In this article published in the Antitrust Law Journal, the authors analyze merger enforcement data for 2001–2020 using a database created by the authors. The database lists the identity and outcome of every transaction that received a second request during this 20-year period. The database also lists the identity and outcome of every challenge to an already-consummated merger during the period. The goal of creating the database is to provide further information on merger enforcement, which the authors hope can inform policy and spur additional analysis.
Selected findings include:
- Since 2001, almost all litigated cases have focused on unilateral effects rather than (or in addition to) coordinated effects.
- This 20-year period witnessed a rebirth and focus on successful
challenges to hospital mergers by the FTC.
- The 2010 Horizontal Merger Guidelines were a major update and took a more holistic approach to the evidence and came close to adopting anticompetitive presumptions based on GUPPIs and mavericks. Like the agencies’ prior merger guidelines, the 2010 Guidelines have achieved significant acceptance in the courts.
- The idea of asking a district court to adjudicate a defendant’s voluntary remedy proposal (“litigating the fix”) became common.
- The 2001–2020 period showed increasing concern with mergers that had vertical elements. Over the 20-year period, about 45% (i.e., 33) of the 74 challenges involved mergers that were either purely vertical or a combination of vertical and horizontal. However, a closer look at these challenges would indicate that where there were both horizontal and vertical issues, the agency often focused only on the horizontal.
- The most striking observation about merger enforcement during this period involves the fact that the government almost always wins in court. Of the 26 litigated outcomes during the period, the government won 17 and lost 9, a win rate of 65%.
- In addition, the merging parties abandoned their transaction in
the face of litigation in another 34 matters. Including abandonments, the government prevailed in 51 (i.e., 17+34) of its complaints, which implies a win rate of 85% (i.e., 51/60). Even among the government’s 9 losses in court, judges accepted the parties’ proposed remedies in 2, so the government arguably received a partial win.
- Among Hart-Scott-Rodino Act (HSR) transactions receiving second requests, only 28% were cleared as is. About 40% of the rest were settled with consent decrees, another 30% (i.e., (254+34)/969) were abandoned during the HSR investigation or after a complaint was filed, and the rest proceeded to trial. The situation facing the parties was even more dire if their consummated merger was challenged. For those 44 resolved matters, the government prevailed in 42 (35 consent decrees and 7 wins at trial). The parties escaped without a remedy in less than 5% (i.e., 2/44) of the matters.
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