A federal judge last week killed a proposed $6.3 billion merger between office supply giants Staples and Office Depot, in the latest high-profile deal to fall apart.
Today, Judge Emmet G. Sullivan released an opinion outlining his reasons for agreeing with the Federal Trade Commission and rejecting the merger. In his opinion, Sullivan concurred that the deal would have jacked up prices for big-business customers in a way that would have violated US antitrust law.
In seeking to keep the deal alive, Staples and Office Depot had argued that the FTC’s attempts to shield “mega companies” from big prices were misplaced. The office-supply companies argued the merger “indisputably will benefit all retail customers, and more than 99 percent of our business customers,” according to Sullivan’s opinion.
However, Sullivan wrote that B-to-B customers (businesses that transact with other businesses) are entitled to protection under antitrust law — even if they are only part of the customer base.
“Antitrust laws exist to protect competition, even for a targeted group that represents a relatively small part of an overall market,” Sullivan wrote. Later on, he suggested the mergers could hurt this targeted group by writing, “There is overwhelming evidence in this case that large B-to-B customers constitute a market that Defendants could target for price increases if they were allowed to merge.”
In his decision, Sullivan also took aim at the highly unusual strategy of Staples and Office Depot not to call witnesses in their own defense, as Reuters noted.
Full Content: Yahoo Finance
Want more news? Subscribe to CPI’s free daily newsletter for more headlines and updates on antitrust developments around the world.
Featured News
BHP Unveils £31bn Mining Megamerger Proposal with Anglo American
Apr 25, 2024 by
nhoch@pymnts.com
ByteDance Prefers Shutdown Over Sale of TikTok Amid US Ban Threats
Apr 25, 2024 by
CPI
FCC Votes to Restore Net Neutrality Rules
Apr 25, 2024 by
nhoch@pymnts.com
Apple Rejects Spotify’s Updated App Over In-App Pricing Disclosure
Apr 25, 2024 by
CPI
FCC Set to Reinstate Net Neutrality Rules Today
Apr 25, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Economics of Criminal Antitrust
Apr 19, 2024 by
CPI
Navigating Economic Expert Work in Criminal Antitrust Litigation
Apr 19, 2024 by
CPI
The Increased Importance of Economics in Cartel Cases
Apr 19, 2024 by
CPI
A Law and Economics Analysis of the Antitrust Treatment of Physician Collective Price Agreements
Apr 19, 2024 by
CPI
Information Exchange In Criminal Antitrust Cases: How Economic Testimony Can Tip The Scales
Apr 19, 2024 by
CPI