FTC trial against Capri and Tapestry merger ends, judge’s decision awaits

A trial brought by the US Federal Trade Commission (FTC) against a potential merger of luxury goods giants Tapestry and Capri Holdings was brought to a close on Monday, with a federal judge's decision now being awaited.

The FTC brought the antitrust case against the duo after Coach-owner Tapestry announced its intention to acquire competitor Capri, the parent company of Versace and Michael Kors, for a deal valued at 8.5 billion dollars.

The merger was ultimately brought to a halt upon the FTC’s lawsuit, in which the watchdog stated that the move could result in a dominant giant in the market for affordable luxury handbags.

The trial saw a number of executives from both firms take to the stand, including Michael Kors, who spoke on his eponymous brand’s history, its current challenges and the intense competition in the handbag industry.

On both sides, lawyers attempted to define the term “accessible luxury”, while FTC’s counsel Abby Dennis attempted to point to parallels between the multiple transportation methods across the US and how it was difficult for consumers to interchange between those due to price limitations, Reuters reported. Consumers were faced with similar challenges when it came to handbags, Dennis alleged.

The power is now passed over to a US federal judge, who is to decide whether to block the merger or allow it to pass. Tapestry told Reuters that a decision is expected anywhere between three weeks to three months.