What Happened
On July 13, 2026, the Federal Trade Commission announced a settlement with Edwards Lifesciences and Genesis MedTech Group requiring them to pay a total of $12 million for failure to file Hart-Scott-Rodino Act (HSR Act) notifications in connection with an acquisition closed in July 2024. The penalty is the largest ever for failure to comply with the HSR Act, breaking a $5.6 million record set in 2025. The settlement also requires Edwards to provide prior notice to the FTC before acquiring any asset or business involved in the relevant product (transcatheter aortic valve replacement for aortic regurgitation (TAVR-AR)) in the United States, and to implement an antitrust compliance program.
The Bottom Line
This settlement is a reminder that the FTC will look closely at transaction structures it believes were designed to avoid HSR reporting requirements and seek penalties for violations. As stated by FTC Chairman Andrew N. Ferguson (R), companies trying to “sneak deals through” without making an HSR filing “should take notice.” While such avoidance devices may initially evade regulatory review, they become especially vulnerable when a regulator later opens an investigation, even if unrelated. The FTC’s position here also underscores that both buyers and sellers risk exposure to penalties for HSR violations, and that side investments and other arrangements may be treated as part of the consideration for the underlying deal when documents show they were designed to avoid HSR.
The Full Story
The HSR Act requires parties to notify the FTC and the Department of Justice (DOJ) and observe a waiting period before closing transactions above a certain threshold. Failure to file can result in civil penalties of up to $53,088 per day. The HSR rules also provide that any “avoidance device” used for the purpose of avoiding an HSR filing will be disregarded, and the filing obligation is determined by the substance of the transaction.
In July 2024, Edwards acquired JC Medical, a subsidiary of Genesis, for a purchase price below the HSR threshold. However, as later came to light in a separate investigation of another Edwards acquisition of JenaValve Technology that the FTC successfully challenged, the below-threshold price was designed to address concerns about filing HSR, and a separate investment by Edwards in Genesis was intended to make up the valuation gap for JC Medical. The FTC concluded that the side investment constituted additional consideration for JC Medical, bringing the value of the transaction above the HSR threshold and making it reportable. Because the acquisition closed without complying with the HSR notification requirement, the parties were subject to per-day penalties for a period of nearly two years.
In the settlement, Edwards agreed to pay $10 million (approximately $13,870 per day) and Genesis $2 million ($2,774 per day). Notably, while the FTC touted the penalty as “the largest ever for failing to make an HSR filing,” the per-day penalty represents only around 25% of the maximum civil penalty for Edwards and 5% for Genesis, which is significantly less proportionally than the most recent penalty for an HSR avoidance device imposed in 2019 against Canon/Toshiba (approximately $31,646 per day, around 75% of the maximum penalty), where each defendant paid half of the $5 million total penalty. The settlement also includes a prior notice requirement for five years, and for Edwards to implement an antitrust compliance program.
The FTC also highlighted the broader competitive context surrounding the acquisition. It alleged the JC Medical transaction was intentionally structured to be below the HSR threshold, and thus was not publicly announced and closed without regulatory review. This happened shortly before Edwards announced a separate agreement to acquire JC Medical’s primary competitor in the development of TAVR-AR devices. According to the FTC’s complaint, Edwards understood that the dual acquisitions of JC Medical and the competitor would attract significant regulatory attention, as it would give Edwards control of the only two companies with TAVR-AR devices in clinical trials in the United States. Both the HSR violation enforcement action associated with the Genesis transaction as well as the merger challenge of the JenaValve transaction were actions by taken by the FTC under the current Trump administration.
Conclusion
The practical lesson is straightforward: HSR compliance is mandatory. Particularly for repeat players, failure to make necessary filings or structuring transactions to avoid HSR can result in significant penalties and additional regulatory scrutiny, and ongoing prior notice requirements that may impact a future acquisition pipeline.
