Third party companies that have been dragged into the U.S. Department of Justice’s fight to undo the merger of two social commerce businesses are clamoring to make sure that they don’t suffer anticompetitive effects themselves.
The fate of Bazaarvoice’s 2012 acquisition of its main rival, PowerReviews, will be decided in a bench trial before U.S. District Judge William Orrick III that begins Monday. The DOJ alleges that the merger extinguished competition in the market for online product reviews and ratings.
On the brink of trial, about a dozen companies that were deposed by the DOJ or Bazaarvoice Inc. filed motions arguing that information they supplied should remain for attorneys’ eyes only and that disclosure could harm their businesses.
Amazon.com Inc., represented by Stoel Rives of Sacramento, noted that its materials detail the company’s plans to change ratings and reviews features. “This information is highly confidential and competitively sensitive,” Amazon manager Waqas Ahmed stated in declaration.
Abercrombie and Fitch Co. said it hopes to keep just a handful of lines from a deposition transcript confidential. That information, if made public, would gravely harm business, the company argues.
“A byproduct of the suit – which is purportedly designed to restore competition – should not be that third-party witnesses suffer anticompetitive harm,” the motion states.
Orrick held a hearing on Thursday to discuss the companies’ concerns. Those in attendance included lawyers from Akin Gump Strauss Hauer & Feld for Acer America Corp. and Greenberg Traurig for Demand Media Inc. Orrick noted that each company’s motion for confidentiality argued that trade secrets were at stake.
“There’s a strong presumption of access,” Orrick said. “But it can be overcome by compelling reasons. Protecting trade secrets is one of those.”
Orrick said he would not close the courtroom for testimony, but information that companies have labeled as confidential will not be discussed in open court. Rather, Orrick said he will review those depositions privately and rule at the end of trial on the companies’ motions to keep the information confidential.
Neither Peter Huston, assistant chief of the Antitrust Division in San Francisco, nor Bazaarvoice lawyer Dylan Liddiard of Wilson Sonsini Goodrich & Rosati raised concerns.
Although DOJ and Bazaarvoice conducted scores of depositions, they have narrowed the list of executives whose statements they will use in trial. Some lawyers wondered aloud whether their clients might be cut.
“We’re hopeful that we’re going to be one of those parties,” Acer lawyer Amit Kurlekar of Akin Gump said.
Antitrust lawyers expect customers to play an interesting role in U.S. v. Bazaarvoice, 13-133. In antitrust trials, the government typically calls on customers to talk about how the merger in question has harmed them, said Jones Day partner Craig Waldman in San Francisco. But Bazaarvoice also included many customers on the list of witnesses it plans to call, he noted, meaning the trial could feature dueling clients.
“Bazaarvoice is saying, ‘We can bring customers to the table as well,’” Waldman said.
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