FTC secures $12m penalties for HSR Act violations
M&A teams face $12m penalties and court-enforced prior-notice and acquisition restrictions for transactions structured to avoid HSR filing obligations
Change
On 13 July 2026, the Federal Trade Commission (FTC) secured a proposed final judgment requiring Edwards Lifesciences to pay $10 million and Genesis MedTech to pay $2 million (total $12 million) for failing to file under the Hart-Scott-Rodino Act (HSR) and imposing advance-notice acquisition restrictions on Edwards plus a required antitrust compliance program.
Why it matters
The settlement treats structuring a transaction to fall below the HSR size-of-transaction threshold as a reportable deal in substance, making sub-threshold pricing a matter of court exposure rather than optional deal design. It establishes that contemporaneous payments and investments tied to an acquisition are aggregated when testing the reporting threshold, and confirms the FTC will pursue per-transaction penalties — here the largest ever for an HSR filing failure — against parties that avoid mandatory pre-merger review.
Implications
- — Applies if you structure a US acquisition priced just below the HSR size-of-transaction threshold: corporate M&A teams and deal counsel must treat the FTC's substance-over-form position as aggregating contemporaneous payments and side-investments into the reported deal value — pricing under the threshold does not remove the filing obligation, and failure to file can produce monetary penalties and injunctive relief.
- — Deal counsel and corporate development teams must file under HSR and observe the waiting period before completing any transaction that meets the threshold on a combined basis, because consummating without filing exposes the acquirer to per-deal penalties and post-closing unwinding risk, as this settlement's record penalty demonstrates.
Who is affected
- — Corporate M&A teams structuring US acquisitions near the HSR threshold
- — Deal counsel and corporate development teams advising on HSR-reportable transactions