Key Takeaways
- • The U.S. Court of Appeals for the Fifth Circuit denied the FTC's motion for a stay on March 19, 2026, clearing the way for enforcement of the court's decision vacating the 2024 Hart-Scott-Rodino merger reporting rule.
- • States are increasingly stepping into antitrust enforcement gaps left by federal agencies, with California and nine other states seeking $10.3 million in fees and costs for blocking the $25 billion Kroger-Albertsons merger, signaling a structural shift in U.S. merger enforcement dynamics.
- • California alone would recover $5.1 million and is independently challenging major acquisitions including Nexstar's $3.54 billion Tegna purchase and Paramount Skydance's $110 billion Warner Bros Discovery acquisition after federal agencies declined or settled respective cases.
- • State-led antitrust action is proving cost-intensive, with states spending significantly more when operating without federal FTC partnership, creating pressure on state budgets and reshaping the landscape for merger challenges going forward.
Summary
The Fifth Circuit's March 19 denial of the FTC's stay request represents a critical procedural victory for opponents of expanded merger reporting requirements. The court's decision allows the vacatur of the 2024 Hart-Scott-Rodino rule to move forward without federal enforcement delay, fundamentally altering the regulatory framework for deal notifications. This ruling follows the U.S. Chamber of Commerce v. FTC decision and underscores ongoing judicial resistance to the FTC's attempted expansion of merger reporting obligations.
Paralleling this regulatory battle, state attorneys general are emerging as consequential independent antitrust enforcers, compensating for federal enforcement constraints. California and nine other states are seeking $10.3 million in recovery for their litigation costs in the Kroger-Albertsons case—a $25 billion deal that would have represented the largest supermarket merger in U.S. history. U.S. District Judge Adrienne Nelson in Portland, Oregon, has already ruled the states are entitled to recover fees, with the final amount determination pending. California's share totals $5.1 million, reflecting its lead role in the successful challenge.
The fee recovery request underscores an uncomfortable fiscal reality for states: independent antitrust enforcement is significantly more expensive than collaborative federal-state litigation. According to filings in Oregon federal court, states spent substantially less when working alongside the FTC in the Kroger matter than they would have spent proceeding alone. This cost differential is proving consequential as California simultaneously pursues major antitrust challenges without federal partnership—including opposition to Nexstar's $3.54 billion acquisition of Tegna after the Department of Justice declined to challenge the deal, and a case against Live Nation after the DOJ settled mid-trial. California is also investigating Paramount Skydance's proposed $110 billion acquisition of Warner Bros Discovery, which the DOJ is separately probing.
The convergence of the Fifth Circuit's HSR ruling and escalating state-level enforcement signals a bifurcated antitrust landscape where state budgeting constraints may increasingly determine which mergers face legal challenge. As state attorneys general forge ahead without federal partners in high-profile cases, the cost burden of independent litigation threatens to constrain their enforcement capacity, creating potential strategic gaps in merger oversight.
Paralleling this regulatory battle, state attorneys general are emerging as consequential independent antitrust enforcers, compensating for federal enforcement constraints. California and nine other states are seeking $10.3 million in recovery for their litigation costs in the Kroger-Albertsons case—a $25 billion deal that would have represented the largest supermarket merger in U.S. history. U.S. District Judge Adrienne Nelson in Portland, Oregon, has already ruled the states are entitled to recover fees, with the final amount determination pending. California's share totals $5.1 million, reflecting its lead role in the successful challenge.
The fee recovery request underscores an uncomfortable fiscal reality for states: independent antitrust enforcement is significantly more expensive than collaborative federal-state litigation. According to filings in Oregon federal court, states spent substantially less when working alongside the FTC in the Kroger matter than they would have spent proceeding alone. This cost differential is proving consequential as California simultaneously pursues major antitrust challenges without federal partnership—including opposition to Nexstar's $3.54 billion acquisition of Tegna after the Department of Justice declined to challenge the deal, and a case against Live Nation after the DOJ settled mid-trial. California is also investigating Paramount Skydance's proposed $110 billion acquisition of Warner Bros Discovery, which the DOJ is separately probing.
The convergence of the Fifth Circuit's HSR ruling and escalating state-level enforcement signals a bifurcated antitrust landscape where state budgeting constraints may increasingly determine which mergers face legal challenge. As state attorneys general forge ahead without federal partners in high-profile cases, the cost burden of independent litigation threatens to constrain their enforcement capacity, creating potential strategic gaps in merger oversight.
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