DOJ Offers Guidance On Unprecedented Arbitration In Merger Challenge

In Short:

The Situation: The United States Department of Justice Antitrust Division ("DOJ") has provided details on the unprecedented use of arbitration to resolve its challenge to the proposed acquisition of Aleris Corporation by Novelis Inc.

The Significance: Companies now have greater insight into the factors DOJ will consider when contemplating arbitration in antitrust matters. This could prove to be a positive development for companies—and for the government—to the extent it facilitates faster resolution of critical issues without incurring the time and expense to litigate all issues in court.

Looking Ahead: Alternative dispute resolution could become a model for future antitrust enforcement actions if the government and companies can agree that the potential benefits (efficiency, timing, certainty) outweigh the limitations, including DOJ's guidance that arbitration may not be appropriate if it means a lost opportunity to create legal precedent.