FTC Says Court Should Grant Its Motion to Strike Iqvia and Propel's Affirmative Defenses

The court should grant the FTC’s motion to strike and dismiss defendants Iqvia and Propel Media’ s constitutional and equitable affirmative defenses with prejudice, said the FTC’s Wednesday reply memorandum of law (docket 1:23-cv-06188) in U.S. District Court for Southern New York in Manhattan. The FTC moved the court last month to strike those defenses asserted by Iqvia on the grounds that several raise constitutional challenges to the FTC’s process and powers that are “immaterial” and “impertinent” to the “narrow inquiry” that the court must undertake pursuant to Section 13(b) of the FTC Act in evaluating a claim for a preliminary injunction enjoining Iqvia from completing its purchase of Propel Media. Iqvia also raised defenses of laches and estoppel that weren't properly pled and can’t be raised against the government in the circumstances of this case, said the FTC's reply. The FTC will suffer prejudice if forced to expend resources defending against “sideshow matters that have no bearing on the Section 13(b) inquiry," said the agency. That's "especially true in light of the expedited nature of these proceedings and the far-reaching implications of Defendants’ allegations -- which attack the constitutionality not just of the FTC, but also of other federal agencies that use administrative proceedings to protect and serve the American public,” it said in September. Defendants argued in their opposing memorandum of law this month (see 2310050057) that Section 13(b) of the FTC Act allows a court to issue a temporary restraining order and preliminary injunction in favor of the FTC only after “weighing the equities” and considering its likelihood of success. “The Court must consider whether the FTC is likely to ultimately succeed on its underlying claim that the merger would be anticompetitive, and must weigh the equities of enjoining the merger pending the administrative proceedings,” defendants said, saying their constitutional defenses “challenge the constitutionality of the FTC itself as well as of the administrative proceedings in connection with which the FTC initiated this action.” Defendants didn’t cite one Section 13(b) case to support their “novel interpretation,” said the FTC’s Wednesday reply. Given the importance of constitutional challenges, “the statutory scheme of the FTC Act and the Federal Rules mandate certain procedures to ensure that the government has sufficient time to defend itself against such charges, which have implications across federal agencies,” it said. Defendants’ “self-imposed drop-dead date” for the acquisition, which they have established can be moved, “is not a basis to push this Court to grapple with far-reaching constitutional issues on an expedited schedule,” the FTC said.