U.S. sues firm backing Moscow-based company
DOJ says investment firm did not comply with antitrust rules during creation of Lightcast
The U.S. Justice Department announced Tuesday that it has filed a civil lawsuit against the investment firm that financially backs Moscow-based company Lightcast.
The DOJ says KKR & Co. Inc. failed to comply with antitrust laws for at least 16 separate transactions, including the merger that led EMSI and Burning Glass to become Lightcast.
KKR acquired EMSI, a labor market analytics company, for approximately $350 million in 2021.
The lawsuit alleges KKR failed to file documents that would put it in compliance with the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
This law requires parties involved in transactions above a certain size to submit a premerger filing to the Department of Justice’s Antitrust Division and the Federal Trade Commission.
The DOJ alleges KKR “systematically flouted” the requirements of the HSR Act. This allowed KKR to close potentially anti-competitive transactions without proper review by the government, the government agency stated.
“The omitted documents contained essential information about competition between Emsi and a KKR portfolio company called Burning Glass, a leading competitor to Emsi and one of very few meaningful alternatives available to customers at the time,” the lawsuit states.
The DOJ says EMSI and Burning Glass are two leading providers of labor market analytics. Their merger raised concerns about higher prices, fewer choices for customers and less innovation, the court document says.
According to DOJ court filing, Lightcast did adopt a strategy of increasing prices following the merger.
A Justice Department news release said KKR allegedly failed to make complete and accurate HSR filings for at least 16 transactions.
“The HSR Act authorizes civil penalties for violations of the Act at more than $50,000 per day per violation,” the news release says. “As a result, the maximum penalty for KKR’s alleged violations exceeds $650 million.”
KKR is a global investment firm headquartered in New York. It is one of the world’s largest investment firms with more than $500 billion in total assets under management.
Lightcast did not respond to an email asking for comment Wednesday.
Kuipers can be reached at akuipers@dnews.com.
