or things of value offered | or received rather than on the basis of other factors, such as price, quality and/or service.

c. Laboratories making said payments have obtained unfair competitive advantage over their competitors. d. The public has been deprived of accurate information concerning said acts and practices, and therefore has been rendered unable to evaluate the relative prices of Medical Laboratory Tests and other medical services on an informed basis.

e. As aconsequence, certain Medical Laboratory Test prices have tended to be stabilized at higher levels, and overall costs to consumers have been increased.

DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondent named in the caption hereof, and respondent having been furnished thereafter with a copy of a draft of complaint which the Bureau of Competition proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondent with violations of Section 7 of the Clayton Act and of Section 5 of the Federal Trade Commission Act; and The respondent and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by respondent of all the jurisdictional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission’s Rules; and The Commission having considered the agreement and having provisionally accepted same and placed it on the public record for a period of sixty (60) days, and having duly considered the comments filed thereafter by interested persons pursuant to Section 2.34 of the Commission’s Rules, now in further conformity with the procedure provided by Section 2.34 of its Rules hereby issues its decision in disposition of the proceeding against the above-named respondent, makes the following jurisdictional findings, and enters the following findings and order:

1. Respondent Damon Corporation is a corporation organized, existing and doing business under and by virtue of the laws of the State of Delaware, with its executive offices located at 115 Fourth Ave., Needham Heights, Massachusetts.

Decision and Order 91 F.T-C.

2. The Federal Trade Commission has jurisdiction over the subject matter of this proceeding and over the respondent, and the proceeding is in the public interest.

ORDER I For purposes of this order, the following definitions shall apply: 1. Respondent: Damon Corporation, and those persons, partnerships, corporations, and other legal entities acting on its behalf, including but not limited to, its officers, directors, agents, represen- _tatives, employees, subsidiaries, affiliates, successors and assigns. 2. Medical Laboratory Tests: Tests or examinations performed on specimens. drawn or otherwise taken from the human body, or on other organic material, for the purpose of assisting in the diagnosis of disease or assessment of medical condition or state of body condition; not including autopsies, x-ray and other radiographic examinations, and electrocardiographic and other electrographic examinations.

3. Medical Laboratory Test Services: The services performed by businesses performing or arranging for the performance of Medical Laboratory Tests in connection with the performance of such Tests, which services may include-but are not limited to: provision of such equipment and supplies as are necessary to obtain specimens; pickup of specimens; performing or arranging for the performance of Medical Laboratory Tests; communication of results of Medical Laboratory Tests to interested parties; and giving assistance to physicians in their interpretation of the meaning of the results of such Medical Laboratory Tests.

4. Independent Laboratory: any entity performing or arranging for the performance of Medical Laboratory Tests, other than a entity: (1) owned and operated by a hospital or hospitals; or (2) more than 90 percent of the Net Sales of Medical Laboratory Tests of which during its four most recent complete fiscal quarters were attributable to sales of Medical Laboratory Tests performed at said laboratory on specimens obtained from in-patients and out-patients of either: (i) a single hospital, or (ii) a group of hospitals that has jointly contracted to purchase Medical Laboratory Test Services from a single source or to have such Test Services performed by a single source.

Lad area? , we . sae - DAMON CORP. . pss 311 801. Decision and Order Hl A. It is ordered, That for a period of ten (10) years from the date of service of this order, respondent shall not acquire, directly or indirectly, without the prior approval of the Federal Trade Commission, the whole or any part of the stock, share capital, or any other indicia of ownership of, or any ownership interest in, any other Independent Laboratory: (1) which performs any Medical Laboratory Tests at any location within a Market; or (2) which during its four most recent fiscal quarters has derived more than. twenty-five percent (25%) of its Net Sales of Medical Laboratory Tests from Tests performed upon specimens originating from within any one Market. ;

“'B. For purposes of this Part II, any arrangement between respondent and an Independent Laboratory pursuant to which such ; Independent Laboratory:

1. Transfers or otherwise makes available to respondent, for a consideration, any list of customers for Medical Laboratory Tests in a Market; or 2. : Discontinues the solicitation of customers for, or the marketing of,:Medical Laboratory Tests within a Market, pursuant to an understanding with respondent, and. thereafter refers or sends customers for Medical Laboratory Tests in such Market to respondent;

shall constitute an acquisition by respondent of an ownership interest in such Independent Laboratory subject to the provisions of Paragraph.A of this Part II.

C. For purposes of this Part II, the term “Market” shall mean each of the following geographic areas:

1.. the Philadelphia, Pennsylvania area, being Bucks, Chester, Delaware, Montgomery and Philadelphia counties within the Commonwealth. of .Pennsylvania; and Burlington, Camden and Gloucester counties within the State of New Jersey; 2... the Chicago, Illinois area, being Cook, DuPage, Kane, Lake, McHenry and Will counties within the State of Illinois; ‘3. the Birmingham, Alabama area, being Jefferson, St. Clair, Shelby and Walker counties within the State of Alabama; . 4,. the Tampa, Florida area, being Hillsborough, Pasco and Pinellas counties within the State of Florida; 5. the Bradenton, Florida area, being Manatee County within the State of Florida;

6... the Phoenix, Arizona area, being Maricopa County within the State of Arizona;

Decision and Order 91 F.T.C.

7. the Orlando, Florida area, being Orange, Osceola and Seminole counties within the State of Florida;

8. the Huntsville, Alabama area, being Limestone, Madison and Marshall counties within the State of Alabama; 9. the Topeka, Kansas area, being Jefferson, Osage and Shawnee counties within the State of Kansas;

10. the Los Angeles, California area, being Los Angeles county within the State of California; :

11. the Ventura, California area, being Ventura county within the State of California;

12. the Santa Barbara, California area, being Santa Barbara county within the State of California;

provided, that if respondent, in any of its fiscal years during the continuing existence of this Part II has less than five hundred thousand dollars ($500,000) in Net Sales of Medical Laboratory Tests performed on specimens originating from within any geographic area listed above, said area or areas shall not constitute a Market for each of respondent’s subsequent fiscal quarters during which respondent’s Net Sales of Medical Laboratory Tests performed on specimens originating from within said area or areas, including such sales by any Independent Laboratory acquired by respondent, are below one hundred and twenty-five thousand dollars ($125,000). D. No acquisition made by respondent shall be deemed immune or exempt from the provisions of the antitrust laws by reason of anything contained in this order.

I A. It is further ordered, That respondent shall not, directly or indirectly, make any payment of money, or grant or transfer any other thing of value, to or for the benefit of any person: (a) to induce such person either: (i) to contract with respondent for respondent to perform any Medical Laboratory Test Service; or (ii) to order or arrange for any Medical Laboratory Test Service to be performed by or through respondent; or (b) to compensate such person for so contracting, ordering, or arranging; whether or not said payment, grant or transfer is described or regarded as a rebate, credit, gift, commission, rental payment, participation in or share of profits, payment for any service in connection with the provision of any Medical Laboratory Test Service, or otherwise. This provision shall not, however, prohibit respondent:

(1) from providing Medical Laboratory Test Services to any person without charge, unless respondent knows or should know #h-~+ -- + DAMON CORP. 313 01 Decision: and Order yerson will receive anything of value for such Services from any »ther person or a hospital; or (2) from granting such bona fide extensions of credit to persons tharged for Medical Laboratory Test Services as are usual in the yormal course of providing such Medical Laboratory Test Services; or (3) from granting to persons charged for Medical Laboratory Test 3ervices any discount or reduced price for any Medical Laboratory Test Services (free Medical Laboratory Test Services, however, being controlled solely by subparagraph (1) above and not by this subparagraph); provided, that subsequent to the date six (6) months after the date of service of this order upon respondent, (i) the resultant net price for each Medical Laboratory Test Service on which any discount or reduced price is granted is provided in writing to the person charged for the Medical Laboratory Test Services before or at the time said person is billed for such Services, and (ii) the method of calculation and the conditions of eligibility for such discount or reduced price are clearly stated in writing on all notices of charges therefor.

B. For the purposes of this Part III, the term “person” shall mean any individual, corporation, partnership, trust, unincorporated association or organization, or government or agency or political subdivision thereof, other than a hospital or respondent. C. No act or practice carried out by respondent shall be deemed immune or exempt from the laws of any state or of the United States by reason of anything contained in this order. IV It is further ordered, That for a period of ten (10) years from the date of service of this order, respondent shall, within ten (10) days after signing an agreement in principle to acquire any Independent Laboratory, or after the acquisition of any Independent Laboratory, whichever event is first, submit the following information in writing to the Federal Trade Commission:

1. Name of such Independent Laboratory.

2. Location of each facility owned, operated, or managed by such Independent Laboratory at which Medical Laboratory Tests were performed within the twelve (12) month period preceding the date of notification and, with respect to each such facility: a. Net Sales of Medical Laboratory Tests for each of the last twelve (12) complete fiscal quarters prior to the date of notification; b. The principal geographic area(s) it served within the twelve (12) month period prior to the date of notification; and 314 FEDERAL TRADE-COMMISSION DECISIONS Decision and Order 91 F.T.C.

c. Medical Laboratory Tests it was licensed to perform by any state or federal agency within the twelve (12) month period prior to the date of notification.

3. Price paid or to be paid for such Independent Laboratory. 4. Location of the facility owned, operated, or managed by respondent at which Medical Laboratory Tests were performed within the twelve (12) month period preceding the date of notification which was nearest to each facility of such Independent Laboratory identified pursuant to (2) above. 5. Net Sales of Medical Laboratory Tests attributable to each facility of respondent identified pursuant to (4) above for each of the last twelve (12) complete fiscal quarters of respondent prior to the date of notification.

6. Date of closing or contemplated date of closing. Vv It is further ordered, That respondent shall forthwith distribute a copy of this order to each of its operating divisions, its present corporate officers, its medical laboratory directors, and its sales personnel; and shall secure from each such officer, director, and employee, a signed statement acknowledging receipt of said order. VI It is further ordered, That respondent shall, within sixty (60) days after the date of service of this order, and thereafter on the first anniversary date of the date of service of this order and on each anniversary date thereafter to and including the tenth anniversary date, submit in writing to the Commission a report setting forth in detail the manner and form in which respondent intends to comply, is complying, and has complied with Parts II and III of this order. All compliance reports shall include such other information and documentation as may hereafter be required to show compliance with this order.

Vil It is further ordered, That respondent shall notify the Commission at least thirty (30) days prior to any proposed change in its corporate structure such as dissolution, assignment or sale resulting in the emergence of a successor corporation, or any other change in the naemnentinn webinl wines AM aint ALT wAdi nnn natn Ae. 4 -f4aL8. ~--1--. GROLIER, INC., ET AL. 315 315 ‘ Complaint