Antitrust

The Federal Trade Commission has announced it settled with Edwards Lifesciences Corp. and Genesis MedTech Group Limited for $12 million, alleging the parties failed to notify the sale of Genesis’s business, JC Medical, under the Hart-Scott-Rodino Act (HSR). This was the largest negotiated settlement for HSR failure to file, surpassing the prior high-water mark of $11 million in 2016. The record-breaking settlement here likely reflects the fact that the FTC alleged that the parties intentionally structured the transaction to avoid the required notification and waiting period to enable Edwards to sequence two transactions of competing companies without having to wait for HSR clearance for each transaction.

The FTC and DOJ have applied especially strong scrutiny when they uncover evidence suggesting that parties deliberately avoided the HSR Act filing requirements. FTC Chairman Andrew Ferguson noted in the Edwards/Genesis press release that the agency will continue to “seek penalties” for “[c]ompanies that try to sneak deals through without lawful FTC review.” The matter highlights that the federal antitrust agencies take HSR notification seriously and carefully guard the integrity of the HSR process.

Background on the JC Medical and JenaValve Acquisitions

On July 22, 2024, Edwards signed and closed its acquisition of medical device maker JC Medical. In a press release the following day, Edwards announced it agreed to acquire another medical device company, JenaValve Technology. At the time, JC Medical and JenaValve were the only two companies in the United States conducting clinical trials for transcatheter aortic valve replacement implants to treat a heart condition called aortic regurgitation (“TAVR-AR”). In August 2025, the FTC filed a complaint challenging Edwards’ planned combination of JC Medical and JenaValve, securing a preliminary injunction in federal court in January 2026. In response, Edwards abandoned its acquisition of JenaValve. In settling the charges that Edwards failed to file HSR on its initial acquisition of JC Medical, the FTC alleged that, because JC Medical and JenaValve were conducting trials in the same area, the parties were concerned that HSR review could delay the JC Medical closing given Edwards’ intention to also acquire JenaValve.

HSR Filing Requirements and the FTC’s Avoidance Theory

The HSR Act applies to transactions that meet specified size-of-transaction and, in some cases, size-of-person thresholds. Under the Act, parties are required to submit premerger notification filings to both the FTC and DOJ and observe the waiting period before closing a transaction. The waiting period allows the agencies to assess whether a proposed transaction may substantially lessen competition and, if necessary, further investigate a transaction prior to consummation.

According to the FTC, at the time of the transaction, Genesis valued JC Medical at $125-150 million. The then-applicable HSR size-of-transaction threshold was $119.5 million. Edwards agreed to pay Genesis $115 million, plus milestone payments for JC Medical, as well as a contemporaneous $25 million investment in Genesis in connection with the acquisition. The FTC previously alleged in its challenge to Edwards’ acquisition of JenaValve that “Edwards intentionally hid its acquisition of JC Medical from the FTC”, and that the parties intentionally structured the deal so the acquisition price would fall just below the threshold. Because Edwards’ $25 million investment in Genesis was connected to the main transaction, the FTC asserted that it should have been included in the size-of-transaction calculation.

The FTC relied on the parties’ emails discussing the deal architecture to support its allegation that Edwards designed the transaction to avoid the pre-closing HSR review process. In its complaint, the FTC explained that JC Medical sent the main transaction and Genesis investment term sheets in one email making it “clear that both were part of a single transaction.” In the same email, JC Medical stated that the main transaction closing and the investment would occur concurrently. Edwards also told JenaValve they would not file HSR “because it was ‘below the threshold! Intentional’”.

As part of the settlement, Edwards will pay a $10 million penalty and Genesis will pay a $2 million penalty. Additionally, for a period of five years, Edwards will be required to provide notice to the FTC if it acquires any interest in a company that sells or is conducting trials for TAVR-AR devices. Edwards must also create an antitrust compliance program.

Closing Thoughts

The Edwards/Genesis settlement demonstrates the seriousness with which the DOJ and FTC treat alleged attempts to avoid HSR Act filing obligations. This is not new; past administrations have followed a similarly aggressive approach on failure-to-file actions. The HSR Act is the primary means by which the government learns about and can investigate mergers, and the DOJ and FTC jealously guard this territory.  Parties should engage HSR counsel early in the transaction to identify filing obligations, avoid misinterpretations of the rules, and reduce the risk of penalties for failure to file.