Federal Judge Strikes Down FTC Premerger Rules Opposed By MSCI

A federal judge has struck down a Federal Trade Commission (FTC) regulation that had required companies to provide more information to the commission ahead of mergers and acquisitions. More specifically, the rule added a number of new disclosures to the premerger form, including details regarding company officers and directors, organizational charts, the firms’ rationale for merging, foreign subsidy information, and other details.

With other trade associations, including the U.S. Chamber of Commerce, the Metals Service Center Institute (MSCI) had opposed the rule, which was finalized in 2024 under the Biden administration.

Fortunately, last week Judge Jeremy Kernodle of Texas’ Eastern District ruled the regulation exceeded the FTC’s statutory authority because the agency was not able to demonstrate that the benefits of the regulation would outweigh its “significant and widespread costs.” The decision vacated the rule, but Judge Kernodle stayed the order for seven days to allow the FTC time to seek emergency relief from the appeals court. (It is unclear whether the FTC, now under leadership of the Trump administration, will seek that option.)

MSCI and its allies have continually argued that the FTC rule directly violated administrative law and would stifle innovation, reduce market efficiencies, and harm consumers.