The U.S. Federal Trade Commission on Monday sued to block Coach parent Tapestry's US$8.5 billion deal to buy Michael Kors owner Capri, saying it would eliminate "direct head-to-head competition" between the flagship brands of the two luxury handbag makers.
In a statement, the FTC said the tie-up, which would create a company with about 33,000 employees worldwide, could reduce wages and employee benefits.
"The proposed merger threatens to deprive millions of American consumers of the benefits of Tapestry and Capri's head-to-head competition, which includes competition on price, discounts and promotions, innovation, design, marketing and advertising," the FTC said.
The FTC's rare antitrust challenge against a high-end fashion merger could set a precedent for luxury deal regulation, several antitrust lawyers said.
The U.S. luxury market is highly fragmented with several differentiated brands catering to a wide range of consumers, antitrust experts said, arguing that legacy fashion brands typically face healthy competition from labels launched every year.
"The FTC's decision to sue is surprising because there's no shortage of competition for fashion, apparel and accessories. The commission has latched onto a marketing term - 'accessible luxury' - and treats it like a unique market that exists in a vacuum," said Howard Hogan, chair of the fashion, retail and consumer practice at law firm Gibson Dunn.
U.S. antitrust enforcers issued new merger guidelines in December to encourage fair, open and competitive markets.
Antitrust lawyers noted that the FTC is using a new tactic under the guidelines by arguing that the merger would directly affect hourly workers who may lose out on higher wages due to reduced competition for employees.
"The revised federal merger guidelines outlined that potential effects on labor like lowering wages or work conditions is a basis to challenge a merger, so that is a newer trend. It's not surprising since the agencies announced they'd do that but it is something new to test in court," said Jennifer Lada, litigation attorney at Holland & Knight.
Tapestry had offered to buy Capri in August, hoping to create a U.S. fashion behemoth that could effectively battle bigger European rivals such as Louis Vuitton parent LVMH and potentially get more share in the global luxury market.
But the FTC requested more information from the firms on their deal in November.
"Capri Holdings strongly disagrees with the FTC's decision," the company said in a statement. "The market realities, which the government's challenge ignores, overwhelmingly demonstrate that this transaction will not limit, reduce, or constrain competition."
Tapestry, in a statement, also said "there is no question that this is a pro-competitive, pro-consumer deal and that the FTC fundamentally misunderstands both the marketplace and the way in which consumers shop."
Earlier in April, the companies received regulatory clearance from the European Union and Japan for their deal, that would bring top luxury labels such as Kate Spade and Jimmy Choo under one roof.
While Capri's stock is trading at US$37.96, well below the US$57-per-share Tapestry has offered to pay, most analysts expect the deal to close before Aug. 10, the deadline for the two companies to complete the transaction.
"In our view, we do not believe consumers would be harmed with a combination given the competitive nature of the category and varying degrees of cultural relevance," analysts at TD Cowen wrote in a note earlier in April.
(Reporting by Abigail Summerville in New York, Jasper Ward in Washington and Granth Vanaik in Bengaluru; Editing by David Ljunggren, Shilpi Majumdar and Anirban Sen and Richard Chang)
Canada's first Arctic and Offshore Patrol Vessel will officially be brought into the Pacific fleet today and Princess Anne, the sister of King Charles, is scheduled to take part in its commissioning ceremony.
Here are the latest recalls Canadians should watch out for, according to Health Canada and the Canadian Food Inspection Agency.
A 4.8-magnitude earthquake was reported west of Vancouver Island Thursday evening.
A new poll suggests a majority of Canadians feel their right to freedom of speech is in danger.
Niki Benjamin, from the U.S., had travelled to a paradise island to do some soul searching, and her life ended up going in a very different direction when her dog ran up to a stranger.
A source close to singer Britney Spears tells CNN that the pop star is 'home and safe' after she had a 'major fight' with her boyfriend on Wednesday night at the Chateau Marmont in West Hollywood.
The federal government will provide Toronto just over $104 million in funding to host the 2026 FIFA World Cup.
Police moved in to clear an encampment at New York University on Friday at the request of school officials, a move that follows weeks of pro-Palestinian protests at college campuses nationwide that have resulted in nearly 2,200 arrests by police.
Emotional support animal registrations in the United States reached 115,832 last year, by an industry group’s count. But in the eyes of reptile rescuer Joie Henney, there’s only one: 'Wally Gator.'
A Winnipeg judge is expected to decide today whether the trial of a man accused of killing four women will still be heard by a jury.
A new poll suggests a majority of Canadians feel their right to freedom of speech is in danger.
A 4.8-magnitude earthquake was reported west of Vancouver Island Thursday evening.
Nova Scotia's premier is drawing criticism from the opposition over a recent trip to Spain that his office didn't announce publicly.
Canada's first Arctic and Offshore Patrol Vessel will officially be brought into the Pacific fleet today and Princess Anne, the sister of King Charles, is scheduled to take part in its commissioning ceremony.
A pro-Palestinian activist group says its international co-ordinator, who was arrested in a Vancouver hate-crime investigation, was released with an order not to attend any protests for the next five months.
A police officer who was involved in clearing protesters from a Columbia University administration building earlier this week fired his gun inside the hall, a spokesperson for District Attorney Alvin Bragg's office confirmed Thursday.
A prominent surgeon in Gaza has died in an Israeli prison after being held for more than four months, according to Palestinian prisoners’ groups, which decried his death as part of a “systematic targeting” of health care workers.
Since President Vladimir Putin launched his invasion of Ukraine, attacks and harassment of Russians -- prominent or not -- have been blamed on Moscow's intelligence operatives across Europe and elsewhere.
Recent statements by France's president and Britain's foreign secretary about the war in Ukraine are "dangerous" and will deepen international tension around the conflict, the Kremlin's spokesman said Friday.
The prosecution's star witness has yet to take the stand in Donald Trump's hush money trial. But jurors are already hearing Michael Cohen's words as prosecutors work to directly tie Trump to payments to silence women with damaging claims about him before the 2016 election.
Former British Prime Minister Boris Johnson was turned away from a polling station after forgetting to bring ID to vote in the U.K.'s local elections.
A federal commission of inquiry into foreign interference is slated to release a report today on alleged meddling in the last two general elections.
A Conservative MP is challenging claims by House of Commons administration that a China-backed hacking attempt did not impact any members of Parliament, because the attack was on his personal email.
The mayor of North Grenville, just south of Ottawa, says hybrid work has been a boon to her community, and a recent move by the federal government to force public servants back to downtown Ottawa office buildings is misguided.
Here are the latest recalls Canadians should watch out for, according to Health Canada and the Canadian Food Inspection Agency.
New Brunswick's official languages commissioner says the province's online health-care service is violating provincial law by failing to consistently provide services in French.
H5N1 or avian flu has been detected at dozens of U.S. dairy farms and Canadian experts are urging surveillance on our side of the border too.
Many species of animals form social groups and behave collectively: An elephant herd follows its matriarch, flocking birds fly in unison, humans gather at concert events. Even humble fruit flies organize themselves into regularly spaced clusters, researchers have found.
China on Friday launched a lunar probe to land on the far side of the moon and return with samples that could provide insights into differences between the less-explored region and the better-known near side.
Scientists studying a Neanderthal woman's remains have painstakingly pieced together her skull from 200 bone fragments to understand what she may have looked like.
Danny DeVito had the opportunity to know way more about Drew Barrymore than the rest of us.
The start of the first civil trial stemming from the 2021 Astroworld festival, at which 10 people were killed in a crowd surge, has been delayed.
By its nature, it's nearly anonymous work, with stunt performers doubling for daintier stars. But Leitch, a longtime stuntman before he became a director, and "The Fall Guy," which opens in theatres Friday, hope to redefine the role of stunt work in Hollywood.
Ontario is set to clamp down on bad employers with big fines. Labour Minister David Piccini says his government will introduce legislation next week that will see fines increased for violations of the Employment Standards Act.
Co-operatives are found in many forms, from agricultural co-ops to grocery stores, gas stations and car-shares. Their exact business models vary, but what they have in common is that they are owned by their members, who have a share in the organization and a say in how it runs.
A Freedom Mobile customer who sued the company for negligence after a "SIM swap" scam cost him more than $63,000 in bitcoin will have to go through the company's arbitration process to pursue his claim, a B.C. court has ruled.
A Montreal astrologer and horoscope writer just got a boost on his retirement budget, after winning Loto-Quebec’s Grande-Vie prize, which comes in the form of $1,000 a day for life.
What do you need to pack for a cruise? When it comes to this upcoming cruise from tour and travel company Bare Necessities, the answer appears to be very little.
Nathaly Paola Castro Torres has a rare disorder called Laron syndrome that is caused by a genetic mutation. It stunts her growth but also provides a hidden silver lining: Her body is protected from chronic diseases such as cancer that often take life away long before old age.
A Winnipeg judge is expected to decide today whether the trial of a man accused of killing four women will still be heard by a jury.
William Nylander scored twice and Joseph Woll made 22 saves as the Toronto Maple Leafs downed the Boston Bruins 2-1 on Thursday to force Game 7 in their first-round series.
Canada's para hockey team gets another swing at winning a world championship on home ice. The 2024 edition at Calgary's WinSport Arena, where the Canadians open against Japan on Saturday, provides more familiar territory.
Drivers in Saskatchewan will now lose their licence for a week and their vehicle for a month if they are caught committing certain high-speed and dangerous offences on the road.
Auto sales last month totalled 164,000 units, higher than April 2023, which was the weakest month for sales last year.
Rolls-Royce is vastly expanding its factory in Chichester, England. The BMW subsidiary is adding five new buildings with construction planned to start next year.
A British Columbia mayor has been censured by city council – stripping him of his travel and lobbying budgets and removing him from city committees – for allegedly distributing a book that questions the history of Indigenous residential schools in Canada.
Three men in Quebec from the same family have fathered more than 600 children.
A group of SaskPower workers recently received special recognition at the legislature – for their efforts in repairing one of Saskatchewan's largest power plants after it was knocked offline for months following a serious flood last summer.
A police officer on Montreal's South Shore anonymously donated a kidney that wound up drastically changing the life of a schoolteacher living on dialysis.
Since 1932, Montreal's Henri Henri has been filled to the brim with every possible kind of hat, from newsboy caps to feathered fedoras.
Police in Oak Bay, B.C., had to close a stretch of road Sunday to help an elephant seal named Emerson get safely back into the water.
Out of more than 9,000 entries from over 2,000 breweries in 50 countries, a handful of B.C. brews landed on the podium at the World Beer Cup this week.
Raneem, 10, lives with a neurological condition and liver disease and needs Cholbam, a medication, for a longer and healthier life.
The lawyer for a residential school survivor leading a proposed class-action defamation lawsuit against the Catholic Church over residential schools says the court action is a last resort.
A British Columbia mayor has been censured by city council – stripping him of his travel and lobbying budgets and removing him from city committees – for allegedly distributing a book that questions the history of Indigenous residential schools in Canada.
A Freedom Mobile customer who sued the company for negligence after a "SIM swap" scam cost him more than $63,000 in bitcoin will have to go through the company's arbitration process to pursue his claim, a B.C. court has ruled.
Canada's first Arctic and Offshore Patrol Vessel will officially be brought into the Pacific fleet today and Princess Anne, the sister of King Charles, is scheduled to take part in its commissioning ceremony.
The federal government will provide Toronto just over $104 million in funding to host the 2026 FIFA World Cup.
Drivers in Toronto may have to navigate multiple road closures this weekend as a result of construction, special events and filming.
Police say they have arrested a man wanted in connection with a string of shootings outside movie theatres across the GTA.
As wedding dress styles change through the decades, one Calgary shop has remained a constant option for local brides for more than half a century.
Thousands of Calgarians are set to lend a hand in the city’s annual effort on Friday.
After a few days of wet and cold weather, Calgary and southern Alberta will see a well-timed (albeit short) reprieve.
The mayor of North Grenville, just south of Ottawa, says hybrid work has been a boon to her community, and a recent move by the federal government to force public servants back to downtown Ottawa office buildings is misguided.
CTVNewsOttawa.ca looks at things to do in Ottawa during the first weekend of May.
Waiting lists for mammography screening will be reduced, as a mobile mammography screening unit opens to the public in the Outaouais region.
A Quebec judge overseeing the trial of a person accused of killing a cyclist with their car has raised concerns that an amendment to the province's language charter could cause 'undue delays' for trials held in English.
Eight years ago, Lauren McGowan found out she had Celiac disease. As a baker, the Montrealer says the diagnosis didn't just change her life personally -- but also professionally.
A former worker at a COVID-19 vaccination centre pleaded guilty after he made $150,000 from helping hundreds of Quebecers obtain fake vaccination passports during the height of the pandemic.
Light wind, some sun and a warming trend for the Edmonton area today and Saturday.
The Alberta government, in the face of mounting criticism, says it will make changes to a bill that gives Premier Danielle Smith and her cabinet unfettered power to overturn local bylaws and fire mayors and councillors.
A campaign that started online has many Canadian shoppers promising to boycott Loblaw companies in May, but a local expert says the boycott is unlikely to take off.
Nova Scotia's premier is drawing criticism from the opposition over a recent trip to Spain that his office didn't announce publicly.
Maritime motorists are paying less at the pumps after gas prices dropped Friday morning.
Airport officials disagree with idea of one centralized airport in New Brunswick.
A Winnipeg judge is expected to decide today whether the trial of a man accused of killing four women will still be heard by a jury.
The long-standing Starbucks in Osborne Village is set to close its doors next week – it comes one day after a man was attacked next door.
Manitobans are being invited to weigh in on a hospitality regulation designed to prevent sexual exploitation in the industry.
Saskatchewan motorists won’t be getting an immediate 15 cent per litre break at the pumps as an NDP motion to cut the provincial gas tax was voted down by the Sask. Party on Thursday.
Saskatchewan Roughriders past and present along with many friends, family and fans from around the CFL will gather in Regina Friday afternoon to remember the late Jim Hopson.
Three months since the Government of Saskatchewan stopped funding single use pipes and needles for safe consumption sites – those working on the ground with people battling addiction say the effects are clear.
Three Bridges Road is closed as emergency crews respond to what police say is a “large barn fire” in Elmira.
A New Hamburg family is feeling deflated after buying a new Toyota hybrid truck.
Waterloo regional police are looking for a driver involved in a crash that left a pedestrian with serious injuries.
A Saskatchewan family won the bovine lottery after their cow gave birth to a rare set of quadruplets.
Saskatchewan motorists won’t be getting an immediate 15 cent per litre break at the pumps as an NDP motion to cut the provincial gas tax was voted down by the Sask. Party on Thursday.
If April showers bring May flowers, then what does snow in May bring?
A New Hamburg family is feeling deflated after buying a new Toyota hybrid truck.
An intoxicated man wearing only his underwear and a lifejacket had to be pulled from the Thessalon River early Wednesday evening.
Social services agencies across the north are sounding the alarm after funding cuts on homelessness programs were recently published.
Around 6:45 p.m. on Thursday, first responders were called to the scene near the intersection of Pigram Road and Salford Road in South-West Oxford Township.
Despite a recent clean-up around the former St. Pierre Renovation Centre, concern persists about trespassing and the risk of fire at the former industrial building.
A two-vehicle crash involving a transport truck and a passenger vehicle closed Dundas Street, just west of Thamesford, late Thursday afternoon.
Over the years, Georgian Bay General Hospital (GBGH) has been working to expand its birthing program to meet the needs of its community.
Barrie's photo radar cameras will relocate to new community safety zones this month to curb speeding on neighbourhood roads.
After a lacklustre season for the Owen Sound Attack, the team has parted ways with their top two coaches.
A joint traffic initiative in a construction zone on Highway 401 resulted in dozens of charges.
A Windsor man is facing charges after police seized drugs and cash worth over $18,000. In April, members of the Drugs and Guns Enforcement Unit (DIGS) started an investigation into a person they believed was trafficking drugs.
Jim Crichton is no stranger to the spotlight – having spent two decades at the anchor desk of CTV Windsor’s newscast. He’s also no stranger to the annual gala held by the Multicultural Council of Windsor and Essex, often serving as emcee for the evening.
Canada's first Arctic and Offshore Patrol Vessel will officially be brought into the Pacific fleet today and Princess Anne, the sister of King Charles, is scheduled to take part in its commissioning ceremony.
A 4.8-magnitude earthquake was reported west of Vancouver Island Thursday evening.
A British Columbia mayor has been censured by city council – stripping him of his travel and lobbying budgets and removing him from city committees – for allegedly distributing a book that questions the history of Indigenous residential schools in Canada.
Out of more than 9,000 entries from over 2,000 breweries in 50 countries, a handful of B.C. brews landed on the podium at the World Beer Cup this week.
An emaciated dachshund is now recovering thanks to a Good Samaritan who found the pup near a biking trail in Kelowna, according to the BC SPCA.
Search and rescue crews have been called in after a vehicle belonging to a missing senior was located near a rural intersection outside of Kelowna Tuesday.
The bell at Erle Rivers High School in Milk River, Alta., will ring for the last time on June 26, as the 114-year-old school is scheduled to be torn down to make way for a new K-12 school.
Years of hard work paid off for Tanner McLachlan after he heard his name called at the NFL draft last Saturday.
Volunteers with ‘The Watch’ program in Lethbridge have been patrolling the city centre rain or shine for five years.
Phase 1 of the reconstruction of Queen Street in downtown Sault Ste. Marie is getting underway, although it will be scaled down from the original plan.
Social services agencies across the north are sounding the alarm after funding cuts on homelessness programs were recently published.
An intoxicated man wearing only his underwear and a lifejacket had to be pulled from the Thessalon River early Wednesday evening.
Richard Martin is spending this year's fishing season on land after he says a Royal Newfoundland Constabulary officer broke his left leg in three places during a protest last month that shut down the provincial legislature.
Tributes continue to pour in for Bob Cole as his family has confirmed a funeral will be held for the legendary broadcaster Friday in St. John's, N.L.
Legendary sportscaster Bob Cole was a Newfoundlander through and through, and his daughter says his connection to the province was 'everything' to him.
The Shopping Trends team is independent of the journalists at CTV News. We may earn a commission when you use our links to shop. Read about us.
