Your Deal May Be Too Small for an HSR Filing. It May Not Be Too Small for Antitrust Review.

A $250 million settlement over how documents were handled in merger filings, a proposed FTC order over board seats attached to a minority stake, and a growing list of state notice laws with thresholds far below the federal line. Antitrust appears to be becoming a lower middle market question.

For many lower middle market companies, antitrust has felt like someone else’s problem. The federal premerger filing threshold is $133.9 million this year, most deals in this market are well under it, and no filing has often been treated as meaning no review. 

That assumption may be getting weaker. This year has produced a record settlement over how a buyer handled documents in its filings, a proposed FTC order over the board seats that came with a minority stake, a case in which the agency added up two smaller transactions to find a filing obligation, and a spreading set of state laws that require notice of deals well below the federal line. None of this makes a small deal unlawful. It does suggest the antitrust question may belong on the checklist even when the HSR answer is no. 

The federal filing line, and what has been happening at it 

The Hart-Scott-Rodino Act generally requires buyers and sellers to notify the FTC and DOJ before closing deals above a size threshold, currently $133.9 million, and to wait, typically 30 days, while the agencies look. The penalty for a violation can run up to $53,088 per day. What the filing must include has been in flux: a more demanding form took effect in February 2025, a federal court vacated it in February 2026, the Fifth Circuit declined to stay that ruling in March, and the agencies are using the prior form while they consider a new rulemaking they have said could come by year-end. 

Three enforcement actions this year suggest the agencies do not need the new form to be aggressive. 

In August, DOJ announced a $250 million civil penalty against KKR to settle allegations about its HSR filings, which the department called the largest HSR penalty ever and “more than 20 times” any prior DOJ HSR penalty. According to DOJ’s complaint and the proposed settlement, the alleged conduct spanned at least 16 transactions in 2021 and 2022: altered documents in filings for at least eight deals, missing filings for at least two, and omitted documents in at least ten. The government’s competitive impact statement describes pages deleted from investment committee materials before submission. KKR has said it acted in good faith and consistent with industry practice, and that outside law firms will reimburse the penalty; the settlement awaits court approval. The lesson firms appear to be drawing is about document discipline: as White & Case put it, “once a document (including a draft shared with the Board) becomes responsive, it must be attached to the HSR filing. Do not alter the document, including revising text or removing content/pages from the document.” 

In July, the FTC obtained $12 million in penalties from Edwards Lifesciences and Genesis MedTech over a deal that, on its face, may not have required a filing. According to the FTC’s complaint, Edwards bought a company for $115 million plus milestone payments, below the threshold at the time, while investing $25 million in the seller’s parent as part of the same arrangement. The FTC treated the two as one transaction that should have been filed. Chairman Ferguson’s statement was direct: “Companies that try to sneak deals through without lawful FTC review should take notice.” 

And in September, the FTC accepted a proposed consent order with Beretta over its agreement to buy up to 25 percent of Ruger, a competitor, with the right to appoint two directors. The agency alleged an unlawful interlocking directorate under Section 8 of the Clayton Act. The proposed order would bar Beretta from placing anyone on Ruger’s board who is not independent of Beretta, require 15 days’ notice before any board appointment, and wall off Ruger’s nonpublic information. It was open for public comment as of this writing. 

Why this may matter now 

Two of those three cases turn on rules that appear to apply regardless of deal size. 

Section 8 generally prohibits the same person from serving as a director or officer of two competing companies once each has more than about $54.4 million in capital, surplus, and undivided profits and the competitive overlap exceeds certain de minimis thresholds. That is not a large company. A sponsor or strategic investor that holds a board seat at two competing portfolio companies, or takes a seat as part of a minority investment in a competitor, may be within the rule. And in a 2025 court filing, DOJ and the FTC took the position that “an individual cannot evade liability by serving as an ‘observer’ on a competitor’s board.” 

The Edwards case suggests that a deal priced just under the threshold, with a related investment alongside it, may invite the agencies to add things up. The federal merger statute itself, Section 7, applies to acquisitions that may substantially lessen competition, filed or not, and the agencies have spent several years signaling interest in “serial acquisitions,” the roll-up strategies common in healthcare, veterinary, home services, and other fragmented markets. The FTC’s case against U.S. Anesthesia Partners, alleging a decade-long roll-up of anesthesia practices in Texas, was heading toward a settlement whose terms remained confidential as of this writing. In May, the attorneys general of California, Connecticut, Rhode Island, Washington, and the District of Columbia told the federal agencies they would like a five-year “look back” at prior acquisitions built into the filing regime. 

The state layer 

The other change is closer to home. States have been building their own notice regimes, and the thresholds are nothing like $133.9 million. 

For healthcare deals, at least fourteen states now appear to require advance notice of transactions involving providers or facilities, several with review or approval rights. Illinois made its law permanent this summer and, effective January 1, 2027, expanded it to reach private equity buyers of Illinois providers and of out-of-state entities with $10 million or more in annual revenue from Illinois patients; notice goes to the Attorney General at least 30 days before closing, with a penalty of up to $500 per day for missing it. Oregon requires 180 days’ notice. California’s Office of Health Care Affordability requires 90 days. Indiana requires 90 days’ notice of deals involving healthcare entities with $10 million or more in assets. Maine’s law, effective January 1, 2027, targets private equity, hedge funds, and management services organizations specifically. 

For deals in every industry, a newer model is spreading. Washington (July 2025), Colorado (August 2025), and California (effective January 1, 2027) have adopted versions of the Uniform Antitrust Premerger Notification Act, which generally requires parties to an HSR-reportable deal to send a copy of their filing to the state attorney general when a party has its principal place of business in the state or has in-state sales of at least 20 percent of the HSR threshold (about $27 million this year). These laws piggyback on the federal filing rather than creating a new one for smaller deals, but they give state enforcers a seat at the table they did not previously have. 

State attorneys general are also litigating on their own. In September, a coalition of states led by California announced a settlement of their challenge to the Paramount and Warner Bros. Discovery combination on terms reported to include film production commitments and an independent compliance monitor, obtained through the states’ own suit. 

Questions that may be worth asking on a deal below the threshold 

• Are there other transactions, investments, or side agreements with the same counterparty that an agency could view as part of one deal? 

• Will any investor, sponsor, or strategic buyer hold a board seat, observer seat, or information rights at a competitor of the target? 

• Does the target operate in healthcare or another sector with a state notice law, and if so, in which states and with what lead time? 

• Is the buyer building a platform through serial acquisitions in a narrow market, and could the combined share attract attention? 

• Are the board decks, banker books, and internal analyses being written with the possibility in mind that a regulator could read them? 

This article summarizes federal and state antitrust developments at a high level as of October 21, 2026; it is a general description, not a complete statement of any law. Several items described here are pending: the Beretta/Ruger order is proposed, the KKR settlement awaits court approval, and the HSR form rulemaking has not been published. 

How CGL can help 

CGL advises buyers and sellers of lower middle market companies on deal structure, including when antitrust counsel may need to be brought in, how to calendar state notice requirements, and how to approach board and information rights in minority investments. 

If you have a deal in process or a platform strategy that touches any of the questions above, book a 30-minute call to discuss your situation and whether we can help, including when antitrust counsel should be involved.

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This newsletter is provided by CGL LLP for general informational purposes only and is not legal or tax advice; reading it or replying to it does not create an attorney-client relationship. The information is current as of October 22, 2026 and may change. Please consult counsel about your specific situation.