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Welcome to The Corner. In this issue, we discuss the appointment of Lina Khan as chairwoman of the Federal Trade Commission and the release of five House antitrust bills aimed at taking down Big Tech.

Lina Khan Appointed Chairwoman of the FTC

On Tuesday, the Senate confirmed Lina Khan to a seat on the Federal Trade Commission by a 69-28 vote. President Joe Biden then named Khan as chairwoman of the regulatory agency. Khan’s confirmation will give Democrats a 3-2 majority at the FTC. For all of us at Open Markets, this was very powerful and personal news. Lina is a close friend and a very important ally. She was also our longtime colleague, having worked for OMI as a writer and researcher from 2011 to 2014, and then as OMI’s legal director in 2017 and 2018. (See our statement [[link removed]] on Lina’s confirmation).

After Lina’s appointment as chairwoman, we went back through our files to select some of her most important articles from her first three years at Open Markets. The articles — which range from close studies of federal regulation to pioneering investigations of Wall Street trading schemes to essays on the link between neoliberalism and inequality — demonstrate Lina’s wide range of interests and truly outstanding abilities as a reporter, writer, and thinker.

How America became uncompetitive and unequal [[link removed]] (The Washington Post, June 13, 2014, with Sandeep Vaheesan) Why you might pay more than your neighbor for the same bottle of salad dressing [[link removed]] (Quartz, Jan 19, 2014) The Rise of Big Chocolate [[link removed]] (Foreign Policy, Nov. 12, 2013) Monsanto's scary new scheme: Why does it really want all this data? [[link removed]] (Salon, Dec. 29, 2013) The Fed is about to make owning physical assets a game all banks can play [[link removed]] (Quartz, Oct. 23, 2013) The Folks Who Sell Your Corn Flakes are Acting Like Goldman Sachs—and That Should Worry You [[link removed]] (The New Republic, Sept. 11, 2013) Obama’s Game of Chicken [[link removed]] (Washington Monthly, Nov/Dec 2012) The Slow-Motion Collapse of American Entrepreneurship [[link removed]] (Washington Monthly, Jul/Aug 2012) Terminal Sickness [[link removed]] (Washington Monthly, Mar/Apr 2012, with Phillip Longman)

House of Representatives Launches Assault of Legislation Aimed at Taking Down Big Tech

By Daniel A. Hanley

Building on its landmark antitrust report [[link removed]]last fall, the House antitrust subcommittee last Friday introduced five bills to make it easier for enforcement agencies to address the power of online platforms such as Google and Amazon. Each bill targets a different aspect of the structure and behavior of the largest online corporations, and, if enacted, will dramatically alter how people communicate and do business on the internet. All five bills were co-sponsored by Republicans, making this the first major antitrust legislation with bipartisan support since the 1970s. The five measures are:

The American Innovation and Choice Online Act [[link removed]] proposed by Rep. David Cicilline (D-R.I.), who chairs the subcommittee, would prevent platforms from promoting their own products over those of other companies ( what [[link removed]] the Open Markets Institute calls [[link removed]] [[link removed]] “ [[link removed]] self-preferencing [[link removed]]”). The bill would prevent a platform from interfering with the pricing of goods and services it hosts and from restricting a user’s ability to uninstall pre-installed software.

The Platform Competition and Opportunity Act [[link removed]], proposed by Rep. Hakeem Jeffries (D-N.Y.), would greatly restrict the ability of large platforms to acquire other companies, particularly those that present a nascent threat to an incumbent. The act specifically places the burden on the platform to show that the attempted acquisition does not harm competition.

The Ending Platform Monopolies Act [[link removed]], sponsored by Rep. Pramila Jayapal (D-Wash.), would prevent a platform from being both a provider and a competitor on the platform it hosts and from conditioning access to the platform. Importantly, the act calls for the breakup of any corporation that violates this act.

The Augmenting Compatibility and Competition by Enabling Service Switching [[link removed]] [[link removed]] (ACCESS) [[link removed]] Act [[link removed]], proposed by Rep. Mary Gay Scanlon (D-Pa.), would require large platforms to create clear rules that allow users to transfer their data to an alternative platform and requires large platforms to be interoperable with other competitors.

Rep. Joe Neguse (D-Colo.) introduced The Merger Filing Fee Modernization Act [[link removed]]. The act would appropriate more than $250 million and more than $450 million to the Department of Justice and the FTC, respectively, for antitrust enforcement. The act also significantly raises merger filing fees for mergers over $1 billion. Increased filing fees would attempt to deter mergers and would also provide the reviewing agencies desperately needed [[link removed]] funding to expand their enforcement capabilities.

The Open Markets Institute released a statement applauding this momentous course of action by the House of Representatives. The full statement can be viewed here [[link removed]]. The statement was mentioned in the Washington Post [[link removed]].

🔊 ANTI-MONOPOLY RISING:

Last week, Google agreed to end some of its self-preferencing practices in the online advertising industry after being fined 220 million euros ($268 million) by the French Competition Authority and accused of abusing its market power. The watchdog agency found that Google illegally favored its own DFP advertising server for publishers when looking for platforms to sell ad space. The action was spurred by a complaint filed by publishers News Corp, Le Figaro, and Rossel. ( CNBC [[link removed]])

Last week, the New York state Senate passed an antitrust bill that takes aim at companies with a dominant market position of 40% or more. The bill would remove barriers in proving that these companies abuse their market position and make it easier for plaintiffs to bring antitrust lawsuits against these companies. The bill also considers the “unilateral power to set wages” or noncompete clauses as part of its abuse of dominance standard. ( The [[link removed]] [[link removed]] Wall Street Journal [[link removed]])

On Tuesday, the Competition and Markets Authority opened an investigation into the dominant market power in mobile operating systems, app stores, and web browsers held by Apple and Google. The CMA will assess whether the duopoly in these markets harm consumers by dictating how they can access a wide range of products and services in the mobile ecosystem. The CMA has argued that this duopoly has led to less innovation and increased prices for products and digital advertising. ( CNN [[link removed]])

Last week, the CMA announced that it would open an investigation into Amazon’s data practices on its retail platform. The investigation will also focus on Amazon’s process in deciding which merchants are placed in its "buy box," an on-screen panel on the platform that allows customers an easier way to purchase products. ( Reuters [[link removed]])

📝 WHAT WE'VE BEEN UP TO:

Open Markets released a statement [[link removed]] calling on the U.S. Judicial Panel to deny Google’s attempt to impede the Texas AG multistate case. “Recognizing the urgency of the Texas AG multistate case against Google, Eastern District of Texas Judge Sean Jordan has moved the docket quickly and has denied Google’s motion to transfer the case. An eight-week trial is set for June 2023. Transferring the Texas AG multistate case would spell years of delay. America’s free press and democracy cannot afford such a wait. Google’s motion to transfer and consolidate the Texas AG multistate case must be denied.”

Sandeep Vaheesan wrote a piece in Democracy Journal [[link removed]]about how Biden’s FTC can go after Google and Facebook’s unfair domination of advertising through surveillance. “Prohibiting surveillance advertising is critical to protecting our privacy, strengthening anti-discrimination laws, ending a business built on the dissemination of addictive and provocative content, and steering resources in socially beneficial directions.”

Daniel Hanley published a piece in Competition Policy International [[link removed]] about how self-preferencing can violate Section 2 of the Sherman Act. “Self-preferencing occurs when a firm unfairly modifies its operations to privilege its own, another firm’s, or a set of firms’ products or services. Extensive domestic and international investigations have confirmed that dominant technology corporations, like Google and Facebook, use self-preferencing to acquire, maintain, and entrench their dominant market position.”

Claire Kelloway’s piece in Food & Power [[link removed]] about cyberattacks and America’s concentrated beef industry was published in The Washington Monthly [[link removed]]. “Just four corporations control more than 80 percent [[link removed]] of all U.S. beef processing. Pandemic and cyber disruptions revealed how concentrated production can send shock waves when just a handful of closed plants take out a large chunk of meat processing capacity.”

The American Prospect [[link removed]] republished Sandeep Vaheesan’s piece about how federal agencies can use their existing authority to neutralize corporate power. “Even without new legislation, the next president can limit corporate power with the awesome anti-monopoly authorities already vested in the DOJ, FTC, USDA, and other federal agencies.”

Claire Kelloway and Sandeep Vaheesan co-authored a piece in the LPE Project [[link removed]] about how anti-monopoly is about democratizing the food system (and the rest of the economy). “The historical and present-day purpose of antimonopoly law and policy is to distribute power downward and build, in agriculture and elsewhere, an economy that is fair and democratic.”

Sally Hubbard was quoted in Politico [[link removed]] speaking about the newly introduced House antitrust bills and the importance of their elimination of self-preferencing practices. “Policing discrimination can be like a game of Whac-A-Mole because there are so many levers these platforms can push,” said Hubbard, a former enforcer who now serves as director of enforcement strategy at the anti-monopoly advocacy group Open Markets. And she said if the proposals for tougher enforcement don’t work, you can “structurally remove those conflicts of interest as we’ve done in other industries.”

Johnny Ryan and his group, The Irish Council for Civil Liberties, were mentioned in Reuters [[link removed]] for filing a privacy lawsuit against IAB Tech Lab for allegedly breaching EU privacy rules. "A retailer might use the data to single you out for a higher price online. A political group might micro target you with personalised disinformation," Johnny Ryan, ICCL senior fellow, said in a statement. Ryan was also mentioned in BBC [[link removed]], Ad Exchanger [[link removed]], and Infosecurity Group [[link removed]].

An Open Markets study about right-to-repair was mentioned in Tech Insider [[link removed]]. As a 2020 study [[link removed]] by the Open Markets Institute noted, “Monopolizing repair allows corporations to extract additional revenue during the lifespans of their products, but this profiteering comes at a larger social cost.”

Open Markets was mentioned in widespread coverage of former Open Markets Institute legal director Lina Khan’s confirmation as commissioner on the Federal Trade Commission. Coverage included CNBC [[link removed]], AP News [[link removed]], PBS News Hour [[link removed]], Bloomberg Law [[link removed]], Yahoo [[link removed]], Economist [[link removed]], The Wall Street Journal [[link removed]], Barrons [[link removed]], US News [[link removed]], LA Times [[link removed]], Star Tribune [[link removed]], AJC [[link removed]], ABC [[link removed]], MarketWatch [[link removed]], Gizmodo [[link removed]], and Dawn [[link removed]]. Barry Lynn was quoted in The New York Times [[link removed]].

Open Markets’ chart about the four major U.S. meatpacking companies was cited in Bloomberg [[link removed]] in a story about meat market concentration.

Open Markets’ amicus brief in the EpiPen case was cited in Snack Safely [[link removed]] in a piece about Sanofi’s appeal. “The brief explains that Mylan maintained its monopoly in the market for auto-epinephrine injectors using practices that the Sherman Act prohibits.” The brief was also mentioned in Medical Dialogues [[link removed]].

We appreciate your readership. Please consider making a contribution to support the continued publication of this newsletter.

DONATE [[link removed]] 📈 VITAL STAT: 150

The number [[link removed]] of patents held by Sonos Inc. that Google and Amazon infringe upon, according to the speaker company’s chief legal officer.

📚 WHAT WE'RE READING: “ How Cheap Speech Underserves and Overheats Democracy [[link removed]]” (UC Davis Law Review, Gregory P. Magarian): Magarian details how the democratization of speech derived from access to the internet and unregulated content moderation practices pose real threats to democracy. The author explains that Big Tech's control over the internet harms professional journalism and increases extremism.

BARRY LYNN’S

NEW BOOK

Liberty From All Masters

The New American Autocracy vs. The Will of the People

St. Martin’s Press has published Open Markets Executive Director Barry Lynn’s new book, Liberty [[link removed]] f [[link removed]] rom All Masters [[link removed]].

Liberty is Lynn’s first book since 2010’s Cornered. In his new work, Lynn warns of the threat to liberty and democracy posed by Google, Amazon, and Facebook, because of their ability to manipulate the flows of information and business in America. Barry then details how Americans over the course of two centuries built a “System of Liberty,” and shows how we Americans can put this system to work again today. Lynn also offers a hopeful vision for how we can use anti-monopoly law to rebuild our society and our democracy from the ground up.

Liberty from All Masters has already made waves for its empowering call to restore democracy by resurrecting forgotten tools and institutions. “Very few thinkers in recent years have done more to shift debate in Washington than Barry Lynn. In Liberty from All Masters, he proves himself as a lyrical theorist and a bold interpreter of history. This book is an elegant summoning of a forgotten tradition that can help the nation usher in a new freedom,” says Franklin Foer, author of World Without Mind and national correspondent for The Atlantic.

You can order your copy of Lynn’s book here [[link removed]].

SALLY HUBBARD’S

NEW BOOK

MONOPOLIES SUCK

7 Ways Big Corporations Rule Your Life and How to Take Back Control

Simon & Schuster published Monopolies Suck [[link removed]] by Sally Hubbard on Oct. 27. The book is the first by Hubbard, who is Open Markets’ director of enforcement strategy. Hubbard examines how modern monopolies rob Americans of a healthy food supply, the ability to care for the sick, and a habitable planet, because monopolies use business practices that deplete rather than generate. Monopolists also threaten fair elections, our free press, our privacy, and, ultimately, the American Dream, Hubbard shows. In Monopolies Suck, Hubbard reminds readers that antitrust enforcers already have the tools to dismantle corporate power and that decisive action must be taken before monopolies undermine our economy and democracy for generations to come. In Monopolies Suck, Sally provides an important new view of America’s monopoly crisis and of the political and economic harms of concentrated private power. Order your copy here [[link removed]].

🔎 TIPS? COMMENTS? SUGGESTIONS?

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Written and edited by: Barry C. Lynn, LaRonda Peterson, Jackie Filson, Daniel A. Hanley, Garphil Julien, and Ezmeralda Makhamreh.

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