Humana recently lost its effort to limit third-party discovery requests served by the Federal Trade Commission (FTC) in its ongoing Walgreens/Rite Aid investigation. Typically, negotiations over the scope of third-party subpoenas in an antitrust investigation (whether at the U.S. Department of Justice (DOJ) or the FTC) are resolved through negotiations with the staff attorneys investigating the transaction. In this instance, Humana invoked rules that enable third parties to petition the FTC to limit or quash the discovery after meeting and conferring with staff.¹

In its motions, Humana chronicled the negotiations with the FTC over two separate civil investigative demands (CIDs) and an additional subpoena for testimony.² Humana and the FTC reached agreement on two of the specific CID requests, but after repeated attempts, failed to do so on two others. The FTC denied Humana's petition, ordering Humana to respond.³ The FTC reasoned that the information requested was directly relevant to the investigation, largely unavailable from other sources, and that Humana failed to support its claim that complying with the subpoena would cause undue burden. The FTC has since filed an emergency petition with the U.S. District Court for the District of Columbia requesting that the court require Humana to comply with the subpoena.

Humana's motion highlights an issue that many companies face in the context of merger investigations. That is, government merger investigations often involve broad discovery requests on third-party market participants, including competitors of the merging parties, the merging parties' business partners (e.g., suppliers, distributors, consultants, and investment bankers), and other industry players. These requests are costly and hard to avoid outright (as evidenced by Humana's latest effort).

However, there are a few things third parties can do to limit the burden:

1. Be Prepared. Work with counsel to identify employees and shared files likely to have information covered by the subpoena. Having this information (and knowing what you do not have) at the outset can facilitate productive engagement with the antitrust agency.
2. Ask Questions About the Requests. Requests often appear to be duplicative, and engaging with the agency on their reasoning for specific requests may lend insight into additional ways the request can be narrowed or focused.
3. Offer a Counter Proposal. Once engaged in discussions with the agency, be proactive in identifying ways in which the subpoena that could be modified and/or reduced. This can include identifying the specific employees' files where information will be collected, or searched, identifying company shared files with the relevant information, and modifying the date range of the search. Be prepared to explain how the proposal gets the agency the actual set of documents and/or data they are looking for versus extensive information that follows the letter of the subpoena but will result in duplicative or irrelevant information.
4. Specify the Burden. Be exact in describing the scope of the subpoena's burden by specifying the number of employees' records that would be impacted, whether any of the information requested is held in file storage, the volume of documents that would need to be collected, and the cost of reviewing the files. Be prepared to explain how narrowing the scope of the subpoena to fewer employees or a specific time frame would reduce both the burden and the cost of compliance.

Each subpoena and investigation will have its own facts and circumstances that influence the extent to which a subpoena can be narrowed, but with preparation and early agency discussions, the burden may be reduced. As FTC Acting Chairman Maureen Ohlhausen recently stated: "The FTC must remain able to collect the information we need to enforce the law, but I am certain that we can do this while reducing the burden on businesses, particularly third parties who are not under investigation."⁴