By: Breann Bell
In 2019, Congress opened a bipartisan investigation into the four major tech firms to address concerns about competition in digital markets and anticompetitive conduct.[1] Following the investigation, which included a hearing in which the CEOs of Apple, Alphabet (Google), Amazon, and Facebook were questioned by members of Congress about the practices and conduct of their respective businesses, the Subcommittee on Antitrust, Commercial, and Administrative Law published a report with drastic implications for government involvement in business.[2]
While governmental enforcement of antitrust laws has been minimal in past years, Congress’ recent report indicates a possible change in governmental enforcement of antitrust regulations as the report criticizes the lack of enforcement by the Department of Justice and the Federal Trade Commission for potential violations of the Robinson-Patman Act and the Sherman Act.[3] Critics of the current state of antitrust regulation express concerns over legislation, enforcement, and the judicial process.[4] Further, critics fear the power monopolies can have on competition, influencing worker conditions, creativity, competition, and pricing.[5] The recommendations made by the Subcommittee incorporate both legislative and enforcement reform that would address these concerns.[6]
The report indicates future change in antitrust regulation that may not only affect the policies and practices of big businesses, but also their overall composition.[7] The recommendations included legislative reform and the revival of antitrust enforcement.[8] If the recommendations are put in place in a next legislative session, businesses can expect a shift from the “consumer welfare” standard, put in place by the Supreme Court in Reitner v. Sonotone Corp.,[9] to a broad standard that will consider the effects a monopoly can have on various parties such as workers, startups, and consumers.[10] The recommendations offered by the House Judiciary Committee could help to combat anticompetitive practices and address common critiques of antitrust regulation.[11] It is the court’s interpretation of the legislation in creating or assessing the new standard that will make the difference.[12] As a result, the recommendations, if implemented, can be successful in diluting the power of big businesses only if there are judicial results in favor of those opposing big businesses.[13]
While the consumer welfare standard has limited the government regulation of businesses, the recommended reforms could lead to substantial changes in the practices, compositions, and policies of businesses – highlighting necessary changes for regarding oversight of mergers, tying, self-preferencing, predatory pricing, and refusal to deal practices. [14] The reform may broadly help protect “workers, entrepreneurs, independent businesses, open markets, a fair economy, and democratic ideals”,[15] however the changes for big businesses may be drastic.
As mergers will become under stricter review, it is likely for big businesses that government enforcement will call into question several mergers and businesses may be forced into divesture, as Microsoft almost was in 2001 when it was charged with antitrust violations.[16] Furthermore, the legislative initiatives will at the very least call for business to change their policies and practices such as self-preferencing and favoritism.[17] Finally, the promise for increased enforcement and increased funding as well as the possible establishment of bright-line rules and the consideration to override and clarify “problematic” court decisions will make it difficult for big businesses to be victorious if litigation ensues.[18]
[1] Staff of H.R. Comm. on Judiciary, 116th Cong., Subcommittee on Antitrust, Commercial, and Administrative Law 6 (2020), https://judiciary.house.gov/uploadedfiles/competition_in_digital_markets.pdf.
[2] See id. at 19-21.
[3] Id. at 402.
[4] See Greg Bensinger, Google Has Edge in Antitrust Fight, The New York Times (Oct. 21, 2020), https://www.nytimes.com/2020/10/21/opinion/google-justice-department-lawsuit.html?searchResultPosition=3 (acknowledging the legislative budget afforded to the Department of Justice, the lack of enforcement, and the monetary resources available to the Google’s legal team).
[5] See Katrina vanden Heuvel, In a House subcommittee’s report, a strong step toward an antitrust revival, Wash. Post (Oct. 13, 2020), https://www.washingtonpost.com/opinions/2020/10/13/house-subcommittees-report-strong-step-toward-an-antitrust-revival/
[6] See Staff of H.R. Comm. on Judiciary, supra note 1, at 19-21.
[7] See id. at 387-88 (indicating the need for more oversight of mergers and acquisitions).
[8] Id. at 20-21.
[9] 442 U.S. 330 (1979) (holding that consumers who suffer monetary loss due to antitrust violations have standing to bring a claim under § 4 of the Clayton Act).
[10] See Staff of H.R. Comm. on Judiciary, supra note 1, at 392; see also Adi Robertson & Russell Brandom, Congress releases blockbuster tech antitrust report, The Verge (Oct. 6, 2020), https://www.theverge.com/2020/10/6/21504814/congress-antitrust-report-house-judiciary-committee-apple-google-amazon-facebook; Lauren Feiner, Congress just finished its Big Tech antitrust report — now it’s time to rewrite the laws, CNBC (Oct. 7, 2020), https://www.cnbc.com/2020/10/07/after-congress-big-tech-antitrust-report-its-time-to-rewrite-the-laws.html.
[11] See vanden Heuvel, supra note 5 (emphasizing the importance of enforcement and investigation); see also Bensinger, supra note 4 (emphasizing the imbalance in financial and legal resources between Google’s legal team and the Justice Department’s antitrust division in the upcoming antitrust litigation).
[12] See Staff of H.R. Comm. on Judiciary, supra note 1, at 391.
[13] See id. at 392.
[14] See id. at 395-98.
[15] See id. at 392.
[16] United States v. Microsoft Corp., 253 F.3d 34, 106 (D.C. Cir. 2001).
[17] See Staff of H.R. Comm. on Judiciary, supra note 1, at 382-83.
[18] See id. at 394, 396-98.
