US: FTC response to Axon due today

Valley-based body camera maker Axon is awaiting response due Friday, January 24, from the Federal Trade Commission (FTC) on Axon’s latest motion filed in an ongoing antitrust battle with the FTC.

Axon has asked a federal district court to intervene and take power away from the FTC to administer in this case, arguing that the FTC administers proceedings within its own agency, not a court, a system Axon does not accept as fair after the Commission filed its complaint against Axon January 3.

In early January, the FTC announced it wanted to break up Axon into two competing firms, challenging Axon’s May 2018 acquisition of Vievu, a competitor company that won a big contract to supply to New York Police Department by deeply discounting the contract price.

The FTC stated the combined company is too large to allow for fair competition. But Axon’s founder and CEO Rick Smith said the acquisition doesn’t qualify as antitrust. Axon claims the field of competitors have won 55 bids to provide body cameras to agencies with more than 100 officers since the deal. Last year, Motorola acquired competitor WatchGuard for US$271 million. However, the FTC disagreed, saying that Axon dominates the body camera market for major metropolitan police departments.

“The company was a failing firm, meaning they were on the edge of insolvency, so it’s my understanding that if you buy a failing firm, by definition, it’s not anti-competitive,” Smith said. “When Vievu called us, I remember thinking, ‘Wow, it must be a cold day somewhere for them to be calling us because there’s no love lost between the companies.’ Clearly, we’re their last resort,” he said.