The Antitrust Agenda: Joint FTC, DOJ Press Conference on Merger Guidelines Request for Information; Kanter Slate of Hires Expected Soon; Senate Banking Chair Brown, Warren Prod Fed Nominees on Concentration

Published on Jan 18, 2022

The Antitrust Agenda: Joint FTC, DOJ Press Conference on Merger Guidelines Request for Information; Kanter Slate of Hires Expected Soon; Senate Banking Chair Brown, Warren Prod Fed Nominees on Concentration 

Kanter and Khan Joint Press Conference on Issuing Request for Information to Update Merger Guidelines: 

  • LINK to press release. 
  • LINK to request for information. 
  • LINK to livestream: 
  • Prepared statement from Chair Khan: “This inquiry launched by the FTC and DOJ is designed to ensure that our merger guidelines accurately reflect modern market realities and equip us to forcefully enforce the law against unlawful deals. Hearing from a broad set of market participants, especially those who have experienced first-hand the effects of mergers and acquisitions, will be critical to our efforts.”
  • Prepared statement from Assistant Attorney General Jonathan Kanter: “We need to understand why so many industries have too few competitors, and to think carefully about how to ensure our merger enforcement tools are fit for purpose in the modern economy.”
  • Comment period lasts for 60 days. 

Areas of Inquiry of Request for Information (quoted from press release): 

  • Purpose and scope of merger review: The agencies seek information on whether the guidelines explain and implement the statutory ban on transactions that “may” substantially lessen competition or tend to create a monopoly, and what harms are contemplated by those standards. The agencies further seek input on whether distinctions between horizontal and vertical transactions reflected in the guidelines should be revisited in light of trends in the modern economy. 
  • Presumptions that certain transactions are anticompetitive: The guidelines identify certain market circumstances that justify a presumption of competitive harm based on market concentration. The agencies seek information on whether concentration thresholds should be adjusted to improve the efficiency and effectiveness of enforcement, whether alternative metrics or qualitative factors should also trigger presumptions of competitive harm, and evidence regarding accuracy of such presumptions. 
  • Use of market definition in analyzing competitive effects: The agencies seek input on potential updates to the guidelines’ market definition analysis to better account for non-price competition. They also seek input on when direct evidence of a transaction’s likely competitive effects, such as evidence of head-to-head competition, may eliminate the need for a separate market definition exercise. 
  • Threats to potential and nascent competition: The agencies seek input on potential updates to the guidelines’ discussion of potential and nascent competitors, which may be key sources of innovation and competition. 
  • Impact of monopsony power, including in labor markets: The agencies seek input on how to address the issue of buyer power in more detail in the guidelines. Labor markets are a key example of buyer power, and the agencies seek information regarding how the guidelines should analyze labor market effects of mergers. 
  • Unique characteristics of digital markets: The agencies seek information on how to account for key areas of the modern economy like digital markets in the guidelines, which often have characteristics like zero-price products, multi-sided markets, and data aggregation that the current guidelines do not address in detail.  

Kanter front office slate expected soon. Some media reports have given the impression that the slate of lawyers Kanter has selected for the antitrust division’s front office is being held up because of identity politics, and that the door is still open for establishment Democrats to enter the antitrust division in high level positions. 

That, however, is almost certainly wishful thinking from a wing of the Democratic party that already lost its fight with the Biden White House for the top spots at DOJ and the FTC. In fact, the White House has subsequently doubled down on the importance of strong antitrust enforcement as one of its key tools to fight inflation, calling into question the political constituency for establishment antitrust Democrats in the first place.   

It is true that the White House has taken quite a long time to give Khan and Kanter the people they need to push ahead with an aggressive agenda. But we chalk that up primarily to competing priorities at the White House, a packed Senate calendar, and general delays in background checks for personnel. We expect Kanter’s slate to be approved in the coming weeks and for the front office to be aligned with his views on antitrust. 

Senate Banking Chair Brown, Warren prod Fed nominees on concentration. Senate Banking Committee Chair Sherrod Brown (D-OH) said Federal Reserve Chair Jerome Powell must ensure the economy works for everyone and not just banks celebrating “one of their most profitable years ever, with huge bonuses and payouts.” The Fed “must do more to stop consolidation in the banking industry from hurting consumers and small businesses,” said Brown at a January 11 hearing on Powell’s nomination to another term. 

Senator Elizabeth Warren (D-MA) prodded Powell on “the role of corporate concentration in driving inflation,” and suggested some companies may be “passing along increased costs” and “charging more on top of that.” Powell said “that could be right,” though it could also just be “that demand is incredibly strong” and “they’re raising prices because they can.” Warren replied, “That’s the point. They’re raising prices because they can, and they’re not being competed down. Market concentration has allowed giant corporations to hide behind claims of increased costs to fatten their profit margins.” 

Warren pressed her views with Lael Brainerd, Fed vice chair nominee, at a January 13 hearing. Asked by Warren if the Fed had power to address broader concentration concerns beyond bank mergers, Brainerd answered, “no.” Warren said, “That’s really the point here. Dealing with inflation requires the Fed to act if the problem is an overheated economy, but dealing with rising consumer prices also involves the FTC, the Department of Justice, in breaking up monopolies and investigating crooked price-fixing schemes that also increase costs for hardworking families. And that’s why it is so important that the Biden administration is taking action to fight corporate power by enforcing antitrust laws and boosting competition.” 

FTC calendars. The Capitol Forum did not receive any calendars via FOIA this week. 

Personnel News 

Judge in Linet-Hillrom case an ex-Thomas law clerk and Trump appointee. The judge currently assigned to hear the Linet America antitrust complaint against Hillrom in the U.S. District Court of Northern Illinois is Martha Pacold. She clerked for Supreme Court Justice Clarence Thomas, was previously a Federal Society member, and was nominated by former President Donald Trump, according to a bio and Wikipedia entry 

Ex-FTC privacy expert Mithal starts at Wilson Sonsini. Maneesha Mithal, an ex-FTC senior privacy official, has joined Wilson Sonsini’s privacy and cybersecurity practice as a partner, the firm announced. She will also focus on FTC matters, government investigations, and internet strategy and litigation, says her profile. 

Ex-EC antitrust official starts at Gibson, Dunn. Nicholas Banasevic, a former acting director and head of unit overseeing high-tech/IT antitrust cases for the EC Directorate-General for Competition, has joined Gibson, Dunn & Crutcher’s antitrust and competition practice as a managing director, Brussels, the firm announced.   

FTC Bureau of Competition seeks attorneys to help with enforcement, litigation. The FTC Bureau of Competition is seeking “attorneys to support enforcement work in its Litigation Divisions” (details). 

DOJ antitrust looking for attorneys, economists, analysts, others. The DOJ antitrust division continues to seek attorneys, economists, research analysts, paralegal specialists and others, according to its employment page 

 

Top Events  

Wednesday, January 19 at 10 a.m. EST. House Judiciary antitrust subcommittee hearing,Reviving Competition, Part 5: Addressing the Effects of Economic Concentration on Americas Food Supply.” 

Thursday, January 20 at 9 .a.m. Senate Judiciary Committee business  meeting with agenda including two bipartisan bills: the American Innovation and Choice Online Act (S. 2992), which seeks to prevent market abuse by dominant platforms, and the Open App Markets Act (S. 2710), which would regulate “covered” app stores (those with more than 50 million U.S. users). 

Other Upcoming Events 

 

Tuesday, January 18 at 11 a.m. EST. U.S. Chamber of Commerce four-part weekly series kicks off with webinar, “Competition for Global Leadership: Trade, AI, and Security: Advancing global trade, securing cyber networks and supply chains, and leading on artificial intelligence.” 

Wednesday, January 19 at 10 a.m. EST. FTC Chair Lina Khan to talk with Andrew Ross Sorkin and Kara Swisher about “the antitrust landscape, the growing power of big tech, as well as the FTC’s approach to the current wave of mergers and acquisitions, among other topics,” CNBC announced. 

Wednesday, January 19 at 11 a.m. EST. Lexology, GCR webinar, “Recent developments in EU and UK merger control – Strategic opportunities for third parties,” giving an overview of key developments in the merger control regimes in the EU and the UK, with a focus on how merger review creates opportunities for third parties—competitors, customers, or suppliers—to protect and advance their own strategic interests. 

Wednesday-Thursday, January 19-20 at 9:30 a.m. EST (3:30 p.m. CET).  Concurrences’ Cartels Workshop: “An advanced seminar on substantive and procedural EU developments.” Speakers include Maria Jaspers, director of DG Comp’s cartel directorate; Dirk Van Erps, adviser to DG Comp’s deputy director-general for antitrust and cartels; senior U.K. and Spanish competition authority officials; and legal secretaries of the EU Court of Justice. 

Wednesday, January 19 at 10 a.m. EST. House Oversight and Reform Committee hearing, “Price Gouging in Military Contracts: New Inspector General Report Exposes Excess Profit Obtained by TransDigm Group” (committee memo). 

Thursday, January 20 at noon EST. ABA antitrust webinar, “Recent Developments in Healthcare & Pharma Q4 2021.” 

Thursday, January 21 at 1 p.m. EST. FTC monthly open meeting, with a staff presentation on identify theft, recent trends reported by consumers, resources available at IdentityTheft.gov and RobodeIdentidad.gov, and upcoming Identity Theft Awareness Week initiatives. 

Friday, January 21. Initial FTC administrative law judge decision due in administrative case on FTC antitrust complaint that Altria Group-JUUL Labs deals, including for Altria to buy a 35 percent stake in JUUL, eliminated competition in the market for closed-system electronic cigarettes. 

The week of January 24-28. Senate Commerce Committee reportedly might vote on nominations, including of FTC and FCC commissioner nominees Alvaro Bedoya and Gigi Sohn, needed to create Democratic majorities. 

January 25 at 1 p.m. EST. The Information video summit, “2022 Tech Outlook: What’s Next?” 

January 26 at 8:45 a.m. EST. George Mason University virtual conference, “Mercatus Antitrust Forum: One Year of Biden Antitrust.” Speakers include FTC Commissioner Christine Wilson and various former FTC commissioners, DOJ antitrust chiefs and other senior officials. 

January 26 at 1:30 p.m. EST. Protocol webinar, “Tech regulation is coming: How does Big Tech respond?” Speakers include Julie Brill, Microsoft chief privacy officer and VP for global privacy and regulatory affairs. 

January 27 at noon EST. Information Technology & Innovation Foundation webinar, “Patchwork Penalty: The Hidden Toll of State Privacy Laws.” 

January 27-28 at 8:30 a.m. EST. “GCR Live: Law Leaders Global” antitrust conference (program), Miami Beach. Speakers include: FTC Commissioner Noah Phillips; Maria Jaspers, EC director, DG Competition; and David Stewart, UK Competition Markets Authority executive director, mergers and markets. 

 

Recent Developments 

Senate Judiciary Chair Durbin: ‘Buckle your seat belt,’ Big Tech ‘forays’ coming. Senate Judiciary Committee Chair Dick Durbin (D-IL) signaled his panel is about to get busy with efforts to address concerns about tech giants. Responding to the plea of Sen. John Kennedy (R-LA) for more action and less talk on “Big Tech” dominance and influence, Durbin said at the panel’s January 13 business meeting, “Senator Kennedy … buckle your seat belt: this committee is going to be taking some forays into the field that you just mentioned.” A spokesperson declined to elaborate to TCF. 

As expected, the committee delayed action on Antitrust Subcommittee Chair Amy Klobuchar’s (D-MN) bipartisan American Innovation and Choice Online Act (S. 2992, release) seeking to prevent internet platform market abuse. Noting the bill was on the agenda for the first time, Ranking Member Charles Grassley (R-IA), one of 11 co-sponsors, said the legislation “will promote competition” to “dominant Big Tech platforms” and he looked forward “to voting this bill out of Committee.” The committee is targeting a vote on the bill at a meeting this Thursday, along with a possible vote on the bipartisan the Open App Markets Act (S. 2710), which would regulate “covered” app stores (those with more than 50 million U.S. users). 

The committee cleared by a 17-5 vote the nomination of Katherine Vidal, to be director of the U.S. Patent and Trademark Office, with Senators Kennedy, Mike Lee (R-Utah), Ted Cruz (R-TX), Josh Hawley (R-MO) and John Ossoff (D-GA) opposed. Kennedy said that Vidal’s answers to questions were “very evasive” and that she and previous PTO directors had represented “Big Tech,” which “doesn’t like patents” impinging on their “market dominance.” Senator Thom Tillis (R-NC) said Vidal had assured him she would continue “reforms” in “the right direction” in “going after Big Tech” efforts to undermine small innovators’ patent protection. Senator Patrick Leahy (D-VT) said he agreed with Tillis.  

House Freedom Caucus backs floor vote on venue bill to fight ‘Big Tech censorship.’ The conservative House Freedom Caucus tweeted its support for Rep. Ken Buck’s (R-CO) discharge petition to force a floor vote on his State Antitrust Venue Enforcement Act (H.R. 3460), which would “fight against Big Tech censorship.” The caucus “supports this measure to ensure that Big Tech doesn’t get home court advantage for antitrust cases filed by state attorneys general,” said its statement. Currently, state AG actions may be consolidated in the U.S. District for Northern California, “a favorable venue” for Big Tech companies with headquarters there. “First Big Tech bill endorsed by the [HFC],” tweeted Buck. 

N.Y. antitrust bill clears first hurdle in 2022; advocates mix optimism and realism. Advocates of expanding New York state antitrust authority renewed their push, as the Senate Consumer Protection Committee voted 5-1 to approve the 21st Century Antitrust Act (S933A) on January 12. “Corporate power has reached unprecedented and dangerous levels, and we need powerful new laws to protect the public and our economy,” said Michael Gianaris (D), Senate Deputy Leader and bill sponsor. He looks forward to the bill “passing the Senate and Assembly and becoming law.” Last year, it passed the Senate but didn’t move in the Assembly. 

“We have a lot of work to do” to educate members and parties on the legislation, said Assemblyman Jeffrey Dinowitz (D), sponsor of a companion bill with 23 cosponsors. “It’s a matter of communication.” Some business opposition is based on misunderstanding, he told The Capitol Forum. He called the measure good for consumers and businesses competing with dominant firms. Asked why the Assembly didn’t move the bill last year, he said, “It just wasn’t its time.” 

Maritza Silva-Farrell, executive director of ALIGN: The Alliance for Greater New York, said she’s optimistic about the bill’s prospects: “Years and years of old antitrust law. We need to update it.” ALIGN has spearheaded the New Yorkers for a Fair Economy, a coalition of labor groups, small businesses, and immigrant and community organizations backing the legislation. A January 13 briefing of assembly members and staff went well, helping people understand that the bill is good for consumers and small businesses, she said. 

“This may be the year the bill becomes law,” blogged Constantine Cannon attorney Daniel Vitelli, updating a 2022 antitrust overview he co-authored. He called it “a groundbreaking antitrust bill that would fundamentally reshape antitrust law and enforcement” in the state. He noted he and his colleagues believed “the bill would (1) introduce an ‘abuse of dominance’ antitrust standard; (2) launch a broad premerger review program to protect consumers; and (3) make New York ‘Antitrust Central,” including by allowing for recovery of expert fees and by giving antitrust plaintiffs a means to avoid federal precedent on two-sided markets. 

Two reports cite huge increase in merger activity. The pandemic and the policy response have exacerbated “already extreme levels of corporate concentration” through “a massive increase in mergers,” said an American Economic Liberties Project report on January 11. “Merger activity reached an all-time high of $5.8 trillion in 2021, with private equity spending more than $1 trillion on deals over the course of the year—up 110 percent compared to 2020. Banks announced a larger total deal value in mergers and acquisitions in the first half of 2021 than in all of 2020. Composed of a record number of $5 billion-plus ‘megadeals,’ the onslaught is raging through nearly every sector,” said AELP, urging policymakers to “stop the merger frenzy.” 

White & Case cited a “massive global surge” in merger-control filings in a survey of 58 of the most active jurisdictions. In the United States, the number of merger transaction filings jumped by 110 percent from 1,965 in 2020 to 4,130 in 2021, and by 107 percent compared to the annual average of 2,000 from 2016 to 2020, which was mostly pre-pandemic, said the firm’s January 10 report.  

Judge allows FTC suit vs. Meta to proceed, but says proving case may be ‘tall task.’ A U.S. district court judge ruled that the FTC can proceed with its amended complaint’s core Sherman Act Section 2 claims against Meta/Facebook, dismissing the company’s motion to dismiss on January 11. “Although the agency may well face a tall task down the road in proving its allegations, the Court believes that it has now cleared the pleading bar and may proceed to discovery,” said the opinion of Judge James Boasberg of the D.C. District.    

The FTC has alleged “enough facts to plausibly establish that Facebook exercises monopoly power” in the “Personal Social Networking” services market, “adequately alleged” the company’s “dominant market share is protected by barriers to entry,” and “explained” that it is has willfully maintained that power through anticompetitive conduct—specifically, the acquisitions of Instagram and WhatsApp,” wrote Boasberg. He also rejected Facebook’s objection that FTC Chair Lina Khan’s complaint vote was invalid because “her alleged prejudgment required” recusal. “Kahn was acting in a prosecutorial capacity, as opposed to a judicial role” on the vote, he wrote. 

Boasberg did block FTC allegations that Facebook platform policies prevent interoperability with other apps, noting the company abandoned them in 2018, which Meta said “narrows the scope” of the case. Meta is “confident the evidence will reveal the fundamental weakness” of the FTC case; the company’s “investments in Instagram and WhatsApp transformed them” and “have been good for competition,” and users of “our products.”  

State AGs ask D.C. Circuit to overturn dismissal of their Facebook case. State attorneys general argued for reversing the U.S. District Court for the District of Columbia’s dismissal of their suit alleging Meta/Facebook is exploiting its monopoly power to crush competition. The “district court’s refusal to allow the States to proceed to discovery reflected an extraordinary, insupportably narrow view of the scope of the federal antitrust laws,” said the January 14 brief of 48 AGs in the D.C. Circuit Court of Appeals. “This Court has repeatedly made clear that antitrust laws must be applied flexibly because the means of illicit exclusion, like the means of legitimate competition, are myriad,’” particularly in digital markets, they said.  

Meta believes the dismissal “was correct, and that there are no grounds for overturning that decision,” emailed a company spokesperson. 

Meanwhile, the FTC and some states led by New York are investigating Meta’s virtual reality unit Oculus for potential anticompetitive violations, Bloomberg reported. It said the enforcers have asked outside developers how the Oculus app store may be discriminating against third parties that sell apps competing with Meta’s own software. North Carolina and Tennessee are also involved, Reuters reported 

Judge rules against ‘Pharma Bro’ Shkreli; banned for life, must disgorge profits. A U.S. district court ruled that Martin Shkreli, founder of Turing (now Vyera) Pharmaceuticals, violated federal and state law by raising the price of the life-saving drug Daraprim by over 4,000 percent in 2015, and using exclusive supply agreements in a scheme to delay generic drug competition for at least 18 months. “Shkreli will be barred for life from participating in the pharmaceutical industry and is ordered to disgorge $64.6 million in net profits from his wrongdoing,” said the opinion of Judge Denise Cote of the Southern District of New York on January 14, siding with FTC and state attorney general claims.  

The “precedent-setting relief should be a warning to corporate executives everywhere that they may be held individually responsible for the anticompetitive conduct they direct or control,” said FTC Chair Lina Khan. “Shkreli is a pharma bro no more,” said New York AG Leticia James. 

Microsoft’s LinkedIn sued by premium users; allegations denied. LinkedIn premium subscribers sued LinkedIn, alleging “unlawful monopolization of the professional social networking” market. “Combining LinkedIn’s unrivaled professional data trove and infrastructure with its parent Microsoft’s high-end cloud computing arrays, the companies are developing an AI and machine-learning-backed monopoly of enormous scale,” building “a near-insurmountable, and growing, barrier to meaningful entry,” said the January 13 class-action complaint in the U.S. District Court for Northern California. “LinkedIn agreed with its most obvious natural competitor—social networking juggernaut Facebook—to divide markets, sealing off the last remaining source of potential rivalry.” LinkedIn and Meta called the allegations against them meritless.  

‘Elite’ universities engaged in ‘price-fixing cartel,’ alleges suit of ex-students. Former students sued 16 “elite,” private universities that “by their own admission, have participated in a price-fixing cartel … designed to reduce or eliminate financial aid as a locus of competition, and that in fact has artificially inflated the net price of attendance for students receiving financial aid.” Defendants aren’t entitled to an antitrust exemption for institutions that admit all students on a “need-blind basis,” said the January 9 class action complaint in the U.S. District Court of Northern Illinois. Plaintiffs said at least nine defendants “have favored wealthy applicants” in admissions—“disfavoring students needing financial aid”—and all the defendants “have conspired to reduce the amount of financial aid they provide to admitted students.” The allegations are “damning,” opined Peter Coy in The New York Times. 

Deere alleged to monopolize repair market for brand agricultural equipment with ECUs. John Deere is monopolizing the repair service market for its brand agricultural equipment with onboard central computers called “engine control units” (ECUs), alleged a January 12 Forest River Farms class-action complaint in U.S. District Court of Northern Illinois. By “shutting out farmers and independent repair shops from accessing the necessary resources for repairs, Deere and [its] Dealerships have cornered the Deere Repair Services Market in the United States for Deere-branded agricultural equipment controlled by ECUs and have derived supracompetitive profits from the sale of repair and maintenance services,” it alleged. Deere didn’t respond to a TCF query. 

Minor league suit of MLB seeks to scrap baseball antitrust exemption. Major League Baseball (MLB) “orchestrated a horizontal agreement” among its clubs “to eliminate their affiliation with—and thus to effectively destroy” 40 minor league teams, alleged four of the affected teams in a recent complaint in the U.S. District Court of Southern New York. They said it’s time to cast a 1922 Federal Baseball antitrust exemption for such anticompetitive conduct into “the dust bin” of history, particularly given that the Supreme Court “signaled its willingness to reconsider” the baseball exemption in its unanimous 2021 NCAA v. Alston ruling allowing NCAA athletes to be compensated. MLB didn’t respond to TCF queries. 

FTC issues final order requiring generic drug divestitures in ANI purchase of Novitium. The FTC announced on January 12 it voted 4-0 to approve a final order to settle charges that ANI Pharmaceuticals’ planned $210 million purchase of Novitium Pharma would harm competition in markets for an antibiotic to treat infections and a steroid to treat inflammation. Under the decision, the FCC said the companies would have to divest ANI’s rights and assets in “generic SMX-TMP oral suspension and generic dexamethasone tablets” to Prasco LLC within 10 days after finalizing the takeover. 

FTC finalizes order requiring DaVita dialysis clinic divestitures to settle Utah deal. The FTC announced on January 12 it voted 4-0 to approve a final order requiring dialysis service provider DaVita  to divest three clinics in the Provo, Utah, area to Sanderling Renal Services. Under its decision to settle charges its acquisition of University of Utah dialysis clinics, the FTC said DaVita is also barred from engaging in non-compete agreements and other employee restrictions, and to obtain FTC prior approval before acquiring any new ownership interests in Utah dialysis clinics for 10 years. 

Select Committee issues subpoenas to Alphabet, Meta, Reddit, Twitter. The House Select Committee on the January 6 Capitol attack subpoenaed four social media companies after receiving “inadequate responses to prior requests for information.” The panel “is demanding records from Alphabet, Meta, Reddit, and Twitter relating to the spread of misinformation, efforts to overturn the 2020 election, domestic violent extremism, and foreign influence in the 2020 election,” announced January 13. The panel also wants to know “what steps—if any—social media companies took to prevent their platforms from being breeding grounds for radicalizing people to violence,” said Chairman Bennie Thomason (D-MS). Company representatives told Politico’s Morning Tech they’re cooperating. 

Senate confirms Davidson as NTIA chief. The Senate by a 60-31 vote on January 11 confirmed nominee Alan Davidson—recently with Mozilla, also ex-Google—to be assistant secretary of commerce heading the National Telecommunications and Information Administration. NTIA seeks input on distributing $48 billion from the recent bipartisan infrastructure act to expand broadband deployment and low-cost service. It also manages federal government spectrum use and represents the president at the FCC and elsewhere, including on domain names, where it maintains an amended Verisign cooperative agreement allowing .com registry wholesale price increases of up to 7 percent annually through 2024. 

Chamber of Commerce chief takes aim at government overreach. The head of the U.S. Chamber of Commerce chief warned against government overreach “that could stifle competition and our fragile economic recovery.” President Joe Biden “introduced a sweeping executive order based on the false premise that our entire economy is overconcentrated and stagnant,” said CEO Suzanne Clark on January 11. “Modern-day ‘trust-busters’ on Capitol Hill—from both parties—think all big is bad and necessarily a threat” to small companies. 

In addition, the FTC “has taken such an aggressive stance against mergers and acquisitions that small and medium-sized businesses fear they’ll have worked for years to build something and have no exit strategy if they choose to sell,” Clark said. There are numerous other examples, “from the proposed partisan tax-and-spending spree to fund a massive expansion of the federal government … to aggressive oversight and overregulation from agencies like the SEC and the CFPB … to overenforcement from the DOJ, the EPA, and the IRS.” Meanwhile, the chamber and other groups wrote lawmakers to call for national privacy legislation.  

App association criticizes some internet platform regulation proposals. An app trade group voiced concern about federal and state internet platform regulation proposals “to make compromises when it comes to the privacy and security of their ecosystems in the name of competition.” Many proposals “would undermine overall trust in app stores, as well as in our member companies,” said ACT | The App Association. “Small app developers benefit mightily from the investments of the large app platforms on privacy and security features, such as Apple’s App Tracking Transparency, privacy labeling, just-in-time notifications, encryption, and more, some of which could be eliminated or curtailed by the competition proposals.” 

Sen. Blumenthal presses TikTok CEO on user safety, cites “Whoosh” video. Senator Richard Blumenthal (D-CT) voiced “grave concerns over TikTok’s failure to ensure the safety of users,” including children. “Time and again, TikTok users … are seriously injured attempting to emulate videos they watch,” including a “Whoosh Bottle Experiment” where alcohol poured in a plastic bottle is set aflame (TV report), he wrote TikTok CEO Shou Zi Chew on January 10. “TikTok must do better to enforce its own community guidelines…” Blumenthal asked the CEO to meet with him and Connecticut school officials and parents to explain “how harmful videos” remain on its platform and the remedies he’s taking. TikTok didn’t respond to a TCF query. 

Fact-checkers cite YouTube misinformation, disinformation, seek solutions. Global fact-checkers objected to “destructive misinformation and disinformation being spread” on Google/YouTube’s platform, and called for “meaningful transparency” and other solutions. “We monitor how lies spread online—and everyday, we see that YouTube is one of the major conduits of online disinformation and misinformation worldwide,” they wrote on January 12. “YouTube is allowing its platform to be weaponized by unscrupulous actors to manipulate and exploit others, and to organize and fundraise themselves.” Google didn’t respond to a TCF query. 

Progressives target Meta/Facebook efforts to “dictate” Web 3 development. Progressive advocates voiced alarm that “Big Tech ‘s business models are fundamentally at odds with justice, democracy, and human rights,” and cited Meta/Facebook in particular. “With its rebrand to ‘Meta’ and interest in creating its own digital currency, Facebook has now set its sights on dictating the next generation of the internet, aka Web 3,” wrote Fight for the Future and 25 other groups to members of Congress. “This must not be allowed to happen, and you must take action. … We do not want to further entrench the monopoly power, data harvesting practices, and discrimination of Big Tech companies like Facebook—we must encourage alternatives.” Meta didn’t respond to a TCF query.