Dive Brief:
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In what has become an acrimonious court battle between the Federal Trade Commission and Staples and Office Depot over the office supplies retailers' proposed $6.3 billion merger, U.S. District Judge Emmet Sullivan Tuesday urged the lawyers involved to “sit down and talk,” reports Bloomberg.
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That request came on the heels of Staples lawyer Diane Sullivan’s hour-and-half-long argument asking the court to toss the FTC’s request to block the merger. “Based on the evidence, they’ve fallen woefully short,” Diane Sullivan said, calling the agency’s case an “utter failure,” according to Bloomberg.
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Bloomberg also paints Judge Sullivan as skeptical and says FTC attorney Tara Reinhart is on the defensive. FTC attorneys rested their case, and Staples attorneys said they wouldn’t call any witnesses in the retailer's defense.
Dive Insight:
The proposed merger between Staples and Office Depot for months has seemed in doubt, hinging on the idea that the combined company’s resulting dominance in the business contracts space would impede competition. Just last month, Staples CEO Ron Sargent said that the retailer is working on a “Plan B” in case it isn’t able to prevail, lamenting the FTC's “incredibly narrow” definition of Staples’ office supplies business.
But the FTC’s decision to downplay Amazon’s emerging threat in the space may have backfired. Andre Barlow, an antitrust lawyer at Doyle Barlow & Mazard Pllc, told Bloomberg that Staples’ decision to forgo witnesses is unusual and may reflect confidence on Staples’ part.
Last week Judge Sullivan took issue with the FTC’s assertion that Amazon’s Business efforts wouldn’t fly, and questioned the FTC’s apparent attempt to have Amazon itself characterize its business office supplies effort as not ready for primetime. The judge also took the unusual step of unsealing the portion of the day’s court reporting that recorded his probing questions on that matter.
“I encourage the parties to resolve this,” Judge Sullivan said Tuesday, according to Bloomberg. Both sides are slated to return April 19 for final arguments.