Three Must-Reads Ahead Of The ABA’s Spring Antitrust Meeting
As the American Bar Association (ABA) prepares to hold its annual Antitrust Spring Meeting this week, here are three must-reads on recently-proposed antitrust policy from Congress and the FTC:
1) Former DOJ Senior Economic Counsel Gregory Werden notes the FTC has “declared that the agency has, and will exercise, extraordinary powers that it never before asserted” in its updated Section 5 guidance that departs from “the usual antitrust standard.”
— Werden points out the Section 5 policy statement “declares that the FTC is free from the requirements of evidence and analysis that are imposed both on private antitrust plaintiffs and on the Department of Justice.”
— According to Werden, “the policy statement rejects the usual antitrust standard – the ‘rule of reason,’ which distinguishes between reasonable and unreasonable business practices. The Supreme Court recently described the rule of reason as a ‘fact-specific assessment’ designed to determine a practice’s ‘actual effect on competition.'”
— Werden adds: “the FTC is prepared to depart from the rule of reason in two fundamental ways: The FTC plans to condemn practices based on a fear that they could harm competition, rather than on concrete evidence that they have harmed competition, or are likely to do so. And the FTC plans to condemn practices on bases other than harm to competition.”
2) Outgoing FTC Commissioner Christine Wilson outlined recent FTC actions that have “erode[d] rules of the road, a central function of the rule of law.” According to Wilson, “Neo-Brandeisians have undermined transparency and predictability in other ways, as well. These actions erode certainty regarding the rules of the road, a central function of the rule of law. For example, the Neo-Brandeisians at the FTC have:
— Rescinded the Section 5 policy statement and foreshadowed a more expansive enforcement agenda while failing to issue a new policy explaining this agenda;
— Withdrawn support for the Vertical Merger Guidelines and characterized them as insufficiently aggressive, while declining to provide guidance on where the new lines will be drawn; and
— Failed to challenge mergers within the requisite statutory timeframes and instead issued threatening warning letters as waiting periods expire.”
3) Dr. Mark Jamison of the American Enterprise Institute warns that recently-proposed legislation like the Open App Markets Act (OAMA) could “introduce more vulnerabilities to our networks.”
— Jamison explains: “One implication of our research is that if the OAMA outlaws the platform features that consumers are demonstrating they like, one can expect fewer apps of the kinds consumers prefer, fewer qualified app developers, less app innovation, and less app consumption. On top of that, my colleague Shane Tews has repeatedly warned of the cybersecurity dangers of removing the vetting processes currently in place. Such a move would flood the marketplace with malware, introducing more vulnerabilities to our networks. Our elected officials would serve consumers and the American economy well by continuing to let consumers determine platform and app developer success and not imposing regulations founded on faulty assertions.”
Learn more about the issues posed by recent actions by the FTC and Congress here, here, and here.