The U.S. Department of Justice (DOJ) has filed a lawsuit to prevent Hewlett Packard Enterprise (HPE) from acquiring Juniper Networks in a $14 billion deal, citing concerns over reduced competition in the enterprise-grade wireless local area network (WLAN) market.
The lawsuit, filed in the Northern District of California, argues that the merger would lead to higher prices, less innovation, and fewer choices for businesses and institutions, violating Section 7 of the Clayton Act.
“HPE and Juniper are strong competitors in the WLAN market, but instead of continuing to compete, they are attempting to consolidate,” said Acting Assistant Attorney General Omeed A. Assefi of the DOJ’s Antitrust Division. He emphasized that the merger would directly impact critical industries such as healthcare and small businesses, leading to increased costs and weaker innovation in wireless networking technology.
WLAN technology plays a vital role in modern workplaces, enabling everything from wireless internet access to secure business operations. Juniper, known for its rapid growth and cost-effective innovations, has been a major competitor forcing HPE to lower prices and enhance its own offerings. Internal HPE communications, revealed in the DOJ complaint, show the company considered Juniper a serious threat, with employees actively strategizing to counter its market influence.
If the acquisition proceeds, HPE and Cisco Systems would together control over 70% of the market, further consolidating an already concentrated industry. The DOJ argues that such a move would significantly harm competition, which is exactly what the Clayton Act aims to prevent. The lawsuit now sets the stage for a legal battle over the future of competition in the WLAN market.
