In what may be the first case ever, a party to an FTC administrative merger challenge has filed suit in U.S. District Court asking the court to halt the administrative proceeding and order the FTC to pursue a preliminary injunction motion in that court. The gravamen of their argument is that the outside date for the transaction is in May, and there is no way that they could conclude an administrative trial in that amount of time.  They claim further that choice to proceed only with an administrative complaint is to delay deliberately the resolution of the suit so that the outside date passes and the deal breaks.  They “deserve their day in court.”  As a matter of substantive law, the case is unsound.  The FTC is free, within the confines of the FTC Act, to choose where it wishes to pursue an action, and this has been so for more than 100 years.  As a means to recapture some negotiating leverage from the FTC and perhaps save a few bucks, it’s probably not a bad strategy.  Perhaps the chance of a loss, however remote, and the potential “embarrassment” of dragging enforcement out “needlessly” will prompt the FTC to settle on more favorable terms.  The cost, however, is Tronox’s, and Tronox’s lawyers’, reputation at the Commission and may only prompt them to dig in their heels.

Tronox Limited and its target, Cristal, both make high purity titanium dioxide (TiO2), an input for products like paint. TiO2 makes paint white.  Tronox announced its intent to acquire Cristal in February 2017.  The FTC investigated the transaction under the HSR Act and purportedly allowed the waiting period to expire on December 1, 2017.  Tronox noted this fact in a press release suggesting it was free to close under the HSR Act.  Four days after that press release, on December 5, 2017, the FTC sued the companies alleging the combination would substantially lessen competition in the market for high purity TiO2.  In their press release announcing the suit, the FTC asserted that the waiting period had in fact expired on October 7, 2017, but the parties had entered into a timing agreement whereby they would provide the Commission 10 days’ notice of their intent to consummate.  The FTC suggested that the parties had not given adequate notice under the timing agreement.  The transaction is still under review in other suspensory jurisdictions that prevent the parties from closing globally.
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On July 6, 2017, QVC announced its intent to acquire the remaining 62 percent of Home Shopping Network it doesn’t already own.  More so than DraftKings or Walgreens, this transaction will demonstrate whether Trump’s election has had any effect on antitrust enforcement, and should be watched carefully.  HSN and QVC are very similar, and the ability to do the deal will turn on what product market definition wins the day.  A very broad product market definition, that focuses on means of distributing products to consumers, and that includes the Internet, will suggest the transaction will have very little effect on competition, and should be allowed to close.  A narrow product market definition that focuses, say, on television shopping as a unique form of entertainment to consumers, and therefore a unique channel in which to sell products, may very well result in a challenge.

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Federal Trade Commission Acting Chairman Ohlhausen and Commissioner McSweeny recently gave two very different speeches on algorithmic pricing. Commissioner McSweeny’s speech seemed to express concern that algorithms would lead to price fixing, coordination and higher prices.  The Chairman seemed less concerned.  The Chairman is likely correct.  Pricing bots are not a new, sinister specter haunting

Bill MacLeod, chair of the American Bar Association’s Antitrust Section and Kelley Drye partner, addressed the Section with an introductory note to their eighth sequential Presidential Transition Report. The 2017 Presidential Transition Report offers a retrospective of current state and federal antitrust and consumer protection law and policy, as well as recommendations for ways

It’s not that hard to predict. If you want to factor the antitrust forecast into your business plans, you have two weather patterns looming.  We can assess the first one quite accurately already.  And notwithstanding all the speculation, we can get a pretty good feel for the second front as well.

Forget about the first

Fortiline LLC distributes ductile iron pipe. It competes with the manufacturer which somewhat regularly undercuts its distributor in the market.  Fortiline on several occasions asked the manufacturer not to do so.  Fortiline emailed the manufacturer complaining that the manufacturer was not keeping its numbers up compared to other manufacturers.  Fortiline also stated that “[w]ith this

On August 24, 2015, the Federal Trade Commission entered into an agreement with hedge fund Third Point settling allegations that Third Point violated the HSR Act by acquiring shares in Yahoo! In 2011 without reporting the acquisition prior to consummation.  Third Point had acquired shares valued at more than the size-of-transaction at the time but

On May 29, 2015, the FTC filed a complaint against Steris Corporation and Synergy Health plc alleging their proposed merger would substantially lessen competition in a market that included the sterilization of medical products.  On September 24, 2015, the Court ruled in favor of the parties, denying the FTC’s motion for a preliminary injunction and