District Judge Amit Mehta Sets Date for Hearings in Sysco - US Foods Antitrust Suit
WASHINGTON, D.C. - A federal judge has set a start date of May 5th for court hearings on the Federal Trade Commission’s (FTC) antitrust lawsuit against the merger of Sysco and US Foods.
As we previously reported, the FTC had voted 3 to 2 to block the merger along with 11 Attorneys General from California, Illinois, Iowa, Maryland, Minnesota, Nebraska, Ohio, Virginia, Pennsylvania, Tennessee and the District of Columbia.
U.S. District Judge Amit Mehta said he would consider the case from May 5th to May 8th and would add as many as three days the following week, according to The Wall Street Journal. Judge Mehta will not be conducting a full-blown trial on the FTC’s allegations, and instead is considering issuing a preliminary injunction to block the companies from merging. This is intended to allow the FTC to hold a longer, “more-robust” trial beginning in July.
However, The Wall Street Journal writes that Judge Mehta’s proceedings could be a crucial testing ground for the case. Both the companies and the FTC would be largely affected by the decision. If the injunction is denied, the ruling could undermine the FTC’s proceedings, and if it is granted, the companies may face a much more difficult and lengthy litigation.
Lawyers for the two sides gave some initial hints about their plans for the court hearings. Lawyer for the FTC, Stephen Weissman, said the agency wanted to present customers of Sysco and US Foods from the health-care and hospitality industries as witnesses, as well as a witness from a foodservice management business. Richard Parker, a lawyer for Sysco, said he would bring in top company executives to testify on why the deal was pro-competitive, according to The Wall Street Journal.
“This proposed merger would eliminate significant competition in the marketplace and create a dominant national broadline foodservice distributor,” said Debbie Feinstein, Director of the FTC’s Bureau of Competition in The Mt. Juliet News. “Consumers, and the businesses that serve them, across the country benefit from the healthy competition between Sysco and US Foods, whether they eat at a restaurant, hotel, or a hospital.”
Government merger litigation is somewhat rare. According to The Wall Street Journal, the FTC’s lawsuit, announced last month, is its highest-profile merger challenge since 2007.
