Department of Justice Fines Company $550,000 for HSR Act Violation for Failure to Submit Item 4(c) Competition Documents

The Department of Justice (DOJ) fined Iconix Brand Group (Iconix) $550,000 for violating the Hart-Scott-Rodino Act (HSR Act) by failing to submit to the Federal Trade Commission (FTC) and DOJ certain required documents in connection with its proposed acquisition of assets from Rocawear Licensing (Rocawear) earlier this year. The fine was levied even though the authorities had approved the proposed acquisition finding that it posed no threat to competition.

The HSR Act requires parties of a certain size involved in transactions valued above $59.8 million to make a preclosing filing with the FTC and DOJ and to observe the applicable waiting period before closing. The parties are also required to submit any Item 4(c) documents, which are documents prepared in connection with the proposed transaction that address any aspect of competition, sales growth, or entry into new product or geographic markets if seen by an officer or director. Documents prepared by a third party such as an investment bank may also be responsive. Responsive documents may include formal presentations as well as emails or handwritten notes.

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