UNITED STATES OF AMERICA 

BEFORE THE FEDERAL TRADE COMMISSION 

COMMISSIONERS: Jon Leibowitz, Chairman 

J. Thomas Rosch 

Edith Ramirez 

Julie Brill 

Maureen K. Ohlhausen 

In the Matter of 

1210140 

Docket No. 9354 

Integrated Device Technology, Inc., a corporation, 

and 

PLX Technology, Inc., a corporation. 

COMPLAINT 

REDACTED PUBLIC 

VERSION 

Pursuant to the provisions of the Federal Trade Commission Act and of the Clayton Act, 

and by virtue of the authority vested in it by said Acts, the Federal Trade Commission (the 

"Commission"), having reason to believe that Respondent Integrated Device Technology, Inc. 

("IDT") and Respondent PLX Technology, Inc. ("PLX") having executed an agreement and plan 

of merger in violation of Section 5 ofthe Federal Trade Commission Act ("FTC Act"), 15 V.S.c. 

§ 45, and which if consummated would violate Section 7 of the Clayton Act, as amended, 15 

V.S.C. § 18, and it appearing to the Commission that a proceeding by it in respect thereof would 

be in the public interest, hereby issues its complaint pursuant to Section II(b) of the Clayton Act, 

15 U.S.C. § 21(b), and Section 5(b) of the Federal Trade Commission Act, 15 U.S.c. § 45(b), 

stating its charges as follows: 

NATURE OF THE CASE 

1. IDT's proposed acquisition ofPLX threatens to create a near-monopoly in the PCIe 

switch market, which is likely to substantially lessen competition for the development 

and sale of PC Ie switches on a worldwide basis, leading to higher prices, lower quality, 

and less innovation. PCIe switches are integrated circuits that playa vital role in 

computer architecture. They are used in a variety of computer and embedded electronic 

applications to provide serial, high-speed, point-to-point connections between multiple 

input/output devices and a microprocessor. 

1 
2. IDT and PLX often compete head-to-head for PCle switch sales opportunities. Senior 

executives from both companies testified that IDT and PLX are the two primary PCle 

switch suppliers and each other's closest competitors. IDT and PLX's business 

documents repeatedly identify each other as their primary competitor, with little or 

nothing said about the few fringe suppliers. Indeed, a "competitive market landscape" 

prepared at the request ofIDT's Board of Directors as part ofIDT's 2012 strategic plan 

review identified PLX as IDT's only competitor in the PCle switch market. Moreover, 

IDT's documents project that following the acquisition ofPLX, IDT will be the only 

PCle switch supplier six years from now. PLX's chief scientist identified IDT as "almost 

our sole competitor in PCle switches" and further noted that IDT will gain a "near 

monopoly" with this acquisition. 

3. IDT's senior management has been on a mission over the last two years to grow IDT's 

PCle switch market share, either by fighting PLX tooth and nail or by acquiring its rival 

outright. According to IDT's 2011 strategic plan, IDT saw PLX as the primary 

competitive challenge to increasing its PCle switch sales. IDT's CEO was clear about his 

company's goal when he demanded that his sales team overtake PLX's lead in the PCIe 

switch market in the most dramatic terms, imploring them to "crush PLX." When a 2011 

attempt to purchase PLX failed, IDT's CEO instructed his team to compete harder against 

PLX and declared, "if we can't buy them, we're going to have to start taking their market 

share. You need to start kicking some butt." IDT's CEO frequently exhorted his team to 

direct IDT's competitive energies at PLX, for example giving the head ofIDT's PCle 

switch business a "mandate" to "pull together a 'take no prisoners' plan (roadmap, 

resources, strategy) to secure the #1 position in PCIe" adding that he was "not going to be 

backed into a corner where I have to buy PLX. We are going to beat them on their own 

turf." 

4. This intense competition between IDT and PLX has benefitted their customers. The two 

companies compete with each other to offer lower prices, more innovative features, and 

better customer service. As one IDT executive customers use IDT as a 

UI',UUJ"" PLX and 

IS not surpnsmg, th(~retor'e 

merger assumed that the combined company would have 

"increased pricing power" and that post-merger switch revenues would be higher as a 

result. 

5. IDT and PLX also compete to improve their products by adding new and innovative 

features and functionality to their switches. For example, IDT was the first to offer 

spread spectrum clocking and PLX had to respond with a similar offering to remain 

competitive. Likewise PLX first offered non-transparent bridging, a feature IDT has 

since made available on its PC Ie switch offerings. IDT and PLX are the only two 

companies offering 3rd generation PCle switches today. The two companies also 

compete by offering a range of customer support and services to their customers who 

incorporate PCle switches into complex products. 

6. Customers agree that they play IDT and PLX off against each other on price, service and 

in their demands for innovative features. Many PC Ie switch customers see IDT and PLX 

2 
as their only choices. When they issue Requests for Quotations, IDT and PLX are often 

the only companies from whom PCle switch users solicit bids. Eliminating this close 

competition between IDT and PLX likely will result in anticompetitive effects. Postacquisition, IDT will not have the same incentive to discount its prices to meet 

competition and it will not have the same incentive to innovate and offer new features 

and functionality. 

7. Together IDT and PLX dominate the PCle switch market, having a combined market 

share exceeding 80%. These extraordinarily high market shares and concentration levels 

render IDT's acquisition ofPLX presumptively unlawful under the relevant case law and 

the U.S. Department of Justice and Federal Trade Commission Horizontal Merger 

Guidelines ("Merger Guidelines"). 

8. Effective entry or expansion into the PCle switch market is unlikely in response to a 

small but significant price increase because there are significant barriers to entry. PCle 

switches are complex integrated circuits and developing switches with the necessary 

features and functionality to meet customers' requirements is an expensive and timeconsuming endeavor. 

9. The proposed acquisition will eliminate IDT's only significant competitor, resulting in 

higher prices, reduced innovation, and inferior customer service. Indeed, both IDT and 

its customers predict higher prices, lower quality, and reduced innovation because of the 

acquisition. 

BACKGROUND 

A. Respondents 

10. Respondent, IDT, is a corporation existing and doing business under and by virtue of the 

laws ofthe State of Delaware, with its office and principal place of business located at 

6024 Silver Creek Valley Road, San Jose, California. For the fiscal year ended April 1, 

2012, IDT had revenues of$526.7 million. IDT is the number two supplier in the PCle 

switch market, behind PLX. 

11. Respondent PLX is a corporation existing and doing business under and by virtue of the 

laws of the State of Delaware, with its office and principal place of business located at 

870 W. Maude Avenue Sunnyvale, California 94085. PLX reported sales revenues of 

$115.8 million in 2011, of which it attributed to PCle switches. With about 

200 employees, PLX designs and develops . ClfCUltS that perform critical system 

connectivity functions including, but not limited to, connecting various input-output 

devices to x86 CPUs made by Intel and other manufacturers. PLX is the number one 

supplier in the PCle switch market. 

B. PCI Express and PCle Switches 

12. PCI Express is used in a wide range of computers, from consumer laptops and desktops 

to enterprise data servers, in consumer, server, and industrial applications, as a 

motherboard-level interconnect (to link motherboard-mounted peripherals), a passive 

3 
backplane interconnect and as an expansion card interface for add-in boards. The PCle 

bus serves as the primary motherboard-level interconnect, connecting the host systemprocessor with both integrated and add-on peripherals. The first generation PCle 

standard was established in 2002 to replace PCI and PCI-X, used in computers since the 

early 1990s. 

13. PCle switches have connections (known as "lanes") controlled by the switch that connect 

root complexes (processors and their accompanying chip sets) to end points using the 

PCle protocol. The switches function something like railroad switches by multiplying 

the paths over which the data packets, like train cars, can travel. The end points can be 

any number of input/output ("1/0") devices, such as network cards, storage devices, or 

hard disk drives, among others. 

14. PC Ie switches are the most cost-effective approach to provide appropriate connection 

between subsystems in complex multi-chip computing systems, without impeding the 

native performance of the underlying devices. 

15. IDT and PLX's customers incorporate PCle switches into a variety of computing 

applications such as servers and storage arrays. PCle switches are small, relatively 

inexpensive parts that are designed into much larger and more expensive products. PCle 

switches, which are sold for anywhere between few dollars to as much as one hundred 

dollars, are often incorporated into enterprise computing devices that cost thousands of 

dollars to build. Customers design PCle switches into their high-end computing systems 

as part oftheir design engineering process. Re-engineering these complex computing 

systems to eliminate the need for a PCle switch is both costly and time-consuming. For 

most customers, no other products are reasonably interchangeable with PCle switches, 

and customers would not tum to alternate products in the face of a small but significant 

price increase. 

c. Jurisdiction 

16. Respondents IDT and PLX are, and at all relevant times have been, engaged in commerce 

or in activities affecting commerce, within the meaning of the Clayton Act. The 

proposed merger constitutes an acquisition under Section 7 ofthe Clayton Act. 

D. The Proposed Transaction 

17. IDT proposes to acquire all the common stock ofPLX for approximately $330 million, in 

a cash and stock deal- $3.50 and 0.525 shares ofIDT for each share ofPLX (the 

"Acquisition"). 

4 
COMPETITIVE EFFECTS 

A. Price Competition 

18. The Acquisition likely will substantially lessen competition in the market for PCIe 

switches by eliminating head-to-head competition between the two primary suppliers and 

creating a near-monopoly. Customers also view IDT and PLX as the only significant 

suppliers of PC Ie switches. . 

19. Given the near-monopoly position that a merged IDTIPLX will enjoy, it is likely that the 

Acquisition will eliminate actual, substantial, and direct competition between IDT and 

PLX, including competition on price. The parties' own testimony and documents provide 

strong support for this conclusion. For IDT's Matt J a leader of the PCIe 

switch sales unit admitted: 

an to a n""rTl(,'lI 

PLX, Mr. Jones provided a more colorful description of 

this head-to-head price competition, complaining that the customer was using IDT as a 

"price hammer" against PLX. 

20. IDT's business records repeatedly describe fierce competition with PLX, underscoring 

the pricing pressure IDT faces from its main rival. For example, a_ 2011 IDT 

email regarding a loss to PLX at_ explained that one of the reasons PLX won this 

business over IDT was because PLX was pricing approximately I percent lower than 

IDT. In tum, IDT approved lower pricing for an opportunity in March 2012 in order to 

"beat PLX." 

21. In summer 2011, IDT's CEO lamented that one of the reasons PLX would not sell to IDT 

was because PLX was experiencing "design win success" against IDT. He then told his 

senior management that "we need to start beating them [PLX] up a little. Let's take the 

off." In this he his 

22. Not surprisingly, PLX's internal documents tell a similar 

Dave then Schmitt to avoid 

23. This price competition between IDT and PLX runs across all generations of PC Ie 

switches. F~ in. 2011, PLX's head of sales approved al% price 

reduction to_ in the face of competition from a comparable IDT 2nd 

PCIe switch. In October a PLX sales ·ve noted 

, a 

pricing for a 3rd generation PCIe switch opportunity with 

"we could lose this to IDT" as the reason for the aggressive price discount. 

5 
vein, in. 2012, PLX approved lower prices forll on a 3rd generation PCle switch 

due to price competition from IDT. 

24. IDT and PLX are both well aware that customers leverage them against one another in 

order to obtain better and lower prices. While pursuing a particular PC Ie switch 

sales IDT executive concern that the ", .. " .... ",.1-".,,,", 

could be 

-

wondered 

price." PLX Director of PC Ie switches responded, "I wouldn't be surprised if 

they were and agree to lower margins to take the socket away .... I would." 

25. Customers' reactions to the announcement ofthe Acquisition provide further evidence 

that the Acquisition will result in higher prices. For example, during a Mayl 2012 

meeting with PLX, one customer voiced the concern that IDT would likely raise PC Ie 

switch prices after the acquisition due to its dominant position. Likewise, in a May I 

20 . PLX's Western Regional Sales manager reported that a_ was worried that the Acquisition would lead to higher prices. 

B. Innovation Competition 

26. The Acquisition is likely to result in a loss of innovation by removing a key incentive to 

add new features to the parties' PCle switch families: competitive pressure from the other 

firm's product development. This loss in innovation competition represents a significant 

harm to customers in the PCle switch market, many of whom value innovation 

competition as much as price competition. 

27. As the two primary competitors (and innovators) in the PCIe switch market, IDT and 

PLX monitor and respond to each other's product developments. They regularly 

compare their existing and upcoming products to their rivals' on "roadmaps" that 

describe switch offerings. Over the past several years, successful innovation by one firm 

has often spurred the other firm to follow suit. One needs look no further than the 

development history of the various generations of PC Ie switches for evidence of this 

phenomenon. IDT was the first company to develop 2nd generation PC Ie switches; PLX 

followed soon thereafter. For 3rd generation PCle switches, the parties reversed roles: 

PLX brought its switches to market ahead ofIDT. 

28. The innovation rivalry drives IDT and PLX to add important new features to their PCIe 

switches thus driving innovation in the PCIe switch market. When PLX began offering 

non-transparent bridging on its 2nd generation PCle switches, IDT began losing sales to 

PLX due to the popularity ofthis feature. IDT responded by incorporating this feature 

into a new family of 2nd generation PC Ie switches. 

29. IDT's PCIe switch innovations have spurred PLX in a similar fashion. PLX responded to 

IDT's innovation by incorporating a feature known as spread spectrum clocking isolation 

into its 3rd generation PCle switches after losing several opportunities to IDT for 2nd 

generation PCIe switches. When IDT won a switch opportunity, PLX also responded to 

6 
losing by introducing the multicast feature to its 2nd generation PCle switches because it 

"didn't want to lose any more [2nd generation] opportunities." PLX responded again to 

an IDT innovation by incorporating an industrial temperature feature into certain 2nd 

generation PCle switches "in order to unseat IDT as the incumbent PCle switch supplier" 

at industrial temperature accounts. 

C. Competition in Customer Support 

30. The Acquisition also threatens to reduce the merged firm's incentives to provide 

customer support and maintain the quality of its switch offerings. For complex products 

such as PCle switches, high-quality support is critical for most customers. Throughout 

the design process, customers rely heavily on IDT and PLX for various forms of support, 

including engineering consultations, test cards, and debugging assistance. To meet their 

customers' needs, IDT and PLX must provide sample parts, maintain a well-trained 

engineering staff, and supply expensive testing equipment such as evaluation boards. 

This type of support requires a significant commitment of resources. In the absence of 

competitive pressure from a close rival, the resulting monopolist will have greater 

freedom to reduce the resources it allocates to customer support. 

31. PLX has used customer support as a competitive tactic to build customer loyalty and keep 

IDT from making inroads with those customers. In. 2011, a PLX sales 

representative working with III noted, "we have to find a way to support their 

development. This IS our way to keep IDT out [of] III·" (Emphasis in original). III 

months later, in light of news of an impending PCIe switch launch from IDT, the same 

sales representative proposed providing product samples free of charge tolll noting "it 

will go a long way to building good will withlll engineering." The competitive 

pressure from IDT also spurred PLX to fix errors in PCle switches more rapidly. 

32. IDT documents foretell the Acquisition's likely impact on customer service. Historically, 

IDT has often been willing to loan evaluation boards, expensive testing equipment, 

without charge to customers as a means of differentiating themselves from PLX. 

However, in recent IDT emailsdiscussingarequestforthissortofequipment.anIDT 

sales person indicated that ifhe "knew the PLX acquisition was a done deal" he would 

charge the customer for the equipment. 

THE RELEVANT MARKETS 

A. Product Market 

33. The development and sale of PC Ie switches is the relevant product market for analyzing 

the competitive effects of the Acquisition. 

34. IDT and PLX's internal documents consistently treat PCle switches as a discrete market. 

Multiple presentations from both IDT and PLX calculate market shares, identify 

competitors, and discuss business strategies in a PCIe switch market. 

7 
B. Geographic Market 

35. For the purposes of this Complaint, the relevant geographic market for PCIe switches is 

worldwide. IDT and PLX have customers around the world. The larger customers 

themselves have worldwide operations with locations spread around the globe. Given the 

value of the product relative to its weight, shipping costs are negligible. Moreover, 

average prices for PCIe switches are comparable throughout the world. 

MARKET STRUCTURE 

36. The PCIe switch market has approximately $85-100 million in sales per year, with 

expectations that the market will grow to over $124 million by 2015. 

37. Currently, PLX and IDT are the number one and number two providers of PC Ie switches, 

respectively. IDT's internal business documents estimate that PLX has approximately 

69% of the PCIe switch market and IDT has approximately 31 %. In an email exchange 

discussing whether to continue competing with PLX or to acquire it, IDT's CEO 

described the difference as one of"2 strong players vs. one monopoly." An investment 

banking presentation prepared for IDT likewise described PLX as having "a duopoly 

position in the increasingly important PCIe space." Unsurprisingly, PLX's senior 

executives have expressed similar viewpoints: PLX's former CEO Ralph Schmidt 

observed that the Commission's investigation of the Acquisition "was not unexpected as 

we have two dominant competitors combining." 

38. PCIe switch competitors such as Pericom, Texas Instruments, ASMedia, NVIDIA, 

Emulex, and MicroniVirtensysrepresent a marginal competitive fringe at best. Pericom 

currently offers only a handful of smaller, i.e., those with eight or fewer lanes, 1 st and 2nd 

generation PCIe switches. Texas Instruments offers only one small 1 st generation PCIe 

switch. NVIDIA only sells a limited number oflegacy 2nd generation PCIe switches with 

its· and is now using III switches in its products, and 

sells a limited line of 2nd PCIe 

any 

o other firm currently sells PCle switches. 

39. For most customers, IDT and PLX are the only companies that make PCIe switches that 

meet their requirements. In turn, IDT and PLX routinely are the only companies 

responding to requests for quotes or proposals for PCIe switches. Moreover, most 

customers do not view the PCle switches offered by fringe competitors as substitutes for 

the PCIe switches offered by IDT and PLX. 

MARKET CONCENTRATION 

40. The market for PCIe switches is highly concentrated. The Merger Guidelines measure 

concentration using the Herfindahl-Hirschman Index ("HHI"). Under that test, a merger 

is presumed likely to create or enhance market power (and presumptively illegal) when 

the post-merger HHI exceeds 2,500 and the merger increases the HHI by more than 200 

8 
points. Here, the Acquisition increases concentration in the relevant market for PCle by 

2,859 points to a HHI level of7,482, creating a substantially more concentrated market. 

These post-merger PCIe switch market concentration levels, as well as the increase in 

concentration produced by the Acquisition, greatly exceed where a transaction is 

presumed to produce anticompetitive effects. Under the Merger Guidelines and case law, 

these concentration levels establish a presumption that the Acquisition will lead to 

anticompetitive harm. The HHI figures are summarized in the following table. 

PCIe Switch Market Concentration 

PCIe Switch 

Competitor 

Pre-Acquisition Market Share Post-Acquisition Market Share 

PLX 63.40% 

IDT 22.55% 85.95% 

Pericom 

NVIDIA 

Emulex 

Texas Instruments 

Pre-Acquisition IllII = 4623 

Post-Acquisition IllII = 7482 

Change in IllII = 2,859 

41. These market concentration figures likely understate the competitive harm resulting from 

the Acquisition. As described, supra ~ 38, Texas Instruments and Pericom do not 

3rd generation PCle switches or those with large lane counts and 

a 2nd . PCle switch for its own 

customers can 

switches. 

ENTRY BARRIERS 

42. Neither entry by new firms nor expansion by the fringe competitors will occur in a 

timely, likely, or sufficient manner to avert the Acquisition's anticompetitive effects. 

43. New entry or meaningful expansion into the relevant market is difficult and expensive, 

and thus unlikely, due to the high level of expertise that is required to develop PCle 

switches that meet customers' requirements. PLX recognizes that the complexity of PC Ie 

switches serves as an entry barrier to the relevant market, describing a PCIe switch as "a 

sophisticated product not many people can do." 

9 
44. The high cost of entry by new firms or expansion by the fringe competitors serves as 

another barrier to entry or expansion into the relevant product market. Entry with even a 

single PCIe switch would cost several million dollars. These costs constitute a significant 

barrier to entry in the context of a market with current sales of $1 00 million dollars or 

less. Notably, PLX recognizes that the high cost of developing a PCIe switch is a barrier 

PLX's interim CEO detailed this barrier in an email to one of his 

45. The high cost of entry is magnified because an entrant would likely need to develop a 

broad product portfolio of PC Ie switches to compete effectively with IDT and PLX. The 

breadth ofIDT and PLX's product portfolios allow them to compete for, and capture, a 

much larger portion of the total available PCIe switch market than fringe competitors or 

potential entrants. It also enhances their reputation among customers. Only IDT and 

PLX have the broad portfolios to compete for most PCIe switch opportunities. The 

fringe firms in the market lack broad product portfolios and have not grown significantly 

in the last several years. 

46. In light of these advantages, it is not surprising that PLX's interim CEO, Dave Raun, 

detailed in a 2009 email that "one of the barriers to entry is the requirement for a broad 

product line." Mr. Raun further highlighted that: potential entrants to the relevant market 

need to develop all three generations of PC Ie switches, all of which according to Mr. 

Raun "requires a big investment." IDT and PLX have already made significant 

investments into developing these portfolios. Any potential entrant would thus need to 

develop a full family of PC Ie switches across multiple generations in order to compete 

effectively against IDT and PLX. The risks of making this investment are substantial, as 

it can take a significant amount of time before determining whether a new product will 

achieve success, and the investment associated with any failed entry attempts would 

largely be unrecoverable. 

47. Beyond the challenges of expertise and money, even if a new entrant were confident that 

it could overcome IDT and PLX's significant incumbency advantages, developing a PCIe 

switch is time consuming. Since new PCIe switches must be backwards compatible with 

previous generations, firms that wish to develop the newest-generation PCIe switches 

must also ensure those switches meet all of the prior generations' specifications. 

Completing the necessary design and testing to ensure this compatibility prolongs the 

development process. As a result, even the best-positioned putative entrants would need 

at least two years to develop market-reid PCIe switches. In fact, even with its proven 

expertise, it has taken IDT longer than ye~~.l~.~~=~Jlrst 3

rd generation PCIe 

switch family of products, at a cost of at 1east_. 

EFFICIENCIES 

48. Any pro competitive efficiencies from the Acquisition will not outweigh its likely 

anticompetitive effects. The merger of the two leading competitors in the PCIe switch 

market threatens consumers with higher prices, reduced innovation, and inferior customer 

service. Under the Merger Guidelines, "the greater the potential adverse competitive 

10 
effect of a merger, the greater must be the cognizable efficiencies, and the more they 

must be passed through to consumers." IDT's projected cost savings fall far short of this 

standard. 

49. Even if the Court were to credit all ofIDT's efficiency claims, the projected savings are 

insufficient to justify a merger to near-monopoly in the PC Ie switch market. The high 

market concentration levels presented in this case require IDT to show credible 

efficiencies of an extraordinary nature. Under the case law and the Merger Guidelines, 

efficiencies almost never justify a merger to monopoly or near-monopoly. 

50. In addition, only efficiencies that are specifically produced by the Acquisition should be 

credited. The vast majority of the parties' anticipated efficiencies fail this test. For 

example, more than half of IDT' s projected efficiencies are savings associated with the 

divestiture ofPLX's Teranetics business. Since PLX has already entered into an 

agreement to divest the Teranetics business, which will occur regardless ofthe 

Acquisition'S outcome, a sizable . of the total efficiencies will occur 

even if the ·sition does not. 

51. not verifiable. For example,_ 

IS 

from efficiencies will have to be revised downward. 

VIOLATIONS 

Count I -- Illegal Acquisition 

IDT admits that 

the total savings 

52. The allegations contained in Paragraphs 1-51 are repeated and realleged as though fully 

set forth here. 

53. The Acquisition, if consummated, would substantially lessen competition or tend to 

create a monopoly in violation of Section 7 of the Clayton Act, 15 u.S.C. § 18, and 

Section 5 ofthe Federal Trade Commission Act, 15 U.S.C. § 45. 

Count II - Unfair Method of Competition 

54. The allegations contained in Paragraphs 1-51 are repeated and realleged as though fully 

set forth here. 

55. The Acquisition agreement constitutes an unfair method of competition in violation of 

Section 5 ofthe FTC Act, as amended, 15 U.S.c. § 45. 

11 
NOTICE 

Notice is hereby given to the Respondents that the twentieth day of May, 2013, at 10:00 a.m. 

is hereby fixed as the time, and Federal Trade Commission offices, 600 Pennsylvania Avenue, 

N.W., Room 532, Washington, D.C. 20580, as the place when and where an evidentiary hearing 

will be had before an Administrative Law Judge of the Federal Trade Commission, on the 

charges set forth in this complaint, at which time and place you will have the right under the 

Federal Trade Commission Act and the Clayton Act to appear and show cause why an order 

should not be entered requiring you to cease and desist from the violations of law charged in the 

complaint. 

You are notified that the opportunity is afforded you to file with the Commission an answer to 

this complaint on or before the fourteenth (14th) day after service of it upon you. An answer in 

which the allegations of the complaint are contested shall contain a concise statement ofthe facts 

constituting each ground of defense; and specific admission, denial, or explanation of each fact 

alleged in the complaint or, if you are without knowledge thereof, a statement to that effect. 

Allegations of the complaint not thus answered shall be deemed to have been admitted. 

If you elect not to contest the allegations of fact set forth in the complaint, the answer shall 

consist ofa statement that you admit all of the material facts to be true. Such an answer shall 

constitute a waiver of hearings as to the facts alleged in the complaint and, together with the 

complaint, will provide a record basis on which the Commission shall issue a final decision 

containing appropriate findings and conclusions and a final order disposing of the proceeding. In 

such answer, you may, however, reserve the right to submit proposed findings and conclusions 

under Rule 3.46 of the Commission's Rules of Practice for Adjudicative Proceedings. 

Failure to file an answer within the time above provided shall be deemed to constitute a waiver 

of your right to appear and to contest the allegations of the complaint and shall authorize the 

Commission, without further notice to you, to find the facts to be as alleged in the complaint and 

to enter a final decision containing appropriate findings and conclusions, and a [mal order 

disposing of the proceeding. 

The Administrative Law Judge shall hold a prehearing scheduling conference no later than ten 

(10) days after the Respondents file their answers. Unless otherwise directed by the 

Administrative Law Judge, the scheduling conference and further proceedings will take place at 

the Federal Trade Commission, 600 Pennsylvania Avenue,N.W., Room 532, Washington, D.C. 

20580. Rule 3.21(a) requires the parties' counsel to meet as early as practicable before the prehearing scheduling conference (but in any event no later than five (5) days after the Respondents 

file their answers). Rule 3.31 (b) obligates counsel for each party, within five (5) days of 

receiving the Respondents' answers, to make certain initial disclosures without awaiting a 

discovery request. 

12 
NOTICE OF CONTEMPLATED RELIEF 

Should the Commission conclude from the record developed in any adjudicative proceedings 

in this matter that the Acquisition challenged in this proceeding violates Section 7 of the Clayton 

Act, as amended, or Section 5 of the FTC Act, as amended, the Commission may order such 

relief against Respondents as is supported by the record and is necessary and appropriate, 

including, but not limited to: 

1. If the Acquisition is consummated, divestiture or reconstitution of all associated and 

necessary assets, in a manner that restores two or more distinct and separate, viable 

and independent businesses in the relevant markets, with the ability to offer such 

products and services as PLX and IDT were offering and planning to offer prior to the 

Acquisition. 

2. A prohibition against any transaction between IDT and PLX that combines their 

businesses in the relevant markets, except as may be approved by the Commission. 

3. A requirement that, for a period of time, respondents provide prior notice to the 

Commission of acquisitions, mergers, consolidations, or any other combinations of their 

businesses in the relevant market with any other company operating in the relevant 

market. 

4. A requirement to file periodic compliance reports with the Commission. 

5. Whatever additional relief the Commission deems necessary to restore competition 

lost as a result of respondents' anticompetitive transaction or to restore PLX as a 

viable, independent competitor in the relevant market. 

IN WITNESS WHEREOF, the Federal Trade Commission has caused this complaint to be 

signed by its Secretary and its official seal to be hereto affixed, at Washington, D.C., this eighteenth 

day of December, 2012. 

By the Commission, Commissioner Ohlhausen recused. 

13 

Donald S. Clark 

Secretary