Throughout the 2020 presidential campaign, candidates and commentators alike noted the recent and unprecedented growth in economic concentration across American industries. They vigorously debated—and continue to debate—the role enforcement of our antitrust laws should play in shaping the economy.
Some believe that aggressive antitrust policies should rein in dominant companies and their mergers. Others have advocated that the focus on consumer welfare should shift to protecting small businesses, and that the antitrust laws should also be used to promote innovation as well as the welfare of workers and racial equity. As a new presidential administration begins, the focus shifts to what we can expect next.
Watch for Key Appointments
President Biden has announced that he will select Merrick Garland to serve as attorney general. Garland, the widely respected former chief judge of the U.S. Court of Appeals for the District of Columbia Circuit, was once an antitrust professor at his alma mater, Harvard Law School. Garland also authored in 1986 a still-relevant article, “Antitrust and State Action: Economic Efficiency and the Political Process,” that exemplifies the restraint in his approach. (96 Yale L.J. 486)
While on the bench, Garland’s antitrust decisions were seen as being neither pro-plaintiff nor pro-defendant, reflecting instead a consistently measured application of antitrust law. Despite Garland’s long history with antitrust issues, his moderate approach offers few clues to the direction antitrust enforcement will take under his leadership.
The leadership of the Biden transition team, however, offers more insight. Bill Baer, who headed the DOJ Antitrust Division during part of the Obama administration, has led the team with Gene Kimmelman, a critic of Big Tech.
News reports speculate that candidates in the running to be assistant attorney general for the Antitrust Division include several who served in the division or in the Federal Trade Commission under President Obama.
All reports emphasize that antitrust enforcement is expected to be a significant focus of the Biden-Harris administration. Given the recent resignation of FTC Chair Joseph Simons, President Biden will also have a Democratic FTC majority to carry forth his initiatives once his replacement (and possibly others) is confirmed.
Prepare for Increased Enforcement Activity
So what do we expect? Businesses should prepare for increased activity on multiple fronts spanning increased civil antitrust enforcement, in particular against dominant firms; stepped up merger enforcement, including efforts to block the acquisitions of nascent competitors; and an increase in criminal investigations and actions, including involving labor practices.
On the civil front, the Biden administration will inherit the investigation of Big Tech—including Google, Facebook, and Apple—that began under the Trump administration. In fact, after years without a monopolization lawsuit, the justice department filed suit against Google just two weeks before the election. Most expect that the Biden administration will vigorously prosecute the case, possibly even expanding the scope of its claims.
We also expect additional lawsuits to be forthcoming as evidenced by the FTC and the 48 state attorneys general suing Facebook for illegal monopolization and to unwind Facebook’s WhatsApp and Instagram acquisitions.
Equally important changes on the civil front are in the works. Many commentators, including Baer, have criticized the courts for placing too great a burden on antitrust plaintiffs. We can expect that Congress will look to pass laws that clarify or lessen the proof that the government or private plaintiffs must put forth.
While on the campaign trial, Sen. Amy Klobuchar (D-Minn.) had a well-developed antitrust platform that she is well-positioned to carry forward as the ranking Democrat on the Judiciary Committee’s antitrust subcommittee. New legislation could usher in an era of significantly increased litigation and greater uncertainty as the courts grapple with new laws.
We also can expect to see an uptick in merger enforcement. The Trump administration led to markedly low levels of merger enforcement and a reversal of the string of victorious Obama-era merger challenges.
The Biden administration likely sees merger enforcement as a tool for reshaping the American economy, including tackling what the Biden-Sanders Unity Task Force saw as “runaway corporate consolidation.” The task force recommended a review of mergers “to assess whether any have increased market concentration, raised consumer prices, demonstrably harmed workers, increased racial inequality, or reduced competition, and assign appropriate remedies.”
Many expect such reviews will target the Big Tech, pharmaceutical, health care, and agricultural industries. We also can expect that no deal will be too small to escape scrutiny, and that merger review will target the acquisitions of nascent competitors.
Expect More Prosecutions
On the criminal front, we can expect a reversal of the Trump administration’s downturn in cartel cases, criminal fines, and sentences. There will likely be a focus on individual accountability, including the prosecution of company officials.
There is one point of continuity—the Trump administration brought the first criminal case involving employment practices. We can expect a vigorous effort to criminally prosecute companies and individuals who engage in agreements not to poach one another’s employees or fix wages, salaries or other benefits.
These practices are viewed as restricting wages and preventing the movement of employees from one employer to another. An increase in these investigations and prosecutions is expected as part of a directive to regulators to consider the potential effects of these practices on the labor market, on low-income and racially marginalized communities, and on racial equity.
While we cannot be certain of any of these predictions, there is one thing we can all feel confident about—the next four years of antitrust enforcement will not be dull.
This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.
Leslie E. John leads Ballard Spahr’s Antitrust and Competition group. She concentrates on antitrust litigation and counseling, representing clients in federal and state courts and before the DOJ and FTC.