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ARTICLE · 21 APRIL 2008

Are Joint/Club Bids At Risk Of Competition Law Enforcement?

Blake, Cassels & Graydon LLP
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Can a joint bid for control of a business (also referred to as a ‘club bid’) constitute an illegal price fixing arrangement under Canada’s “Competition Act”?

CanadaAntitrust/Competition Law
Blake, Cassels & Graydon LLP
Blake, Cassels & Graydon LLP
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Copyright 2008, Blake, Cassels & Graydon LLP

Originally published in Blakes Bulletin on Competition Law, April 2008

Can a joint bid for control of a business (also referred to as a 'club bid') constitute an illegal price fixing arrangement under Canada's "Competition Act"? The underlying reasons set out in a recent U.S. judgment would seem to suggest that this type of enforcement action would not be likely to succeed.

The decision of the U.S. District Court, dated February 21, 2008, in Pennsylvania Avenue Funds v. Edward J. Borey, et al., sheds light on whether a club bid could constitute a conspiracy, in this case under section 1 of the U.S. Sherman Act. The case was brought against two U.S. private equity funds, Vector Capital Corporation (Vector) and Francisco Partners LP (FP) that, having made several independent bids for WatchGuard Technologies Inc. (WatchGuard), entered into a

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