A recent settlement with the Federal Trade Commission (FTC) clarifies the applicability of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act) to certain investment fund activities. Relying on an exemption for acquiring voting securities solely for investment purposes (that does not result in the acquirer owning more than 10% of the target’s voting securities), Third Point LLC (Third Point) and three funds that it manages acquired shares of an issuer in excess of the HSR Act thresholds. The FTC and DOJ brought this enforcement action, claiming that the exemption did not apply because of particular actions with respect to board or management representation at the issuer. This article summarizes the relevant provisions of the HSR Act, the specific charges against Third Point and its funds, as well as the terms of – and FTC rationale for – the settlement. For more activity by Third Point, see “How Can a Hedge Fund Manager Dislodge a Poison Pill at a Public Company?,” Hedge Fund Law Report, Vol. 7, No. 12 (Mar. 28, 2014). For analysis of other issues affecting activist investing, see “Top SEC Officials, Law Firm Partners and In-House Counsel Discuss Private Fund Enforcement Priorities, Tender Offer Rules Applicable to Activist Investing, Valuation Challenges, Personal Trade Monitoring and Compliance Testing (Part Four of Four),” Hedge Fund Law Report, Vol. 8, No. 3 (Jan. 22, 2015); “Practitioners Discuss U.S. and Canadian Shareholder Activism and Activist Tools,” Hedge Fund Law Report, Vol. 7, No. 45 (Dec. 4, 2014); and “Did Pershing Square and Valeant Violate Insider Trading, Antitrust or Tender Offer Rules in Their Pursuit of Allergan?,” Hedge Fund Law Report, Vol. 7, No. 17 (May 2, 2014).