Last evening the federal district court for the Eastern District of Texas vacated and set aside the “Final Rule” that revised and expanded the filing requirements for transactions that are subject to the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (“HSR Act”). The Final Rule, which has been in effect since February 2025, had been challenged by a group of plaintiffs that included the U.S. Chamber of Commerce and Business Roundtable.
The HSR Act gives the FTC the authority to promulgate rules that require filing persons to supply information that is “necessary and appropriate” for the enforcement of the antitrust laws. In its decision, the court held that the Final Rule exceeds the FTC’s statutory authority, because the agency did not satisfactorily show that the claimed benefits of the Final Rule reasonably outweigh its “significant and widespread costs.” The court also held that the Final Rule is “arbitrary and capricious,” in part because the FTC did not adequately explain its rejection of less costly and burdensome alternatives.
The court stayed its order for seven days to allow the FTC time to file an appeal. The FTC announced this morning that the Final Rule “thus remains in place through February 19, and [that] any filers submitting between now and then should use the new form.”
If the FTC decides to appeal the decision it will likely seek a stay of the order pending that appeal. If a stay is issued, the current HSR rules and filing requirements will continue to remain in effect. If the FTC chooses not to appeal or if it is unable to get a stay, we expect it to issue guidance on how parties should file if the court’s order takes effect. If the Final Rule is set aside, for example, the HSR filing process may revert to the prior HSR rules and “old form,” either automatically or through action by the FTC to reinstate the previous rule.
We are tracking these issues closely, and we will provide updates as we learn more about how the FTC intends to deal with this development.
If you have any questions concerning the material discussed in this client alert, please contact the members of our Antitrust practice.
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