Hearst Settles Antitrust Charges

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By: David Ho, Associated Press Writer

(AP) The government approved a settlement with Hearst Corp. Friday, allowing the company to settle federal antitrust charges by selling a drug database company and returning $19 million to customers.

The Federal Trade Commission had charged in April that Hearst, a privately held New York-based media company, violated antitrust laws by creating a monopoly when it bought the computer database company Medi-Span in 1998.

Medi-Span, based in Indianapolis, was the only major competitor for Hearst’s original database company, First DataBank, the agency said.

To settle the charges, Hearst has agreed to sell Medi-Span to Facts and Comparisons, a St. Louis-based publisher of health and drug information owned by the Dutch company Wolters Kluwer, the FTC said.

Hearst spokesman Paul Luthringer said the company does not admit any liability by agreeing to settle. He said that the agreement and the settlement of a related private lawsuit against the company “resolve all matters concerning the Medi-Span acquisition.”

The drug databases hold comprehensive clinical and pricing information on prescription drugs. After Hearst acquired Medi-Span, prices for database access were raised, sometimes doubled, the FTC said.

The settlement requires Hearst to return $19 million to customers who were forced to pay the increased prices for database access, the agency said.

The company has already agreed to pay at least $26 million to settle private class action lawsuits brought over the same matter, the FTC said. Any money paid to customers from that settlement will count toward the $19 million required by the government.

The agreement, approved with a 5-0 vote, has been given to a federal judge, who must sign it before it becomes final, the agency said.

In October, Hearst agreed to pay $4 million in civil penalties to settle related charges that it failed to submit certain corporate documents before it bought Medi-Span, hindering the government’s ability to study the competitive effects of the sale.

The commission’s complaint had also named as a defendant The Hearst Trust, a family-held trust also based in New York.

Hearst Corp. owns 12 daily newspapers, including the Houston Chronicle and San Francisco Chronicle. Hearst also has interests in television, cable and radio, while its large magazine division publishes titles such as Cosmopolitan and Good Housekeeping.

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