David B. Hamilton, Brent F. Powell, and Matthew F. Tilley of Womble Bond Dickinson provided insight into recent changes in the antitrust law landscape as a part of MSBA’s 2021 Legal Summit Series. Among other things, the presentation touched on recent executive and legislative actions, and litigation and compliance trends generally.
Hamilton kicked off the discussion with a summary of recent developments from the executive branch, specifically President Biden’s recent choices of Jonathan Kanter and Lina Khan to lead the Justice Department’s Antitrust Division and the Federal Trade Commission (respectively). Prior to leading the Division, Kanter ran a boutique antitrust law firm focused on enforcement at the state and federal level, and Khan gained notoriety in the antitrust law world for her criticism of the existing antitrust law enforcement framework. President Biden also appointed Tim Wu to the National Economic Council, which is mainly used by the President for considering economic policy matters. Prior to working for the Administration, Wu taught antitrust law at Columbia University, and his published work has shaped regulatory discussions around competition policy in the labor and technology sectors.
In July 2021, President Biden also issued Executive Order 14036, encouraging the leading antitrust agencies to increase agency rulemakings and enforcement efforts in certain market sectors. Sectors identified in the executive order include technology, labor, agricultural, and healthcare (including prescription drugs, hospital consolidation, and insurance).
Hamilton also noted that a variety of new antitrust law developments have emerged out of Congress with a number of bills gaining national attention. For example, Senator Amy Klobuchar proposed the Competition and Antitrust Law Enforcement Act, which would provide federal agencies with increased funding and strengthen prohibitions on certain mergers. Similarly, Representative David Cicilline introduced the American Choice and Innovation Online Act, which would prevent online platforms from using their market power to favor their own products while disadvantaging other businesses that rely on those same platforms.
Powell went on to explain how litigation trends have played a role in the changing antitrust law landscape with new enforcement cases and private plaintiff actions challenging anticompetitive mergers and employment compensation restrictions. Powell also highlighted how state attorneys general have added to antitrust litigation trends with state-led lawsuits addressing issues like price-fixing in the e-commerce business, market monopolization in the digital platform space, and anticompetitive practices in the search and advertising industry. Other trends included new antitrust considerations in the employment and labor space, with the Department of Justice investigating illegal wage fixing and no-poach agreements.
A few other antitrust law cases highlighted during the presentation are listed below.
- Steves & Sons, Inc. v. JELD-WEN, Inc., 988 F.3d 690 (4th Cir. 2021)(affirming divestiture in a private antitrust lawsuit that claimed a 2012 merger in the door manufacturing industry was violative of the Clayton Act)
- In re Google Digit. Advert. Antitrust Litig., No 20-CV-03556-BLF, 2021 WL 2021990(N.D. Cal. May 13, 2021)(alleging monopoly in digital advertising services)
- Epic Games, Inc. v. Apple Inc., 493 F. Supp. 3d 817 (N.D. Cal. 2020)(alleging that Apple’s practice of taking thirty percent of in-app purchases violates the Sherman Act)
- NCAA v. Alston, No. 20-512 (U.S. June 21, 2021)(prohibiting caps on education related benefits for student-athletes and subjecting the NCAA’s student-athlete compensation restrictions to the “rule for reason” standard)
Tilley closed out the presentation by discussing key compliance considerations. Just as the largest market participants face litigation and compliance risk, so too do small businesses. For example, increasing scrutiny in the mergers and acquisitions space affects both big and small companies. While there are certain dollar thresholds that trigger pre-merger reporting requirements, mergers can nonetheless be challenged as anticompetitive in instances where they may not meet statutory reporting thresholds.
Consequently, given recent executive and legislative actions, as well as current litigation trends, companies should seriously consider whether their business practices raise antitrust concerns and whether their compliance programs adequately address employee training and emerging antitrust law issues.
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