This alert was updated on February 20, 2026, to reflect the FTC’s subsequent appeal of the District Court’s order and the Fifth Circuit’s grant of an administrative stay pending full briefing of the FTC’s emergency motion for a stay pending appeal.
On February 12, 2026, a federal judge in the Eastern District of Texas vacated the Federal Trade Commission’s (FTC) final rule promulgating a new Hart-Scott-Rodino (HSR) Act premerger notification form (Final Rule).1 The FTC published the Final Rule in October 2024,2 and the new HSR form became effective one year ago.
The Final Rule significantly expanded the information and documents required from merging parties and marked the first major overhaul of the notification form in more than 40 years. See our prior alert describing the changes here.
The U.S. Chamber of Commerce and others sued last year,3 challenging the Final Rule on several grounds under the Administrative Procedure Act (APA)—including arguing that the Final Rule exceeds the FTC’s authority under the HSR Act. Judge Jeremy D. Kernodle agreed and issued an order granting the Chamber’s motion for summary judgement and finding that the Final Rule is not “necessary and appropriate,” as required by the authorizing statute,4 and is “arbitrary and capricious.” The court focused heavily on the increased costs that filers incur to meet the Final Rule’s expanded requirements. It determined that those costs were not “reasonably outweigh[ed]” by the potential benefits to the US antitrust agencies in improving their HSR merger reviews, finding that the FTC had presented little to no evidence of such benefits.
Judge Kernodle imposed an initial seven-day stay (through February 19, 2026) to allow the FTC time to appeal his decision.
On February 17, 2026, the FTC filed an emergency motion for a stay with Eastern District of Texas and stated its intent to file an appeal with the Fifth Circuit by February 18, 2026.5 The FTC argued that it would likely succeed on the merits of its appeal for at least two reasons (i) the Chamber of Commerce lacked standing to challenge the Final Rule and (ii) Judge Kernodle incorrectly weighed the evidence regarding the costs and benefits of the Final Rule. As to (ii), the FTC argued that Judge Kernodle applied the incorrect standard by requiring the FTC to produce evidence of an actual anticompetitive merger that would have been prevented had the incremental information that the new HSR form requires been mandated.
Judge Kernodle denied the FTC’s motion on February 18, 2026.6 Later that day, the FTC filed a notice of appeal and requested an administrative stay from the Fifth Circuit pending the FTC’s motion for a stay pending appeal.7 The Fifth Circuit granted the FTC’s motion on February 19, 2026, and set a deadline of February 26, 2026, for the motion to stay to be fully briefed.8
In the meantime, the new HSR form remains in effect and merging parties should proceed with that form. We will continue to update this space as more information becomes available.
