FTC Secures $12M Settlement for HSR Act Non-Filing Violations
In-house counsel overseeing M&A transactions must prioritize full Hart-Scott-Rodino Act compliance, as the FTC is imposing steep penalties on parties that structure deals to avoid pre-merger filing requirements.
The FTC reached a $12 million combined settlement with Edwards Lifesciences and Genesis MedTech after determining the parties structured a 2022 asset purchase to avoid triggering Hart-Scott-Rodino Act pre-merger notification requirements. The agreement included terms that delayed transfer of operational control and voting rights until after the statutory HSR waiting period would have lapsed, allowing the transaction to close without a required filing. The settlement signals the FTC’s heightened focus on enforcing HSR compliance for all transaction structures, including those designed to circumvent filing thresholds. In-house counsel should review pending and completed deals for potential HSR gaps, and ensure future transaction structuring does not include provisions intended to avoid pre-merger notification obligations.