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Davis Polk Discusses FTC Challenge to Director Interlock at Non-Corporate Entity

On August 16, 2023, the U.S. Federal Trade Commission (FTC) announced that it had simultaneously sued and approved a settlement (a consent order) related to the proposed acquisition of EQT Corporation by funds managed by Quantum Energy Partners (Quantum). The key terms of the proposed order include requiring Quantum to forego its right to a seat on EQT’s Board and unwinding a pre-existing joint venture, The Mineral Company, between EQT and Quantum. Below are three key takeaways from the announcement:

Antitrust compliance efforts should include regular reviews for potential interlocking directorates, including for investment entities. 

The use of non-corporate structures may not insulate entities from FTC (and DOJ) scrutiny for interlocking directorates. 

Merging parties should anticipate that the FTC may investigate and challenge “unfair methods of competition” under Section 5 of the FTC Act—including those that are unrelated to the merger.


1 Press Release, U.S. Dep’t of Just., Two Pinterest Directors Resign from Nextdoor Board of Directors in Response to Justice Department’s Ongoing Enforcement Efforts Against Interlocking Directorates (Aug. 16, 2023), departments-ongoing; Press Release, U.S. Dep’t of Just., Justice Department’s Ongoing Section 8 Enforcement Prevents More Potentially Illegal Interlocking Directorates (Mar. 9, 2023); Press Release, U.S. Dep’t of Just., Directors Resign from the Boards of Five Companies in Response to Justice Department Concerns about Potentially Illegal Interlocking Directorates (Oct. 19, 2022),; Press Release, U.S. Dep’t of Just., Endeavor ExecutivesResign from Live Nation Board of Directors after Justice Department Expresses Antitrust Concerns (Jun 21, 2021),

2 If two related parties have an “unity of purpose” under Copperweld (which typically requires, at minimum, a 50% or greater interest), courts have found them not to be competitors for purposes of Clayton Act Section 8.

3 Fed. Trade Comm’n, Policy Statement Regarding the Scope of Unfair Methods of Competition Under Section 5 of the Federal Trade Commission Act, Comm’n File No. P221202 at 9 (Nov. 10,2022),

4 This follows a policy statement by the FTC in November 2022 that adopted an expansive view of FTC authority, without specific enforcement principles or guidance. For more information, see Davis Polk, Client Update, FTC interprets “unfair competition” broadly in new Section 5 policy statement (Nov. 15, 2022),

This post comes to us from Davis, Polk & Wardwell LLP. It is based on the firm’s memorandum, “FTC challenges director interlock involving non-corporate entity,” dated August 23, 2023, and available here. 

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