USA – ILLINOIS Trends and Developments Contributed by: Craig C. Martin and Matt Basil, Willkie Farr & Gallagher LLP
Guidelines further permit the Agencies to “examine a pattern or strategy of growth through acquisition by examining both the firm’s history and current or future strategic incentives,” including “in the markets at issue and in other markets.” (2023 Guidelines, supra at Section 2.8.) States followed suit. Illinois, for example, enacted a “Baby HSR” law, 740 Ill. Comp. Stat. Ann. 10/7.2a, effective from 1 January 2024, extending quasi-HSR requirements to any healthcare facility or provider organisation headquartered in it, exempting certain out-of-state entities. (Id. at 10/7.2a(b).) Accordingly, many entities engaging in covered activity, when at least one party is Illinois-based and the transaction involves out-of-state entities that, post-merger, will generate at least USD10 million in revenue annually from Illinois patients, must now provide at least 30 days’ notice to the Illinois Attorney General, who may seek injunctive relief forbidding non-compliance. (Id. at 10/7.2a(d).) Like the states, the Biden Administration then began using those tools to realise its proposed enforce - ment efforts, including against private equity. The Agencies launched a public inquiry to “ identify serial acquisitions and roll-up strategies throughout the U.S. economy that have led to consolidation and harmed competition.” The Biden Administration advanced that mission in court, too. In September 2023, the FTC sued Welsh Carson and its portfolio company U.S. Anesthesia Partners (USAP), challenging USAP’s prolonged series of acquisitions in the Texas anes - thesiology market. Alleging a number of violations, including, notably, Section 7 of the Clayton Act and Section 2 of the Sherman Act. (Compl., FTC v U.S. Anesthesia Partners, Case No. 4:23-cv-03560 (S.D. Tex. 21 September 2023) .) Just days before President Trump’s inauguration, the DOJ filed a novel lawsuit against KKR, one of the largest private equity firms in the US, seeking civil penalties of up to USD51,000 per day in perpetuity, for allegedly violating the HSR Act. (Compl., United States v KKR & Co., Inc., et al., No. 1:25-cv-00343 (S.D.N.Y. 14 January 2025) .) Put sim - ply, private equity was under scrutiny from the Biden Administration’s beginning to its literal end.
More broadly, the Biden Administration’s view of pri - vate equity affected its overall approach to resolving such enforcement actions, too. Assistant Attorney General Kantor was particularly concerned that set - tlement divestitures “very often... [involved] private equity firms [often] motivated by either reducing costs at a company, which will make it less competitive, or squeezing out value by concentrating [the] industry in a roll-up.” In such situations, he argued, “divesti - tures that were supposed to address a competitive problem have ended up fuelling additional competitive problems.” (Id.) Thus, Biden Administration enforcers thought divestiture less effective than attempting to block the deal outright, shrinking the enforcers’ tool - box. In turn, that led to more severe enforcement over - all and fewer opportunities for private equity firms to acquire divested companies. (Id.) A new antitrust consensus? If both political parties are coalescing around a broad - er understanding of antitrust’s task, what explains occasional pro-merger statements from Slater or Fer - guson? After all, they ostensibly deviate from the prior administration’s approach to enforcement. And what does it mean for private equity? First, agreement on the task – policing aggrandise - ment of power – does not mean the Trump Adminis - tration agrees with the Biden Administration’s scope. The Sherman Act protects “all who are made victims of the forbidden practices by whomever they may be perpetrated.” ( Reiter v Sonotone, 442 U.S. 330, 337-38 (1979) (quoting Mandeville Island Farms v Am. Crystal Sugar Co., 334 U.S. 219, 236 (1948)) .) Much of the differences observed between President Trump and President Biden’s antitrust schemes may lie in their respective definitions of those whose interests are within their understandings of consumer welfare (or any other term) used to define whose interests are to be considered or protected. For example, the Biden Administration’s “merger analysis... account[ed] for the differences between unionized and nonunion - ized workforces,” holding that the 2023 Guidelines make clear that mergers “that lessen competition in labor markets cannot be redeemed through benefits provided to other market participants.” Ferguson has vowed the FTC “will end Big Tech’s vendetta against... free speech.” He reaffirmed the 2023 Guidelines and,
317 CHAMBERS.COM
Powered by FlippingBook