The order blocking Henkel from buying Liquid Nails runs to two pages, and the findings that explain it stay sealed until at least September 11
The order is two pages long.
On 14 August, Judge Katherine Polk Failla of the United States District Court for the Southern District of New York permanently enjoined Henkel AG & Co. KGaA and two of its American units from acquiring A-Paint Topco, Inc., the holding company behind the Liquid Nails construction adhesive brand. The order states that the acquisition would violate Section 7 of the Clayton Act and Section 5 of the Federal Trade Commission Act. It does not explain how the court reached that conclusion, because the explanation sits in a separate document that was filed the same day and handed to the parties under seal.
What the public docket holds
Entry 192 on the docket is the Findings of Fact and Conclusions of Law. It is marked sealed and no version of it can be read. Entry 193 is the order that follows from it, and that is the document above.
The court set out how the seal comes off. Under Lugosch v. Pyramid Co. of Onondaga, the Second Circuit decision that governs public access to judicial documents, the parties may propose redactions. They have until 11 September to file a joint letter saying which passages they want withheld. The judge will then take those suggestions into account and put a redacted version of the findings on the public docket.
Nothing in the order sets a date for that second filing.
The trial, and the procedure the Commission is claiming
The bench trial ran from 13 July to 21 July. The Federal Trade Commission, which announced its challenge in December, put the price of the blocked deal at $725m and named the seller as the private equity firm American Industrial Partners.
In a statement issued on Monday, three days after the order, the Commission said the case also marks a change in how it litigates mergers. Its usual route is to seek a preliminary injunction in a district court and then try the merits itself, in its own administrative proceeding. Here it asked the district court for a permanent injunction and got one, which the Commission described as its new approach to blocking anticompetitive mergers without continuing in administrative proceedings.
Daniel Guarnera, who directs the Commission's Bureau of Competition, said the decision "will ensure that Americans benefit from continued competition between Loctite and Liquid Nails, including lower prices and higher quality."
The Commission's own case page still lists the matter as pending.
