Not So Fast, Judge Says About CVS’s Purchase of Aetna

Companies told they must justify combining their businesses in the $68 billion deal.

CVS Health and Aetna completed their merger last week without first getting court approval for a settlement that the Justice Department signed off on and that irked U.S. District Judge Richard Leon. He said that he’s not a “rubber stamp” and scheduled a hearing for December 18 in Washington, D.C., where he “will consider ordering the companies to keep their assets separate until he weighs approval of the antitrust settlement with the government, a process that could take months,” Bloomberg reports.

Leon, who also complained of “being kept in the dark” concerning the deal, is evoking a federal law known as the Tunney Act in calling for the hearing. Tunney requires court approval of settlements that the Justice Department OKs once it is satisfied that merged companies won’t represent a monopoly. “The risk [of a court hearing] is that a settlement is rejected, requiring revisions to the agreement or the unwinding of the merger,” Bloomberg reports.

CVS is treading carefully, issuing only a brief statement saying that “CVS Health and Aetna are one company, and our focus is on transforming the consumer health experience,” and making no mention of the upcoming hearing before Leon.

The Justice Department approved the CVS-Aetna deal in October after Aetna sold off its prescription drug plans to WellCare Health Plans. That sale addressed Justice Department concerns that the merger would otherwise thwart competition.