# United States v. Philadelphia National Bank (1963) **Argued:** February 20–21, 1963 · **Decided:** June 17, 1963 · **5–2, Justice William Brennan** · 374 U.S. 321 The most durable holding in American merger law. Sixty-three years later it is still the first thing the government argues in every §7 trial — including the 2024–2026 platform and grocery cases. Philadelphia National Bank, the second largest in its four-county market, proposed to merge with Girard Trust Corn Exchange, the third largest. The combined bank would hold at least **30%** of commercial banking in the metropolitan area, and the two-firm concentration ratio would rise from about 44% to about 59% — a roughly one-third increase. ## The structural presumption Brennan's formulation is the operative sentence: > "a merger which produces a firm controlling an undue percentage share of the relevant market, and results in a significant increase in the concentration of firms in that market, is so inherently likely to lessen competition substantially that it must be enjoined in the absence of evidence clearly showing that the merger is not likely to have such anticompetitive effects." Followed immediately by: "Without attempting to specify the smallest market share which would still be considered to threaten undue concentration, we are clear that 30% presents that threat." What makes this survive is that it is a **burden-shifting rule, not a share threshold**. The government proves market definition and concentration; the burden of production then moves to the defendants to rebut. It converts a merger case from an economic prediction contest into a structured argument. ## The long fight over the rebuttal The presumption was never overruled — the fight moved to how easy it is to rebut. *United States v. Baker Hughes* (D.C. Cir. 1990) held that "a variety of factors can rebut a prima facie case," and observed that the Supreme Court "has at the very least lightened the evidentiary burden on a section 7 defendant." *FTC v. H.J. Heinz* (D.C. Cir. 2001) tightened it again for mergers to duopoly, requiring "proof of extraordinary efficiencies." ## Why it is back at the center The 1982 and 2010 [[Merger Guidelines]] pushed analysis away from structure and toward predicted competitive effects, unilateral-effects modeling, and efficiencies. The **2023 Merger Guidelines** reversed that, re-grounding merger analysis explicitly in *Philadelphia National Bank* and lowering the structural presumption to HHI above 1,800 with a change above 100. Those guidelines were issued by [[Lina Khan]] and [[Jonathan Kanter]] — and kept in force by [[Andrew Ferguson]] in February 2025. **The oldest surviving structural rule in American antitrust is currently the operative one under both parties.** See [[US Antitrust and Monopoly Timeline]].