Third Circuit Sets Aside Sabre-Farelogix Ruling

According to Bloomberg, a court decision greenlighting the planned merger of travel booking platforms Sabre and Farelogix was set aside Monday, July 20th, by the Third Circuit, which held that the ruling became moot when the deal was scrapped after UK regulators came out the other way.

Since the appellate order expresses “no opinion on the merits,” it “should not be construed as detracting from the persuasive force of the district court’s decision, should courts and litigants find its reasoning persuasive,” a three-judge panel wrote.

The one-page ruling rewarded the Justice Department’s persistent efforts to undo a Delaware federal judge’s ruling rejecting the government’s bid to block the $360 million tie-up.

Even after the UK decision the next day led the parties to terminate the deal, the DOJ pressed on to the US Court of Appeals for the Third Circuit, arguing that Judge Leonard P. Stark’s widely criticized reasoning could upend merger enforcement.

Stark let the transaction move forward in April, saying Sabre and Farelogix don’t count as competitors under the US Supreme Court’s controversial 2018 ruling in Ohio v. American Express because Sabre is a “two-sided” companyand Farelogix isn’t.
The DOJ originally appealed Stark’s ruling on the merits. After the deal was called off, it asked the Third Circuit to vacate the decision instead, saying it “could have an outsized effect on cases involving competition in the digital economy, where it is not uncommon for multi-sided platforms to face competition from one-sided rivals.”

The government doubled down on its arguments last month, after Farelogix reached a new deal to be acquired by Vista Equity Partners subsidiary Accelya, a Barcelona-based travel tech company.

Sabre and Farelogix opposed the request, saying the DOJ played a role in rendering the ruling moot by coordinating closely with the U.K. regulators who blocked the merger. The government shouldn’t get a “reward” for its “gamesmanship,” the companies said.

Full Content: Bloomberg

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