Here is news from Davis Polk:

On January 26th, Assistant Attorney General Christine Varney of the Antitrust Division of the U.S. Department of Justice provided an update – in these remarks – regarding the current review of the Horizontal Merger Guidelines.

Last September, the DOJ and the Federal Trade Commission announced that they would solicit public comments and hold a series of five workshops to consider potential revisions to the Guidelines. The current Guidelines, which have remained unchanged for seventeen years, outline the process by which the FTC and the DOJ analyze the antitrust implications of mergers and acquisitions. The review process recently initiated by the DOJ and the FTC was intended to ensure that the Guidelines accurately reflect current agency practice and incorporate developments in the field of antitrust analysis from the past seventeen years.

According to remarks prepared for the fifth and final workshop, Varney stated that the review process has identified “gaps between the Guidelines and actual agency practice.” In particular:

– The sequential nature of the Guidelines’ five-step analytical process should be deemphasized. Specifically, “defining markets and measuring market shares may not always be the most effective starting point for many types of merger reviews” but instead “something to be incorporated in a more integrated, fact-driven analysis directed at competitive effects.”

– The current Guidelines “overstate the importance” of the Herfindahl-Hirschman Index thresholds in merger analysis.

– Regarding unilateral effect analysis in evaluating mergers: “This is an area where economic thinking and Agency practice have progressed significantly since 1992. There are important considerations that the Agencies routinely employ when assessing unilateral effects but are not mentioned or even alluded to in the Guidelines.”

– Other discrete areas, including discussion of targeted customers and price discrimination, assessment of market shares from recent projected sales in the relevant markets, and unifying the agencies’ approaches to concepts of expansion, entry and repositioning, should be clarified.

Varney did not comment as to when any revisions to the Guidelines might be issued.

Tune in tomorrow for the webcast – “The Latest on Fairness Opinions” – to hear Kevin Miller of Alston & Bird, Steve Kotran of Sullivan & Cromwell, Stuart Rogers of Credit Suisse Securities and Chris Croft of Houlihan Lokey explore the latest trends and developments in fairness opinion practices. You may want to print these course materials in advance – one set regarding recent case developments and another set regarding the role of investment bankers.

Act Now: As all memberships are on a calendar-year basis, renew now if you haven’t yet – or try a ’10 no-risk trial if you’re not a member.

Recently, as noted in this Milbank Tweed memo by Robert Reder, a Federal District Court – in Levie v. Sears Roebuck & Co. – offered guidance as to the timing for disclosures in connection with merger or other change in control transactions under the federal securities laws. The principles that the Court relied on in reaching its decision support the view that, as a general matter, disclosures should not be required, even though active negotiations are under way, and the parties are “kicking the tires” of a transaction until definitive documentation is signed and the parties are required to file a Form 8-K.