N.Y. AG joins antitrust push in medical waste merger

Bryan Cohen Apr. 8, 2011, 2:52pm


NEW YORK (Legal Newsline) -- New York Attorney General Eric Schneiderman joined the U.S. Justice Department on Friday in filing an antitrust lawsuit that challenges the planned merger of two medical waste service companies.

The lawsuit, filed in the U.S. District Court for the District of Columbia, challenged the planned acquisition by Stericycle Inc. of Healthcare Waste Solutions Inc. The acquisition would result in Stericycle controlling 90 percent of the medical waste business in the New York City metropolitan area and could lead to price increases for customers.

"Restoring New Yorkers' faith in the private sector requires real competition and fair prices," Schneiderman said. "The New York City metropolitan area is the largest market in the nation for medical waste services, making it all the more critical that there is genuine competition and that one company is unable to set arbitrary prices."

New York's civil complaint was filed under Section 7 of the Clayton Act, which is a federal antitrust law that gives the attorney general the authority to block anticompetitive mergers. The complaint alleges that, unless remedied, Stericycle will control around 90 percent of the medical waste business in the area, including counties in New Jersey and Connecticut.

A corresponding agreement proposed to Stericycle would require them to sell Healthcare Waste Solutions' medical waste transfer station in the Bronx to a credible competitor to preserve competition. Stericycle and HWS have made an agreement to sell the transfer station to a credible competitor. The new competitor would allegedly keep up competition with Stericycle and would keep prices down while keeping service quality high.

Medical waste must be handled by a specialized, economically and environmentally critical industry that must exist separately from conventional waste haulers due to stringent federal, state and local regulations.

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