This is a thread of tweet about the bar FTC has to meet to block an M&A deal.


My question is does this bar only apply to FTC? Is it the case that only FTC can sue to block an M&A deal based on antitrust ground? Can anybody sue to block an M&A deal (given it's a civil case as I believe?)

2 Answers 2


My question is does this bar only apply to FTC?

There is a general set of rule that apply to granting preliminary injunctions. In the link in the question, that test is tailored to the facts of the case and stated slightly less generally to a case involving the FTC suiting for an anti-trust prohibition.

Is it the case that only FTC can sue to block an M&A deal based on antitrust ground?

No. At a minimum, a state attorney-general can also do so. There are also some industries (e.g. licensed Federal Communications Commission license holder, or state marijuana industry holders) where other regulators in addition to, or in lieu of the Federal Trade Commission, would have standing to block an M&A deal.

There are probably some private parties who would have standing to do so (perhaps a smaller competitor) but not every private person would have standing to do so.

It is also worth keeping in mind, in this regard, that in addition to federal anti-trust laws, there are also state anti-trust laws. So, even if a deal can't be blocked upon federal anti-trust laws, a private person might have standing to block it (if they can show sufficient actual injury from the deal) under a state anti-trust law.

Can anybody sue to block an M&A deal (given it's a civil case as I believe?)

Shareholders of the company often have standing to seek a preliminary injunction blocking an M&A deal on non-anti-trust grounds, such as a breach of fiduciary duties owed by the directors to the company. This is done with a frequency similar to that of an anti-trust based effort to prevent a deal.

Sometimes, the grantors of an intellectual property license (based upon a covenant in that agreement, or a bond holder (based upon a bond covenant) will have standing to block an M&A deal.


Can anybody sue to block an M&A deal (given it's a civil case as I believe?

The answer to that is very clearly no, because of the doctrine of standing: Standing is, in its simplest form, the right of an injured party to sue someone responsible for the damage. Or rather, it is usually argued by the defending party: Only someone that was injured by the defending party can sue them. Let's make some examples:

  • If Alice hits Bob, Bob has standing to sue Alice for damages (=money). Mortimer, unrelated to everything, has no standing to do that.
  • If Bob dies from the hit, Bob's wife Charlene may sue Alice instead. Mortimer, again, does not.
  • If Delta-Corporation's toaster set Bob's and Charlene's house on fire, they may sue Delta-Corporation. Mortimer, once again unrelated, does not.

However, standing is more complex than that. Relevant to the FTC, some agencies are granted standing based on the fact that they represent the common interest or are specifically tasked to do things:

  • If Alice does not pay her taxes, the IRS has standing to sue her for the taxes.
  • If Alice murders Bob, the prosecutor's office may go after Alice criminally and put her into jail.
  • If Delta-Corporation's unsafe toaster is sold thousands of times, a Consumer Protection Office that is empowered to do so (not all are!) might step up and get an injunction against Delta-Corporation's toaster ovens.

An individual end consumer does not have any chance of standing in this matter of Antitrust Law against a producer of the product, especially if they buy the item from a retailer.

No one individual had a sufficient economic stake to bear the litigation burden necessary to maintain a private suit for recovery under section 4. Restrictive judicial interpretation of the notice and manageability provisions of F.R.C.P. 23 and proof of individual damages has made consumer class actions rare.
- Journal of Legislation, Vol. 6: 85, Consumer Standing in Antitrust violations: The Kennedy Proposal

Illinois Brick also establishes this in part: Only a direct purchaser has standing. So if you buy your games from Steam, or Epic, you have no standing to sue Microsoft or Activision. Steam and Epic would need to sue Microsoft or Activision.

However, the FTC is special: they are directly legislated to be able to bring antitrust lawsuits. They were empowered by the FTCA of 1914, the Sherman Antitrust Act of 1890 and the Clayton Act of 1914. The most relevant article that grants them the power to actually do things can be found in 15 USC §44 & §45. In fact, let me bold it for you:

15 USC §45 (2) The Commission is hereby empowered and directed to prevent persons, partnerships, or corporations, except banks, savings and loan institutions described in section 57a(f)(3) of this title, Federal credit unions described in section 57a(f)(4) of this title, common carriers subject to the Acts to regulate commerce, air carriers and foreign air carriers subject to part A of subtitle VII of title 49, and persons, partnerships, or corporations insofar as they are subject to the Packers and Stockyards Act, 1921, as amended [7 U.S.C. 181 et seq.], except as provided in section 406(b) of said Act [7 U.S.C. 227(b)], from using unfair methods of competition in or affecting commerce and unfair or deceptive acts or practices in or affecting commerce.

That sentence directly says, the FTC is empowered and talked with enforcing all the antitrust laws, which gives them also standing to enforce the laws (by working together with the DoJ usually).

  • 1
    I think this answer is probably correct, but it would benefit from some law saying so. There are also some counterarguments that I'm not certain would be incorrect, e.g., that consumers or competitors in the relevant market would have standing as a result of injuries likely to flow from market consolidation, or that interested parties would have standing to challenge the FTC's inaction under the APA.
    – bdb484
    Jun 16, 2023 at 13:53
  • @bdb484 15 USC §45(2); Consumer standing does only exist for direct purchasers due to Illinopis Brick, so Epic, Steam, Gamestop, or whatever games retailer, not the end user.
    – Trish
    Jun 16, 2023 at 14:24
  • Understood not anybody can sue. But if SONY feels they suffer the damages, they can sue to prevent the merger of Microsoft and Activision, even if FTC doesn't?
    – Matt Frank
    Jun 16, 2023 at 14:26
  • "Standing is, in its simplest form, the right of an injured party to sue someone responsible for the damage." I think it would be better to say that standing is the right to not be the target of a suit by a party that has not sustained a damage. It's normally argued whether the plaintiff has grounds to sue the respondent.
    – hszmv
    Jun 16, 2023 at 14:31
  • @MattFrank Sony might have standing, because they are actually a competitioner that might get a particular damage. Steam might sue because they are direct purchasers.
    – Trish
    Jun 16, 2023 at 14:37

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