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Justice Department Weighs in on Whether Politics Motivated the Lawsuit Against AT&T-Time Warner Merger



WASHINGTON, June 13, 2018 – Was a federal district court judge’s decision to permit AT&T’s merger with Time Warner a victory for the rule or law over politics – or was it instead another defeat for the consumer at the hand of ever-consolidating mega-entities?

That question permeated Tuesday’s conference on “Free Speech and Democracy in the Age of Platform Monopoly” hosted by the Open Markets Institute think tank – even before Judge Richard Leon ruled late in the date that AT&T may consummate its merger over the objection of the Justice Department.

Speaking in the morning, before Leon’s ruling, Assistant Attorney General Makan Delrahim said, “The career staff put together a straightforward consumer welfare analysis that showed that merger would unlawfully raise prices for cable TV subscribers, and harm online innovation.”

Delrahim called the merger an “anti-competitive acquisition,” accused AT&T of using it as a way to monopolize the pay TV business.

Rule of Law, or political meddling in antitrust enforcement?

The Trump administration position was supported by many left-leaning consumer groups, even as they warily considered the role that President Trump’s well-known aversion to CNN – which is owned by Time Warner – might have played in the decision to sue AT&T.

On the other hand, free market groups such as TechFreedom celebrated Judge Leon’s decision. President Berin Szoka released a statement celebrating the outcome of the merger case, and accusing the Trump administration of meddling in the law.

“Today’s decision is a victory for the rule of law,” said Szóka. “This lawsuit was never intended to do what antitrust is supposed to do: protect consumers from the abuse of market power…The Trump [Department of Justice’s] legal and economic theories were so baseless that the court went out of its way to urge the DOJ not to appeal or even to seek a stay upon appeal. This wasn’t a remotely political decision: it was simply an application of well-established antitrust principles to the facts of this case.”

“At least in antitrust law, the courts, not Trump officials, will have the final say on what the law really is,” said Szóka.

Dancing around the elephant in the room: Donald Trump’s personal vendettas

Delrahim denied any political involvement in Justice Department’s decision to bring the AT&T merger to court – and even expressed the importance of not allowing political viewpoints to interfere in antitrust enforcement.

Beyond his argument that this particular merger might squeeze out competition, Delrahim expressed concerns over the political landscape negatively influencing decisions in antitrust cases.

“When we were preparing our complaint in the AT&T Time Warner case, we received a curious request from an unnamed state antitrust enforcer,” Delrahim said.

“They told us that they would join our case if we provided written assurances that no divestiture of that transaction would go to Fox, or to Rupert Murdoch. They actually wanted to direct a divestiture based on the viewpoint of the buyer, not on what benefits competition or consumers, as defined by the consumer welfare standard.”

”We of course rejected that request because it would have been unconstitutional,” Delrahim said.

“Is that really where we want antitrust enforcement to go? To pick winners and losers based on ideology?” Delrahim said. “Political positions should have no role in determining the propriety of antitrust enforcement action.”

(Photo of Delrahim speaking at an antitrust division roundtable courtesy Department of Justice.)



‘Time is Now’ for Separate Big Tech Regulatory Agency, Public Interest Group Says

‘We need to recognize that absolutely the time is now. It is neither too soon nor too late.’



Photo of Harold Feld, senior vice president at Public Knowledge

WASHINGTON, June 21, 2022 – Public Knowledge, non-profit public interest group, further advocated Thursday support for the Digital Platform Commission Act introduced in the Senate in May that would create a new federal agency designed to regulate digital platforms on an ongoing basis.

“We need to recognize that absolutely the time is now. It is neither too soon nor too late,” said Harold Feld, senior vice president at Public Knowledge.

The DPCA, introduced by Senator Michael Bennet, D-CO., and Representative Peter Welch, D-VT., would, if adopted, create a new federal agency designed to “provide comprehensive, sector-specific regulation of digital platforms to protect consumers, promote competition, and defend the public interest.”

The independent body would conduct hearings, research and investigations all while promoting competition and establishing rules with appropriate penalties.

Public Knowledge primarily focuses on competition in the digital marketplace. It champions for open internet and has openly advocated for antitrust legislation that would limit Big Tech action in favor of fair competition in the digital marketspace.

Feld published a book in 2019 titled, “The Case for the Digital Platform Act: Breakups, Starfish Problems and Tech Regulation.” In it, Feld explains the need for a separate government agency to regulate digital platforms.

Digital regulation is new but has rapidly become critical to the economy, continued Feld. As such, it is necessary for the government to create a completely new agency in order to provide the proper oversight.

In the past, Congress empowered independent bodies with effective tools and expert teams when it lacked expertise to oversee complex sectors of the economy but there is no such body for digital platforms, said Feld.

“The reality is that [Congress] can’t keep up,” said Welch. This comes at a time when antitrust action continues to pile up in Congress, sparking debate across all sides of the issue.

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FTC Commissioner Concerned About Antitrust Impact on Already Rising Consumer Prices

Noah Phillips said Tuesday he wants the commission to think about the impact of antitrust rules on rising prices.



Screenshot of Federal Trade Commissioner Noah Phillips

WASHINGTON, May 17, 2022 – Rising inflation should be a primary concern for the Federal Trade Commission when considering antitrust regulations on Big Tech, said Commissioner Noah Phillips Tuesday.

When considering laws, “the important thing is what impact it has on the consumer,” said Phillips. “We need to continue to guard like a hawk against conduct and against laws that have the effect of raising prices for consumers.”

Current record highs in the inflation rate, which means money is becoming less valuable as products become more expensive, has meant Washington must become sensitive to further price increases that could come out of such antitrust legislation, the commissioner said.

Phillips did not comment on how such movies would mean higher prices, but that signals, such as theHouse Judiciary Committee’s antitrust report two years ago, that reign in Big Tech companies and bring back enforcement of laws could mean higher prices. He raised concerns that recent policies are prohibiting competition rather than facilitating it.

This follows recent concerns that the American Innovation and Choice Online Act, currently awaiting Senate floor consideration, will inhibit America’s global competitiveness by weakening major American companies, thus impairing the American economy. That legislation would prohibit platform owners from giving preference to their products against third-party products.

This act is one of many currently under consideration at Congress, including Ending Platform Monopolies Act and Platform Competition and Opportunity Act.

Small businesses have worried that by enacting some legislation targeting Big Tech, they would be impacted because they rely on such platforms for success.

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Critics and Supporters Trade Views on American Innovation and Choice Online Act

American Innovation and Choice Online Act is intended to protect fair competition among businesses, but panelists differed on its impact.



Photo of Amy Klobuchar from August 2019 by Gage Skidmore used with permission

WASHINGTON, May 10, 2022 – Experts differed on the effect that antitrust legislation targeting big tech companies allegedly engaging in discriminatory behavior would have on small businesses.

Small businesses “want Congress not to do anything that will screw up or weaken the services that they rely on for their business,” said Michael Petricone, senior vice present of the Consumer Technology Association, at a Protocol Live event on Thursday.

Petricone said that antitrust bill would encourage tech companies to relocate to other countries, harming the American economy. He said small businesses would be affected the most.

Instead, Petricone called for  a “smarter immigration policy” to allow foreign innovators access to American tech market, as well as the defeat of the antitrust legislation.

But other said that small businesses suffer from predatory behavior by big tech companies. “Companies can’t get their foot in the door when there is already self-preferencing,” said Awesta Sarkash, representative for Small Business Majority, an advocacy organization, adding that 80% of small businesses say they want antitrust laws to protect them.

Self-preferencing on online platforms is detrimental to the success of small businesses who rely on social media advertising for business, she said. The new antitrust proposals would ensure an level playing field and promote fair competition, she said.

The American Innovation and Choice Online Act would prohibit certain online platforms from unfairly preferencing products, limiting another business’ ability to operate on a platform, or discriminating against competing products and services.

The bill sponsored by Sen. Amy Klobuchar, D-Minn, was introduced to the Senate on May 2 and is awaiting Senate floor consideration.

The debate follows concerns raised by both democrats and republicans about America’s global competitiveness as the bill would weaken major American companies.

If passed, the bill will follow the European Union’s Digital Services Act which similarly sets accountability standards for online platforms, preventing potentially harmful content and behavior.

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