In a recent article published on the U.S. Chamber of Commerce website, Sean Heather, the Senior Vice President of International Regulatory Affairs and Antitrust at the U.S. Chamber of Commerce, criticizes the Department of Justice's (DOJ) track record in antitrust cases and raises concerns about bias in legal proceedings.
Heather argues that antitrust cases require a thorough review of the facts and a balancing of interests. He acknowledges that routine business conduct can cause some harm to competition but also benefits consumers. The ultimate determination of whether business conduct violates antitrust laws should consider these factors, according to Heather.
The U.S. Department of Justice (DOJ) has recently accused tech giant Google, which holds a 90% market share in search, of using unfair tactics to maintain its dominant position. However, Google's lead lawyer, John Schmidtlein, has argued that Google Search's dominance is a result of its superior product compared to its competitors. Google has also emphasized that consumers have the option to easily switch to a different search engine if they prefer.
Additionally, the Federal Trade Commission (FTC) teamed up with more than a dozen state attorneys general last month to file an antitrust lawsuit against Amazon, alleging that the e-commerce giant has unlawfully leveraged its market dominance to eliminate potential competitors. The suit, which targets the parts of Amazon’s business that service consumers and sellers, is being actively fought by Amazon who argues that if the FTC gets its way, it would lead to a decrease in product variety, higher prices, slower deliveries for consumers, and limited choices for small businesses, adding that this outcome would contradict the intended purpose of antitrust laws.
One of Heather's main concerns is the shift in the DOJ's approach to antitrust law. He points out that Assistant Attorney General Jonathan Kanter, who leads the DOJ's Antitrust Division, supports a Neo-Brandeisian approach that emphasizes "market realities" rather than the traditional consumer welfare standard and rule of reason. This approach distances antitrust law from empirical economic analysis and the interests of consumers. Heather also mentions that some state Attorneys General have adopted this view.
However, despite this shift in approach, Heather highlights that the courts have not been quick to endorse it. The DOJ has recently experienced several litigation losses in cases involving cybersecurity, insurance reimbursement, virtual reality, and cloud gaming. Heather expresses concern that if the courts don't change their approach, the DOJ may face similar outcomes in the current antitrust cases against tech giants.
In the case against Alphabet and Google, Heather notes that a district court ruled against the government. The court emphasized the importance of evidence in litigation and highlighted the lack of evidence to support the government's claims. The ruling also emphasized the need to demonstrate how a company's competitive behavior harms competition, not just competitors.
Heather further criticizes the DOJ for attempting to prevent Google from offering evidence that its conduct improved its products and was not anticompetitive. This move raised concerns about due process and the government's ability to prevent courts from considering pro-competitive effects. Heather argues that such actions could lead to unfair default victories for the government.
Additionally, Heather points out that Assistant AG Kanter has opposed due process norms in international negotiations. He and FTC Chair Lina Khan urged the United States Trade Representative to abandon due process provisions in the United States-Mexico-Canada Agreement. These provisions require the government to preserve exculpatory evidence in competition investigations. Although the DOJ asked the court to overlook this protection, the court rejected the DOJ's attempts to bias the proceedings, upholding the Constitution and due process.
