Preliminary Injunction Litigation

• Pages: 467-481

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CHAPTER XII

PRELIMINARY INJUNCTION LITIGATION

When the federal agency reviewing a proposed transaction believes

the transaction as originally structured would violate Section 7, the

agency will seek a remedy. As discussed in Chapter X, most frequently,

the agency’s concerns can be addressed in a negotiated settlement that

includes a remedy such as a divestiture of assets.1102 At times, though, an

agency may have concerns that cannot be satisfied with a structural

remedy, either because the steps required to address the agency’s

concerns would make the transaction unattractive to the parties, or

because there is no remedy that would resolve the agency’s contemplated

anticompetitive effects. In those situations, the agency may attempt to

block a pending transaction, or unwind a consummated transaction,

through federal district court litigation. This chapter considers the

procedures involved in a decision by either the Federal Trade

Commission (FTC or Commission) or the U.S. Department of Justice

(DOJ or Antitrust Division) to enjoin a proposed or consummated

transaction and related strategic concerns faced by the parties to a

challenged transaction.1103

1102. The DOJ challenged nineteen mergers in fiscal year 2010. Ten of those

resulted in consent decrees, eight resulted in the transactions being

abandoned, and one resulted in contested litigation. The FTC challenged

twenty-two mergers in fiscal year 2010, with nineteen resulting in

consent decrees, and three being abandoned. See Fed. Trade Comm’n,

Hart-Scott-Rodino Annual Report, Fiscal Year 2010, available at

http://www.ftc.gov/os/2011/02/1101hsrreport.pdf.

1103. It is beyond the scope of this Handbook to provide an in-depth discussion

of the litigation process itself. In federal district court challenges by the

agencies (or third parties), the standing procedural rules of the court and

federal rules of evidence apply, subject to what the parties and the

reviewing agency may have stipulated to prior to commencement of the

action in timing agreements or otherwise. See Chapter VII.