EpicRandy said:
A quash is exactly to nullify the previous report "A motion to quash is a request to a court or other tribunal to render a previous decision or proceeding null or invalid." The judge did not 'offer' a quash, it's not up to the parties to decide/accept a quash. He was basically saying the context might warrant a summary judgement and quash (most likely) the phase 2 investigations. Here is the proceedings document highlighting the quash procedure for the UK CAT : where it quashes the whole or part of that decision, remit the matter back to the CMA with a direction to reconsider and make a new decision in accordance with the ruling of the Tribunal: Schedule 8, paragraph 3A of the 1998 Act. What you suggest is a simple remittal not a quash, it is also highlighted in the same document section 2.17 Under paragraph 3(2) the power of the Tribunal on such an appeal includes the power to:
Those are certainly valid reasons but not the only ones for the CMA, the judges having to identify mistakes done by the CMA that resulted in the quash was bad optics. This could result in binding new procedures/limitations for the CMA. There are already many cases where the CMA was given procedural restrictions while some others resulted simply in a rebuke of a findings/a procedure employed. But, that would be left entirely for the CAT to determine. Not to mention in such a high-profile case it may decrease public trust in the regulatory body. We saw last week what can happen to such bodies when public trust is waiving.
I'm not jumping to a conclusion and I not saying it absolutely would but it could have that effect, previous cases including nonmerger ones already acted to restrict the CMA in the procedures it can use and how they use those. The quash wouldn't have been granted because the CMA findings were inadequate There is only 2 basis to quash CMA findings, either an unlawful practice or highly unreasonable findings. Here it would most likely have been quashed for the unlawfulness of one of its practice. The judge strongly hinted at the quash not because of the new development with Sony but because CMA was engaging in negotiation with MS the judge even asked the CMA "Why didn’t you listen to these new proposals before?". That's because the CMA has a duty to use block only as a last resort which they obviously didn't reach here. it would've been granted because they are new developments and a new transaction all together is on the table right now. Again no, as far as the CAT is concerned there is no new evidence allowed plus CMA interim order prevents MS from doing a new deal with ABK. The "new deal" is only being employed loosely by the CMA to justify extending the currently pending final decision. MS did not reopen the contract with ABK so there's no new deal to date. Normally the CMA does not even have the right to do that, that's why the judge said the CAT won't rule on the lawfulness of how the CMA wants to go forward, but he needs to get an idea of what the legal basis is. interestingly, the new developments that could've led to a quash include the SONY CoD deal. He did not mention Sony prior or at the time he mentioned the quash but he did mention the new deal with Sony kind of blows apart the CMA’s whole argument later on. However, I think the judge was being informal with this mention because the CMA findings are a cloud SLC and Sony is not part of that meaning it should have been of no consequence here. But maybe the judge would then have found that the CMA overlooked the benefits in the console market and failed to properly weigh them to the cons of the Cloud Market IDK. You're smart enough to know this, why do you always resort to speculation and hyperbole? You are clearly very involved in this which makes the context you're providing for the "quash" disingenuous. And again you resort to using ad hominem attacking the one arguing instead of the arguments, you resort to this a lot. It prevents us to have an enjoyable conversation as your simply looking to discredit the ones you do not agree with. The context I provide for the quash is actually supported by the proceedings of the CATs, what have you as a source to prove it as trivial as you suggested?
That's not the kind of consequences I was referring to, but yes those suck. The thing is the CMA enjoys quite large power in the UK way more so than any other jurisdiction, but it comes with a warning not to abuse it. Here the CMA is responsible to have fueled their detractors' arguments against themselves IMO. There's no way that when you have findings that baffle the vast majority of industry experts and have been obtained while making regular phone calls with the highly politically motivated FTC would not make others ask questions.
None of the paths employed by MS here was illegitimate, MS as the right to voice its concerns to the government like anybody else. The only connection that speeds up the process here is simply the fact MS is important to the UK. Also, the CAT appeal path is extremely difficult as it requires finding the CMA either unlawful or so unreasonable literally no one else would conclude the same Which is the highest standard possible. In the end, it looks like the CMA could have been quashed on with both as evidenced by the Judge's comments and the fact they're now pretty much alone. But even the CMA would have been tasked with the same review anyway, and to date, they never changed their decision after being quashed. Meaning even if MS was to be 100% right and have been wronged by the CMA, the CMA would only have to reach the same conclusion over and over again to eventually kill the deal. This exact behavior is so prevalent with the CMA that many companies abandon mergers instead of appealing to the CAT even though they might have a legitimate and strong case. This is not an example of a body with proper checks and balances that separation of power requires. Next time Amazon, Facebook or Apple has a problem with the CMA, they know what to do, and it's clearly not just going to CAT. Next time the CMA may use a block truly as a last resort as they should, providing a proper path for companies to address all concerns beforehand. |
1. The quash business
Read the transcript, he wasn't suggesting the CMA April's decision is unreasonable and therefore, he was going to quash it. No, he was suggesting according to the CMA/MS joined statement about the restructured deal and the deal MS signed with SONY, it seemed to him we are in an entirely new territory where he believes the original CMA findings need to be quashed because they're historical and apply to a deal that is no longer on the table.
Followers of the stream, me included, initially thought he was just suggest a quash through which the acquisition is cleared, or a quash because the CMA findings were incorrect, but as it turns out, he was suggesting a path for the process to start over because the findings were historical. Both the CMA and MS argued strongly against taking the quashing path. (yes, you are right, he wasn't "offering", he was laying out possibilities, apologies, the words used here).
MS and CMA lawyers argued that actually, there has always been a path in the books for MS to notify the CMA with new proposals and there has always been a path for the CMA to accept said proposals and review them following an expedited process, a chart/diagram/flowchart/algorithm was shown to the judge to prove this.
2. "The judges having to identify mistakes done by the CMA that resulted in the quash was bad optics"
Actually, it would've been beautiful optics to see the CAT remitting the case to the CMA or telling them "you're being irrational". It would've shown that there is a path through the CMA if they were being irrational, and it would've shown that the system in place works and there is no reason to play dirty and get politicians to slander underpaid hardworking public sector workers.
I am one of the public and an objective look at the CMA work through its short lifespan tells you it spared the UK multiple domestic disasters, having the occasional decision being quashed or remitted by CAT and the process in place getting followed isn't going to waive anyone's trust. The CMA hasn't been engaged in delaying tactics or ended up with concerns different from the concerns the EC ended up with.
Some want us to believe that the CMA is so irrational it's so obvious for everyone to see, yet, MS preferred to not go ahead with the CAT hearings that literally could've started within days, this tells me they're not remotely confident in their ability to demonstrate how the CMA findings are irrational, and they'd settle with the CMA with a new restructured deal that the CMA still has the power to refuse (not going to happen).
3. "There is no new deal" + "the CMA doesn't have the right to do that"
Yes, I agree, I am not as careful as you are with choosing my words, you should be a lawyer. There is no new deal, there is a new proposal, a restructure, a concession. I don't know what to call it. Correct me if I am not wrong, both the CMA/MS have shown the judge the legal basis for how and why this new proposal should be considered already and that's why the conditional adjournment was given?
Both MS/CMA lawyers spent considerable amount of time explaining to the judge the legal basis for what they're doing now. He accepted their reasoning and the legal basis for what they're doing, it's one of the reasons he's given them what they wanted in the end, he was satisfied.
4. my previous comment: ""You are clearly very involved in this which makes the context you're providing for the "quash" disingenuous"".
Go through the transcript, at no point the judge was suggesting he was going to quash the CMA decision because of the reasons that you listed, you tried to shoehorn so many unsubstantiated claims using the mere possibility of a "quash" happening as an umbrella. The judge was engaging in discussion with CMA/MS lawyers through out, he asked to be explained why he should do what they were asking and not do other things like "quashing".
I am not sure why you think I was attacking you? You're genuinely smart, and you have genuinely indulged in speculation in your post:
- "This means somewhere in phase 2 the CMA failed to give MS due process. Could be not arguing in good faith, not giving the proper signal upon proposed remedies so that MS can propose a stronger one or any others".
The above is clear speculation, another unsubstantiated claim. In what way point this out is this an attack on you?
5. The thing is the CMA enjoys quite large power in the UK way more so than any other jurisdiction, but it comes with a warning not to abuse it. Here the CMA is responsible to have fueled their detractors' arguments against themselves IMO. There's no way that when you have findings that baffle the vast majority of industry experts and have been obtained while making regular phone calls with the highly politically motivated FTC would not make others ask questions.
The CAT is there to keep them in check, the CAT literally has the power to look at the CMA report and threw it in the trash, the CMA can't abuse their powers, the CMA haven't abused their power.
The CMA was following the process, you haven't shown any evidence of this not being the case. To suggest they fuelled their detractors is victim blaming.
The findings aren't so baffling, the fact MS chose to settle through a longer process instead of going ahead with the scheduled CAT hearings tell me they weren't confident in getting the outcome they needed.
The CMA and the FTC has acted within the law by communicating with each other, if I remember correctly, MS has given them the permission to communicate as well. There was nothing wrong with this and I am not sure why you think their communications are worth mentioning.
6. Also, the CAT appeal path is extremely difficult as it requires finding the CMA either unlawful or so unreasonable literally no one else would conclude the same Which is the highest standard possible.
But you honestly believe that the CMA findings are so baffling and so unreasonable it's obvious for everyone to see, so why do you not expect the CAT to not see what you're seeing?
Don't say because it never happened before, previous cases the CMA won have no bearings on this one, the CAT wasn't going to judge this case based on how they judged previous ones.
7. This exact behavior is so prevalent with the CMA that many companies abandon mergers instead of appealing to the CAT even though they might have a legitimate and strong case. This is not an example of a body with proper checks and balances that separation of power requires.
You will have to provide examples and show how the CMA abused their powers in those examples and how they were incorrect. This is way too generalised of a statement to make and in no way substantiate your claim that the CMA doesn't have proper checks and balances.
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