Michael Bernstein, Deborah Feinstein, Apr 24, 2008
In the old game show, To Tell the Truth, panelists tried to convince the audience that they were the one associated with a particular story. They had to weave facts and details into the story to make it sound like the events had happened to them. The audience had to try to figure out which facts were likely to be consistent with the actual story. At the end, the host asked the real person associated with the story to stand up. Analyzing a merger has many similarities to this old game show. While hopefully no one in a merger analysis is actively trying to mislead, the decision makers must still sort through a plethora of facts to determine which are consistent with a theory that would condemn a merger versus a theory that would clear a merger. This is a particularly difficult exercise in a retail merger. There are no customers to interview and there are no customers documents from which one can glean how they might behave in the event of changes in the competitive environment. Which facts are meaningful and which are simply details that serve only to obscure the story? Which facts should be given weight and which should be ignored? And, how much weight should documentary and testimonial evidence be given as compared to economic evidence? An examination of these issues in the Whole Foods matter shows that what the U.S. Federal Trade Commission (FTC) and the district court thought the evidence showed, and what weight to give various evidence, differed so significantly that they reached entirely different conclusions about the matter.
