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LabCorp Can Complete Purchase of Westcliff, Judge Rules

Laboratory Corp. of America can complete the purchase of rival clinical-testing company Westcliff Medical Laboratories Inc., a U.S. judge ruled, rejecting a challenge by the U.S. Federal Trade Commission.

U.S. District Judge Andrew J. Guilford in Santa Ana, California, yesterday denied the FTC’s request for a preliminary injunction. The agency argued in court papers that the transaction would harm competition in Southern California.

LabCorp, the second-largest independent clinical laboratory in the U.S., agreed to buy Santa Ana-based Westcliff Medical for $57.5 million in May.

“Based on the applicable facts and law concerning the relevant markets and other issues, the court cannot conclude that the FTC is likely to succeed on the merits,” Guilford wrote in his 40-page decision.

The FTC in December filed for an injunction to prevent Burlington, North Carolina-based LabCorp from merging with Westcliff, claiming it would lead to higher prices and lower quality in the Southern California market for clinical laboratory-testing services sold to physician groups.

The FTC filed a motion to appeal the decision today and another request to prevent the transaction from being completed until the appeal is decided, FTC spokesman Mitchell Katz said.

“We are disappointed with the court’s ruling,” FTC Bureau of Competition Director Richard Feinstein said in an e-mailed statement.

Steve Anderson, LabCorp’s director of investor relations, didn’t immediately return a telephone message seeking comment.

The case is Federal Trade Commission v. Laboratory Corporation of America, 10-cv-1873, U.S. District Court, Central District of California (Santa Ana).

To contact the reporter on this story: Tom Schoenberg in Washington at

To contact the editor responsible for this story: John Pickering at

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