Shifting Sands: DOJ Applies New Merger Enforcement Standards in Recent Lawsuit

On September 15, 2022, the Department of Justice (“DOJ”) sued to block ASSA ABLOY AB’s (“ASSA ABLOY”) proposed $4.3 billion acquisition of the Hardware and Home Improvement division of Spectrum Brands Holdings Inc. (“Spectrum”). The Complaint, as well as a recent speech at the Georgetown Antitrust Law Symposium by Assistant Attorney General (“AAG”) Jonathan Kanter, reflects a number of merger enforcement policy changes. In particular, the Complaint shows DOJ’s willingness to sue to block problematic transactions even when parties propose remedies to address the agency’s concerns. In addition, DOJ appears to be moving away from an analysis of the likely competitive effects of a transaction and toward a more formalistic analysis emphasizing market shares. DOJ’s new approach increases risks for parties during the merger review process at the agency but also creates opportunities for parties willing to litigate against the agency, given DOJ’s attempt to move away from established case law.