Texas District Court docket Strikes Down Up to date HSR Act

On February 12, 2026, the U.S. District Court docket for the Jap District of Texas (the “Court docket”) struck down the Federal Commerce Fee’s (“FTC”) rule increasing the scope of the Hart-Scott-Rodino (“HSR”) Act Premerger Notification Type. See Chamber of Com. of the U.S. v. Fed. Commerce Comm’n, No. 6:25-CV-9-JDK, 2026 WL 402498 (E.D. Tex. Feb. 12, 2026). The Court docket deemed the brand new rule “arbitrary and capricious” beneath the Administrative Process Act (“APA”) and dominated the FTC failed to indicate that prices on merging corporations outweigh the FTC’s claimed advantages.

The Court docket’s determination casts uncertainty on the submitting course of and necessities for corporations coming into into or contemplating HSR reportable transactions.

Background

The HSR Antitrust Enhancements Act of 1976, as amended, requires all individuals considering sure mergers or acquisitions that meet or exceed sure jurisdictional monetary thresholds to file a premerger notification (an “HSR Submitting”) with the FTC and Antitrust Division of the Division of Justice (collectively, the “Businesses”) and to attend a time period earlier than consummating the transaction.

On October 10, 2024, the FTC voted unanimously (5-0) to finalize adjustments to the HSR premerger notification kind and related directions, in addition to the premerger notification guidelines implementing the HSR Act. Primarily based on adjustments to the shape and directions, the FTC estimated that the typical time to finish an HSR Submitting would practically triple – from a median of 37 hours per submitting beneath the unique rule to 105 hours per submitting beneath the brand new rule (with related prices rising commensurately).

On January 10, 2025, the U.S. Chamber of Commerce, together with different distinguished enterprise organizations such because the Enterprise Roundtable and American Funding Council, filed a lawsuit difficult the amendments to the HSR premerger notification guidelines, arguing that the FTC overstepped its statutory authority by implementing necessities that aren’t “needed and acceptable” for preliminary antitrust evaluate. The plaintiffs argued that the brand new HSR guidelines impose extreme burdens on enterprise and will deter doubtlessly useful mergers and acquisitions, whereas the Businesses argued that the adjustments imposed by the brand new rule are meant to deal with “important gaps within the data generated for premerger evaluate” that antitrust enforcers want to guage doubtlessly anticompetitive transactions.

The events cross-moved for Abstract Judgment, the plaintiffs sustaining their arguments, and the FTC arguing plaintiffs lacked standing. The Court docket dominated in favor of the plaintiffs, holding that the ultimate rule implementing the brand new HSR Submitting necessities violated the APA and needs to be vacated, given it’s “unlikely that the FTC can justify its determination on remand.”

Subsequent Steps and Sensible Takeaways

• In granting Abstract Judgment for the plaintiffs, the Court docket additionally stayed the order for seven days, permitting the FTC to attraction the Court docket’s determination to the Fifth Circuit. Throughout this keep, the up to date HSR rule and the brand new kind and directions will stay in place.
• The FTC is more likely to attraction the choice, given the numerous assets and time spent, thus far, growing and implementing the brand new HSR kind and common bipartisan help with the Businesses for the up to date rule.
• An attraction would create important uncertainty for transaction submitting necessities and timing as the method performs out by way of the courts.
• Within the occasion of an attraction, courts will present up to date steering relating to the standing of the HSR Submitting course of, together with seemingly an extra keep of the Court docket’s determination, sustaining the established order whereas the difficulty is taken into account by the Fifth Circuit.
• Any end result from the Fifth Circuit is more likely to, once more, be appealed to the Supreme Court docket, which might resolve whether or not to grant certiorari.
• If, however, the FTC elects not to attraction the Court docket’s ruling, the HSR course of will revert to the Businesses’ historic HSR processes, topic to additional steering from the Businesses.

Within the interim, merging events ought to proceed to plan to file beneath the brand new HSR kind and related directions. As this matter progresses, Corridor Render’s Antitrust Crew will proceed to observe the state of affairs and supply common updates.

If in case you have any questions or would really like extra details about this matter, please contact one of many following members of Corridor Render’s Antitrust Observe Group: