US Mergers

Nearly a year has passed since the Federal Trade Commission (FTC) and the Antitrust Division of the US Department of Justice (DoJ) (collectively, the Agencies) unveiled the heavily anticipated final revision of the Horizontal Merger Guidelines (2010 Guidelines) on 19 August 2010. The 2010 Guidelines substantially revised the 1992 Guidelines and purport to ‘describe the principal analytical techniques and the main types of evidence on which the Agencies usually rely to predict whether a horizontal merger may substantially lessen competition.’1

The substantial revisions reflected in the 2010 Guidelines - the final form of which followed an extensive public comment period, as well as a series of public workshops during the drafting period - aim to ‘provide more clarity and transparency, and... provide businesses with an even greater understanding of how [the Agencies] review transactions.’2 Although the 2010 Guidelines are not entirely new in terms of content (as many of the revisions reflect refinements previously identified in the 2006 Commentary on the Horizontal Merger Guidelines, as well as Agency practice that had become known to practitioners), they critically emphasise merger review as ‘a fact-specific process through which the Agencies, guided by their extensive experience, apply a range of analytical tools to the reasonably available and reliable evidence to evaluate competitive concerns in a limited period of time.’3 In this way, the 2010 Guidelines provide increased flexibility to the Agencies in evaluating horizontal mergers for harmful competitive effects.

The 2010 Guidelines were welcomed by the business and legal community because the 1992 Guidelines were woefully out of date and did not represent the actual current practice of the Agencies. It still largely remains to be seen, however, whether the goals of flexibility, clarity and transparency will ultimately be achieved in a manner that maintains sufficient certainty to aid businesses and antitrust lawyers in accurately predicting the outcome for proposed transactions. This article examines merger activity since the issuance of the 2010 Guidelines and the extent to which the notable changes in the 2010 Guidelines have been reflected in merger enforcement actions over the last year in any way discernible by the antitrust bar (as opposed, perhaps, to specific parties to particular transactions).

Three main themes emerge. First, despite the Agencies’ objective of enhancing flexibility in merger review, the traditional adherence to analysis of market definition, share and concentration continues to feature prominently in the public documents in merger challenges and in actual merging party experience. Second, the hope that Agency practice would clarify the meaning of newly introduced analytical tools has not yet materialised. Third, the transparency of internal Agency review remains somewhat limited: private parties may have a better sense of what tools are used by the Agencies in merger review, but not always how they are used. This lack of transparency exists even in areas that witnessed fewer substantial changes between the 1992 and 2010 Guidelines, and in which the Agencies’ practice seems to be generally consistent with the 2010 Guidelines, such as in the Agencies’ public discussions in particular merger cases of coordinated effects, entry and efficiencies. Admittedly, the Agencies are limited by confidentiality restrictions from laying out minute details of their analysis, but many public documents border on boilerplate.

In evaluating the relative success the Agencies have had in implementing the 2010 Guidelines, it is important to recognise that the Agencies do not operate in a vacuum and face external constraints. Hindering the implementation of some of the changes embodied in the 2010 Guidelines, especially those that de-emphasise market definition or emphasise diverse types of evidence, is the role of the courts, as merger case-law has long centred around the proper definition of the market. Because information is more readily available for challenged mergers, where market definition may be required by the courts, it is difficult to judge whether available public statements mask the de-emphasis of market definition and concentration, although actual experience and anecdotal evidence suggest it is still being emphasised, even in circumstances where it would not be expected.

Another challenge facing the Agencies is the tension among the goals that the 2010 Guidelines sought to achieve. There is an underlying conflict between the pursuit of transparency and the pursuit of flexibility. Flexibility permits the Agencies to select the methodologies to use in analysing the competitive effects of a particular merger and in deciding whether to start their analysis with market definition, competitive effects or elsewhere. This flexibility can compromise the transparency of the process, however, and create greater uncertainty as to the specific tools and analyses that the Agencies will employ in any given merger. Similarly, if the Agencies wish to have flexibility in applying the analytic tools of merger analysis, then defining the meaning of these concepts with precision and clarity becomes more difficult. Fact-specific analyses and flexibility, in other words, yield results that are less amenable to clear, bright-line rules or predictable patterns of enforcement. As recognised by many at the time of the 2010 Guidelines’ issuance, the Guidelines thus have some embedded constraints on transparency, clarity and predictability for which there may be no easy solution.

In addition to examining the application of the 2010 Guidelines to recent mergers, this article looks briefly at the new Antitrust Division Policy Guide to Merger Remedies issued by the DoJ in June 2011 (the Guide to Merger Remedies). The Guide to Merger Remedies, updated from the 2004 version, explains the well-known rule that anti-competitive horizontal mergers are best-suited for structural remedies but also provides that behavioural remedies may be useful in supplementing those structural remedies in certain cases.

2010 Horizontal Merger Guidelines: one year later

Market definition, share and concentration still feature prominently in the public record of merger challenges

Although the traditional five-step analytical approach formulated by the 1992 Guidelines has been abandoned entirely in the 2010 Guidelines, each of the five elements remains a part of the Agencies’ analytical tool kit. The 2010 Guidelines make clear that market definition and measurement of market shares and concentration - the first step in the prior sequential five-step process - is merely ‘one of the tools... use[d] to assess whether a merger is likely to lessen competition.’4 The 2010 Guidelines de-emphasised the use of market definition as the primary tool for determining which mergers should be challenged and stressed that, while market definition will always be a tool used by both Agencies, it would not be the end of the merger inquiry and may not even be the starting point of the inquiry.

However, it appears that the Agencies continue to explicitly address and emphasise market definition in merger challenges, and may be constrained in their ability to de-emphasise market definition and pursue a more flexible approach to merger enforcement actions. In a notable example, FTC Commissioner Rosch identified the case of Polypore during a March 2011 speech as a missed opportunity to move away from ‘an upfront structural case’:

Despite the 2010 Guidelines’ goal of moving away from an upfront structural case and toward the use of direct evidence of a merger’s anticompetitive effects, it’s not clear to me that agency practice - at least at the FTC - has actually changed much since those Guidelines became effective. Exhibit A in that regard is the Commission’s Polypore opinion, which follows the analytical approach of the 1992 Guidelines, rather than the 2010 Guidelines.5
In Polypore, the FTC’s opinion followed the traditional five-step approach, beginning with the definition of relevant markets, despite substantial evidence that prices had been raised post-consummation of the February 2008 merger between two of three North American manufacturers of battery separators for flooded lead-acid batteries.6 The FTC took this approach despite recognising that ‘[i]n a consummated merger, post-acquisition evidence of actual anti-competitive harm may in some cases be sufficient to establish Section 7 liability without separate proof of market definition.’7

Indeed, one major constraint on the Agencies’ attempt to de-emphasise market definition is the high priority that courts place on market definition analysis. As FTC Commissioner Rosch recognised, one reason for beginning with market definition in Polypore was that this was ‘the smart way to secure an appellate victory.’8 Although the Agencies understand that defining a relevant market merely permits the inference of potential harm to competition from high market concentration levels or individual market shares and that, in some cases, direct evidence exists that certain customers are likely to be harmed by a merger, or that certain customers have already been harmed by a consummated merger, courts appear to be wary of relying on such direct effects in the absence of a defined market. The March 2011 decision in LabCorp suggests, for example, that where a court disagrees with an agency’s approach to market definition, it may be unlikely to be persuaded by direct evidence. The district court in LabCorp denied the FTC’s motion for a preliminary injunction enjoining the post-consummation integration of Laboratory Corporation of America and Westcliff Medical Laboratories, Inc, pending the outcome of administrative litigation.9 In reaching its decision on the likelihood of success on the merits, the court disagreed with the FTC’s definition of the relevant market (the Southern California market for the sale of clinical laboratory testing services to physician groups) and appeared to place little weight on the direct evidence of anti-competitive effects presented.10 Commissioner Brill, later dissenting from the FTC’s decision to withdraw the appeal of the district court decision to the Ninth Circuit, criticised the court’s failure to consider substantial direct evidence of competitive effects as an error of law.11

Moreover, despite the identification of diverse sources of evidence in the 2010 Guidelines, it appears that the Agencies’ practice has not yet substantially diverged from the traditional focus on evidence of market shares and concentration. The 2010 Guidelines identify five types of evidence considered in merger inquiries intended to increase flexibility and transparency regarding the actual factors weighed by the Agencies:

  • actual effects observed in consummated mergers;
  • direct comparisons based on experience;
  • market share and concentration in a relevant market;
  • head-to-head competition; and
  • the disruptive role of a merging party.12

Consistent with the 2010 Guidelines’ de-emphasis of market definition and shares and emphasis on ‘competitive effects’, only one of the types of evidence discussed is market shares and concentration.

Overwhelmingly, even post-2010 Guidelines, merger challenges still appear to be grounded in evidence of market shares and concentration evidence and, to a lesser extent, evidence of head-to-head competition and direct effects. This may suggest a less than flexible approach to merger review. It may also indicate the varying weight given to the categories of evidence identified in the 2010 Guidelines and the reality of the kinds of evidence relied upon by, or that are presented as most persuasive to, the Agencies. Again, a failure to reference diverse types of evidence may indicate external constraints on available information (or its confidentiality) rather than a lack of emphasis on or willingness to consider this kind of information by the Agencies.

Although market share and concentration evidence is consistently analysed by the Agencies post-2010 Guidelines, the Agencies continue to caution against excessive reliance on Herfindahl-Hirschman Index (HHI)-driven market concentration analysis, indicating the Agencies’ commitment to a flexible, contextual approach in this regard. The Agencies have actively resisted the view that HHI thresholds indicate the bounds of safe harbours from merger review. Commissioner Rosch, for instance, has expressed concerns about the use of HHI levels in unilateral effects situations where merging firms have low shares but are very close substitutes, or where the proposed merger is between potential competitors and one or both parties have no current sales.13 In LabCorp, the FTC argued that HHI concentration levels and market shares generally understate market concentration in situations where one of the merging parties is a recent entrant and is rapidly growing. In that case, which involved the merger of clinical laboratory testing service providers in Southern California, the Administrative Complaint stated that the ‘market concentration figures, as well as Westcliff’s market share, likely understate the competitive significance of Westcliff in the relevant market as Westcliff did not enter the market until 2007, and has been growing rapidly since that time..., Westcliff’s impressive success rate demonstrates that it has a much greater chance of winning upcoming business than would be implied by its current market share.’14 Not surprisingly, the FTC has advocated that other regulatory agencies move beyond HHI analysis and adopt a more contextual approach to issues of horizontal market power; in response to FERC’s March 2011 request for comments regarding whether FERC should revise its analytic approach to horizontal market power concerns to reflect the 2010 Guidelines, the FTC cautioned against FERC’s merely adopting the revised HHI levels without also integrating the broader, contextual approach expressed in the 2010 Guidelines.15

Although market concentration analysis has remained at the forefront of merger review, it is worth noting that other types of evidence listed in the 2010 Guidelines have also been relied upon by the Agencies in challenging recent mergers. In particular, the Agencies have emphasised evidence of head-to-head competition even when HHI levels are extremely high, indicating an attempt to move beyond pure market concentration analysis. For example, in requiring divestitures in the acquisition of Kerasotes by AMC (between the time that the 2010 Guidelines were proposed and finalised), the DoJ’s public documents noted that AMC and Kerasotes were each other’s most significant competitor in the relevant markets and that the merger would eliminate the head-to-head competition between the two operators of mainstream movie theatres showing first-run commercial films.16 Evidence of head-to-head competition has also frequently been cited by the FTC, including in LabCorp (‘Numerous physician groups have leveraged the competition between LabCorp and Westcliff, and in the process have obtained lower prices’),17 ProMedica’s proposed acquisition of St Luke’s Hospital (‘By eliminating significant, beneficial competition between Respondent ProMedica and St Luke’s, the Acquisition vests ProMedica with an increased ability and incentive to demand supra-competitive reimbursement rates from commercial health plans and their membership’),18 and Phoebe Putney’s proposed acquisition of Palmyra Park Hospital (‘Phoebe Putney and Palmyra are each other’s closest competitors, and... have battled fiercely for inclusion in health-plan networks and have gone to great lengths to increase their appeal to health-plan members’).19 Finally, although less often cited, evidence of direct effects in post-consummation situations has also been relied upon by the Agencies in recent merger challenges, including in LabCorp and NuFarm.20 Accordingly, notwithstanding the demands on market definition that have not yet abated, the Agencies continue to stress that market definition is not an end in itself and are attempting to move beyond this stage of analysis. It is also possible that the de-emphasis on market definition has become more influential in cases where mergers have not been challenged and the Agencies retain the flexibility, outside the courts’ purview, to exercise their discretion.

New analytical tools still require clarification

The 2010 Guidelines attempt to clarify in various respects the Hypothetical Monopolist Test, which is frequently used to aid in defining relevant markets and examines whether a hypothetical monopolist in the product market as defined can profitably impose a small but significant and non-transitory increase in price (SSNIP).21 If the answer is yes and the price increase would be profitable for the hypothetical monopolist, then the market is appropriately defined; if the answer is no, then the relevant product market is defined too narrowly and must be expanded.The 2010 Guidelines also discuss Critical Loss Analysis (CLA), which is a break-even analysis that is perceived to be a method for giving the Hypothetical Monopolist Test a more rigorous basis.22 CLA involves calculating the percentage of lost sales, or ‘critical loss’, that will equate lost profits that result from decreased sales caused by a Hypothetical Monopolist’s SSNIP with an increase in profits on the retained sales.23 If the predicted or actual loss is greater than the equilibrium critical loss, then the SSNIP is unprofitable, indicating that consumers are turning to other alternatives and that the market should therefore be expanded to include those alternatives.

Application of these two analytic tools for market definition - SSNIP and CLA - is still unclear, however. Regarding SSNIP, the 2010 Guidelines clarify that a price increase level of five per cent would normally be used, but ensure the Agencies have flexibility to stipulate that a level more or less than five per cent be used in certain cases.24 Despite the clarification attempted in the 2010 Guidelines, the price increase level used when the SSNIP test is applied remains unclear in most enforcement actions. In a minority of cases, a numerical range is provided, but there is not much transparency regarding what level of SSNIP is chosen in any particular case.

With respect to CLA, the only application, post-2010 Guidelines, supports the view that CLA was included in the Guidelines to prevent misuse of CLA rather than to reflect the Agencies’ affirmative use of it. The only reference to CLA by the Agencies since the issuance of the 2010 Guidelines has been by the FTC in rejecting a CLA argument advanced by the acquirer Market Data Retrieval (MDR), a division of The Dun & Bradstreet Corporation, of its February 2009 acquisition of Quality Educational Data, a division of Scholastic, Inc:One of MDR’s primary defenses to the acquisition was that MDR’s purportedly high margins created a disincentive to raise prices post-merger. The Bureau of Economics and the Bureau of Competition were not persuaded by this critical loss argument because, as set forth in Section 4.1.3 of the 2010 Merger Guidelines, it failed to account for the possibility that high margins might also imply highly inelastic demand and thus fewer lost sales from a price increase. Indeed, as described above, the weight of the evidence indicated that post-merger market conditions would provide an incentive to raise prices.25

A similar lack of in-depth clarity is true of newly introduced tools designed to evaluate competitive effects and, in particular, unilateral effects. The 2010 Guidelines discuss unilateral price effects in markets with differentiated products and identify analytical indicators - such as diversion ratios, upward pricing pressure (UPP) and merger simulations - as tools that the Agencies will employ.26 With respect to UPP, the proposed Guidelines articulate this relatively new concept that examines post-merger changes in pricing incentives and is viewed as an alternative to market definition and concentration analysis for differentiated products. It essentially quantifies the concept that the merger of two differentiated products that are close substitutes will increase incentives to increase the price of one product because a significant portion of the lost sales will be internalised post-merger.

While the Agencies’ strong focus on unilateral effects is evident, recent cases have not significantly enhanced clarity or transparency about how the analytical tools identified in the 2010 Guidelines are being used. Significantly, UPP (also called “value of diverted sales”) has not been explicitly referenced by the Agencies in public statements such as Competitive Impact Statements filed for challenged transactions, leaving open questions about its use and the manner in which this concept is applied. Diversion ratios have been referenced explicitly only infrequently, though the general concept of diversion is prominent and alluded to in public statements regarding a number of cases. It therefore remains unclear how diversion ratios are being used and whether they are being calculated on the basis of market shares and if not, what evidentiary basis is being used, given that diversion ratios need not be explicitly linked to market shares and more direct evidence may be available.27 Price-cost margins are referenced in some cases, particularly in connection with diversion analysis, but the precise manner in which this type of data is interpreted and utilised by the Agencies is also unclear.

In sum, the 2010 Guidelines are not precise in explaining certain of the tools regarding market definition and unilateral effects, and how they are handled by the Agencies. The Agencies’ practice in using these tools - and making publicly available their analyses - could significantly aid the business community’s understanding of these tools and how they will be used in merger review, and such further explication and development is warranted.

Transparency remains limited, even in areas consistent with the 2010 guidelines

Other areas of the 2010 Guidelines, while not necessarily inconsistent with the 2010 Guidelines, could nonetheless benefit from increased transparency and development. These areas include coordinated effects, entry and efficiencies.

In the area of coordinated effects, the 2010 Guidelines aim at explaining, with increased clarity and transparency, what types of evidence the Agencies look for when determining whether there will be coordinated effects in a given merger. Notably, coordinated effects appear to be more frequently mentioned by the Agencies as a consideration in the past year than in previous years such as 2008-2009. Several recent cases, including LB Foster and H&R Block,28 reference some of the types of evidence concerning coordination that the 2010 Guidelines indicate the Agencies will use in their analysis, thus suggesting that the updates to the Guidelines were successful in reflecting actual practice in this respect.However, there is still a lack of clarity concerning the ‘credible basis’ standard for coordinated effects articulated in the 2010 Guidelines. The 2010 Guidelines clarify that the Agencies are likely to challenge a merger where there is a ‘credible basis’ on which to conclude that the merger may enhance vulnerability to coordinated conduct.29 Whether this ‘credible basis’ requirement is a meaningful restraint on the Agencies is not yet fully apparent. Given the ‘credible basis’ standard, it is also surprising that in many cases, no rationale or an extremely limited rationale is offered to support the conclusion that a merger may increase vulnerability to coordinated conduct.

The areas of entry and efficiencies are also areas in which the Agencies’ practice generally seems consistent with that articulated in the 2010 Guidelines. There still remains some uncertainty, however, as to what constitutes timely entry. The former two-year bright-line standard for timeliness of entry was eliminated and the Guidelines stress that the entry analysis, including timeliness, will be a heavily fact-specific inquiry.30 Again, the tension between flexibility and transparency is at play; although the Agencies eliminated the two-year time period for entry and now only require entry that is ‘rapid enough’ to render unprofitable any anti-competitive conduct encouraged by the merger,31 the Agencies typically do not reference a specific time period for timeliness. Adding to the uncertainty, when a specific time period is referenced by the FTC in public discussions of cases, it has so far continued to use the two-year time frame for timeliness in many cases, including Phoebe Putney, ProMedica, Simon Property Group and Air Products.32

Regarding efficiencies, the 2010 Guidelines attempt to be more inclusive in the consideration of how a merger can positively affect the consumer, such as through technological innovations.33 Efficiencies have not yet figured prominently in challenged mergers in the last year, but have, like in the area of entry analysis, played some role in the decision not to challenge specific mergers, such as Southwest Airlines Company’s acquisition of AirTran Airways in which the DoJ determined that the merged firm will be able to offer new services on routes that neither company previously served, and that the presence of low-cost carriers would likely lower fares on routes previously served only by incumbent legacy carriers.34 Again, however, this area could benefit from further explication and more transparency, as the Agencies have not publicly addressed efficiency issues in challenged cases, even when the merging parties appear to have argued that the merger will create significant efficiencies. The exceptions thus far have been George’s Foods, in which the DoJ argued that its ordering George’s to invest in certain freezer and other plant improvements would create efficiencies sufficient to allow the merger to proceed,35 and the FTC complaints in LabCorp and ProMedica, which indicate, without much explanation, that ‘extraordinary’ merger-specific efficiencies would be necessary to justify the respective acquisitions given their vast potential harm to competition.36 The Agencies’ purported goal of providing transparency in this and other areas will hopefully be supplemented on an ongoing basis through explanations of the rationale underlying enforcement decisions, press releases and speeches and, if necessary, further updates to guidelines and policies.

New DoJ Guide to Merger Remedies

The recently issued 2011 DoJ Policy Guide to Merger Remedies acknowledges that, where a competitive problem exists, the DoJ ‘will pursue a divestiture remedy in the vast majority of cases involving horizontal mergers.’37 Recent DoJ consent decrees exemplifying this approach include Unilever and LB Foster Co.38

Although the usual remedies for horizontal mergers are structural remedies that generally involve the sale of physical assets by the merging firms or require that the merged firm create new competitors through the sale or licensing of intellectual property rights, the Guide to Merger Remedies notes that conduct remedies, which prescribe certain aspects of behaviour post-consummation, can be a valuable tool as well. Notably, the Guide to Merger Remedies states that conduct remedies ‘are sometimes used to address concerns raised by horizontal mergers (usually in conjunction with a structural remedy).’39 This is a notable change from the 2004 version of the Guide, which indicated that structural remedies were always preferred and that conduct remedies should be used only in limited circumstances.40 Common forms of conduct remedies are firewall, non-discrimination, mandatory licensing, transparency and anti-retaliation provisions, as well as prohibitions on certain contracting practices.41

Consistent with the DoJ’s policy approach, a number of FTC consent agreements - Irving, Flying J and MDR (Dun & Bradstreet)42 - have involved remedies that may be appropriately characterised as behavioural, including non-discrimination, prohibitions on certain contracting policies and firewalls. These behavioural remedies were all employed in conjunction with, and to ensure the effectiveness of, structural divestiture remedies in those cases.

The new DoJ Guide to Merger Remedies also makes clear that behavioural remedies are very appropriate for vertical mergers. Describing the most common problem with vertical mergers as a change in incentives that may encourage the merged firm to impair the competitive process, the Guide to Merger Remedies characterises conduct remedies as good choices for counteracting such changed incentives.43 Although recognising that a divestiture could nonetheless be an appropriate remedy for a vertical merger, conduct remedies are clearly being embraced by the DoJ for vertical mergers. Although the FTC has not issued any new remedy policy guidelines, its decision to accept a firewall solution in PepsiCo, Inc’s acquisition of bottlers that also bottled for PepsiCo’s competitor, Dr Pepper Snapple Group, shows that the FTC is also ready to embrace conduct remedies.44As almost all of these decisions pre-date the issuance of the 2011 Guide to Merger Remedies, it will be interesting to see what further applications of behavioural remedies in the context of both horizontal and vertical mergers arise in the near future.

Conclusion

The 2010 Guidelines have certainly succeeded in updating the guidelines for Agency merger review. Still, some of the changes embodied in the 2010 Guidelines have not yet been implemented in full or need further clarification through Agency disclosure and practice over time. Indeed, the emphasis on flexibility and the fact-specific nature of the merger review process means that certain bright-line rules and patterns of enforcement are not as readily available. Although the limitations on transparency and clarity can present substantial challenges for practitioners when counselling potentially merging clients, for the most part, the 2010 Guidelines have significantly enhanced practitioners’ ability to describe the kinds of tools and evidence that the Agencies will consider during the merger process. As the first year of merger enforcement post-2010 Guidelines indicates, further developments will necessarily take time as more transactions and principles are tested before both the Agencies and the courts.

Notes

1
US Department of Justice, Antitrust Division, and Federal Trade Commission, Horizontal Merger Guidelines (19 August 2010) (www.justice.gov/atr/public/guidelines/hmg-2010.html#1) (2010 Guidelines) section 1.

2
Press Release, Department of Justice, Department of Justice and Federal Trade Commission Issue Revised Horizontal Merger Guidelines (19 August 2010) (www.justice.gov/atr/public/press_releases/2010/261642.htm).

3
2010 Guidelines, supra note 1, section 1.

4
2010 Guidelines, supra note 1, section 4.

5
‘The Past and Future of Direct Effects Evidence,’ Remarks of J Thomas Rosch, Commissioner, Federal Trade Commission, Before the ABA’s Section of Antitrust Law’s 59th Spring Meeting (30 March 2011) (www.ftc.gov/speeches/rosch/110330aba-directeffects.pdf) (Rosch ABA Remarks), at 12-13.

6
Commission Decision, In the Matter of Polypore International, Inc Docket No. 9327 (13 December 2010) (www.ftc.gov/os/adjpro/d9327/101213polyporeopinion.pdf) (Polypore Decision), at 11, 30-31.

7
Id at 11.

8
Rosch ABA Remarks, supra note 5, at 13.

9
Order Denying Preliminary Injunction, FTC v Laboratory Corporation of America, Case No. SACV 10-1873 AG (MLGx) (11 March 2011) (www.ftc.gov/os/caselist/1010152/110222labcorporder.pdf).

10
Id.

11
Dissenting Statement of Commissioner Julie Brill on the Commission’s Decision to Withdraw Its Appeal in FTC v LabCorp (23 March 2011) (www.ftc.gov/os/caselist/1010152/110324lapcorpstatement.pdf).

12
2010 Guidelines, supra note 1, section 2.1.

13
Rosch ABA Remarks, supra note 5, at 16-17.

14
Administrative Complaint, In the Matter of Laboratory Corporation of America, Docket No. 9345 (December 1, 2010) (www.ftc.gov/os/adjpro/d9345/101201lapcorpcmpt.pdf) (LabCorp Complaint), at paragraph 22.

15
Comment of the Staff of the Federal Trade Commission, US Federal Energy Regulatory Commission, Analysis of Horizontal Market Power Under the Federal Power Act, Docket No. RM11-14-000 (1 June 2011) (www.ftc.gov/os/2011/06/1106ferchorizmarket.pdf), at 1-2.

16
Competitive Impact Statement, USA v AMC Entertainment Holdings Inc, No. 1:10-cv-00846 (DDC) (21 May 2010), at 7-8.

17
LabCorp Complaint, supra note 14, at paragraph 25.

18
Administrative Complaint, In the Matter of ProMedica Health System, Inc, Docket No. 9346 (6 January 2011) (www.ftc.gov/os/adjpro/d9346/110106promedicacmpt.pdf), at paragraph 23.

19
Administrative Complaint, In the Matter of Phoebe Putney Health System, Inc, Docket No. 9348 (19 April 2011) (www.ftc.gov/os/adjpro/d9348/110420phoebecmpt.pdf), at paragraph 8.

20
Polypore Decision, supra note 6; Complaint, In the Matter of Nufarm Limited, Docket No. C-4298 (7 September 2010) (www.ftc.gov/os/adjpro/d9348/110420phoebecmpt.pdf), at paragraph 14(f).

21
2010 Guidelines, supra note 1, sections 4.1.1 and 4.1.2.

22
2010 Guidelines, supra note 1, section 4.1.3.

23
The formula for calculating the Critical Loss is S/(M+S), where S is the amount of the SSNIP and M is the pre-merger gross margin.

24
2010 Guidelines, supra note 1, section 4.1.2.

25
Analysis of Agreement Containing Consent Order To Aid Public Comment, In the Matter of the Dun & Bradstreet Corporation, Docket No. 9342 (10 September 2010) (www.ftc.gov/os/adjpro/d9342/100910dunbradstreetanal.pdf), at 1-2.

26
2010 Guidelines, supra note 1, section 6.1.

27
Carl Shapiro, ‘The 2010 Horizontal Merger Guidelines: From Hedgehog to Fox In Forty Years,’ 77 Antitrust Law Journal 718 (10 September 2010).

28
Complaint, In the Matter of LB Foster Co, No. 1:10-cv-02115 (D.D.C.) (14 December 2010) (www.justice.gov/atr/cases/f265100/265127.pdf), at paragraph 37; Complaint, USA v H&R Block, Inc, No. 1:11-cv-00948 (DDC) (23 May 2011) (www.justice.gov/atr/cases/f271500/271579.pdf), at paragraphs 46-49.

29
2010 Guidelines, supra note 1, section 7.1.

30
2010 Guidelines, supra note 1, section 9.

31
Id.

32
Administrative Complaint, In the Matter of Phoebe Putney Health System, Inc, Docket No. 9348 (19 April 2011) (www.ftc.gov/os/adjpro/d9348/110420phoebecmpt.pdf), at paragraph 77; Administrative Complaint, In the Matter of ProMedica Health System, Inc, Docket No. 9346 (6 January 2011) (www.ftc.gov/os/adjpro/d9346/110106promedicacmpt.pdf), at paragraph 35; Complaint, In the Matter of Simon Property Group, Inc, Docket No. C-4307 (10 November 2010) (www.ftc.gov/os/caselist/1010061/101110simoncmpt.pdf), paragraph 12; Complaint, In the Matter of Air Products and Chemicals, Inc, Docket No. C-4299 (22 October 2010) (www.ftc.gov/os/caselist/1010093/100909airproductscmpt.pdf), paragraph 9.

33
2010 Guidelines, supra note 1, section 10.

34
Statement of the Department of Justice Antitrust Division on Its Decision to Close Its Investigation of Southwest’s Acquisition of Airtran, Department of Justice Office of Public Affairs (26 April 2011) (www.justice.gov/opa/pr/2011/April/11-at-523.html).

35
Competitive Impact Statement, USA v George’s Foods, LLC, No. 5:11-cv-00043 (WD Va) (23 June 2011) (www.justice.gov/atr/cases/f272500/272501.pdf), at 10.

36
Administrative Complaint, In the Matter of Laboratory Corporation of America, Docket No. 9345 (1 December 2010) (www.ftc.gov/os/adjpro/d9345/101201lapcorpcmpt.pdf) (LabCorp Complaint), at paragraph 37; Administrative Complaint, In the Matter of ProMedica Health System, Inc, Docket No. 9346 (6 January 2011) (www.ftc.gov/os/adjpro/d9346/110106promedicacmpt.pdf), at paragraphs 6, 37-38.

37
Antitrust Division Policy Guide to Merger Remedies, US Department of Justice Antitrust Division (June 2011) (www.justice.gov/atr/public/guidelines/272350.pdf) (Guide to Merger Remedies), at 5.

38
Proposed Final Judgment, United States v Unilever, No. 1:11-cv-00858 (DDC) (6 May 2011) (www.justice.gov/atr/cases/f270800/270862.htm); Final Judgment, United States v LB Foster Co, No. 1:10-cv-02115 (D.D.C.) (2 May 2011) (www.justice.gov/atr/cases/f270500/270581.pdf).

39
Guide to Merger Remedies, supra note 37, at 12.

40
Antitrust Division Policy Guide to Merger Remedies, US Department of Justice Antitrust Division (October 2004) (www.justice.gov/atr/public/guidelines/205108.htm#1), section E.

41
Guide to Merger Remedies, supra note 37, at 13.

42
Decision and Order, In the Matter of Irving Oil Limited, Docket No. C-4328 (15 July 2011) (www.ftc.gov/os/caselist/1010021/110715irvingexxondo.pdf); Decision and Order, In the Matter of Pilot Corporation, Docket No. C-4293 (23 November 2010) (www.ftc.gov/os/caselist/0910125/101123pilotcorpdo.pdf); Decision and Order, In the Matter of the Dun & Bradstreet Corporation, Docket No. 9342 (10 September 2010) (www.ftc.gov/os/adjpro/d9342/100910dunbradstreetdo.pdf).

43
Guide to Merger Remedies, supra note 37, at 5.

44
Analysis of Agreement Containing Consent Order to Aid Public Comment, In the Matter of PepsiCo, Inc, FTC File No. 091-0133 (www.ftc.gov/os/caselist/0910133/100226pepsicoanal.pdf), at 4

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