The Federal Trade Commission filed a single response to both Black Knight and Intercontinental Exchange, asking a judge to strike the constitutionality and separation of powers claims they raised in their respective April 25 filings.
Those claims are “impertinent” and “immaterial” to the matter at hand, the FTC filing made on May 16 argued. The case is being heard in the Federal District Court for the Northern District of California and was assigned to Judge Araceli Martinez-Olguin.
In those responses, both Black Knight and ICE raised eight common defenses to the FTC’s claims seeking to halt the merger. Those are the arguments the FTC is seeking to have an immediate ruling on. Additional defenses have been raised that were not addressed in this newest filing.
The FTC filed for an administrative proceeding in March seeking to halt the merger, based on alleged dominance in the loan origination system and product and pricing engine areas, but only went to federal court to get an injunction one month later. Prior to the March filing, Black Knight agreed to sell its Empower LOS to Constellation Software and has argued that would address any concerns the FTC raised.
ICE and Black Knight in their respective April answers filed a single count counterclaim that also raises the constitutionality arguments.
“First, [ICE and Black Knight] concede that the constitutional issues they have raised as counterclaims are not required to decide the FTC’s request for a preliminary injunction,” the motion stated. Under the Federal Rule of Civil Procedure, that alone meets the standards for impertinence and immateriality.
“Second, even putting aside Defendants’ counterclaims and concession, the constitutional defenses are ‘impertinent’ and ‘immaterial’ to the issues the Ninth Circuit has held that a court needs to resolve in deciding whether to grant an FTC claim to preliminarily enjoin a merger.”
The Ninth Circuit Court of Appeals is the higher court for the Northern District of California and its rulings apply in this matter. That prior case involved the FTC and Meta Platforms.
Black Knight and ICE also raised “bare statements of legal conclusions that fail to meet the required pleading standards,” the FTC said as a third consideration for the court for it to throw out their defenses.
ICE and Black Knight did not respond to a request for comment by press time.