The Antitrust Week In Review
Here are some of the developments in antitrust news this past week that we found interesting and are following.
Penguin Random House Defends Effort to Buy Simon & Schuster. Penguin Random House, the largest book publisher in the United States, said in a court filing that its plan to buy a competitor, Simon & Schuster, would be a boon for the industry, benefiting authors, booksellers and readers. However, the U.S. Justice Department disagrees. Last month, it sued to stop the $2.18 billion acquisition, reflecting the Biden administration’s more skeptical view of corporate consolidation across industries. In its complaint, the department attacked the deal on the grounds that it would harm best-selling authors, since they could potentially receive lower pay with one fewer publisher competing to acquire their books.
U.S. says antitrust suit challenging air alliance should advance. The U.S. Justice Department asked a judge to reject a bid by American Airlines and JetBlue Airways Corp to dismiss an antitrust lawsuit over their “Northeast Alliance” partnership. The lawsuit filed in September by the U.S. government and six states alleges the deal would lead to higher fares in busy Northeastern U.S. airports and seeks to unwind the partnership. The Justice Department and six states including California, Massachusetts and Arizona said in a court filing the Northeast Alliance “seeks to accomplish through a joint venture what would not be tolerated as a merger: eliminating significant competition between a dominant airline and a uniquely disruptive competitor. … Instead of fighting with JetBlue, American now seeks to co-opt it.”
EXCLUSIVE Facebook to win conditional EU nod for Kustomer buy, sources say. Facebook is set to gain EU antitrust approval for its acquisition of Kustomer after offering remedies that allow rival products to function with those of the U.S. customer service startup, people familiar with the matter said. A buying spree of startups by big companies has triggered concerns on both sides of the Atlantic, with regulators worried about so-called killer acquisitions aimed at shutting down potential rivals before they are big enough to be a threat. Kustomer, which sells CRM software to businesses so they can communicate with consumers by phone, email, text messages, WhatsApp, Instagram and other channels, would help Facebook scale up its instant messaging app WhatsApp, which has seen usage soar during the COVID-19 pandemic.
UK antitrust regulator looks into Microsoft’s $16 bln Nuance deal. Britain’s antitrust regulator said it will look into Microsoft Corp’s $16 billion purchase of artificial intelligence and speech technology firm Nuance Communications Inc. The Competition and Markets Authority, which has been stepping up its regulation of Big Tech, said it was considering if the deal would result in lesser competition in the UK market. Microsoft announced it would buy Nuance in April to boost its presence in cloud services for healthcare. The deal has already received regulatory approval in the United States and Australia, without remedies given.
Edited by Gary J. Malone