Justice Department Reaches Settlement with Legends Hospitality Over Illegal Premerger Coordination

The U.S. Department of Justice has reached a settlement with Legends Hospitality Parent Holdings LLC (Legends) following allegations of illegal premerger coordination in connection with its proposed acquisition of ASM Global Inc. (ASM). The settlement, announced on Monday, requires Legends to pay $3.5 million in civil penalties and mandates significant compliance measures to prevent future antitrust violations.

The Justice Department's Antitrust Division filed a civil lawsuit in the Southern District of New York, accusing Legends of violating the Hart-Scott-Rodino (HSR) Act by exercising control over certain operational aspects of ASM during the HSR waiting period. Specifically, Legends is alleged to have improperly influenced the management of venue services for an arena in California, which was under ASM's control, before the merger was legally finalized.

"Companies must remain separate and independent before they close their merger," said Deputy Assistant Attorney General Andrew Forman of the Antitrust Division. "Our complaint alleges that Legends did not live up to that obligation. The proposed settlement requires Legends to pay a meaningful civil penalty and imposes significant obligations to ensure that Legends complies with the law moving forward. I commend our tremendous investigative teams who remain vigilant in trying to ensure that there is no improper coordination between parties before closing."

The HSR Act requires companies planning to merge to maintain separate operations until the conclusion of a mandatory waiting period. This provision is intended to prevent the premature integration of businesses, which could otherwise reduce competition or influence market conditions before the merger receives regulatory approval.

As part of the proposed settlement, Legends is required not only to pay the $3.5 million penalty but also to implement an extensive antitrust compliance program. This includes appointing an Antitrust Compliance Officer, initiating an antitrust training program, and providing regular compliance reports to the Justice Department.

The proposed final judgment is subject to approval by the court. In accordance with the Tunney Act, the consent decree and a competitive impact statement will be published in the Federal Register. A 60-day public comment period will follow, during which individuals can submit their views on the settlement. After this period, the District Court for the Southern District of New York will determine whether to enter the final judgment, provided it is found to be in the public interest.

Legends, headquartered in New York, is a prominent global venue services company. ASM Global, based in Los Angeles, specializes in venue management and services. The Justice Department emphasized that the allegations resolved by this settlement are claims only, with no admission of liability by Legends.

The GRC Report is your premier destination for the latest in governance, risk, and compliance news. As your reliable source for comprehensive coverage, we ensure you stay informed and ready to navigate the dynamic landscape of GRC. Beyond being a news source, the GRC Report represents a thriving community of professionals who, like you, are dedicated to GRC excellence. Explore our insightful articles and breaking news, and actively participate in the conversation to enhance your GRC journey.