Antitrust-Related Recent Developments: Merger Agreement Efforts Subject Of Litigation

In a recent action raising the issue of the nature of a merger party’s obligation to take steps necessary to clear antitrust regulatory hurdles “as promptly as reasonably practicable,” Alere, Inc. sued Abbott Laboratories in Delaware Chancery Court, asserting that Abbott breached the parties’ merger agreement. 

Abbott agreed to acquire Alere on January 30, 2016, for $5.8 billion. Soon afterward (on April 28, 2016), Abbott also agreed to acquire St. Jude Medical Inc. for $25 billion. On August 30, 2016, Alere sued Abbott, alleging that Abbott was attempting to back out of the Alere acquisition by stalling the antitrust review process until April 30, 2016, the deal’s walkaway date. Alere pointed particularly to Abbott’s alleged failure to: (1) comply with the Federal Trade Commission’s Second Request; (2) provide notice and an opportunity to comment to Alere prior to entering into a timing agreement with the FTC; and (3) follow up on foreign antitrust clearance