by Cecile Kohrs Lindell
[Posted on February 5, 2008 - 6:23 PM]
E-mail
del.icio.us
Technorati
DiggGovernmental machinery is already gearing up to parse Microsoft Corp.'s proposed $44 billion takeover of Yahoo! Inc.
The Department of Justice will take the lead on reviewing Microsoft's proposed $44 billion takeover of Yahoo! Inc. if the deal goes forward, an agency spokeswoman confirmed Tuesday.
Capitol Hill has already signaled its concern over the deal. Despite the absence of a signed contract, lawmakers have scheduled a hearing for Friday to discuss the implications of this deal and the future of the Internet. The House Task Force on Antitrust, an arm of the Judiciary Committee, has announced a "Hearing on the State of Competition on the Internet" for Friday, but has yet to issue a witness list.
The Federal Trade Commission, which shares antitrust authority with the DOJ's antitrust division, was also interested in reviewing the deal, but bowed out because that agency fought--and won--the right to review the recent Google Inc.-DoubleClick Inc. deal. To secure it, antitrust lawyers familiar with the case said the agency traded off authority to review the next big merger, which turned out to be Microsoft's purchase of Yahoo!
One lawyer, who asked not to be named, said the move highlights inefficiency in the current system of dual regulators. The FTC staff that reviewed Google's acquisition likely combed over the same ground--issues of privacy and online advertising--that new regulators at the DOJ are certain to revisit.
Microsoft is likely to be thrilled with the decision, though, because its lead lawyer on the deal, former Assistant Attorney General Rick Rule, now a partner at Cadwalader Wickersham & Taft LLP, has several former colleagues in the front office of the agency. In addition to working with current Assistant Attorney General Tom Barnett while at Covington & Burling LLP, Rule worked with both of Barnett's deputies as well. One, David Meyers, co-authored several papers with Rule, and the other, Deb Garza, left Covington with Rule to expand the antitrust practice at Fried, Frank, Harris, Shriver & Jacobson LLP.
