## Facts

- General Cinema Corporation (Cinema) bottled soft drinks and exhibited movies; Heublein, Inc. (Heublein) produced and distributed distilled spirits and wines and operated or franchised restaurant businesses and other specialty food lines.
- On February 4, 1982, Cinema filed a Hart–Scott–Rodino (HSR) premerger notification with the Federal Trade Commission (FTC) to acquire up to 49.9% of Heublein’s common stock, triggering a 30‑day waiting period scheduled to expire on March 6, 1982.
- After review, the FTC found no reason to oppose Cinema’s proposed acquisition on antitrust grounds and permitted Cinema to consummate once its waiting period ended.
- On March 2, 1982, during Cinema’s waiting period, Heublein filed its own HSR premerger notification seeking approval to acquire up to 49.9% of Cinema’s common stock.
- Heublein requested early termination of its own HSR waiting period so it could begin purchasing Cinema stock as soon as Cinema’s waiting period expired; Heublein argued there would be no anticompetitive effect and delay would be inconsistent with the HSR program’s aims.
- Under FTC guidance, early termination was not automatic; the requesting party was expected to show a “special business reason” justifying a shorter waiting period.
- The FTC denied Heublein’s early‑termination request, stating Heublein had not shown a “special business reason” and also indicating it wished to remain neutral between the parties in the ongoing control contest.
- By March 12, 1982, Cinema had purchased significant amounts of its own shares and Cinema’s directors planned to increase their holdings; Cinema’s stock price rose sharply.
- Heublein sued the FTC and FTC officials in the District of Connecticut and sought emergency relief (including a temporary restraining order) to allow it to consummate its stock purchases without serving the full HSR waiting period.

## Issues

1. Whether the HSR Act or FTC rules required the FTC to grant Heublein early termination of the waiting period once the FTC concluded the acquisition raised no antitrust concerns.
2. Whether the FTC’s denial of early termination—based on the absence of a “special business reason” and the FTC’s desire to remain neutral—was arbitrary, capricious, or otherwise unlawful under the Administrative Procedure Act (APA).
3. Whether Heublein satisfied the requirements for emergency injunctive relief compelling, or effectively requiring, early termination of the HSR waiting period.

## Decision

- The court denied Heublein’s request for emergency injunctive relief, including a temporary restraining order.
- The court held that early termination under the HSR framework is discretionary and is not an entitlement merely because the FTC does not see an antitrust problem.
- The court concluded that Heublein had not shown that the FTC’s refusal to grant early termination—using its “special business reason” criterion and its stated neutrality in a takeover dispute—was unlawful under the APA.
- Because Heublein did not show a sufficient likelihood of success on the merits (and given the statutory allocation of timing authority to the agency), the court declined to order relief that would override the FTC’s administration of the waiting period.

## Legal Principles

- The HSR Act establishes a statutory waiting period for covered acquisitions; early termination is a permissive mechanism committed to the enforcement agencies’ administration, not a right available on demand.
- An agency may use administrable criteria—such as requiring a “special business reason”—to decide whether to shorten an HSR waiting period, so long as the approach is not contrary to the statute.
- A court will not issue emergency injunctive relief that effectively transfers HSR timing control from the FTC to the judiciary absent a strong showing that the agency acted unlawfully under the APA.
- In a contested control setting, the FTC may consider institutional concerns such as avoiding the appearance of taking sides when deciding whether to accelerate statutory waiting periods.

## Conclusion

Heublein, Inc. v. Federal Trade Commission held that the FTC was not required to grant early termination of Heublein’s HSR waiting period simply because the agency did not view the acquisition as anticompetitive; the district court denied Heublein’s request for a temporary restraining order and treated the FTC’s use of a “special business reason” standard and its neutrality rationale as within the agency’s discretionary administration of the HSR program.


Heublein, Inc. v. Federal Trade Commission, 539 F. Supp. 123 (1982)