After Twitter “de-platformed” former president Donald Trump for spreading lies about the results of the 2020 elections, Texas passed a law banning major social media platforms from removing content based on the “viewpoint” of the user. In mid-September, the U.S. Court of Appeals for the Fifth Circuit upheld the Texas law, contradicting a previous ruling by the Eleventh Circuit that struck down a similar Florida statute. The case is now headed for the Supreme Court where the justices could well decide in a way that makes the problems of disinformation and monopoly power worse.

The Fifth Circuit opinion relied heavily on flawed application of a legal principle known as “common carriage” that has long governed essential facilities, from ferries and inns in colonial times to railroads, airlines, and communications networks in the modern era. Under common carriage laws, the owners of such essential infrastructure are not allowed to arbitrarily discriminate against different individual customers. The Fifth Circuit reasoned that the common carriage law should apply to social media networks. In doing so, it echoed the reasoning used by Supreme Court Justice Clarence Thomas, who in another case last year argued that the non-discriminatory principle embedded in common carriage law could be used to deny Big Tech the “right to exclude” certain users.

But while social media networks are indeed akin to essential facilities and should be subject to common carrier principles, it does not follow that doing so would prevent them from excluding people who spread disinformation or hate speech. Common carriage has never meant that no standards apply; it means that standards have to be announced and applied evenly to everyone. For instance, an airline can say they will not carry anyone who gets dangerously drunk, insults other passengers, or screams obscenities in a flight. But it must apply this standard to everyone, not just to individual passengers it doesn’t want to carry.

The Fifth Circuit also forgets, as does Justice Thomas, that historically Americans have never allowed common carriers to engage in adjacent lines of business. You could be a telephone company or an advertising agency, or a publisher, but you could not be all three, as Google and Facebook are. True reform of today’s platform monopolies involves not just treating them as common carriers, but breaking them up.

The Fifth Circuit’s decision also makes a hash of Section 230, the controversial provision in federal law that allows digital platforms to escape liability for the content they publish while simultaneously giving them the privilege to curate content. The ruling notes the hypocrisy of this legislation, but it favors even less platform liability. The most likely outcome of this approach is that it will continue to deepen the well-documented problems of Section 230, including the ability of extremist groups to continue spreading the Big Lie and organize racist events like the 2017 Unite the Right rally.

This week the Supreme Court agreed to hear two other cases that challenge Section 230 protections to Google, Twitter, and Facebook in relation to how they recommend third-party content that would violate the Anti-Terrorism Act. Rather than passing legislation that addresses the type of competition we want in the digital markets, along with data privacy and free speech protections that foster self-governance, we are allowing unelected judges to further erode the foundations of true democracy.

The Open Markets Institute will cohost a conference entitled “How Monopoly Threatens Democracy and Security: The Next Stage of the Fight in Europe” in Brussels on Thursday, October 13. Speakers will include European parliament members Stephanie Yon-Courtin and Paul Tang and former EU antitrust economist Tommaso Valletti. In addition to working with three European antimonopoly allies to host the event, OMI Executive Director Barry Lynn will speak about the dangers to European and U.S. security and sovereignty posed by extreme concentration within industrial supply chains.

Last week, Open Markets’ Legal Director Sandeep Vaheesan submitted written testimony to the New Jersey Senate Labor Committee in support of a bill that would restrict the use of non-compete clauses and no-poach agreements in the state. Senate No. 1410 prohibits non-compete clauses for a substantial fraction of the state’s labor force (including independent contractors and low-wage workers) and limits the use of these contracts for other workers in the state. For low-wage workers, the bill also bans no-poach agreements in which employers agree not to recruit or hire each other’s employees. In his testimony, Vaheesan explained that these restraints reduce labor market mobility, thereby depressing wages and small business formation. 

Garphil Julien of Open Markets has joined the National Economic Council in the White House to work on diversifying and strengthening America's supply chains. Garphil worked with OMI for more than two years, after joining as an intern. During his time with OMI Garphil produced deeply researched reports on supply chain risk, as well as incisive commentary on pressing political economic issues. Garphil will have plenty of OMI company in the administration. FTC Chair Lina Khan, DOJ Special Counsel Sally Hubbard (pictured with Garphil on the White House lawn), CFPB Senior Advisor Alexis Goldstein, and U.S. Trade Representative Strategic Advisor Beth Baltzan all worked for OMI. In addition many long-time OMI allies are now in the administration, including Assistant Attorney General for Antitrust Jonathan Kanter, Consumer Financial Protection Bureau Director Rohit Chopra, NEC competition coordinator Tim Wu, and acting director of the Office of Information and Regulatory Affairs Sabeel Rahman, among others. 

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