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August 16, 2019
Joel Mitnick comments on Sabre Corp. all but daring the U.S. Department of Justice to sue it as the company tries to push a planned $360 million acquisition past the finish line.
Excerpts from “Sabre Rattling: Merging Co. Gives DOJ Lawsuit Deadline,” Law360, August 16, 2019:
Joel Mitnick, a partner at Cadwalader Wickersham & Taft LLP and a former Federal Trade Commission trial attorney, told Law360 that while most companies “go as far as they can” to accommodate the government in the hope of getting a merger investigation dropped, clients and counsel should also have a conversation about when “enough is enough.”
“When you think there's nothing else you can provide to the government that is going to win them over to your side, then letting them continue their investigation just gives them more time to build a case,” Mitnick said. “Once you reach that decision, it probably is the right strategic move to tell the government that you're going to close the deal.”
…
Closing a deal does not preclude the DOJ or FTC from suing over a merger after the fact, but challenges to consummated transactions are relatively rare. The HSR Act is intended to give enforcers time to assess business combinations and to sue if they find them problematic — before the companies actually integrate.
Once the “eggs are scrambled,” Mitnick said, it’s hard to separate them. When courts assess a merger challenge, one of the things they have to consider is whether there’s an adequate remedy that would restore competition to the level it was at before the merger. But there may not be a reasonable way to separate two companies that have fully combined.
“Remedy is an essential part of the case,” Mitnick said.
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