Department of Justice Endorses Antitrust Bill Aimed at Big Tech
Department of Justice Endorses Antitrust Bill Aimed at Big Tech
On March 28, 2022, the Department of Justice (“DOJ”) sent a letter to Congress endorsing the American Innovation and Choice Online Act—the latest salvo in the ongoing saga of enhanced antitrust scrutiny on Big Tech. The bill seeks to employ “prohibitions on discriminatory conduct by dominant platforms” such as Amazon and Google to “ensur[e] the competitiveness of our digital economy.”
The bill seeks to prevent “the largest digital platforms from discriminating in favor of their own products or services, or among third parties.” So, for example, the bill would prohibit Amazon from boosting the search rankings of its own in-house products, like “Amazon Basics,” over third party products. And it would prevent Apple from boosting its own apps over competitors in its App Store.
The bill recognizes Big Tech’s growing ability to control channels of commerce, and therefore dominate entire markets while excluding or disadvantaging smaller competitors. The DOJ noted that “[b]y confirming the illegality of behaviors that reduce incentives for smaller or newer firms to innovate and compete, the legislation would supplement the existing antitrust laws in preventing the largest digital companies from abusing and exploiting their dominant positions to the detriment of competition and the competitive process.”
Although the bill has broad bipartisan support, Big Tech is fighting back. According to Wired, the largest tech companies have mobilized lobbyists and have initiated “an ongoing publicity push against [the bill].” In rather hyperbolic terms, they’ve “claimed that it would ruin Google search results, bar Apple from offering useful features on iPhones, force Facebook to stop moderating content, and even outlaw Amazon Prime.” But in contrast, the DOJ believes the bill will “have a positive effect on dynamism in digital markets going forward” noting that “[o]ur future global competitiveness depends on innovators and entrepreneurs having the ability to access markets free from dominant incumbents that impede innovation, competition, resiliency, and widespread prosperity.”
Faruqi & Faruqi, LLP focuses on complex civil litigation, including securities, antitrust, wage and hour and consumer class actions as well as shareholder derivative and merger and transactional litigation. The firm is headquartered in New York, and maintains offices in Atlanta, Los Angeles and Philadelphia.
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David Calvello is a Partner in Faruqi & Faruqi, LLP’s New York office. He mainly practices in the area of antitrust litigation with a focus on competition in the pharmaceutical industry. He has worked on multiple cases that resulted in significant settlements, including In re Lidoderm Antitrust Litigation, 14-md-02521 (N.D. Cal.) ($166M settlement), In re Loestrin 24 Antitrust Litigation, 13-md-2472 (D.R.I.) ($120M settlement), and In re Solodyn Antitrust Litigation, 14-md-2503 (D. Mass.) ($76M settlement).
