Articles Posted in Department of Justice

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Authors: Steve Cernak, Luis Blanquez, and Kristen Harris

The comment period on the FTC and DOJ’s request for information on the HSR premerger notification form closed May 26, 2026, with 55 comments on the docket (FTC-2026-0298). That’s a small number for a rule that governs every reportable deal in the country, but many of the filers are the ones who matter: state enforcers, a trade association that sued and won, industry groups with something concrete to lose, and the practitioners who fill out these forms for a living.

For the back story — the February 12 vacatur in the Eastern District of Texas, the Fifth Circuit’s denial of a stay, and the order holding the appeal in abeyance through December 31 — see our earlier posts, HSR in Turmoil and Old, Shorter Form Likely in Use Through At Least 2026. The agencies aim to issue a notice of proposed rulemaking by year-end. Here are our highlights of what the comments say.

The baseline fight: the Chamber’s procedural objection

The U.S. Chamber of Commerce — which sued to block the 2025 form and won — filed a comment making one sharp, narrow point: the agencies keep calling the 2025 version the “Updated Form” and treating it as the starting point for the new rulemaking, and that gets the baseline backwards. In the Chamber’s words, the 2025 form “is no longer an ‘Updated Form’ . . . instead, it is a vacated form that has been found to violate federal law. The only legally valid form is the current form, or as the district court described it, ‘the old Form — used for forty-six years.’”

This isn’t a stylistic quibble. If the 2025 form is the baseline, the agencies can frame the rulemaking as trimming an existing rule. If the pre-2025 form is the baseline, every new requirement has to justify itself from zero — a much higher bar under the Administrative Procedure Act. The Chamber seems to be laying groundwork for the next round of litigation if the agencies pick the wrong posture.

The recurring theme: cut the items that cost the most and return the least

The single most common thread across the docket — from the merger bar, the bar association, and industry trade groups alike — is a request to right-size specific, identifiable line items on the 2025 form rather than a wholesale fight over the form’s existence.

Dechert’s comment is the most granular practitioner-level guide to what actually costs filers time. It splits the 2025 requirements into keep, cut, and clarify:

  • Cut or fix: the move away from a bright-line standard for draft transaction documents toward a subjective “two hats” test that forces lawyers to assess whether a board member reviewed a draft “in their capacity as such”; supply-relationship disclosures reaching third parties a filer would never investigate in the ordinary course; officer-and-director listings duplicated across every subsidiary in the ownership chain; and a top-10-customer breakdown layered on top of the existing product-overlap breakdown.
  • Keep: the single supervisory deal-team lead, the overlap narrative that lets filers explain why two businesses don’t really compete, and streamlined NAICS reporting that dropped the older NAPCS codes.

Dechert also flagged a separate idea floating in the RFI — automatic supplemental filings triggered when parties propose a divestiture or other remedy — and argued a new waiting period with an uncertain outcome would chill timely remedies and push some filers toward litigation instead.

The ABA’s Antitrust Law Section filed the longest and most technical comment and its through-line tracks Dechert’s: keep what’s cheap and useful, cut what costs more than it returns. On the keep side: NAICS revenue reporting, short business descriptions, and the streamlined “Item 4(d)” designation for passive deals. On the cut side: the same pressure points Dechert named — officer-and-director listings, supply-relationship disclosures, and a “Plans and Reports” demand that 2025 informal guidance stretched to cover things as trivial as a news article forwarded to a board. The officer-and-director critique is the sharpest: that disclosure exists to police Section 8 of the Clayton Act, but the 2025 form swept in board service across commonly controlled entities that cannot, as a matter of law, conspire with one another.

The Section also asked the agencies to streamline four categories that rarely raise concerns — passive investment-only deals, executive-compensation grants, “backside” filings from rollovers and earn-outs, and fund-to-fund transfers — backed by the agencies’ own data showing second-request rates near zero for those deals.

The second most common theme: don’t expand reportability to new deal types

A near-equally common position across the bar and industry comments is resistance to the RFI’s invitation to extend HSR reporting into new territory — acquihires, non-exclusive IP licenses, CFIUS-adjacent disclosures, and AI/sovereign-wealth-fund questions the RFI specifically raised.

The ABA Antitrust Section made the clearest legal argument against reaching acquihires through the form: employees are not a statutory “asset” under Section 6 of the Clayton Act (“the labor of a human being is not a commodity or article of commerce”), and the agencies already have civil investigative demands and Rule 801.90 to pursue any deal structured to dodge a filing.

The Computer & Communications Industry Association (CCIA) and NetChoice — both technology trade associations — made overlapping arguments that the form should stay a screen rather than become a dragnet. CCIA’s specific concern is scope creep: sweeping in otherwise non-reportable “hire-and-license-out” deals or requiring duplicative filings during a second request. NetChoice’s comment leaned on the district court’s own finding that the FTC had not shown the 2025 form’s benefits “reasonably outweigh” its costs, and cited the Commission’s own pre-vacatur estimate that the Updated Form roughly tripled average preparation time — from about 37 hours to 105 hours, with the highest-burden filings (those involving competitive overlaps or supply relationships) running 120-plus hours.

The Small Business & Entrepreneurship Council struck a similar note for startups, tying expanded reporting to slower exits and weaker venture formation.

Industry carve-out requests

Two sector-specific comments stand out for asking to be left alone entirely, on largely empirical grounds.

The American Hospital Association wants hospital mergers excluded from any revised form, leaning on the district court’s finding that the FTC could not identify a single anticompetitive merger that escaped the prior form but would have been caught by the 2025 version. The AHA also cites Chairman Ferguson’s prior comment that a transaction-rationale requirement benefits “high-priced law firms,” not the agencies, and his stated preference for a deeper cut than the 2025 rule made.

CCIA and the Small Business & Entrepreneurship Council make the technology and startup versions of the same point (see above), arguing that friction costs are especially high right now given competitive pressure in AI.

The outlier: state attorneys general want more, not less

Five state attorneys general — California, Connecticut, Rhode Island, Washington, and the District of Columbia — filed jointly, and their position is the opposite of nearly every other comment on the docket. They want the 2025 form’s requirements reinstated and then expanded: narrowing the “solely for the purpose of investment” exemption, eliminating the REIT exemption outright, and requiring upfront disclosures on acquihires and serial acquisitions, with consolidation in healthcare, technology, and housing as the stated targets. This reads as much as a roadmap for state-level enforcement as a comment on a federal form, consistent with states’ own expanding merger-notification regimes (Washington’s and California’s new premerger filing laws among them).

What it signals

Strip away the labels and the comments sort into two camps, heavily lopsided. The state AGs want the 2025 form back and expanded. Nearly everyone else who filed — the Chamber, the merger bar, the ABA Section, hospitals, tech trade groups, and small-business advocates — wants the pre-2025 form treated as the floor, with the 2025 additions justified item by item, if at all.

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Author: Aaron Gott

Last week, the Department of Justice announced that Bayer CropScience LLC has removed two sets of potentially anticompetitive provisions from its “Premier Performance Program”—a loyalty program for independent seed companies that sell Bayer’s corn and soybean seed. The announcement came not as the result of a consent decree or court order, but as a voluntary commitment Bayer made during the course of a still-ongoing DOJ investigation.

This is an example of a company taking a hard look at the antitrust risks of its sales initiatives and deciding that the benefit was outweighed by those risks.

Ideally, companies take a hard look at their antitrust risks before they face an investigation. So let’s talk about what those antitrust risks were for Bayer.

Bayer’s Loyalty Program

The Premier Performance Program gave independent seed companies discounts in exchange for meeting sales performance targets. Two features of the program drew DOJ scrutiny.

The first problem with Bayer’s loyalty program was that it imposed a tie. To qualify for discounts, seed companies had to hit targets for *both* corn seed *and* soybean seed. That is a textbook tying arrangement: access to favorable pricing on Product A (corn) conditioned on meeting volume targets for Product B (soybeans).

The antitrust laws treat tying with real suspicion. Tying is suspicious enough, in fact, that Congress has provided the government and private plaintiffs with three different ways under which they can plead a tying claim: as an anticompetitive agreement (between supplier and customer) that violates Sherman Act Section 1; as a unilateral anticompetitive act by a supplier with monopoly power under Sherman Act Section 2; and as a conditional sales arrangement for goods under Clayton Act Section 3. While the requirements of the three different tying claims vary, a seller has antitrust risk for tying where the seller has, at a minimum, appreciable economic power in the tying product.

In a competitive, open market, buyers are free to buy the products they want from the sellers they want. With tying, a seller usurps that choice, using its power in the tying market (where it sells a product customers want) to force buyers to also buy from seller in the tied market (where it sells a product customers don’t want, or at least don’t necessarily want it from seller). As a result, competition in the second (the “tied”) market suffers—alternatives go unpurchased, rivals lose distribution, and that market concentrates around the seller. The result is that seller wins in the “tied” market for reasons other than the merits of seller’s participation in that market. And one largely unspoken principle of antitrust law is that winning for reasons other than the merits is always suspicious.

That was the DOJ’s concern with Bayer’s loyalty program. The DOJ’s announcement notes that Bayer is “the primary source for traited corn seed sold by independent seed companies.” So Bayer is a dominant supplier of traited corn seed, and its loyalty program gave discounts only if the seed company buyers also bought soybean seed from Bayer. In other words, Bayer required customers to take a second product to get favorable terms on the first. In effect, Bayer imposed a toll on corn seed buyers who did not also buy its soybean seeds.

The second problem with Bayer’s loyalty program was that it incentivized exclusivity. The program included provisions that could reduce independent seed companies’ willingness to license seed technology from Bayer’s competitors. The DOJ viewed these incentives as potentially anticompetitive because, it suspected, Bayer was using its loyalty program to foreclose rival seed technology from the distribution channel.

Exclusive dealing and its “cousins”—loyalty discounts, bundled rebates, and incentive programs that effectively limit customers’ ability to patronize competitors—are analyzed under the rule of reason. The question is whether the program forecloses a substantial share of the distribution channel to rivals. A loyalty program that financially penalizes seed companies for licensing competitors’ genetics does exactly that.

Taking a step back from these specific doctrines, the DOJ looked at Bayer’s loyalty program and saw a set of complementary, unilaterally imposed contract terms and incentive structures that functioned to foreclose competition in markets Bayer participated in by using its already substantial power rather than by competing on the merits day by day, product by product. At its core, that is what Section 2 of the Sherman Act seeks to prevent.

Lessons for Investigative Targets

Bayer eliminated both aspects of its loyalty program and has committed not to reinstate them for seven years.

It’s worth noting what Bayer’s commitment does and does not do. DOJ announced that Bayer made its commitment as a result of an “ongoing investigation” and made the changes “during the course of” that investigation. But Bayer did this voluntarily, not because it reached a consent agreement with DOJ. While DOJ will likely consider Bayer’s voluntary cessation of the conduct as a mitigating factor as it proceeds, it does not end the investigation and DOJ remains free to continue its investigation, pursue enforcement, and demand further remedies.

Still, this kind of resolution—behavioral commitments extracted through investigation pressure before DOJ undertakes formal litigation—is common in DOJ enforcement. The Division announces publicly that the conduct has changed, creates a deterrent effect across the industry, and reserves the right to continue its investigation. For Bayer, the alternative was presumably a filed case or a consent decree with more constraining terms. For the DOJ, it is an efficient way to change conduct quickly without committing the resources required for litigation while maintaining full flexibility and discretion going forward —not to mention the ever-present, implicit threat of exercising that discretion to maximum effect.

Also trending in DOJ enforcement? Agribusiness. Bayer is not the first agribusiness to draw this kind of DOJ scrutiny in recent years, and it is unlikely to be the last. Agricultural input markets—seeds, chemicals, equipment—are concentrated and have been under increased enforcement attention since the DOJ and USDA signed their 2025 memorandum of understanding on agricultural competition. Acting Assistant Attorney General Omeed Assefi said it plainly: “Enforcement in agriculture is a top priority for the Antitrust Division.” And that’s to say nothing of state antitrust enforcers, some of whom have also made conduct and concentration in agriculture a chief priority.

Lessons for Loyalty Programs

Ideally, your company will not become an investigative target because of its loyalty programs in the first place. Loyalty programs create risks that can be managed—and assessed against their benefits. A few questions are worth asking to start:

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Authors: Steve Cernak, Luis Blanquez, and Kristen Harris

On May 18, 2026, the FTC and DOJ filed an unopposed motion asking the Fifth Circuit to hold their appeal in abeyance through December 31, 2026. The agencies say they are weighing revisions to the vacated 2024 HSR rule, building on the March 25, 2026 request for information (comments close May 26). They aim to issue a notice of proposed rulemaking by the end of the year and will report to the court every 60 days. The plaintiffs—the U.S. Chamber of Commerce and three other trade associations—do not oppose.

For the back story—the February 12 vacatur in the Eastern District of Texas, the short administrative stay, and the March 19 denial of the FTC’s stay motion—see our earlier post, HSR in Turmoil: Back to the Old Form, at Least For Now.

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Authors: Pat Pascarella & Luke Hasskamp

Recent proceedings involving Apple Inc.—including the U.S. Department of Justice case and Epic Games v. Apple—together with developments in AI markets, suggest an evolving framework for platform-focused antitrust analysis. This article considers how those threads may fit together. 

I. The DOJ Has Done Substantial Groundwork

Begin with market power. In U.S. v. Apple, the district court accepted as plausible a U.S. smartphone market in which Apple holds roughly 65%—now closer to 70%—reinforced by barriers to entry, network effects, and switching costs.

The DOJ also presents an alleged pattern of exclusionary conduct: the repeated neutralization of technologies that reduce platform dependence, including middleware, super apps, cloud streaming, smartwatches, messaging, and digital wallets. According to the complaint, each time a product threatened to make device choice less consequential, Apple constrained or neutralized it. If this allegation is supportable, such a pattern could address concerns about improperly “punishing success.”

II. The Markets Apple Controls at 99 Percent

If a higher market share is needed, the more compelling market is not some smartphone submarket. Rather, it will be markets Apple controls at 99 percent: the iOS functionalities and apps themselves. While not every function is a separate product, some may well  be—particularly those Apple allegedly targets.

Epic v. Apple is instructive on this point, and not fatal. The court did not hold that iOS-tethered markets are inherently non-cognizable—only that Epic failed to establish that consumers lacked awareness of iOS restrictions and could not factor them into purchasing decisions. But those gaps seem addressable.

The full scope of any restraints—and their costs—is obscured in a dense web of contractual and technical restrictions. No reasonable consumer could anticipate the extent to which app review, API access, and distribution control could be wielded against rivals. Nor should antitrust liability turn on whether consumers anticipated unlawful conduct.

Even if consumers had advance knowledge of such restraints, a single-brand market is not foreclosed. Apple’s own counsel acknowledged in Epic that consumers entering the iOS ecosystem cannot predict downstream costs related to app distribution, in-app payments, or aftermarkets. If the costs of any restraints are unknowable at the time of purchase, foremarket competition cannot discipline aftermarket conduct. The remaining elements of a single-brand iOS functionality or app market also appear to be present, including allegations of intentional degradation of interoperability to maintain switching costs—without corresponding loss of share or margin.

III. CoStar, Exclusive Dealing, and the End User License Agreement

Some claims may not require pleading a single-brand market. For example, under the Ninth Circuit’s decision in CoStar v. CREXi, “substantial foreclosure” is sufficient to plead an exclusive dealing agreement.

The agreement? The EULA itself. While a web of contractual and technical restrictions might enable foreclosure, the enforceable agreement between Apple and the user is embodied in the EULA. In that sense, Apple may have supplied potential plaintiffs with the central instrument of its own potential liability.

IV. The EULA as a Negative Tie

The EULA may also provide a foundation for tying claims. Courts often resist tying theories in platform cases, frequently reasoning that coercion must be directed at consumers rather than suppliers. That argument, though contestable, is predictable.

A potential response may be that it is the EULA that effectively conditions use of the platform on the consumer’s agreement not to obtain competing products, services, or apps outside Apple’s approval.

V. Attempted Monopolization and Dangerous Probability of Success

Tying allegations also expand the analytical framework, though courts ultimately may analyze them as attempted monopolization. On the “dangerous probability of success,” a defendant such as Apple likely would invoke concerns about outdated leveraging theories. But this would not be a classic leveraging case.

Any company that demonstrates both the ability and the willingness to neutralize technologies or rivals that threaten its market position may struggle to characterize that conduct as competing on the merits. Such a pattern should reduce concerns about punishing a company simply for being successful. Where a company has demonstrated a pattern of exclusion and retains the ability to repeat it, the “dangerous probability” standard should be satisfied.

VI. Inextricably Intertwined—and Antitrust Standing

A direct monopolization claim targeting the U.S. smartphone market faces a threshold question: standing. Developers and rivals operating at the functionality level are neither customers nor competitors in the smartphone market.

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Authors: Steven Cernak, Luis Blanquez, Cansu Gunel, Sabri Siraj

Bona Law was well represented at the annual largest antitrust conference, the 2026 American Bar Association Antitrust Law Section Spring Meeting in Washington, D.C. Steve Cernak spoke at a panel discussing Robinson-Patman and other issues with big companies; Cansu Gunel attended the Section’s inaugural Trial Skills Academy; and Luis Blanquez and Sabri Siraj attended many panels and led our Bona Law meetings with clients and other firms. With dozens of panels and countless opportunities to meet with friends old and new from nearly 70 different countries, each of us could write an entire post on what we learned last week; however, to keep the length manageable, we each limited ourselves to just the key takeaways for our readers.

Steve Cernak

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Authors: Steve Cernak, Luis Blanquez, and Kristen Harris

On March 19, 2026, the Fifth Circuit denied the FTC’s motion to stay a lower court’s February decision vacating the new HSR form and rules.

As a result, the FTC immediately said it would be accepting the old, less burdensome, form going forward, while recognizing that the agencies continue to wield significant investigatory tools beyond the filing itself At least for the time being, the new form will continue to be accepted too. The FTC will be updating its website with the old form and rules shortly.

The Agency has not announced if it will continue to appeal the lower court’s ruling or re-start the process to develop a different new form. So, the merits appeal remains pending at the Fifth Circuit, meaning the litigation is far from over. A future appellate decision could reinstate the expanded form, require further rulemaking, or affirm the vacatur. For now, however, the legal baseline has reverted to the pre‑2025 HSR regime.

  1. A Sweeping Rulemaking Meets Strong Opposition

In early 2025, the Federal Trade Commission undertook the most ambitious redesign of the Hart‑Scott‑Rodino premerger notification form since the statute was passed in 1976. The dramatically expanded filing framework required parties to submit far more information at the outset of the merger‑review process. The revised form demanded narrative descriptions of competitive dynamics, deeper maps of ownership and governance, detailed horizontal and vertical overlap disclosures, and, often, the submission of certain ordinary‑course business documents never previously required. The stated goal was to help the FTC and the Department of Justice identify problematic deals earlier and reduce friction later in investigations.

The business community was not persuaded. Trade associations, led by the U.S. Chamber of Commerce, argued that the new rule imposed crushing burdens on companies, with compliance costs soaring and preparation time roughly tripling. Many pointed out that the vast majority of HSR filings do not trigger substantial investigations, yet all filers would bear the heightened costs regardless of competitive risk. Even before the rule took effect in February 2025, these groups filed suit in the Eastern District of Texas, claiming the agency had exceeded its statutory authority and failed to justify the new demands.

Their challenge succeeded—at least initially. On February 12, 2026, Judge Jeremy D. Kernodle vacated the rule in its entirety. He found that the agency had not shown the new requirements were “necessary and appropriate” under the HSR Act and had failed to meaningfully weigh costs and benefits as required by the Administrative Procedure Act. The court also found the rule arbitrary and capricious—the FTC failed to show that the rule’s benefits “bear a rational relationship” to its costs. The ruling emphasized that the FTC could not identify even one past transaction that the expanded form would have flagged but the old form would have missed, while acknowledging the enormous cost imposed on every filer. For the court, the disconnect between burden and proven benefit was fatal.

  1. Procedural Whiplash: From Vacatur to Revival

Though the district court vacated the rule, it paused its own order for seven days to allow the FTC to seek appellate relief. The agency scrambled to preserve the status quo. It asked the district court for a stay pending appeal; that request was denied. It then immediately appealed to the Fifth Circuit, filing both an emergency motion for a stay and a separate, narrower request for a short administrative pause.

The Fifth Circuit moved faster than many anticipated. On February 19, 2026—one day before the district court’s stay was set to expire—the appellate court issued an administrative stay of the vacatur “until further order.” The effect was simple but consequential: the 2025 HSR form, despite the district court’s ruling, remained in force. The FTC’s own Premerger Notification Office quickly announced that filers must continue to use the new form while the appeal proceeds.

The court simultaneously set an expedited briefing schedule, requiring the appellees’ response by February 23 and the FTC’s reply by February 26.  On March 19, the court issued a brief per curiam opinion denying the stay. Within hours, the FTC announced on its website that the pre-February 2025 form would be accepted immediately, although filers could also continue using the new form. The FTC expects to further update its website with the old form and rules very soon.

  1. A Landscape of Uncertainty for Dealmakers

Even under the old form, the FTC and DOJ retain broad discretion to request voluntary information during the waiting period.

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Author: Ruth E. Glaeser

Federal officials are reportedly considering an antitrust review of major U.S. homebuilders, particularly around how competitors share information through groups like the Leading Builders of America. The Department of Justice has not yet confirmed a formal investigation, but the discussion highlights risks that extend well beyond the largest national builders.

The size and visibility of large builders make them more likely to attract regulatory attention, particularly when housing affordability has become a major political issue. Policymakers are under pressure to examine whether industry practices, or market structure more broadly, are contributing to supply constraints that make housing less affordable.

But for developers of all sizes, this is a reminder that ordinary industry practices can end up under a microscope. Even conduct that seems routine and well-intentioned can become the focus of a costly and disruptive investigation.

The Issue of Trade Associations

At the center of the concern is information sharing among competitors. Trade associations, like Leading Builders of America, serve legitimate and important purposes. They serve as industry advocates, promote best practices, and provide a forum for discussing common challenges among builders. But regulators have long viewed trade associations as environments where competitors may be tempted to share sensitive information.

United States antitrust law does not prohibit companies from participating in trade associations or gathering market intelligence. What it does require is that each company make its own independent decisions about pricing, production, and strategy and not all information sharing is inherently anticompetitive.

Indeed, the DOJ and FTC have long provided guidance on competitor information sharing to help companies understand how antitrust laws apply to things like collaborations, benchmarking, and exchanging data. For many years, the Antitrust Guidelines for Collaborations Among Competitors, issued jointly by the agencies, offered a framework for assessing when information‑sharing and other activities among competitors might raise antitrust concerns. Although the original 2000 Collaboration Guidelines were withdrawn in December 2024, the agencies have recently requested public comment to develop updated guidance that would cover collaborations and information exchanges for today’s economic and technological landscape.

In practice, problems can arise when communications, including informal ones, suggest that competitors are aligning their behavior. Regulators are especially focused on exchanges involving non-public information about future business plans, because that kind of information is more likely to influence how competitors behave and ultimately affect prices, supply, or quality. Emails, text messages, and meeting notes discussing pricing, future plans, or competitors’ actions can appear more nefarious when viewed in hindsight by regulators.

It’s Not Just the Government

Government investigations are only part of the risk. Antitrust scrutiny often leads to follow-on lawsuits by private parties like homebuyers and investors—an antitrust blizzard of sorts—who have an easier time prosecuting their claims by copying the arguments and evidence from the government’s case. Even when defendant companies believe they’ve done nothing wrong, responding to investigations and defending lawsuits can be expensive, time-consuming, and disruptive.

Economic and Market Forces Can Complicate the Picture

Homebuilders also face challenges unique to the industry. Builders operating in the same markets often respond to the same economic pressures at the same time. Interest rates, material costs, labor availability, and local regulations all affect how many homes are built and how they are priced. When mortgage rates rise, demand slows. Builders may respond by adjusting pricing, slowing production, or delaying projects. Similarly, when lumber prices increase or labor becomes scarce, builders may raise prices or build fewer homes. Local regulation can have the same effect—zoning restrictions, permitting delays, and approval timelines often affect every builder in a given area. Supply chain disruptions can create similar patterns. And if materials are delayed or unavailable, multiple builders may pause or reschedule construction.

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Authors:  Steven Cernak and Luis Blanquez

Section 8 of the Clayton Act prohibits certain interlocking directorates between competing corporations. But while the prohibition has been around since 1914, most antitrust lawyers pay little attention to it, partly because companies can quickly resolve any issues voluntarily.

We first brought Section 8 to the attention of our readers in 2022 because of comments by then-AAG Jonathan Kanter. Even more recent actions by the agencies, detailed below, plus the Hart-Scott-Rodino (HSR) Act’s new requirements under the updated filing form—soliciting information on overlapping directorates—should be enough for everyone to keep a closer eye on the issue, in particular private equity firms.

Clayton Act, Section 8 Basics

The prohibitions of Section 8, in its most recent form, can be simply stated: No person can simultaneously serve as an officer or director of competing corporations, subject to certain jurisdictional thresholds and de minimis exceptions. Truly understanding the prohibition, however, requires understanding all those italicized terms.

First, Section 8’s prohibition applies only if each corporation has “capital, surplus, and undivided profits,” or net worth, of $10M or more, as adjusted. The Federal Trade Commission (FTC) is responsible for annually adjusting that threshold for growth in the economy.  Currently, for 2025, the thresholds are $51.380 million for Section 8(a)(1) and $5.138 million for Section 8(a)(2)(A). These new thresholds took effect on February 21, 2025.

Section 8 provides an exception where the competitive sales of either or each of the corporations is de minimis. Specifically for 2025, no interlocks are prohibited if (1) both of the entities have capital, surplus and undivided profits of $51,380,000 or less, or the competitive sales of either entity are less than $5,138,000; 2) the competitive sales of either corporation are less than 2% of that corporation’s total sales; or 3) the competitive sales of each corporation are less than 4% of that corporation’s total sales.

Originally, Section 8 applied only to directors of corporations; however, the 1990 amendments extended the coverage to officers, defined as those elected or chosen by the corporation’s Board. Despite the clear wording of the statute limiting it to officers and directors, some courts have considered the possibility that Section 8 might apply when a corporation’s non-officer employee was to be appointed a director of a competitor corporation.

The language of Section 8 clearly applies to interlocks between competing corporations. An interlock between a corporation and a competing LLC would not be covered by the statutory language or the legislative history of the original statute or amendment. The FTC and DOJ have not explicitly weighed in on application to non-corporations, although the FTC’s implementing regulations for Hart-Scott-Rodino cover LLC explicitly as “non-corporate interests” different from corporations. Still, the spirit of Section 8 would seem to cover any such non-corporate interlock. Also, any corporate director who also serves a similar role for a competing LLC would face an increased risk of violating Sherman Act Section 1.

Section 8 clearly applies if the same natural person sits on the boards of the competing corporations. It might also apply if the same legal entity has the right to appoint a natural person to both Boards, even if that entity appoints two different natural persons to the two Boards. That interpretation is consistent with the Clayton Act’s broad definition of “person” and has been supported by both the FTC and DOJ and the one lower court to consider the question.

As with other parts of the antitrust laws, the question of competition between the two corporations requires some analysis. The few courts to look at the question have held that corporations that could be found to violate Sherman Act Section 1 through an agreement would be considered competitors. On the other hand, these same courts did not define competitors more narrowly to be those corporations that would not be allowed to merge under the more extensive analysis of Clayton Act Section 7.

Recent DOJ and FTC Action

The DOJ has traditionally enforced Section 8’s prohibition on interlocking directorates, which has become a priority under the current Administration.

As a result, there have recently been an increasing number of instances where directors have resigned to resolve DOJ concerns.

In April 2024, two directors from Warner Bros. Discovery Inc. (WBD)–– Steven A. Miron and Steven O. Newhouse––resigned from the WBD board after the Antitrust Division expressed concerns that their positions on both the WBD and Charter Communications Inc. boards potentially violated Section 8 of the Clayton Act. Charter, with its Spectrum cable service, and WBD, through its Max streaming subscription services, both provide video distribution services to customers. The division’s enforcement efforts to date have unwound or prevented interlocks involving at least two dozen companies.

More recently, in September 2025, the FTC found that Sevita and Beacon Specialized Living Services, Inc.—both owned by private equity investors and providers of services for individuals with intellectual and developmental disabilities—had overlapping board members, violating Section 8 of the Clayton Act. As a result, three directors resigned from the board of Sevita Health following FTC enforcement actions. The FTC didn’t engage in any formal legal action against the companies, and the resignations were enough to resolve the FTC’s competition concerns without further legal action.

Recent DOJ Speeches

The DOJ action that led to the resignations is consistent with recent speeches by DOJ officials

In 2022, Jonathan Kanter, former assistant attorney general in charge of the Antitrust Division at the DOJ, made some significant remarks about Section 8. First, he highlighted the fact that the Division is committed to litigating cases using the whole legislative toolbox that Congress has given them to promote competition, including Section 8 of the Clayton Act. Second, he reminded everyone that Section 8 helps prevent collusion before it can occur by imposing a bright-line rule against interlocking directorates. Third, that for too long, Section 8 enforcement has essentially been limited to their merger review process. And last but not least, that the Division will start ramping up efforts to identify violations across the broader economy and will not hesitate to bring Section 8 cases to break up interlocking directorates. Another former head from the FTC made a similar statement back in 2019, indicating how Section 8 of the Clayton Act protects against potential information sharing and coordination by prohibiting an individual from serving as an officer or director of two competing companies.

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Author: Luis Blanquez

The first part of this article discussed the Dai v. SAS Inst. Inc case, where plaintiffs alleged the inference of a horizontal agreement by the group of Hotel Operators using IDeaS’s software. There, the Northern District of California again confirmed the difficult standard for algorithmic pricing at the motion to dismiss stage. More specifically, the Court highlights (1) how important it is to provide enough facts about the nature of the information shared with the software provider, (2) the way defendants share such information, and (3) to what extent that same information was later commingled and integrated into final pricing recommendations.

In this second article, we dive into the first appellate decision in the US dealing with algorithmic pricing, and the recent Greystar Settlement, where the company agreed to stop using algorithmic pricing tools that rely on non-public data from competitors and to avoid participating in RealPage-hosted meetings with other landlords.

I. Gibson v. Cendyn Group, LLC, 148 F.4th 1069 (9th Cir. Aug. 15, 2025)

In Gibson v. Cendyn Group, LLC et al. plaintiffs alleged two Sherman Act, Section 1 violations:

  • First, defendants engaged in a “hub-and-spoke” antitrust conspiracy by agreeing among themselves to purchase the license to the same revenue management software products from Cendyn and to abide by Cendyn’s pricing algorithms recommendations.
  • Second, the hotels’ individual licensing agreements with Cendyn—”in the aggregate”—had anticompetitive effects in the form of artificially inflated prices for hotel rooms on the Las Vegas Strip.

The District of Nevada dismissed both claims. On appeal, plaintiffs abandoned the hub-and-spoke claim.

On August 15, 2025, the U.S. Court of Appeals for the Ninth Circuit affirmed the district court’s dismissal.

The Ninth Circuit held that plaintiffs failed to state a claim under Section 1 of the Sherman Act by alleging that competing hotels independently purchased licenses for software that provided pricing recommendations. The Court explained that alleging that several competitors contract with the same software service provider, followed by higher prices, was insufficient to state an antitrust claim under the rule of reason.

In addition, the Court highlighted the fact that Section 1 of the Sherman Act requires a causal link between the agreement and an anticompetitive restraint of trade in the relevant market, which is something plaintiffs could not show. This is similar to the case in Cornish-Adebiyi v. Caesars Entertainment, Inc., currently on appeal before the Third Circuit, where according to the district court, plaintiffs failed to show that the algorithmic software used competitors’ nonpublic, proprietary data to provide pricing recommendations.

The Ninth Circuit focused its analysis on the allegations that the individual license agreements between each hotel and Cendyn restrained competition “in the aggregate” and led to higher room rates on the Las Vegas Strip.

The Court addressed the nature of the licensing agreements between Cendyn and individual competing hotels:

  • The Court distinguished between parallel conduct and concerted action, highlighting how competitors may independently adopt similar technologies without getting involved in a conspiracy. So, an agreement among hotel defendants to follow Cendyn’s pricing recommendations would have harmed competition. But here, the agreements only imposed obligations on Cendyn and each specific hotel as to each other (not the hotels together). And allegations of mere parallel conduct—competitors independently adopting similar policies around the same time in response to similar market conditions—or even involving consciously parallel conduct, are insufficient to state a claim under Section 1 of the Sherman Act, without more. In addition, the licensing agreements did not require the competing hotels to follow Cendyn’s pricing recommendations, nor imposed any restrictions on their ability to use alternative pricing tools.
  • Even if hotel defendants had been aware of their competitors’ use of Cendyn’s software products, their independent adoption of Cendyn’s software products—absent evidence of an agreement among hotel defendants to do so—would have been insufficient under the abandoned hub-and-spoke claim. The Ninth Circuit also clarified that this analysis might have changed if plaintiffs had shown that Cendyn shared confidential information from each competing hotel among the licensees. But plaintiffs did not allege that Cendyn pooled, shared, or used the confidential information provided by any of the competitor hotels into the pricing recommendations it generated for any other hotel defendant. Rather, plaintiffs just alleged that each user provided Cendyn with non-public pricing and occupancy data, which the software product then used in their algorithms to generate recommendations.
  • Absent a horizontal conspiracy, alleging the existence of several licensing agreements resulting in higher prices was insufficient to have a collective restraint of trade under Section 1 of the Sherman Act. Antitrust law provides no mechanism by which courts can evaluate the independent agreements between Cendyn and each hotel competitor “in the aggregate,” for the purposes of determining whether together they acted as an unreasonable restraint of trade.
  • In addition, according to the Court, those independent agreements between Cendyn and each hotel competitor were also not vertical agreements. Cendyn operated in the same industry (the hotel industry) but not in the same market (the market for hotel-room rentals on the Las Vegas Strip). While hotels had the ability to use Cendyn’s software, the software was not an input going into the production of hotel rooms for rentals. Cendyn’s services did not render Cendyn “up the supply chain” from Hotel Defendants in the market for hotel room rentals on the Las Vegas Strip. Like a tax adviser the Court analogized, Cendyn’s revenue-management software products merely served a “back-office” function.
  • The Court therefore held that such agreements were just ordinary sales contracts that did not restrain trade in the relevant market. They imposed obligations on Cendyn and on each hotel defendant as to each other for the provision of and payment for the software products. But they didn’t limit competition among hotel defendants in the relevant market, nor their abilities or incentives to compete.

II. Realpage, Inc. Software Antitrust Litigation – First Settlements

In August 2024, the DOJ alleged that RealPage violated Section 1 and Section 2 of the Sherman Act.

Under Section 1, the DOJ alleged that RealPage’s revenue management software was collecting competitively sensitive data from landlords, while generating rental pricing recommendations. At the same time, those same landlords agreed to share such information with the understanding that their competitors would do same thing and receive pricing recommendations.

Under section 2, the DOJ alleged that RealPage leveraged landlords’ data to maintain a monopoly in the commercial revenue management software market by using exclusionary conduct.

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DOJ-Statement-of-Interest-Antitrust-300x158
Author: Steven Cernak

On July 11, the Department of Justice Antitrust Division filed a Statement of Interest in a private lawsuit alleging anticompetitive collusion among defendants like The Washington Post and with non-defendants like X to suppress certain views on COVID and U.S. politics. DOJ’s move generated unpleasant surprise among some in the antitrust community and beyond; but the move seems consistent with numerous statements by the Administration and its supporters, including the America First Antitrust principles recently outlined by Division head Gail Slater.

Summary of Case and Defendants’ Motion to Dismiss

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