A federal judge has laid out the next phase of a legal battle over Hewlett Packard Enterprise’s $14 billion acquisition of Juniper Networks, giving a coalition of states room to probe how federal antitrust enforcers approved a deal they argue still threatens competition in the IT networking market.
Casey Pitts, a U.S. District Judge in San Jose, has set rules for a group of state attorneys general seeking to challenge the Justice Department’s settlement with Hewlett Packard Enterprise and Juniper Networks. The ruling follows an earlier decision allowing the states to intervene under the Tunney Act, a 1974 law that requires courts to determine whether federal antitrust settlements are in the public interest.
For HPE, the acquisition is a strategic move aimed at strengthening its networking portfolio and positioning the company more competitively in data center and AI-driven infrastructure markets. An HPE spokesperson has said the company disagrees with the states’ objections but is confident that an objective review will settle the matter. Juniper has similarly argued that the deal will promote innovation rather than stifle it.
A Possible March Hearing
In January 2025, as reported in TechStrong.ai, the Justice Department sued to block the HPE–Juniper transaction, alleging it would significantly reduce competition in the U.S. market for networking equipment. That lawsuit marked the first major antitrust case brought by the new Trump administration. Days before trial, however, the DOJ abruptly settled, clearing the way for the merger to close subject to a narrow set of conditions.
That reversal drew criticism from Democratic lawmakers and former antitrust officials, particularly after two Justice Department staffers who objected to the settlement were dismissed. Colorado and other states argue those events raise serious questions about whether the agreement adequately addresses the competitive concerns outlined in the government’s original complaint.
Among the core issues is the question of how much scrutiny the court should apply. In his order, Pitts concluded that the states are entitled to at least some of the information exchanged between the DOJ and the companies after the lawsuit was filed. He wrote that the record could help the states assess the risks to competition posed by the merger, the extent to which the settlement mitigates those risks, and the strength of the government’s underlying case.
The judge directed the parties to submit additional briefing and said he may hold a hearing in late March if needed. The scope of any such hearing remains contested. State attorneys general are pushing for a broad review that would resemble a trial, with extended fact-finding to examine whether political influence or lobbying played a role in shaping the settlement.
In contrast, the Justice Department and the companies argue the court’s role should be far narrower, limited to evaluating whether the settlement’s terms serve the public interest.
Containing the Inquiry
Pitts has signaled that there are limits to how far the inquiry can go. He has previously suggested that much of the government’s internal decision-making is likely protected by attorney-client privilege and other doctrines that shield confidential enforcement deliberations. Even so, his comments indicate a willingness to look more closely at aspects of the deal that appear disconnected from the original allegations.
One such point is the settlement’s requirement that HPE divest its Instant On small-business networking unit and license certain Juniper technologies to competitors. The DOJ’s original lawsuit focused on different segments of the networking market, and Instant On was not a central part of its theory of the merger’s potential harm. During a November hearing, Pitts questioned that discrepancy, noting that he had been deeply immersed in the case while preparing for trial and did not recall Instant On featuring prominently in the complaint.
Larger Ramifications
This case, to be sure, is unusual. It is rare for states to continue pressing an antitrust challenge after federal enforcers have settled, and rarer still for a court to entertain allegations that the settlement process itself may warrant scrutiny. As the case moves forward, it is shaping up as a test not only of competition policy in the networking sector, but also of the transparency courts can demand when antitrust enforcement appears questionable.
