District Court Vacates FTC’s 2024 HSR Rule Amendments

February 2026

The future of the 2024 amendments to the Hart-Scott-Rodino (“HSR”) premerger notification requirements (the “Final Rule”) is now in flux, following yesterday’s decision from the Eastern District of Texas that vacated the Final Rule, which has been in effect for over a year. While the Federal Trade Commission (“FTC”) has issued interim guidance that HSR filings made through February 19 should be made under the current regime, the effect of the decision beyond that date is uncertain.

Background

The Final Rule represented the most significant expansion of the HSR filing requirements in nearly 50 years. While some of the most onerous changes proposed in 2023 were removed, the Final Rule dramatically expanded the information and documents required for HSR filings and, increased the associated costs and time to make such filings. See Goodwin’s prior alert for a discussion of the Final Rule, which took effect in February 2025.

In January 2025, the U.S. Chamber of Commerce, American Investment Council, and several other trade associations challenged the Final Rule, asserting that they exceeded the FTC’s authority under the HSR Act and ran afoul of the Administrative Procedure Act (“APA”).

On February 12, the U.S. District Court for the Eastern District of Texas vacated the FTC’s 2024 amendments to the HSR premerger notification requirements, finding that the Final Rule both exceeded the FTC’s statutory authority and was arbitrary and capricious under the APA. The court stayed its ruling for seven days to allow the FTC to seek emergency relief from the Fifth Circuit. The court also found that the plaintiffs had standing on behalf of their members, who frequently make HSR filings and expect to continue doing so.

Final Rule Not “Necessary and Appropriate”

The court held that the Final Rule exceeded the FTC’s statutory authority to issue “necessary and appropriate rules” under the HSR Act, because the benefits of the Final Rule do not reasonably outweigh its costs. The FTC’s own estimates showed the Final Rule could triple filing burdens, adding roughly $39,000 per filing and more than $139 million in annual aggregate costs, with the plaintiffs offering much higher estimates. The court found that these costs, imposed on all filers, far exceeded any of the FTC’s stated benefits.

• First, the FTC argued that the Final Rule would enable it to detect more anticompetitive mergers. The court disagreed, finding that the FTC failed to identify any mergers that the Final Rule would have flagged and that the existing HSR rules would have missed. Further, the court summarily rejected the FTC’s argument that many parties structure deals that are not reportable, emphasizing that the Final Rule did not impact the thresholds for triggering a filing.
• Second, the FTC contended that the Final Rule would save agency resources by enabling it to conclude investigations more quickly, and issue more targeted “Second Requests,” resulting in an overall reduction in staff hours to collect information from filers. The court, however, found that the FTC failed to substantiate any cost savings for the small number of transactions that result in an investigation (8%) or a Second Request (3%) and burdening the 92% of filings that do not require any investigation further outweighs any perceived cost savings.

Rejecting both arguments, the court found that the FTC acted beyond its statutory authority and that the Final Rule was “arbitrary and capricious” under the APA. The court did, however, stay its ruling for seven days to allow the FTC to appeal to the Fifth Circuit.

The FTC is likely to appeal, and can seek a further stay of the court’s ruling during that appeal. If that stay is granted, the Final Rule would remain in effect and HSR filings would continue to be made under the current regime until the Fifth Circuit’s decision. However, such relief is not automatic and is granted on a case-by-case basis.

For further guidance, please contact Paul Jin, Simone Waterbury, Kevin Walsh, or any member of the Goodwin Antitrust & Competition team.

This informational piece, which may be considered advertising under the ethical rules of certain jurisdictions, is provided on the understanding that it does not constitute the rendering of legal advice or other professional advice by Goodwin or its lawyers. Prior results do not guarantee similar outcomes.