States Challenge Trump’s Antitrust Settlement Over HPE Merger

A coalition of state attorneys general is challenging the Trump Justice Department’s settlement that allowed Hewlett Packard Enterprise’s $14 billion acquisition of Juniper Networks to close, asking a federal judge to reject the deal on the grounds that it was the product of corrupt lobbying rather than antitrust analysis. New York Attorney General Letitia James led 17 states in calling for judicial review, and Oregon Attorney General Dan Rayfield led a separate group of 12 states and the District of Columbia that formally intervened in the Tunney Act proceedings before Judge P. Casey Pitts in the Northern District of California.¹²

What the States Are Arguing

The states’ case rests on three claims.

The first is that the settlement process was corrupt. The states allege that HPE hired politically connected consultants to lobby senior DOJ officials directly, bypassing the antitrust division’s career staff. They point to alleged “boozy backroom meetings” between HPE consultants and DOJ officials, and to HPE’s failure to disclose Republican operative Arthur Schwartz as a lobbyist in its Tunney Act filings.²

The second is that the remedies do not fix the competition problem the DOJ itself identified when it sued in January 2025. The department’s original complaint said Cisco, HPE, and Juniper together controlled roughly 70 percent of the enterprise-grade wireless networking market, and that combining the second- and third-largest players would leave two dominant firms.³ The states argue that after the merger, HPE and Cisco would still control the vast majority of that market, and that the divestiture and licensing terms in the settlement do not undo the concentration.¹

The third is consumer harm. The coalition asserts the deal will drive prices up by as much as 14 percent and reduce innovation in wireless networking.¹

How the Settlement Came Together

The DOJ sued to block the merger on January 30, 2025, citing internal HPE communications that called Juniper’s rapid growth a “dire” threat and encouraged staff to “kill” Juniper in competitive sales.³⁴⁵

HPE closed the acquisition on July 2, 2025, while the settlement still awaited court approval under the Tunney Act.⁶

The reporting that followed named two lobbyists as central figures: Mike Davis, a former chief counsel to Senate Judiciary Chairman Chuck Grassley and a Trump adviser, and Arthur Schwartz, a Republican operative with strong White House ties.⁷ Schwartz allegedly arranged meetings between HPE chief operating and legal officer John Schultz and officials at the Pentagon, the CIA, and the DOJ in the weeks before the settlement was finalized.⁸

Inside the DOJ, two officials were accused of steering the deal: Chad Mizelle, Attorney General Pam Bondi’s chief of staff, and Stanley Woodward, an acting associate attorney general overseeing the antitrust division. According to reporting and court filings, Mizelle overruled Gail Slater, the head of the antitrust division, who opposed the settlement.⁹ Woodward held virtual meetings with Schultz on June 25 and 26, 2025, to discuss a revised proposal.⁸ Neither was an antitrust specialist. The final consent decree was signed by them rather than by the DOJ trial attorneys who had built the case.¹⁰

In late July 2025, Slater’s top deputy Roger Alford and merger-enforcement chief William Rinner were both fired.¹¹ Alford went public, accusing Mizelle and Woodward of having “perverted justice and acted inconsistent with the rule of law,” describing a DOJ “overwhelmed with lobbyists with little antitrust expertise” who were “seeking special favors,” and referring to “Faustian bargains” driven by consultants seeking “million-dollar success fees.” He said he was dismissed “for insubordination” after insisting that “lobbyists and lawyers are subordinate to the law,” and returned to teaching at Notre Dame.¹²

How the States Got Into the Case

The Tunney Act, passed in 1974 after reports of improper influence over an ITT antitrust settlement, requires any proposed DOJ consent decree to be published, opened to public comment, and submitted to a federal judge who decides whether it serves the public interest.⁵ That review is what gave the state coalition its opening.

James’s group publicly called on the court to investigate the alleged corruption and reject the settlement if the allegations proved true.¹ Rayfield’s group filed a formal motion to intervene, which Judge Pitts granted on a limited basis to assist in the court’s review.²

Congressional Democrats added pressure. On August 1, 2025, Representatives Jamie Raskin and Jerrold Nadler wrote to Bondi demanding communications between the White House and the DOJ, and between the DOJ and lobbyists Davis and Schwartz.⁷ Senators Elizabeth Warren, Amy Klobuchar, Cory Booker, and Richard Blumenthal wrote to Judge Pitts urging him to hold an evidentiary hearing and compel sworn testimony from DOJ officials, HPE executives, and the lobbyists involved.¹³

Where the Case Stands

Judge Pitts held a Tunney Act hearing on March 23, 2026. News coverage called it the most significant courtroom vetting of an antitrust settlement in roughly 30 years.¹⁴ The states argued the settlement was “ineffective and corrupt”; HPE and the DOJ defended the terms as sufficient to preserve competition.¹⁵

The court declined the states’ request for a full evidentiary hearing, meaning the judge did not compel live testimony from the DOJ officials or lobbyists involved. As of mid-2026, Judge Pitts has not ruled on whether the settlement meets the Tunney Act’s public interest standard. The merger has closed but the consent decree has not been entered as a final judgment.¹⁶ The 180-day deadline for HPE to divest the Instant On business and complete the Mist AI Ops source code auction has not been publicly confirmed as met.⁴

Why This Case Matters

Rejecting a DOJ consent decree would be an almost unprecedented judicial action. Courts have historically deferred to the department’s judgment in Tunney Act proceedings, and only one evidentiary hearing has been held under the statute since 1974: Judge Richard Leon’s 2019 review of the CVS-Aetna merger.¹⁷ The states’ theory here reaches beyond the usual Tunney Act objection that a remedy is too weak. They are asking the court to find the process itself was tainted by political interference.

The dispute is also the sharpest example of a broader pattern. Where the Biden DOJ largely refused to negotiate merger settlements, the Trump DOJ has entered into roughly half a dozen in its first year, and state attorneys general have moved into the space the federal government has vacated.¹⁸ States rejected the DOJ’s mid-trial settlement with Live Nation and won a jury verdict on April 15, 2026, that Live Nation and Ticketmaster illegally monopolized primary ticketing and the large amphitheater market.¹⁹ Eight state AGs and DirecTV sued to unwind the Nexstar-Tegna broadcasting merger after federal regulators approved it, and a federal judge in the Eastern District of California issued a preliminary injunction on April 17, 2026, requiring Tegna to continue operating separately.²⁰ Multistate lawsuits against federal policies numbered 30 in the first four months of 2025 alone, a pace that would far exceed the 160 filed during Trump’s entire first term.²¹

How Judge Pitts rules on the HPE-Juniper settlement will not undo the merger, which has already closed. It will determine whether the consent decree survives as final judgment, and it will signal how much scrutiny courts are willing to bring to antitrust settlements that career staff opposed.

1
New York Attorney General. Attorney General James Calls for Review of Hewlett Packard Merger Settlement
2
Oregon Department of Justice. Attorney General Rayfield Urges Court to Reject Corrupted $14B HPE-Juniper Merger Settlement
3
U.S. Department of Justice. Justice Department Sues to Block Hewlett Packard Enterprise’s Proposed $14 Billion Acquisition
4
U.S. Department of Justice. Justice Department Requires Divestitures and Licensing Commitments in HPE’s Acquisition of Juniper
5
Federal Register. United States v. Hewlett Packard Enterprise Co. and Juniper Networks Inc.
6
HPE Newsroom. Hewlett Packard Enterprise Closes Acquisition of Juniper Networks
7
U.S. House Democrats Judiciary Committee. Judiciary Democrats Probe DOJ’s Settlement of HPE-Juniper Merger
8
Politico. HPE Exec Met With Pentagon, CIA, and DOJ Officials in Lead-Up to Merger Settlement
9
The Hill. DOJ Lobbyist Influence Claims
10
Senator Elizabeth Warren. Letter to AAG Nominee Woodward Regarding DOJ Antitrust Corruption
11
Bloomberg Tax. Top DOJ Antitrust Officials Removed Over HPE-Juniper Settlement
12
Broadband Breakfast. Fired No. 2 Official at Antitrust Division Decries Bribes in Trump Justice Department
13
Senator Elizabeth Warren. Letter to Judge Pitts on HPE-Juniper Merger and Tunney Act
14
The New York Times. HPE Juniper Hearing Settlement
15
Bloomberg. HPE Gets Day in Court as State AGs Challenge $14 Billion Deal
16
American Bar Association. Insights: HPE-Juniper Tunney Act Hearing
17
Applied Antitrust. HPE-Juniper Intervention States Motion
18
The Wall Street Journal. States Flex Muscle on Antitrust Enforcement as Trump Administration Pulls Back
19
NPR. Live Nation Ticketmaster Antitrust Verdict Monopoly
20
The Daily Record. Nexstar Tegna TV Merger Blocked California
21
Government Enforcement Report. State Attorneys General 2025 Enforcement Landscape