Representative Merger Antitrust Reviews

  1. BEA Systems acquisition by Oracle (2008). Co-counsel representing BEA in responding to DOJ investigation of this $ 8.5 billion dollar acquisition by Oracle Corporation. Cleared after initial review.
  2. Brocade Communications Systems, Inc. acquisition. of McData Corp (2007). Represented Brocade in $973 million acquisition of its primary competitor, in one of the most significant technology merger reviews by the Federal Trade Commission in recent history. The parties were the two leading fiber channel switch providers, comprising roughly 80 per cent of that market. After a full Second Request investigation, and despite industry predictions of an antitrust challenge, the FTC cleared the transaction without conditions. [ Note: Historically, about 70 percent of transactions subjected to Second Requests in the U.S. are challenged by the antitrust agencies, almost always requiring either a Consent Decree settlement or abandonment of the merger . Since I founded WSGR’s antitrust practice 25 years ago, the percentage for our clients has been around 35 percent-with every challenge successfully resolved by a Consent Decree that enabled the merger to close.]
  3. Autodesk acquisition of Alias (2006). This relatively small ($ 182 million) acquisition by client Autodesk elicited a thorough FTC review, as well as investigation by the German Federal Cartel Office, since the merger meant, in the words of one analyst, that Autodesk would “own a sizeable portion of the entertainment and design industries” markets. Though the companies’ 3D animation software products were primary competitors, we succeeded in convincing the antitrust agencies here and abroad that the market was easy to enter and dynamic, and would remain competitive after the merger.
  4. You Tube acquisition by Google (2006). This $1.55 billion transaction cleared antitrust review quickly and without regulatory obstacles.
  5. JD Edwards acquisition by PeopleSoft, followed by hostile tender by Oracle for PeopleSoft (2003). This $1.8 billion transaction was intended to create “the world’s second largest enterprise application software company.” Promptly after announcement, Oracle Corp. launched a hostile tender offer for PeopleSoft, so the DOJ had parallel investigations underway on both mergers, as PeopleSoft fought to remain independent. Under my direction, WSGR successfully avoided a Second Request on behalf of JD Edwards, enabling that deal to close quickly and raise Oracle’s potential cost by over $ 1 billion. We continued to work on behalf of JD Edwards/PeopleSoft in the DOJ’s Oracle investigation, which eventuated in a DOJ challenge to that deal. Oracle took the matter to trial, which Oracle won in a celebrated and highly controversial decision. The DOJ’s lead attorney was highly complimentary of our submissions and presentations on behalf of JD Edwards: “One of the best we’ve seen in a very long time;” “wonderful;” “very impressive;” “great;” “more than we could have expected.” The DOJ’s lead economist, calling our submissions “exemplary,” wished WSGR represented all the parties in the transaction. “Why can’t the other firms do that?” My corporate partner for JD Edwards was also pleased: “I feel like I’m in the presence of Babe Ruth when he called his shot. You guys did an awesome job here. You clearly are the masters at this whole Hart-Scott-Rodino area.”
  6. ProBusiness Services, Inc. acquisition by ADP (2003). The DOJ also launched a formal “Second Request” investigation of this $500 million transaction. Industry analysts and the stock market both reflected considerable doubt about whether this deal between the market leader in payroll processing and its major competitor would survive antitrust review. Leading a team of over 100 lawyers and staff on the investigation, I secured clearance without conditions. The DOJ’s chief trial attorney in charge of the investigation described our initial meeting and submission to the agency as “one of the best presentations I’ve seen in years.”
  7. HP acquisition of Compaq Computer Corporation (2002). This $22 billion transaction remains one of the largest technology mergers in U.S. history. Co-counseling with firms in Washington, DC and London for HP, I led a large team of WSGR lawyers, staff and outside economists for almost a year on merger investigations by the FTC, the European Commission and Canada. The companies were direct competitors in multiple markets, including PCs, servers and storage. Many observers expected that divestitures or other remedies would be required to secure antitrust clearance. The merger was eventually approved without conditions or challenge by any agency, paving the way for a successful shareholder vote in the face of opposition by dissident director Walter Hewlett and others. [ Historical Note: The parties’ first presentation to a joint meeting of the FTC and DOJ took place in Washington, DC on the morning of 9/11/2001. None of the 30-35 people who met for 90 minutes in the conference room knew about the attacks on the World Trade Center and Pentagon until the meeting adjourned at about 10am Eastern time.]
  8. Polycom acquisition of PictureTel (2001). Our client, the market leader in voice and video communication products, was subjected to a Second Request investigation by the DOJ when Polycom sought to acquire one of its two major competitors for $362 million. Our legal, economic and document production team ultimately convinced the Justice Department to clear the transaction without challenge or conditions.
  9. E-TEK Dynamics acquisition by JDS Uniphase (2000). This $15 billion transaction was, at the time, the largest tech merger ever . My client E-TEK was a leader in the design and manufacture of high quality passive components and modules for fiber optic systems, including dense wavelength division multiplexers (DWDMs) that vastly increased the capacity of existing fiber optic networks. JDS was the market leader in optical components; both companies competed in sales to network providers like Alcatel, Nortel and Lucent, at a time when demand for internet bandwidth was exploding. The DOJ launched a formal investigation that lasted for several months. The matter cleared with a negotiated consent decree, which essentially required only that the parties waive their exclusive contract rights with certain optical filter suppliers in order to lessen barriers to competition. Our demonstration of efficiencies- i.e., that the merger would result in a vastly expanded supply of DWDM components-was decisive in securing antitrust clearance.
  10. KLA acquisition of Tencor (1997). WSGR client KLA Instruments sought to acquire its main competitor in the semiconductor inspection equipment industry in a $1.3 billion stock swap, but was faced with an opinion from a major Wall Street law firm that antitrust approval was unlikely. KLA then retained me to handle the antitrust review. Rejecting the typical strategy of showing a larger relevant market (and so smaller shares held by the parties), I decided to demonstrate to the DOJ that there were instead dozens of unique applications and ‘niche markets’ in this industry, in most of which the parties did not compete. Aided by a highly respected economic consultant, we persuaded the agency to clear the transaction quickly, without even the need for a Second Request.
  11. Sampling of Other Antitrust Investigations (all successful):
    • Rational Software acquisition by IBM
    • Sanmina acquisition by SCI
    • Quantum acquisition of Maxtor
    • Phoenix Technologies acquisition of Award International
    • Apple/Power Computer
    • Autodesk acquisition of Softdesk
    • Packard Bell Joint Venture with NEC
    • Silicon Graphics acquisition of Wavefront and Alias
    • Cardiovascular Imaging Systems acquisition by Boston Scientific
    • Seagate Technologies acquisition of Connor Peripherals
    • Rolm acquisition by IBM

To date, no client of mine has ever seen its transaction blocked or abandoned due to antitrust challenge by the DOJ, the FTC, or any foreign competition agency.