Judge for Aetna-Humana, Anthem-Cigna merger lawsuits may drop one case

One of the two antitrust lawsuits against mergers of large health insurers would have to be reassigned to another judge if both were to be settled before the end of 2016, according to U.S. District Judge John Bates.

Both Aetna and Anthem—the buyers in the two pending acquisitions—had requested Bates schedule trials and issue his opinion before the end of the year. Aetna had asked for a trial to be completed in October, citing the contractual deadline with Humana to close the deal by Dec. 31, the same date Anthem asked for its trial to be completed.

Bates said in a August 4 hearing that presiding over both cases in such a short time frame wouldn’t be possible.

“That's my determination: that I can't do both” Bates said, according to Reuters. "Unless the schedule is put off, I'm sending one of the cases back."

Bates didn’t specify which case he would send back for reassignment, but he did say he would schedule a trial sooner than the February date requested by the U.S. Department of Justice in the case he kept.

The scheduling is crucial, as both deals offer an escape involving hefty fees if the mergers aren’t completed by certain deadlines. If Aetna doesn’t complete its $37 billion purchase of Humana by Dec. 31, Humana can opt out of the deal and collect a $1 billion break-up fee.

The price would be even higher for Anthem, which would owe Cigna a $1.8 billion break-up fee. While the deadline for the acquisition has been unilaterally extended by Anthem to April 30, 2017, Anthem attorney Christopher Curran said in court that Cigna wouldn’t allow it to be extended any further.

Cigna’s top management is "no longer interested in being pursued," Curran said, according to Bloomberg. "Speed is essential."

Aetna, however, had argued its case should be heard first, since its merger with Humana was announced several weeks earlier in June 2015.

Whichever case is reassigned may lose one advantage of having Bates, an appointee of President George W. Bush, preside over the trial. As Reuters reported, his assignment was seen as favorable to the insurers since he ruled against the Federal Trade Commission in a 2004 antitrust case, United States v. Arch Coal, Inc.