Louis Dreyfus Company and Imperial Sugar Company Secure Major Antitrust Victory Over DOJ

On September 23, 2022, the U.S. District Court for the District of Delaware denied the U.S. Department of Justice’s request for an injunction blocking Louis Dreyfus Company LLC’s (“LDC”) sale of the assets and business of its subsidiary Imperial Sugar Company (“Imperial Sugar”) to U.S. Sugar. The District of Delaware’s decision in favor of the Defendants followed a four day trial in April 2022 and post-trial briefing submitted in May 2022.

In the suit, the DOJ alleged that the transaction, announced in March 2021, would substantially reduce competition in an alleged “Southeast” region of the United States. Cravath, representing Imperial Sugar, and its parent company, LDC, argued, among other points, that the DOJ’s theory of the case ignored the commercial realities of Imperial Sugar’s business and those of the sugar industry more broadly. In particular, Cravath argued that Imperial Sugar’s position in the market as a high-cost, import-based manufacturer rendered implausible the DOJ’s theory that Imperial Sugar acts as a competitive constraint in the market. Cravath further argued that the DOJ’s proposed geographic markets did not comport with the way Imperial Sugar views or conducts its business, and oversimplified the complexities of the overall market.

In entering judgment in favor of defendants and against plaintiff, the court determined that U.S. Sugar’s acquisition of Imperial Sugar will not violate Section 7 of the Clayton Act, 15 U.S.C. § 18.

The Cravath team is led by partners Christine A. Varney, Timothy G. Cameron and Peter T. Barbur and includes of counsel Michael J. Zaken, practice area attorney Lindsay J. Timlin and associates Hannah Dwyer, Serena Candelaria and Perry J. Goffner. Elizabeth H. Shereff also worked on this matter.

The case is United States of America v. U.S. Sugar Corp., No. 1-21-cv-01644 (D. Del.).