U.S. Department of Justice Litigates to Block Two Mergers
The U.S. Department of Justice (“DOJ”) has blocked two mergers in the past several months, in each case after filing a lawsuit against the merging parties. The first case involved a relatively small transaction in the digital tax business involving H&R Block and 2nd Story Software. The second case was the high-profile proposed acquisition by AT&T of rival wireless telephone carrier T-Mobile USA. These cases illustrate an uptick in U.S. merger enforcement and an increased willingness on the part of the DOJ to challenge mergers in court. They also illustrate a resistance on the part of DOJ to accepting concessions proposed by parties seeking to obtain clearance of horizontal merge [...]
Deutsche Börse and NYSE Euronext Blame “Narrow” Market Definition for EC’s Objection to Combination
Despite a U.S. Department of Justice decision to clear the deal, the European Commission (EC) today blocked the proposed merger of NYSE Euronext and Deutsche Börse. The EC determined that the combination would have resulted in a quasi-monopoly in the area of European financial derivatives traded globally on exchanges. The two exchanges control more than 90% of global trade in these products, according to the EC.
In light of the EC decision, NYSE and Deutsche Börse said that they were in discussions to terminate their merger agreement.
“The merger between Deutsche Börse and NYSE Euronext would have led to a near-monopoly in European financial derivatives worldwide,” said Joaquín Almun [...]
A Look Back at the Enforcement Efforts of the Federal Antitrust Agencies in 2011
Having filed over 100 cases in the last 12 months, the Department of Justice Antitrust Division was especially active in 2011. The vast majority of those cases were criminal matters; however, 2011 will most likely be remembered for the Antitrust Division’s merger enforcement efforts.
The Antitrust Division reviewed a number of mega-mergers in 2011. While the most of merger filings were approved by the Justice Department without challenge or with conditions in a consent decree, there were notable court battles.
Among the most significant of these was the federal/state challenge to AT&T’s proposed $39 billion acquisition of T-Mobile USA Inc. from Deutsche Telekom. The parties ultimately ab [...]
U.S. Justice Department Conditionally Approves Combination of Stock Exchange Groups, European Review Still Pending
The prospects for the merger of Deutsche Börse AG and NYSE Euronext are looking a little brighter, since the U.S. Department of Justice Antitrust Division conditionally approved the transaction yesterday.
U.S. antitrust approval is a major hurdle; however, the combination of the two leading stock exchange groups, which was announced in February, still requires clearance by the European Commission (EC).
Although the Antitrust Division settlement would only resolve concerns over the merger’s impact on U.S. markets, it indicates that the parties are willing to make concessions to get the deal done. It is a positive sign for a deal that continues to evolve in an effort to satisfy EC competiti [...]
Proposed Combination of Tax Software Makers Violates Section 7 of the Clayton Act
The federal district court in Washington, D.C. yesterday released its Memorandum Opinion explaining its October 31 order enjoining H&R Block, Inc.’s proposed acquisition of 2SS Holdings, Inc.—the maker of “TaxACT” tax preparation software.
The court took a traditional approach in reviewing the merger and concluded that the transaction, which would have combined the second and third-largest providers of digital do-it-yourself (DDIY) tax preparation products, violates Section 7 of the Clayton Act. It began by defining the relevant market. After determining that the Department of Justice made out its prima facie case of anticompetitive effects based on market concentration, the court co [...]
AT&T/T-Mobile Deal, Antitrust Division Regional Office Closures Addressed at Justice Department Oversight Hearing
While Attorney General Eric Holder spent much of his time at today’s Senate Judiciary Committee Department of Justice Oversight hearing responding to question’s about the “Fast and Furious” law enforcement operation, he also was asked to provide his thoughts on some recent developments at the Antitrust Division.
Senator Herb Kohl (D-WI), chairman of the Senate Antitrust, Competition Policy and Consumer Rights panel, questioned the Attorney General on the Justice Department’s readiness to pursue its court challenge to block AT&T Inc.’s planned acquisition of T-Mobile USA, Inc. The Senator sought confirmation from the Attorney General that the Justice Department was prepared to tak [...]
FTC Needs To Stop The Express Scripts-Medco Merger
Antitrust enforcement has certainly been revived at the Obama Justice Department. With recent cases against Comcast/NBC, health insurers and telecom firms, the DOJ has begun to demonstrate why antitrust enforcement is a critical bulwark for competitive markets.
No area is in greater need of an infusion of sound enforcement than healthcare. The healthcare debate demonstrated the dysfunction of healthcare intermediary markets — health insurer and pharmacy benefit manager (PBM) markets are highly concentrated and largely unregulated, and massive consolidation of health insurers and PBMs over the past decade has led to a long list of deceptive and anticompetitive practices.
Fortunately, the DO [...]
Customers’ Efforts to Use Arbitration to Challenge AT&T/T-Mobile Merger Fail
Federal district courts around the country have blocked AT&T Mobility LLC customers from pursuing arbitration to challenge the merger of AT&T Mobility and T-Mobile USA Inc.—a transaction valued at approximately $39 billion.
At least four federal district courts have granted AT&T Mobility’s motions for preliminary injunctions, and a fifth federal district court did not reach the motion for preliminary injunction but denied a customer’s motion to compel arbitration. The courts have ruled that AT&T is likely to succeed on the merits of its claim the arbitration demands exceed the scope of the arbitration agreement.
More than 1,000 AT&T Mobility customers have filed demands with the Amer [...]
Higher Premerger Filing Fees Included in Senate Appropriations Proposal
The Senate Appropriations Committee has approved legislation that, in addition to funding the Federal Trade Commission next year, would increase the Hart-Scott-Rodino (HSR) Act premerger filing fees that help fund the agency. The legislation (S. 1573) also would block efforts to relocate the headquarters of the FTC from its current location at 600 Pennsylvania Avenue, unless the government were to receive fair market value for the property.
The proposed Financial Services and General Government Appropriations Bill for Fiscal Year 2012 would increase the fees that parties must pay when notifying the FTC and Department of Justice Antitrust Division of a large acquisition or merger under the HS [...]
Seven States Join U.S. in Suit to Block AT&T’s Acquisition of T-Mobile
The Attorneys General of California, Illinois, Massachusetts, New York, Ohio, Pennsylvania, and Washington have signed on to the U.S. Justice Department’s complaint challenging AT&T, Inc.’s proposed $39 billion acquisition of T-Mobile USA. An amended complaint, adding the seven states, was filed on September 16.
On the same day, a proposed scheduling order was also filed in the case. The parties have set some deadlines; however, they have been unable to reach an agreement on a trial date, which impacts the discovery timeline.
The government has proposed a start date for the trial of March 19, 2012. AT&T said it would be ready for trial two months earlier, in January. A status conferen [...]
