A recent case commenced by the Federal Trade Commission (FTC) challenging a merger directly in federal court has contradicted longstanding expectations regarding the agency’s merger enforcement process.
The FTC has generally used Section 13(b) of the Federal Trade Commission Act[1] to obtain preliminary injunctive relief in merger challenges in federal court, but it has also utilized its authority to continue these litigations administratively. This past December, however, the FTC opted to bring an action for a permanent injunction to prevent a merger directly in federal court, skipping its administrative proceedings altogether.[2] The FTC sued to block the proposed acquisition of Liquid Nails by Henkel AG & Co., alleging that the purchase would harm competition by eliminating “fierce competition between Loctite [owned by Henkel] and Liquid Nails, leading to higher prices, lower quality, and reduced innovation, all of which would be detrimental to American consumers.”[3]
This comes as a surprise move by the FTC which, for years, has consistently applied a two-prong approach when challenging mergers: first filing for temporary injunctive relief in federal court; then, if granted, adjudicating the matter on the merits in a separate administrative action before the agency. Utilizing this process, the FTC only needs to convince a court that its administrative proceeding is warranted in order to secure a preliminary injunction.[4] The evidentiary threshold for granting this relief is lower than what is required to grant a permanent injunction.[5]
Should the FTC choose to voluntarily abandon its two-prong approach, this change would have a meaningful impact on the current enforcement scheme. Because the FTC may block the disputed merger preliminarily in federal court and then litigate before its in-house administrative court, the two-prong approach has been viewed by critics as allowing the agency to have two bites at the proverbial apple.[6] In comparison, the Department of Justice Antitrust Division does not have such an option and, therefore, must argue and prove the merits of cases it brings under traditional injunctive relief standards, which critics have pointed to in arguing that the two-prong option for the FTC raises unfairness concerns.[7] The FTC moving away from its administrative proceeding process may help to appease stakeholders and policymakers who believe in eliminating the FTC’s dual strategy altogether.[8]
Wiggin and Dana routinely advises clients in connection with the full range of antitrust, consumer protection, and unfair trade practices matters, including antitrust litigation, compliance counseling, merger investigations, and representations before the FTC, DOJ, and offices of state attorneys general.
[1] 15 U.S.C. § 53(b).
[2] See Complaint for Permanent Injunction, FTC v. Henkel, Case No. 1:25-CV-10371-KPF (S.D.N.Y. Dec. 15, 2025), https://www.ftc.gov/system/files/ftc_gov/pdf/HenkelRedactedCompaint.pdf.
[3] See Press Release, Fed. Trade Comm’n, FTC Sues to Stop Loctite, Liquid Nails Construction Adhesive Merger (Dec. 11, 2025), https://www.ftc.gov/news-events/news/press-releases/2025/12/ftc-sues-stop-loctite-liquid-nails-construction-adhesive-merger?utm_source=govdelivery/.
[4] Federal Courts deciding such requests apply the standard set forth by Section 13(b) of the FTC Act that, “[u]pon a proper showing that, weighing the equities and considering the Commission’s likelihood of ultimate success, such action would be in the public interest . . . a [TRO] or a preliminary injunction may be granted without bond.” 15 U.S.C. § 53(b). The standard for likelihood of success on the merits is normally met “if the FTC has raised questions going to the merits so serious, substantial, difficult and doubtful as to make them fair ground for thorough investigation, study, deliberation and determination by the FTC in the first instance and ultimately by the Court of Appeals.” FTC v. H.J. Heinz Co., 246 F.3d 708, 714–15 (D.C. Cir. 2001).
[5] “Under this standard, the FTC need not prove . . . probable success on the merits but something less.” FTC v. Lancaster Colony Corp., Inc., 434 F. Supp. 1088, 1090 (S.D.N.Y. 1977) (internal quotation marks omitted).
[6] See, e.g.,H.R. Rep. No. 115-412, at 3–4 (2017), (addressing purported disparities between legal standards and processes applied to the FTC and Department of Justice).
[7] See id. at 3.
[8] E.g., H.R. Rep. No. 115-412, supra note 6, at 35–36 (proposing bill to require the FTC to use “the procedures available to the DOJ”).