Revisiting Philadelphia National Bank: The Structural Presumption and the Future of Merger Review

The 1963 Supreme Court case United States v. Philadelphia National Bank established a "structural presumption": if a merger creates a single entity controlling 30% or more of a market, it is legally presumed to lessen competition in violation of Section 7 of the Clayton Act, U.S. antitrust law’s merger statute. U.S. federal and state antitrust enforcers challenging mergers have relied on this presumption for more than half a century. Certain state attorneys general have most recently utilized this presumption to argue that a combined Paramount-Warner Bros. Discovery would control roughly 27% or more of key theatrical distribution and basic cable markets and hence be anti-competitive. 

 

Defenders of the presumption argue that it provides predictability to businesses and gives regulators an efficient way to identify and prevent harmful mergers. Critics charge that the presumption relies on an outdated economic theory and triggers a heavy burden shift for businesses based on thin or speculative evidence of potential harm. Join our panel of experts as they explore the future of the Philadelphia National Bank presumption and whether it will remain in place if the Paramount-Warner Bros. Discovery or other similar cases reach the Supreme Court.