Axon Enterprise, Inc. and Safariland, LLC; Analysis of Consent Order To Aid Public Comment, 22738-22739 [2020-08604]

Agencies

• FEDERAL TRADE COMMISSION

[Federal Register Volume 85, Number 79 (Thursday, April 23, 2020)]
[Notices]
[Pages 22738-22739]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-08604]


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FEDERAL TRADE COMMISSION

[File No. 181 0162]


Axon Enterprise, Inc. and Safariland, LLC; Analysis of Consent 
Order To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement; request for comment.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair methods of competition. 
The attached Analysis to Aid Public Comment describes both the 
allegations in the complaint and the terms of the consent order--
embodied in the consent agreement--that would settle these allegations.

DATES: Comments must be received on or before May 26, 2020.

ADDRESSES: Interested parties may file comments online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Please write: ``Axon and 
Safariland; File No. 181 0162'' on your comment, and file your comment 
online at https://www.regulations.gov by following the instructions on 
the web-based form. If you prefer to file your comment on paper, please 
mail your comment to the following address: Federal Trade Commission, 
Office of the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 
(Annex D), Washington, DC 20580; or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Jennifer Milici (202-326-2912), Bureau 
of Competition, Federal Trade Commission, 600 Pennsylvania Avenue NW, 
Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned consent agreement 
containing a consent order to cease and desist, having been filed with 
and accepted, subject to final approval, by the Commission, has been 
placed on the public record for a period of thirty (30) days. The 
following Analysis of Consent Order to Aid Public Comment describes the 
terms of the consent agreement and the allegations in the complaint. An 
electronic copy of the full text of the consent agreement package can 
be obtained from the FTC website (for April 17, 2020), at this web 
address: https://www.ftc.gov/news-events/commission-actions.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before May 26, 2020. 
Write ``Axon and Safariland; File No. 181 0162'' on your comment. Your 
comment--including your name and your state--will be placed on the 
public record of this proceeding, including, to the extent practicable, 
on the https://www.regulations.gov website.
    Due to the public health emergency in response to the COVID-19 
outbreak and the agency's heightened security screening, postal mail 
addressed to the Commission will be subject to delay. We strongly 
encourage you to submit your comments online through the https://www.regulations.gov website.
    If you prefer to file your comment on paper, write ``Axon and 
Safariland; File No. 181 0162'' on your comment and on the envelope, 
and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW, Suite 
CC-5610 (Annex D), Washington, DC 20580; or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW, 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024. If possible, submit your paper comment to the

[[Page 22739]]

Commission by courier or overnight service.
    Because your comment will be placed on the publicly accessible 
website at https://www.regulations.gov, you are solely responsible for 
making sure that your comment does not include any sensitive or 
confidential information. In particular, your comment should not 
include any sensitive personal information, such as your or anyone 
else's Social Security number; date of birth; driver's license number 
or other state identification number, or foreign country equivalent; 
passport number; financial account number; or credit or debit card 
number. You are also solely responsible for making sure your comment 
does not include any sensitive health information, such as medical 
records or other individually identifiable health information. In 
addition, your comment should not include any ``trade secret or any 
commercial or financial information which . . . is privileged or 
confidential''--as provided by Section 6(f) of the FTC Act, 15 U.S.C. 
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)--including in 
particular competitively sensitive information such as costs, sales 
statistics, inventories, formulas, patterns, devices, manufacturing 
processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request, and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted on the public FTC website--as legally required by FTC Rule 
4.9(b)--we cannot redact or remove your comment from the FTC website, 
unless you submit a confidentiality request that meets the requirements 
for such treatment under FTC Rule 4.9(c), and the General Counsel 
grants that request.
    Visit the FTC website at https://www.ftc.gov to read this Notice and 
the news release describing this matter. The FTC Act and other laws 
that the Commission administers permit the collection of public 
comments to consider and use in this proceeding, as appropriate. The 
Commission will consider all timely and responsive public comments that 
it receives on or before May 26, 2020. For information on the 
Commission's privacy policy, including routine uses permitted by the 
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Analysis of Consent Order To Aid Public Comment

I. Introduction

    The Federal Trade Commission (``Commission'') has accepted, subject 
to final approval, an Agreement Containing Consent Order (``Consent 
Agreement'') with Safariland, LLC (``Safariland''). The Consent 
Agreement seeks to resolve allegations against Safariland in the 
administrative complaint issued by the Commission on January 3, 2020.
    The Commission has placed the Consent Agreement on the public 
record for 30 days to solicit comments from interested persons. 
Comments received during this period will become part of the public 
record. After 30 days, the Commission will again review the Consent 
Agreement and the comments received, and will decide whether it should 
withdraw from the Consent Agreement, modify it, or issue the Order.

II. Challenged Conduct

    This matter involves Safariland's sale to Axon Enterprise, Inc. 
(``Axon'') of its body-worn camera systems division, VieVu, LLC 
(``VieVu''). The merger eliminated direct and substantial price and 
innovation competition between dominant supplier Axon and its closest 
competitor, VieVu, to serve large metropolitan police departments. 
According to the complaint, customers lost VieVu as a bidder for new 
contracts, which enabled Axon to impose substantial price increases.
    In addition to transferring VieVu from Safariland to Axon, the 
parties' agreements included several non-compete and customer non-
solicitation provisions, which grounded the inclusion of Safariland as 
a party to the administrative proceeding. These provisions barred 
Safariland from competing with Axon now and in the future on all of 
Axon's products, limited solicitation of customers and employees by 
either company, and stifled potential innovation or expansion by 
Safariland. These restraints, some of which were intended to last more 
than a decade, substantially lessened actual and potential competition 
and were not reasonably limited to protect a legitimate business 
interest, according to the complaint.

III. The Order

    Since the complaint issued, Safariland and Axon rescinded the 
agreement provisions that the complaint alleges are anticompetitive. To 
ensure that the parties do not enter new agreements with similar 
anticompetitive provisions, Part II of the Order enjoins Safariland 
from entering into any agreement with Axon that incorporates the 
language or substance of the rescinded provisions.
    Part III of the Order requires Safariland to obtain prior approval 
from the Commission before it enters into any agreement with Axon that 
restricts competition between Axon and Safariland. By permitting 
agreements between Axon and Safariland, subject to prior approval, 
rather than imposing an absolute ban on future agreements between the 
parties, the Order permits agreements the parties can demonstrate are 
competitively neutral or procompetitive.
    Part IV of the Order addresses Safariland's litigation assistance 
obligations. These provisions will help facilitate efficient discovery 
from Safariland in the ongoing litigation against Axon.
    Part V contains antitrust compliance program and recordkeeping 
requirements. Part VI requires Safariland to file with the Commission 
verified written compliance reports. Part VII requires Safariland to 
notify the Commission in advance of changes in Safariland's structure, 
including any acquisition, merger or consolidation of Safariland, 
irrespective of Hart-Scott- Rodino reporting obligations. Part VIII 
requires that Safariland provide the Commission with access to certain 
information for the purpose of determining or securing compliance with 
the Order, and Part IX states that the purpose of the Order is to 
remedy the harm alleged in Paragraphs 44-53 and 59-60 of the complaint.
    Part X provides that the Order will terminate 10 years from the 
date it is issued.
    The purpose of this Analysis to Aid Public Comment is to invite and 
facilitate public comment concerning the Order. It does not constitute 
an official interpretation of the Order or in any way to modify its 
terms.

    By direction of the Commission.
April J. Tabor,
Acting Secretary.
[FR Doc. 2020-08604 Filed 4-22-20; 8:45 am]
 BILLING CODE 6750-01-P