A Publication of American University Washington College of Law

Congress’ Failure to Pass Antitrust Legislation Harms Litigation

Nicole is a 2L at WCL. She graduated from Boston University in 2022 with a bachelor’s and master’s degree in political science. After law school, she hopes to work on plaintiff’s side antitrust suits.

Currently, some of the most monumental antitrust cases are moving through the courts.  The federal government, through the Department of Justice (DOJ) and the Federal Trade Commission (FTC), has brought cases against big tech companies in an attempt to break up these monopolies.[1]  However, the success of these cases largely depends on whether Congress enacts antitrust legislation.

In 1890, Congress passed the Sherman Act, the first antitrust law.[2]  Later, in 1914, Congress passed the Clayton Act, which expanded upon and bolstered the Sherman Act,[3] and then amended this Act in 1976 to add the Hart-Scott-Rodino Antitrust Improvements Act.[4]  Almost fifty years later, Congress has failed to pass any updates to the Clayton Act despite many critiques that the 1976 version fails to meet the challenges of modern technology and business.[5]

Senator Amy Klobuchar, the lead Democrat on the Judiciary Subcommittee on Antitrust, Competitive Policy, and Consumer Rights, introduced the Competition and Antirust Law Enforcement Reform Act (CALEA) in February 2021.[6]  CALEA modifies the standard for an unlawful acquisition under the Clayton Act and strengthens DOJ and the FTC’s ability to enforce antitrust laws.[7]  CALEA is the most comprehensive and progressive antitrust bills introduced, and if passed, it would shift the way federal agencies enforce antitrust laws and therefore have a dynamic impact on antitrust lawsuits.  For example, CALEA proposes an amendment in the Clayton Act’s language that would considerably change which potential mergers the government can challenge.  Specifically, the proposed removal of “substantially” from the statute lowers the required standard.  Therefore, with this change, the DOJ and the FTC could sue more businesses and companies engaging in anticompetitive practices that previously fell through the cracks of the Clayton Act.

However, Congress has yet to pass CALEA and recently failed to pass two bipartisan antitrust bills.[8]  A bipartisan group of congressmembers supported the American Innovation and Choice Online Act (AICOA) and the Open App Markets Act (OAMA), which targeted big technology giants and introduced rules to prohibit platforms from unfairly preferencing their own products.[9]  After House and Senate leaders introduced the legislation in the 2022 end-of-the-year spending package, Majority Leader Chuck Schumer failed to bring the legislative package for a vote.[10]

If Congress does no pass updated antitrust legislation, the DOJ and the FTC will continue to rely on outdated language that does not meet the current market.  Many have criticized FTC Chairwoman Lina Kahn for the FTC’s losing streak.[11]  Since Khan’s appointment, the FTC sued to block more than three dozen proposed mergers.[12]  This resulted in 17 settlements, 17 deals abandoned by the companies, and one where the FTC conceded in court.[13]  Although Khan and the FTC have pursued ambitious cases, they are also up against outdated antitrust language.  Partisanship is not an issue with antitrust legislation as seen with the bipartisan support of AICOA and OAMA.[14]  Therefore, to impact antitrust litigation, Congress must act now and enact new antitrust legislation.

 

[1] See generally U.S. v. Google LLC, No. 20-cv-3715 (APM), 2023 WL 6291644, at *1 (D.D.C. Sept. 8, 2023); F.T.C. v. Meta Platforms, Inc., No. 20-3590 (JEB), 2023 WL 3092651, at *1 (D.D.C. Apr. 26, 2023).

[2] The Antitrust Laws, FTC, https://www.ftc.gov/advice-guidance/competition-guidance/guide-antitrust-laws/antitrust-laws.

[3] Id.

[4] Id.

[5] See, e.g., A. Douglas Melamed, Antitrust Law and Its Critics, 83 Antitrust L. J. 269 (2021).

[6] S. 225, 117th Cong. § 2 (2021).

[7] Id. 

[8] Eric Cortellessa, Schumer Kills Bill Big Tech Feared Most, But Boosts Budgets of Agencies Targeting Them, TIME (Dec. 22, 2022, 3:42 PM), https://time.com/6243256/schumer-kills-antitrust-big-tech-bills/.

[9] The American Innovation and Choice Online Act & Open App Market Act,  Public Citizen (July 14, 2022), https://www.citizen.org/article/the-american-innovation-and-choice-online-act-open-apps-market-act/.

[10] Id.

[11] Brian Fung & Catherine Thorbecke, Lina Khan’s rise was heralded as an antitrust revolution. Now she has to pull it off, CNN (Oct. 17, 2023, 7:58 PM), https://www.cnn.com/2023/10/16/tech/lina-khan-risk-takers/index.html.

[12] Id.

[13] Id.

[14] The American Innovation and Choice Online Act & Open App Market Act,  Public Citizen (July 14, 2022), https://www.citizen.org/article/the-american-innovation-and-choice-online-act-open-apps-market-act/.

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