Who needs venture capital money when you have litigation? Facebook was awarded $711 million in damages Thursday in an anti-spam case against Sanford Wallace, an internet marketer. The popular social networking platform went after Wallace for tapping its users' accounts without their permission and sending fake posts and messages.

Wallace has quite a reputation for spamming, having gained the nicknames "Spam King" and "Spamford" back in the 1990s, when he was good for up to 30 million spam e-mails a day.

Back in June, there was a report on WalletPop that Sears (NASDAQ: SHLD) and Kmart spied on customers who participated in an online marketing study. The company paid participants in the study $10 if they would download and retain software for "My SHC Community."

The participants were told that the software would help them "participate in exciting, engaging, and on-going interactions" on their own terms. Sears noted that the software would only monitor the participants' online browsing. Not so, according to the Federal Trade Commission (FTC), which reported that the software captured secured sessions from participants -- including online banking. The FTC and Sears came to a settlement and the company was less than apologetic for its maneuver.

Here's a bit of juicy news. According to the Wall Street Journal (subscription required), The Federal Trade Commission (FTC) plans to crack down on market manipulators. They have decided to levy fines up to $1 million dollars per violation a day. The rule covers both physicals and futures.

The crackdown involves mainly the oil traders. Specifically, the language reads as follows: It bans oil market players from issuing "false public announcements of planned pricing or output decisions, false statistical or data reporting, and wash sales intended to disguise the actual liquidity of a market or the price of a particular product." The rules would also prohibit "material omissions from a statement that, although true, is misleading under the circumstances."

Did you know that the Federal Trade Commission (FTC) has decided to take bloggers to task for a new form of advertising? The FTC is in the process of updating its "Guides Concerning the Use of Endorsements and Testimonials in Advertising" for the first time since 1980. What does this mean?

Well, the FTC is going to crack down on "word-of-mouth marketing." This type of marketing consists of advertisers paying bloggers to review their products. And by "pay" we mean the bloggers get free product samples, gift certificates for shopping sprees, cash, or a year's car loan. Yes, this is what some of the advertisers have paid bloggers for their "reviews."

Rambus (NASDAQ: RMBS - option chain) shares are rising today after the Federal Trade Commission withdrew its antitrust case against the company due to a recent Supreme Court ruling against the FTC. The withdrawal eliminates the possibility of further litigation in the matter. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on RMBS.

RMBS opened this morning at $11.73. So far today the stock has hit a low of $11.27 and a high of $12.21. At 11:20, RMBS is trading at 12.04 up 1.26 (11.7%). The chart for RMBS looks bullish.

The stock market is tough enough to navigate without having to deal with roadblocks that have nothing to do with corporate execution of a business plan or normal supply-and-demand dynamics for equity securities.

We make an investment on reasonable assumptions and take the risk that such assumptions pan out. What we can't do is foresee events that are totally outside of the control of the company, economy, or ourselves. For example, if we buy a stock of a company that utilizes acquisitions as part of its strategy, we can safely assume from past examples that the government will approve or disapprove such acquisitions in a reasonable amount of time.

The Federal Trade Commission has temporarily suspended its antitrust challenge to Whole Foods Market's (NASDAQ: WFMI) 2007 acquisition of Wild Oats to allow the company to explore settlement possibilities.

David Wales, the chief competition enforcer at the FTC, told (subscription required) The Wall Street Journal that "We're going to roll up our sleeves and take a look at what they're offering. We're hopeful that a settlement can be reached."

The FTC won't give up its battle with Whole Foods (NYSE: WFMI) over the company's long-complete merger with Wild Oats Markets, but an agreement has been reached between Whole Foods and a small, local organic and natural foods' grocery, New Seasons Market. About six weeks ago in the New Seasons blog, popular CEO Brian Rohter highlighted an invasive subpoena received from Whole Foods' attorneys, claiming that his company's secrets are party to the FTC/Whole Foods dispute. The subpoena demanded a wide variety of documents, including all documents relating to competition with Whole Foods or Wild Oats; financial information, by store; market studies and strategic plans; and all plans for future stores, expansion and renovation. Local shoppers and business owners cried foul; the subpoena, many believed, was Whole Foods playing dirty pool.

Today, thanks to pressure from both the local and national community, Whole Foods came to an agreement with New Seasons whose terms weren't released, but in which the small Pacific Northwest chain will be required to release far less sensitive information. Rohter wrote that he was "pleased" with the outcome.

It could be that Whole Foods has far bigger fish to fry than whatever advantage it could have gained from New Seasons. The FTC recently asked a judge to order Whole Foods to bring back the Wild Oats signs, and to voluntarily halt whatever integration it still hasn't completed. What's more, rumors that the company is a takeover target could be distracting management as they (depending on these reports' truth) spin the rumor mill or wheel and deal with the potential acquirers. On the days' news, the stock was down 21 cents to $12.16, about four dollars higher than its five-year low, recorded just before Thanksgiving in November 2008.

How do you de-merge two companies? The FTC thinks that the marriage of Wild Oats and Whole Foods (NASDAQ: WFMI) was anti-competitive. Too much concentration in the high-end organic food retail business.

The FTC brought charges against Whole Foods to stop the deal, but the agency did not get its bite at the apple until after the merger had closed. Now it wants to take apart what it sees as a firm created against the better interests of consumers.

According to The Wall Street Journal, the FTC wants all the stores that carried the Wild Oats name to take down their Whole Foods signs and put the old name back up. "The FTC also said it has asked Whole Foods to voluntarily halt further integration of the two companies while the FTC continues its legal challenge to the merger."

Killing a merger that is already done has to be fairly hard. If the FTC prevails, what does Whole Foods do? Does it hire a new management team and spin Wild Oats out into a new public company? Does it restate all of its recent financials to back out Wild Oats results?

From a legal standpoint, the FTC may be right, but rebuilding Wild Oats could kill the company, especially during a recession. The costs of turning it into a standalone operation could be so great that the financial burden would be more than the retailer could bear. Wild Oats might become independent again only to go bankrupt.

The government may be right, but it is not practical.

Douglas A. McIntyre is an editor at 24/7 Wall St.

With the FTC, argues Whole Foods Markets (NYSE: WFMI), it's personal. Ever since the federal agency began its review over the company's merger with Wild Oats Markets about a year and a half ago, Whole Foods says, the deck has been stacked against the organic and natural foods store chain. What's more, the FTC has continued to pursue Whole Foods to undo its deal even though the merger closed in August 2007, after the FTC lost its first challenge to the merger in federal court. Just last week, reports of an intrusive subpoena had many watchers crying foul over Whole Foods' behavior; this week, the FTC is getting its own harsh spotlight.

Whole Foods is appealing to Congress, and yesterday filed a lawsuit to stop the FTC from continuing its challenge to the long-completed merger. The FTC is running a rigged game, says CEO John Mackey, and what's more -- "we would be better off today if we hadn't done this deal" with Wild Oats. With the depressed economy (and, grocery analysts like myself would argue, Whole Foods' inability to develop a cohesive mission that resonated with sustainability-conscious shoppers), Whole Foods sales have been bottoming out, and the debt the company accrued to complete the merger is now weighing heavy on the balance sheet.

Indeed, this battle over a minority of the grocery market -- a minority the FTC inexplicably argues is called "premium and natural grocery" and is unfairly dominated by Whole Foods -- has gone on long enough.

In the continuing FTC battle with Whole Foods (NYSE: WFMI) over the company's merger with Wild Oats Markets (a merger, I might add, that's already complete; all of the stores in my region have been converted to Whole Foods markets for many months), there is a local casualty. This local casualty has not been forced out of business by the strength of the Whole Foods conglomerate, with, now, stores in every quadrant of the city -- no, it's thriving, popular with both customers and the quirky-and-excellent local purveyors of vegetables, cheeses, chickens. But New Seasons Market is facing unwelcome bullying from the organics food giant.

Yesterday in the New Seasons blog, popular CEO Brian Rohter points to the objectionable subpoena he's received from Whole Foods' attorneys, claiming that his company's secrets are party to the FTC/Whole Foods dispute. (A response from Whole Foods indicates that this request went out to 96 companies, stores and vendors, although those aren't detailed.) The subpoena demands a wide variety of documents, including all documents relating to competition with Whole Foods or Wild Oats; financial information, by store; market studies and strategic plans; and all plans for future stores, expansion and renovation. Rohter's attorneys have objected but tell him he could very well lose and be ordered to hand over the documents (at considerable cost to a small local grocery chain).

Rohter argues that, though Whole Foods insists only the attorneys and consultants will see the information "That's like trusting the fox to guard the henhouse – and we don't have any faith it's going to work like that. ... some of the people at Whole Foods have a history of less than stellar behavior when it comes to competing fairly." In a follow-up to a Whole Foods response at Portland Food and Drink, Rohter says, "And those "consultants"...? Once they've looked through our information they're not going to "unlearn" it. The very nature of their job means they carry things they've learned from one job to another. Will they ever work for Whole Foods again?"

If a new legal ruling forces Whole Foods to reverse its Wild Oats buy-out, WFMI shares could soar.

A federal appeals court has decided that the FTC's challenge of the merger between Whole Foods (NASDAQ: WFMI) and Wild Oats should have gone forward. A lower court has said the FTC had to cease its investigation into whether the marriage was anti-competitive.

According to The Wall Street Journal, "Jeffrey Schmidt, head of the FTC's competition bureau, said the agency is hopeful the ruling will ultimately allow the FTC to undertake a full review of competitive issues raised by the combined companies."

Whole Foods ended up with 74 Wild Oats stores, which it plans to cut down to 50. The FTC could ask the new company to close other locations in areas where the new parent has two stores, and, perhaps a monopoly for that region.

The FTC could also argue that the entire merger constitutes an antitrust threat. That news could not be better for WFMI shareholders. If Wild Oat has to be spun back out, it would need to re-brand its stores, add expensive management, and undertake its own marketing. In other words, it would be a severely weakened competitor for Whole Foods, instead of a thorn in the side of WFMI shareholders.

Shares in WFMI are off well over 40% this year. Stocks in many other major food retailers are closer to flat. Part of this may be due to the concern that premium products do poorly in a recession. But it may also have to do with the fact that Wild Oats stores were considered weaker as a group than the original Whole Foods chain.

If WFMI gets to rid itself of the company it got in the buy-out, its shares might get back from $22, near their 52-week low, to the $30 to $40 range.

Douglas A. McIntyre is an editor at 247walls.com.

It has been widely anticipated that the EU would bring new antitrust charges against Intel (NASDAQ: INTC). The FTC and other US authorities are chasing the largest chip company in the world for similar reasons. South Korea has already fined Intel for anti-competitive behavior.

The theory behind the charges is that Intel induced PC companies and their retailers to use its chips and not those from rival AMD (NYSE: AMD). According to The Wall Street Journal, "The European Union launched new antitrust charges against Intel Corp., saying the chip giant paid rebates to a major retailer to encourage it not to carry computers using chips from smaller rival Advanced Micro Devices Inc ."

If the charges are true, it shows the extent to which a company of real size, like Intel, can be its own worst enemy. Microsoft (NASDAQ: MSFT) ran into similar problems a decade ago for being too aggressive killing off competition in the browser and media player markets.

The irony of Intel's legal bind is that it almost certainly did not need to pressure or give incentives to keep AMD in a distant second place. It had the balance sheet to keep margin pressure on AMD and the engineering prowess to offer better chips.

Arrogance and carelessness often go with being in first place. This time it appears that it has caught up to Intel.

Douglas A. McIntyre is an editor at 247wallst.com.

Although Whole Foods Market's (NASDAQ: WFMI) acquisition of Wild Oats has already been completed, the FTC is still trying to get in the way. The Commission is asking a Washington appellate court to overturn a federal district court's ruling [subscription required] that allowed the merger to proceed.

According to The Wall Street Journal, the FTC was split on whether to pursue the appeal, and it's considered a Hail Mary pass.

Regardless of whether you support or oppose the district court's ruling that allowed the deal to proceed -- and in spite of Mr. Mackey's crazy message board antics -- you have to wonder what the point of this appeal is. Are taxpayers really having their money spent wisely pursuing an appeal that has no chance?

I don't think so. Consumers would be better served if the FTC devoted some of this energy to cracking down on the numerous fraudulent multi-level marketing companies that continue to recruit distributors, uninhibited by anti-pyramid laws.

Reuters has written that the progress in the Whole Foods (NASDAQ: WFMI) merger with Wild Oats (NASDAQ: OATS) may be a sign that other mergers being scrutinized by the US government may have an easier time of getting approval. Not likely.

The FTC has tried to block the Whole Foods deal because it may raised the amount that consumers have to pay for organic food. Of course, other food retailers offer these products, so the government's position was probably always a bit thin. The agency went to federal court to try to block the marriage, but was unsuccessful.

Now Reuters is floating the theory that the apparent success of the grocery store merger may make it easier for Sirius (NASDAQ: SIRI) to merge with rival satellite company XM (NASDAQ: XMSR).

The concept is full of holes. Sirius and XM are a de facto duopoly and, merged, would be a monopoly. Their ability to send satellite signals with radio content to receivers is not a business that any other company can enter. That is not really a bit like the Whole Foods situation.

The SIRI/XMSR merger is also a deal that faces opposition in Congress. Legislators want to know why they should countenance a business combination that not only lacks any competing technology but is also one that may use its position to raise rates over time.

The news about the Whole Foods merger may be good for it, but the deal has nothing to do with satellite radio.

Douglas A. McIntyre is a partner at 24/7 Wall St.