UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON SEATTLE DIVISION
DEFENDANTS' FIRST SET OF INTERROGATORIES TO PLAINTIFF FEDERAL TRADE COMMISSION
Pursuant to Federal Rules of Civil Procedure 26(b) and 33
PRELIMINARY STATEMENT
Defendant Cascade Retail Holdings Inc. ("Cascade") and Defendant Pinnacle Market Group Inc. ("Pinnacle") (collectively, "Defendants"), by and through their undersigned counsel, hereby propound the following interrogatories to Plaintiff Federal Trade Commission ("FTC" or the "Commission") pursuant to Rules 26(b) and 33 of the Federal Rules of Civil Procedure.
These interrogatories are served in connection with the FTC's Motion for Preliminary Injunction Pursuant to Section 13(b) of the Federal Trade Commission Act, 15 U.S.C. § 53(b), filed on June 23, 2025, and the related administrative proceeding pending before the Commission, FTC Docket No. 9438.
The FTC is required to answer each interrogatory fully, in writing, under oath, within fourteen (14) days of service of these interrogatories, or such other time as may be ordered by this Court given the expedited discovery schedule established in connection with the evidentiary hearing on the FTC's Motion for Preliminary Injunction currently scheduled for September 8, 2025. Defendants respectfully note that the expedited nature of these proceedings, and the need to ensure that Defendants have a full and fair opportunity to prepare their defense, necessitates prompt and complete responses.
The schedule for discovery in this matter was established by the Court at the Initial Case Management Conference held on July 14, 2025. Defendants serve these interrogatories consistent with that scheduling order and with the mutual obligations of the parties to engage in good-faith discovery to prepare for the September 8, 2025 evidentiary hearing.
DEFINITIONS
As used in these interrogatories, the following terms shall have the meanings set forth below. These definitions are intended to be read broadly and inclusively, consistent with the Federal Rules of Civil Procedure and the interests of full and fair discovery.
1. "You," "Your," "the Commission," or "FTC" means the Federal Trade Commission, including its Bureau of Competition (including the Mergers IV Division), Bureau of Economics, individual Commissioners, staff members, agents, consultants, retained experts, and any other person or entity acting on behalf of, at the direction of, or in coordination with the Federal Trade Commission in connection with the investigation of the Transaction, the filing of the Administrative Complaint, the filing of the Complaint in this action, or any other matter relating to this proceeding.
2. "Cascade" means Cascade Retail Holdings Inc., a Delaware corporation headquartered at 2200 Westlake Avenue North, Suite 3400, Seattle, Washington 98109, trading on the Nasdaq Stock Market under ticker symbol "CSRT," including its subsidiaries, divisions, affiliates, predecessors, successors, and assigns, including CRH Merger Sub Inc., a wholly-owned subsidiary of Cascade formed for purposes of effecting the Transaction.
3. "Pinnacle" means Pinnacle Market Group Inc., a Delaware corporation headquartered at 500 East 6th Street, Suite 800, Austin, Texas 78701, trading on the Nasdaq Stock Market under ticker symbol "PMGI," including its subsidiaries, divisions, affiliates, predecessors, successors, and assigns.
4. "Transaction" or "Merger" means the proposed acquisition by Cascade, through CRH Merger Sub Inc., of one hundred percent (100%) of the outstanding common stock of Pinnacle Market Group Inc. pursuant to the Agreement and Plan of Merger dated March 14, 2025, as amended, for aggregate merger consideration of approximately $4.7 billion (approximately $26.85 per share of Pinnacle common stock), as reported on the Hart-Scott-Rodino Notification and Report Form filed with the FTC and the Antitrust Division of the United States Department of Justice.
5. "Relevant Market" means the product and geographic market alleged in the Complaint, specifically "online marketplace platform services for third-party sellers in the United States," as defined and described in Paragraphs 35 through 55 of the Complaint.
6. "Complaint" means the Complaint for Temporary Restraining Order and Preliminary Injunction Pursuant to Section 13(b) of the Federal Trade Commission Act filed by the FTC on June 23, 2025, in this action, Case No. 2:25-cv-01087-RAJ, United States District Court for the Western District of Washington, Seattle Division.
7. "Administrative Complaint" means the Administrative Complaint issued by the Commission on June 20, 2025, in the Matter of Cascade Retail Holdings Inc. and Pinnacle Market Group Inc., FTC Docket No. 9438, alleging violations of Section 7 of the Clayton Act, 15 U.S.C. § 18, and Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45.
8. "Online Marketplace Platform" means any platform, website, mobile application, or digital service that facilitates transactions between third-party sellers and consumers by providing a venue or infrastructure for listing, discovery, payment processing, and fulfillment of goods or services, as that term is used or implied in the Complaint and the Administrative Complaint.
9. "GMV" or "Gross Merchandise Value" means the total dollar value of merchandise sold through a given platform over a specified period, before deducting returns, cancellations, shipping costs, or platform fees, unless otherwise specified.
10. "Take Rate" means the percentage of GMV retained by a marketplace platform as revenue from commissions, referral fees, listing fees, fulfillment fees, advertising fees, subscription fees, or other charges imposed on sellers in connection with the listing, sale, or fulfillment of goods or services through the platform.
11. "Third-Party Seller" means any person, entity, sole proprietorship, partnership, limited liability company, corporation, or other business organization that lists, offers for sale, or sells goods or services through an online marketplace platform and is not the owner, operator, or affiliate of such platform.
12. "Document" or "Documents" shall have the broadest meaning permitted under Federal Rule of Civil Procedure 34(a) and shall include, without limitation, all writings, recordings, and electronically stored information ("ESI") of every kind and description, including but not limited to emails, letters, memoranda, reports, studies, analyses, spreadsheets, databases, presentations, charts, graphs, notes, drafts, calendars, diaries, logs, recordings, photographs, video recordings, text messages, instant messages (including messages transmitted via Meridian Solutions, Northgate Data Systems, or similar platforms), voicemail messages, social media posts, and metadata associated with any of the foregoing.
13. "Communication" means any oral, written, or electronic exchange of information between two or more persons, including but not limited to emails, letters, memoranda, text messages, instant messages, meeting minutes, presentations, phone calls, video conferences, in-person meetings, and any record or summary thereof.
14. "Identify" (with respect to a person) means to state the person's full legal name, current or last-known employer and job title, current or last-known business address, and current or last-known business telephone number and email address, to the extent known.
15. "Identify" (with respect to a document) means to state the document's date (or approximate date), author(s), recipient(s), and all persons copied, the type of document (e.g., email, memorandum, report, spreadsheet), and a brief description of the general subject matter of the document, with sufficient detail to enable identification and retrieval.
16. "Describe" means to set forth all material facts, circumstances, and details with specificity sufficient to allow Defendants to fully understand the basis for the FTC's position, including the identity of all persons involved, all documents relied upon, and all analytical steps taken.
17. "Vertex Commerce" means Vertex Commerce Inc., a Delaware corporation headquartered at 2100 North First Street, San Jose, California 95131, including its subsidiaries, divisions, and affiliates, and including the online marketplace platform operated by Vertex Commerce.
18. "Nomad Shops" means Nomad Shops LLC, a Delaware limited liability company headquartered at 45 Main Street, Suite 700, Brooklyn, New York 11201, including its subsidiaries, divisions, and affiliates, and including the online marketplace platform operated by Nomad Shops.
19. "Brevity" means Brevity Social Commerce Inc., a Delaware corporation headquartered in Los Angeles, California, including its subsidiaries, divisions, and affiliates, and including the social commerce platform launched by Brevity in 2023.
20. "Trove" means Trove Marketplace Inc., a Delaware corporation headquartered in Chicago, Illinois, including its subsidiaries, divisions, and affiliates, and including the online marketplace platform launched by Trove in 2024.
21. "IOSA" means the Independent Online Sellers Alliance, a 501(c)(6) trade association headquartered at 1025 Vermont Avenue NW, Suite 600, Washington, D.C. 20005, including its officers, directors, employees, members, agents, and representatives, and including any counsel retained by IOSA.
22. "Dr. Hargrove" means Dr. Nathaniel Hargrove, a staff economist in the Bureau of Economics of the Federal Trade Commission, who has conducted economic analysis in connection with the FTC's investigation of the Transaction and this proceeding.
23. "Dr. Keenan" means Dr. Wallace Keenan, a testifying economic expert retained by the FTC in connection with this proceeding, affiliated with Thornfield Research Group, located at 1515 Wilson Boulevard, Suite 300, Arlington, Virginia 22209.
24. "HHI" or "Herfindahl-Hirschman Index" means the standard measure of market concentration calculated as the sum of the squares of the percentage market shares of all firms participating in the relevant market, as described in the U.S. Department of Justice and Federal Trade Commission Merger Guidelines (2023).
25. "Second Request" means the Request for Additional Information and Documentary Material issued by the FTC to Cascade and Pinnacle on May 7, 2025, File No. 251-0089, pursuant to Section 7A(e) of the Clayton Act, 15 U.S.C. § 18a(e), and the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, 15 U.S.C. § 18a, and the rules promulgated thereunder, 16 C.F.R. § 803.20.
INSTRUCTIONS
The following instructions apply to each of the interrogatories set forth below and shall be read in conjunction with the Definitions set forth above.
1. Each interrogatory shall be answered separately and fully in writing, under oath, in accordance with Rule 33(b) of the Federal Rules of Civil Procedure. Each answer shall include all information within the FTC's knowledge, possession, custody, or control, including information known to or reasonably available to the FTC's Commissioners, staff members, agents, consultants, and retained experts, whether located at the FTC's headquarters, regional offices, or any other location.
2. If the FTC objects to any interrogatory or any part thereof, the FTC shall state with specificity the grounds for each objection, including the particular privilege or protection asserted, and shall answer the interrogatory to the fullest extent not objectionable. An objection to any part of an interrogatory shall not be deemed a basis for refusing to answer the remainder of the interrogatory.
3. If the FTC's answer to any interrogatory requires reference to or identification of documents, the FTC shall identify each such document with sufficient particularity consistent with the definition of "Identify" set forth above, and shall produce such documents in response to Defendants' concurrent First Set of Requests for Production of Documents, served on even date herewith, or as otherwise required by the Federal Rules of Civil Procedure and the Court's scheduling order.
4. If the FTC contends that any interrogatory is vague, ambiguous, or otherwise unclear, the FTC is instructed to contact undersigned counsel at Calderwood & Harkness LLP to discuss the interrogatory prior to interposing any objection. Defendants are committed to resolving any good-faith disputes regarding the scope or clarity of these interrogatories through the meet-and-confer process.
5. These interrogatories are continuing in nature pursuant to Federal Rule of Civil Procedure 26(e). The FTC is obligated to seasonably supplement its answers if additional or corrective information becomes available at any time prior to or during the evidentiary hearing scheduled for September 8, 2025, and thereafter as required by the Federal Rules of Civil Procedure.
6. The total number of interrogatories served herein is twenty-five (25), consistent with the presumptive limit set forth in Federal Rule of Civil Procedure 33(a)(1) and any applicable Local Rules of the Western District of Washington or orders of this Court. Each discrete subpart of an interrogatory is not intended to constitute a separate interrogatory, but rather is intended to delineate the categories of information sought in response to a single interrogatory topic.
INTERROGATORIES
INTERROGATORY NO. 1: Identification of Relevant Product Market
State and describe the complete factual basis for the FTC's allegation in the Complaint that the relevant product market is "online marketplace platform services for third-party sellers in the United States," including but not limited to:
(a) the specific characteristics, features, functionalities, or attributes that the FTC contends distinguish "online marketplace platform services" from other forms of e-commerce retail, including but not limited to direct-to-consumer e-commerce, social commerce, hybrid retail platforms that combine first-party and third-party sales, and subscription-based commerce platforms;
(b) the methodology used by the FTC, its staff economists, and its retained experts to determine the boundaries of this product market, including any qualitative or quantitative analyses performed;
(c) whether the FTC applied a hypothetical monopolist test (also known as a "SSNIP test" or "small but significant and non-transitory increase in price" test) and, if so, the parameters of that test, the assumptions made, the data inputs used, and the results obtained, including the magnitude of the hypothetical price increase tested, the relevant price or fee subject to the increase, and the estimated rate of customer substitution;
(d) whether the Commission, its staff, or its experts considered and rejected any alternative product market definitions at any stage of the investigation, including but not limited to broader markets encompassing all e-commerce retail, all online platforms facilitating commerce, or narrower markets limited to specific categories of marketplace platform services, and, if so, the reasons for rejecting each such alternative definition.
INTERROGATORY NO. 2: Geographic Market Definition
State and describe the complete factual basis for the FTC's allegation in the Complaint that the relevant geographic market is the United States, including but not limited to:
(a) whether the FTC considered international online marketplace platforms, including but not limited to platforms headquartered or operating outside the United States, as potential competitive constraints on the merging parties or other participants in the alleged relevant market, and, if so, the identity of each such platform considered and the conclusions reached;
(b) whether any cross-border marketplace platforms — that is, platforms that enable sellers located in the United States to reach consumers located outside the United States, or that enable sellers located outside the United States to reach consumers located within the United States — were included in or excluded from the FTC's geographic market analysis, and the factual and analytical reasons for each such inclusion or exclusion;
(c) any analysis performed by the FTC, its staff, or its experts regarding geographic segmentation within the United States, including whether the FTC considered whether competitive conditions differ materially across regions, metropolitan areas, or states within the United States.
INTERROGATORY NO. 3: Identification of Market Participants and Market Shares
Identify each entity that the FTC considers to be a participant in the alleged relevant market of "online marketplace platform services for third-party sellers in the United States," and for each such entity, state:
(a) the entity's full legal name, the city and state of its headquarters, and the name of its parent company or ultimate corporate parent (if any);
(b) the entity's market share as calculated by the FTC, including the specific metric or metrics used to calculate such share (e.g., GMV, platform revenue, number of active third-party sellers, number of transactions, number of unique buyers), and, if multiple metrics were considered, the results under each metric and the reason the FTC selected the metric reflected in the Complaint;
(c) the time period or periods for which the market share was calculated, including whether the share is based on annual, quarterly, or other data, and the specific calendar year(s) or fiscal year(s) used;
(d) the data sources relied upon by the FTC in calculating each entity's market share, including whether the data was obtained from the entity itself, from public filings, from industry reports, from third-party data providers, from the Second Request, or from other sources;
(e) the specific GMV, revenue, or other numerical figures used in calculating the market shares attributed to Cascade (operating through its CascadeMarket platform) at 8.2%, Pinnacle at 30.1%, Vertex Commerce at 35.7%, Nomad Shops at 14.6%, and "All Others" at 11.4%, as alleged in Paragraph 42 of the Complaint, including the dollar amounts, units, or other absolute figures corresponding to each percentage share.
INTERROGATORY NO. 4: Exclusion of Direct E-Commerce from Market Definition
State and describe the complete factual basis for the FTC's decision to exclude from the relevant product market each of the following categories of online retail, and for each category, identify all documents, data, analyses, expert opinions, and testimony relied upon in making such determination:
(a) direct-to-consumer e-commerce retail, including Cascade's CascadeDirect.com platform, which generated approximately $9.8 billion in gross revenue in fiscal year 2024, and any other direct-to-consumer e-commerce operation in which a retailer sells its own inventory directly to consumers through a proprietary website or application;
(b) social commerce platforms, including Brevity Social Commerce Inc., which launched its social commerce platform in 2023 and which enables transactions between sellers and buyers through social media-integrated storefronts and live-streaming commerce functionality;
(c) direct-to-consumer aggregator platforms, including any platform that aggregates multiple brands or retailers into a single consumer-facing storefront but does not operate as a traditional third-party seller marketplace;
(d) any other form of online retail, digital commerce, or commerce-enabling platform that the FTC considered for inclusion in the relevant product market but ultimately excluded, including but not limited to wholesale platforms, business-to-business marketplaces, auction platforms, classified-listing platforms, and dropshipping platforms.
INTERROGATORY NO. 5: HHI Calculations
Set forth in detail the methodology and calculations underlying the FTC's allegation in Paragraph 47 of the Complaint that the pre-merger Herfindahl-Hirschman Index (HHI) in the alleged relevant market is 2,361 and the post-merger HHI would be 2,856, with an increase (delta) of 495, including:
(a) the individual market share figures (expressed as percentages) used for each market participant in the pre-merger HHI calculation, and the identity of each market participant corresponding to each share figure;
(b) the mathematical calculation of each firm's contribution to the pre-merger HHI, showing the squaring of each market share and the sum of the resulting values;
(c) any rounding conventions applied to individual market shares or to the HHI figures themselves, and the impact of any such rounding on the final reported HHI values;
(d) the source or sources of data underlying each market share figure used in the HHI calculation, including whether data was obtained directly from market participants, from public filings, from third-party data vendors, or from other sources;
(e) whether these HHI calculations account for the two-sided nature of marketplace platforms, including whether the market shares and HHI figures reflect activity on only the seller side of the platform, only the buyer side, or both sides, and whether the FTC considered any adjustment to standard HHI methodology to account for the multi-sided characteristics of marketplace platforms.
INTERROGATORY NO. 6: Two-Sided Platform Analysis
State whether and to what extent the FTC's market definition and competitive effects analysis accounts for the two-sided nature of online marketplace platforms, including:
(a) whether the FTC considered the competitive effects of the Transaction on both seller-side participants (i.e., third-party sellers) and buyer-side participants (i.e., consumers), and, if the FTC's analysis focused on only one side of the platform, the reasons for limiting the analysis in that manner;
(b) how the FTC assessed indirect network effects between sellers and buyers, including whether the FTC analyzed the degree to which an increase in sellers on a platform attracts additional buyers, and vice versa, and the significance of such network effects for the competitive analysis of the Transaction;
(c) whether the FTC considered the analytical framework set forth by the United States Supreme Court in Ohio v. Halcyon Corporation, 585 U.S. 529 (2018), including the Court's holding that credit card networks constitute two-sided transaction platforms for which the relevant market must encompass both sides, and, if so, how the FTC applied or distinguished that framework in the context of online marketplace platforms;
(d) whether Dr. Hargrove or Dr. Keenan performed any cross-platform analysis assessing the interactions between the seller side and the buyer side of marketplace platforms, including any analysis of whether an increase in take rates on the seller side would lead to a reduction in seller participation that would, in turn, reduce buyer engagement and overall platform GMV, and the results of any such analysis.
INTERROGATORY NO. 7: Theory of Competitive Harm — Unilateral Effects
State and describe the complete factual basis for the FTC's allegation that the Transaction would enable the combined entity to exercise undue leverage over third-party sellers, including:
(a) the specific mechanisms by which the FTC contends take rates would increase post-merger, including whether the FTC contends that the combined entity would raise take rates through increased commission rates, new or increased fees, reduced seller subsidies or promotional programs, degradation of seller services, or other means;
(b) any diversion ratio analysis conducted by the FTC or its experts showing the degree to which Cascade and Pinnacle sellers would divert to each other's platforms absent the merger, including the estimated diversion ratios between CascadeMarket and Pinnacle in both directions, the data and methodology used to estimate those ratios, and any diversion ratios estimated between the merging parties and Vertex Commerce, Nomad Shops, or other market participants;
(c) any upward pricing pressure ("UPP") analysis or Gross Upward Pricing Pressure Index ("GUPPI") calculations performed by the FTC, Dr. Hargrove, Dr. Keenan, or any other person, including the estimated magnitude of the UPP or GUPPI, the inputs used, and the assumptions made;
(d) any analysis of seller multi-homing behavior across CascadeMarket, Pinnacle, Vertex Commerce, Nomad Shops, and other platforms, including the percentage of sellers on CascadeMarket that also sell on Pinnacle, the percentage of sellers on Pinnacle that also sell on CascadeMarket, and the percentage of sellers on either platform that also sell on Vertex Commerce, Nomad Shops, or other platforms;
(e) any evidence or analysis regarding the ability of sellers to discipline take rate increases by shifting sales volume to rival platforms, including any analysis of seller switching costs, the time required for a seller to establish a comparable presence on a rival platform, and any evidence regarding historical instances in which sellers have shifted sales volume in response to take rate changes.
INTERROGATORY NO. 8: Theory of Competitive Harm — Coordinated Effects
State and describe the complete factual basis for the FTC's allegation or contention that the Transaction would increase the risk of coordinated effects in the alleged relevant market, including:
(a) the specific factors the FTC contends would facilitate coordination among market participants post-merger, including whether the FTC contends that the reduction in the number of significant competitors, increased market transparency, product or service homogeneity, multi-market contacts, or other structural factors would facilitate tacit or express coordination;
(b) any analysis of pricing transparency, product homogeneity, demand stability, the frequency and observability of competitive interactions, or other conditions relevant to the likelihood of coordinated behavior that the FTC relies upon in support of its coordinated effects theory;
(c) the identity of any firms that the FTC contends would participate in or facilitate coordinated behavior post-merger, whether through tacit parallelism, conscious pricing alignment, or other means;
(d) whether the FTC contends that the presence of Vertex Commerce at 35.7% market share, as alleged in the Complaint, would facilitate or inhibit post-merger coordination, including whether Vertex Commerce's position as the largest market participant by share would serve as a disruptive force that would undermine coordinated behavior or, alternatively, as a focal point that would facilitate such coordination.
INTERROGATORY NO. 9: "Trend Toward Concentration" Allegation
State and describe the complete factual basis for the FTC's allegation in the Complaint that there is a "trend toward concentration" in online marketplace platforms, including:
(a) the time period over which the FTC measured or observed such concentration trend, including the earliest and most recent data points used;
(b) the specific HHI values, market share data, or other concentration metrics used to demonstrate the trend, presented on a year-by-year or period-by-period basis;
(c) any specific transactions, mergers, acquisitions, market exits, business failures, or other events that the FTC contends have contributed to increasing concentration in the alleged relevant market during the relevant time period;
(d) whether the FTC's trend analysis accounts for the entry of new marketplace platforms, including but not limited to Brevity Social Commerce Inc. (which launched its social commerce platform in 2023) and Trove Marketplace Inc. (which launched its online marketplace platform in 2024), and, if the FTC's analysis does account for such entries, the impact those entries had on the measured trend in concentration.
INTERROGATORY NO. 10: Entry and Expansion Analysis
State and describe the complete factual basis for the FTC's analysis of barriers to entry and expansion in the alleged relevant market, including:
(a) each barrier to entry identified by the FTC, described with specificity, including but not limited to network effects, economies of scale, seller acquisition costs, buyer acquisition costs, brand recognition, technology development costs, fulfillment infrastructure requirements, regulatory barriers, and any other barrier identified;
(b) the FTC's assessment of the time required for a new entrant to achieve a competitively significant scale, the capital investment required to enter the market, and the likelihood that entry would be timely, likely, and sufficient to counteract the anticompetitive effects alleged in the Complaint, consistent with the framework set forth in the 2023 Merger Guidelines;
(c) any analysis of the entry of Brevity Social Commerce Inc. and Trove Marketplace Inc. and the significance, if any, that the FTC ascribes to those entries, including any assessment of the current and projected market shares of those entrants, the pace of their growth, the competitive significance of their platform offerings, and whether such entries are "timely, likely, and sufficient" to offset the alleged competitive harm from the Transaction;
(d) any analysis of the ability of existing marketplace platforms, including but not limited to Vertex Commerce and Nomad Shops, to expand their capacity, attract additional sellers, invest in improved platform features, and otherwise increase their competitive significance in response to a post-merger take rate increase by the combined entity;
(e) any analysis of social commerce platforms, including but not limited to Brevity Social Commerce Inc. and other social media-integrated commerce platforms, as potential entrants into the alleged relevant market or as existing competitive constraints on participants in the alleged relevant market, including any analysis of the degree to which social commerce platforms offer third-party sellers an alternative venue for reaching consumers.
INTERROGATORY NO. 11: Dr. Nathaniel Hargrove's Economic Analysis
Describe in detail the economic analysis performed by Dr. Nathaniel Hargrove, Bureau of Economics staff economist, in connection with the FTC's investigation of the Transaction and this proceeding, including:
(a) the specific questions, issues, or hypotheses that Dr. Hargrove was asked or directed to analyze by the Bureau of Competition, the Bureau of Economics, any Commissioner, or any other person at the FTC;
(b) the economic methodology or methodologies employed by Dr. Hargrove, including any econometric models, simulations, or theoretical frameworks used;
(c) the data sources relied upon by Dr. Hargrove, including data obtained from Cascade, Pinnacle, third parties, public sources, or internal FTC databases;
(d) the conclusions reached by Dr. Hargrove, stated with specificity;
(e) any memoranda, reports, presentations, spreadsheets, models, or other documents prepared by Dr. Hargrove or under his supervision in connection with the investigation of the Transaction;
(f) whether Dr. Hargrove's analysis, conclusions, or any memorandum or presentation summarizing his analysis was presented to the Commission or any individual Commissioner prior to the Commission's vote to authorize the filing of the Complaint, and, if so, the date(s) of such presentation and the identity of the Commissioner(s) or staff members to whom the presentation was made.
INTERROGATORY NO. 12: Dr. Wallace Keenan's Retention and Scope
State the terms and scope of the FTC's retention of Dr. Wallace Keenan of Thornfield Research Group as the FTC's testifying economic expert in this proceeding, including:
(a) the date on which Dr. Keenan was retained or engaged by the FTC, including whether Dr. Keenan was retained before or after the Commission's vote to authorize the Complaint;
(b) the specific issues, questions, or topics that Dr. Keenan has been retained to address, including but not limited to market definition, market concentration, competitive effects (unilateral and coordinated), entry analysis, efficiencies, and any other topic;
(c) all data, documents, deposition transcripts, declarations, investigational hearing transcripts, and other materials provided to Dr. Keenan by the FTC, identified with sufficient particularity;
(d) all instructions, guidance, direction, or suggestions given to Dr. Keenan by FTC staff, counsel, or any other person regarding the scope, methodology, assumptions, or conclusions of his analysis;
(e) whether Dr. Keenan has been asked to opine on market definition, competitive effects, efficiencies, entry and expansion, the two-sided nature of marketplace platforms, or any other specific topic, and a description of each opinion he has been asked to render;
(f) the total compensation paid or expected to be paid to Dr. Keenan and Thornfield Research Group in connection with this engagement, including hourly rates, retainer amounts, and an estimate of total fees and expenses through the conclusion of the September 8, 2025 evidentiary hearing.
INTERROGATORY NO. 13: Complaining Third-Party Sellers
Identify each third-party seller who communicated with, complained to, or provided information to the FTC regarding the Transaction or any competitive concern relating to the Transaction, the alleged relevant market, or the conduct of Cascade or Pinnacle, and for each such seller, state:
(a) the seller's full legal name and current business address;
(b) the marketplace platform or platforms on which the seller operates, including specifically whether the seller operates on CascadeMarket, Pinnacle, Vertex Commerce, Nomad Shops, Brevity, Trove, or any other platform, and the approximate annual GMV generated by the seller on each such platform;
(c) the date(s) and substance of each communication between the seller and the FTC, described with sufficient detail to allow Defendants to understand the nature and content of each communication;
(d) whether the seller was contacted by the FTC (whether through a Civil Investigative Demand, voluntary access letter, telephone call, email, or other means) or contacted the FTC on its own initiative, and the identity of the FTC staff member(s) who participated in each communication;
(e) whether the seller is a member of the Independent Online Sellers Alliance (IOSA) or has any other affiliation with IOSA, including whether IOSA referred the seller to the FTC or coordinated the seller's communication with the FTC.
INTERROGATORY NO. 14: Communications with IOSA
Identify each communication between the FTC (including any Commissioner, Bureau of Competition staff member, Bureau of Economics staff member, Office of the General Counsel staff member, or any other agent or representative of the FTC) and the Independent Online Sellers Alliance (IOSA), or its counsel, Galloway & Peck LLP (including Martina Galloway or any other attorney at that firm), regarding the Transaction, the alleged relevant market, or any competitive condition relating thereto, including:
(a) the date of each communication;
(b) the identity of each participant in the communication, including the name and title of each FTC representative and each IOSA or Galloway & Peck representative;
(c) the form of communication (e.g., in-person meeting, telephone call, video conference, email, letter, or other written or electronic communication);
(d) the substance of each communication, described with sufficient detail to allow Defendants to understand the topics discussed and any positions, arguments, or information exchanged;
(e) whether IOSA or Galloway & Peck provided any data, studies, reports, surveys, declarations, white papers, position papers, or other materials to the FTC in connection with any such communication, and, if so, identify each such document by date, author, title, and subject matter.
INTERROGATORY NO. 15: Communications with Vertex Commerce Inc.
Identify each communication between the FTC (including any Commissioner, staff member, or agent) and Vertex Commerce Inc. or any officer, director, employee, agent, or outside counsel of Vertex Commerce, regarding the Transaction, competitive conditions in the alleged relevant market, or any issue relating to this proceeding, including:
(a) the date and form of each communication (e.g., in-person meeting, telephone call, video conference, email, letter, Civil Investigative Demand, voluntary access letter, subpoena, or other means);
(b) the identity of each participant in the communication, including the name and title of each FTC representative and each Vertex Commerce representative;
(c) the substance of each communication, described with sufficient detail to allow Defendants to understand the topics discussed and any positions, arguments, data, or information exchanged;
(d) whether Vertex Commerce provided any data, financial information, declarations, analyses, economic studies, or other documents to the FTC in connection with any such communication, and, if so, identify each such document by date, author, title, and subject matter.
INTERROGATORY NO. 16: Communications with Nomad Shops LLC
Identify each communication between the FTC (including any Commissioner, staff member, or agent) and Nomad Shops LLC or any officer, director, member, employee, agent, or outside counsel of Nomad Shops, regarding the Transaction, competitive conditions in the alleged relevant market, or any issue relating to this proceeding, including:
(a) the date and form of each communication (e.g., in-person meeting, telephone call, video conference, email, letter, Civil Investigative Demand, voluntary access letter, subpoena, or other means);
(b) the identity of each participant in the communication, including the name and title of each FTC representative and each Nomad Shops representative;
(c) the substance of each communication, described with sufficient detail to allow Defendants to understand the topics discussed and any positions, arguments, data, or information exchanged;
(d) whether Nomad Shops provided any data, financial information, declarations, analyses, economic studies, or other documents to the FTC in connection with any such communication, and, if so, identify each such document by date, author, title, and subject matter.
INTERROGATORY NO. 17: Consideration of Procompetitive Efficiencies
State whether the FTC, during its investigation of the Transaction, analyzed or considered any procompetitive efficiencies that might result from the Transaction, including:
(a) any analysis of the parties' claimed merger-specific efficiencies of $340 million annually by Year 3 post-closing, as presented to the FTC during the Second Request investigation, including the FTC's assessment of the magnitude, verifiability, and merger-specificity of each component of the claimed efficiencies;
(b) any analysis of the claimed $195 million in logistics and fulfillment cost savings resulting from the integration of Pinnacle sellers into Cascade's 22-warehouse fulfillment network (branded "CascadeFulfill"), including any assessment of whether such savings would be passed through to sellers or consumers;
(c) any analysis of the claimed $145 million in technology and platform synergies, including savings from the consolidation of technology infrastructure, the elimination of duplicative software development, and the integration of Pinnacle's proprietary seller analytics tools into CascadeMarket's platform;
(d) the reasons, if any, the FTC concluded that such efficiencies are not merger-specific, not verifiable, not cognizable, or insufficient to rebut the presumption of anticompetitive harm, including identification of all documents, analyses, and expert opinions relied upon in reaching such conclusion;
(e) whether the FTC's efficiency analysis was presented to the Commission prior to its 3–2 vote to authorize the filing of the Complaint and the Administrative Complaint, and, if so, the form and substance of that presentation.
INTERROGATORY NO. 18: Consideration of Pinnacle's Competitive Trajectory
State whether the FTC, during its investigation, analyzed or considered the competitive trajectory of Pinnacle Market Group Inc. over the period from 2022 through the present, including:
(a) any analysis of Pinnacle's decelerating GMV growth rate, which declined from approximately 28% year-over-year in fiscal year 2022 to approximately 9% year-over-year in fiscal year 2024, including the FTC's assessment of the causes and significance of this deceleration;
(b) any analysis of Pinnacle's increasing seller churn rate, which increased from approximately 12% in fiscal year 2022 to approximately 21% in fiscal year 2024, including the FTC's assessment of the causes and competitive significance of this trend;
(c) any assessment of whether Pinnacle is a "weakening" or "flailing" competitor whose competitive significance is declining relative to other participants in the alleged relevant market;
(d) any analysis of whether Pinnacle's competitive significance is likely to diminish materially absent the Transaction, including any projection of Pinnacle's future market share, GMV, seller base, or financial performance in a "but-for world" in which the Transaction does not occur;
(e) any documents, memoranda, reports, presentations, or analyses reflecting the FTC's consideration of these issues, including any documents prepared by the Bureau of Competition, the Bureau of Economics, or any retained expert.
INTERROGATORY NO. 19: Failing Firm Defense Evaluation
State whether the FTC evaluated, considered, or rejected a failing firm defense or a weakened competitor defense in connection with the Transaction, including:
(a) whether the FTC assessed Pinnacle's financial viability absent the merger, including any analysis of Pinnacle's revenue trends, profitability, cash flow, debt obligations, and ability to sustain operations as a going concern;
(b) whether the FTC identified any alternative acquirers for Pinnacle or any of its assets, including whether the FTC examined whether Pinnacle made good-faith efforts to elicit reasonable alternative offers, and the identity of any alternative acquirers considered;
(c) whether the FTC assessed Pinnacle's ability to reorganize successfully in bankruptcy under Chapter 11 of the United States Bankruptcy Code, and, if so, the analysis performed and conclusions reached;
(d) the complete factual basis for any conclusion by the FTC that Pinnacle does not qualify for the failing firm defense or the weakened competitor defense, including all documents, analyses, data, and expert opinions relied upon in reaching such conclusion.
INTERROGATORY NO. 20: Commission Vote and Deliberations
To the extent not protected by the deliberative process privilege or other applicable privilege, describe the process by which the Commission voted 3–2 to authorize the filing of the Complaint and the Administrative Complaint, including:
(a) the date or dates on which the Commission considered the staff's recommendation to challenge the Transaction, including any presentations, briefings, or meetings at which the recommendation was discussed;
(b) the identity of each Commissioner who voted in favor of authorization and the identity of each Commissioner who voted against authorization;
(c) whether any Commissioner who voted against authorization issued or made a dissenting statement, an explanation of vote, or any other written or oral statement setting forth the reasons for his or her dissent, and, if so, the substance of each such statement;
(d) whether any Commissioner who voted in favor of authorization conditioned his or her vote on specific terms, limitations, conditions, or understandings regarding the scope of the Complaint, the theory of competitive harm, or the relief sought.
INTERROGATORY NO. 21: Take Rate Analysis
State the complete factual basis for the FTC's allegation that the Transaction would lead to increased take rates for third-party sellers, including:
(a) the current take rates charged by CascadeMarket (which Defendants understand to be approximately 17% as of fiscal year 2024), Pinnacle (which Defendants understand to be approximately 16% as of fiscal year 2024), Vertex Commerce, and Nomad Shops, as determined by the FTC, including the specific fee components (e.g., referral fees, commissions, listing fees, fulfillment fees, advertising fees) included in the FTC's calculation of each platform's take rate;
(b) any analysis performed by the FTC or its experts projecting post-merger take rates for the combined entity, including the projected magnitude and timing of any take rate increase, and the projected impact on third-party sellers;
(c) the methodology used in any such projection, including any economic models, simulations, or theoretical frameworks applied, and the assumptions and data inputs used;
(d) any evidence that CascadeMarket or Pinnacle has historically raised take rates in response to reduced competitive pressure, increased market share, or any other factor, including the dates, magnitude, and circumstances of any such historical take rate increase;
(e) any analysis of contractual protections available to sellers that would constrain take rate increases, including any analysis of the duration, termination provisions, and pricing terms of standard seller agreements on CascadeMarket and Pinnacle, and the ability of sellers to terminate their platform agreements and migrate to alternative platforms in response to a take rate increase.
INTERROGATORY NO. 22: Seller Services and Innovation Impact
State and describe the complete factual basis for the FTC's allegation in the Complaint that the Transaction would result in "reduced seller services" and "diminished innovation" in the alleged relevant market, including:
(a) the specific seller services that the FTC contends would be reduced, degraded, or eliminated post-merger, including but not limited to fulfillment services, seller analytics tools, marketing and promotional services, customer service support, dispute resolution services, and any other services currently provided by CascadeMarket or Pinnacle to their third-party sellers;
(b) the specific innovations that the FTC contends would be diminished, delayed, or foregone as a result of the Transaction, including but not limited to new platform features, improvements to seller tools, enhancements to consumer experience, developments in fulfillment technology, and any other form of innovation;
(c) any evidence, data, analysis, expert opinion, or testimony supporting these contentions, including any historical examples of mergers in the online marketplace or technology sectors that the FTC contends resulted in reduced services or diminished innovation;
(d) any comparison of seller service quality, breadth, and depth across CascadeMarket, Pinnacle, Vertex Commerce, Nomad Shops, and other platforms in the alleged relevant market, including any ranking or assessment of relative service quality performed by the FTC or its experts.
INTERROGATORY NO. 23: Supply-Side Substitution Analysis
State whether the FTC considered supply-side substitution in defining the relevant product market, including:
(a) whether the FTC analyzed the ability of direct-to-consumer e-commerce retailers to enter or expand into marketplace platform services within a reasonably short period of time and at minimal incremental cost, and, if so, the conclusions reached;
(b) whether the FTC analyzed the ability of social commerce platforms, including but not limited to Brevity Social Commerce Inc., to function as marketplace platform services or to enter the marketplace platform segment, and, if so, the conclusions reached;
(c) whether the FTC analyzed the competitive constraint imposed by Cascade's direct e-commerce platform CascadeDirect.com on marketplace platform services, including whether the availability of CascadeDirect.com as an alternative channel for sellers affects the competitive dynamics of the alleged relevant market;
(d) the reasons the FTC included or excluded supply-side substitutes from the relevant product market, including any analysis of the speed, ease, and likelihood of supply-side entry, the capacity of potential supply-side entrants, and the competitive significance of supply-side substitution in constraining the pricing or conduct of marketplace platform participants.
INTERROGATORY NO. 24: Second Request Investigation
Describe the scope and results of the FTC's investigation conducted pursuant to the Second Request issued on May 7, 2025, File No. 251-0089, including:
(a) the approximate number of documents received from Cascade and the approximate number of documents received from Pinnacle in response to the Second Request, and the principal categories or types of documents received (e.g., ordinary course business documents, strategic planning documents, competitive analyses, pricing data, financial records, board materials);
(b) the number of third-party subpoenas, Civil Investigative Demands ("CIDs"), or voluntary access letters issued by the FTC in connection with the investigation, and the identity of each recipient of each such compulsory or voluntary process;
(c) the number of investigational hearings (depositions conducted under the FTC's compulsory process authority) or informal interviews conducted by the FTC in connection with the investigation, and the identity, title, and employer of each witness who testified or was interviewed;
(d) whether the staff of the Bureau of Competition recommended that the Commission challenge the Transaction and, if so, the date and substance of that recommendation, including the recommended form of challenge (i.e., administrative complaint, federal court complaint, or both);