Introduction

On November 14, 2024, the American Bar Association (ABA) held its annual Antitrust Fall Forum in Washington, D.C., co-chaired this year by Wilson Sonsini partner Taylor M. Owings. The Forum was a chance for the antitrust bar to react to the U.S. election results and the likely landscape for antitrust in the next four years.

The Forum was a lively exchange, with three debates posing questions about the success of recent, more aggressive approaches to antitrust in the United States; two forward-looking panels focused on lessons from past presidential transitions and hot topics in the next administration; and two fireside chats—one with Jon Sallet, a prominent state enforcer from Colorado, and another with current Republican FTC Commissioner Melissa Holyoak.

The following provides a summary of the highlights from the Forum, as well as the key predictions from each session.

The Debates

     1. Resolved: The Biden Administration Turned the Page in Antitrust

In the first parliamentary debate of the day, panelists argued for and against the proposition that "The Biden Administration Turned the Page in Antitrust."

The "for" position—argued by Bill Baer (formerly the Assistant Attorney General (AAG) for Antitrust and Acting Associate Deputy Attorney General at the U.S. Department of Justice (DOJ), and the Director of the Bureau of Competition at the Federal Trade Commission (FTC)) and Doha Mekki (current Principal Deputy AAG for Antitrust at the DOJ)—took a relatively modest stance: that the Biden Administration "laid a foundation for meaningful, faithful antitrust enforcement" that is likely to endure with the incoming administration. Baer and Principal Deputy AAG Mekki pointed to successes from both the DOJ and the FTC, as follows:

• the DOJ having won more merger challenges than they lost, including causing 26 mergers to be abandoned following DOJ review;
• the DOJ's success in litigating to block the Penguin Random House/Simon & Schuster merger while focusing solely on upstream markets;
• the passage of the new merger guidelines and their favorable citation by at least 11 courts;
• reinvigorated Section 2 enforcement, including at the DOJ: a trial court victory in the liability phase of the Google search case, litigating the Google Ad Tech case, and the pending litigations against Visa, Apple, RealPage, and Ticketmaster;
• the unwinding of 18 interlocking directorates;
• the DOJ securing more than 60 convictions of companies and individuals for criminal antitrust violations and the recovery of more than $270 million in fines and penalties;
• the revival of Section 2 criminal liability;
• the filing of more than 30 statements of interest or amicus briefs and publication of 28 agency comments;
• the first successful airline merger litigation block since airline deregulation;
• reinvigoration of the FTC Act with a wide variety of Section 6(b) studies to understand how competition is affecting important and rapidly changing industries;
• publication of multiple memoranda of understanding between the DOJ, FTC, and other agencies; and
• increased FTC rulemaking activity, including the hidden junk fees rulemaking and the ban on non-competes.

Baer and Principal Deputy AAG Mekki argued that these actions reflected the Biden Administration's commitment to "identify[ing] areas with significant harm to competition that were previously left unchallenged or under addressed" and acting to protect the areas most vital to competition and consumer welfare, including healthcare, technology, pharmaceuticals, airline travel, retail, housing, and finance. Ultimately, the "for" panelists concluded that the Biden Administration pursued "sound competition policy" that is likely to endure through the next administration and into the future.

The "against” position—argued by Daniel Crane (the University of Michigan Law School) and Kristen Limarzi (former Chief of the Appellate Section at the DOJ’s Antitrust Division)—articulated the ways in which the Biden Administration either stayed the course or met with roadblocks in trying to change the scope of antitrust law. They argued that we must judge the agencies by their "signature ambitions" and that, when judged that way, there has been no enduring change. In particular, Crane and Limarzi called out:

• the issuance of a nationwide injunction, prohibiting the FTC's non-compete ban rule from taking effect;
• the failure to have any court endorse the FTC's Section 5 policy statement;
• despite rhetoric about wanting to reinvigorate the Robinson Patman Act, the fact that no cases have been brought to date;
• the appearance of partisanship in pulling the 2020 vertical merger guidelines without immediately replacing them and the resulting increased likelihood that the 2023 merger guidelines would similarly be pulled;
• the agencies' mixed record in merger litigation and their success only on more traditional types of cases;
• the absence of any court relying in an outcome-determinative way on the new aspects of the 2023 merger guidelines;
• the aversion to merger consent decrees resulting in parties “litigating the fix” and increasing the chance of no court-ordered relief;
• aggressive theories on information sharing, which have not yet been accepted by any court;
• no wins to date in Section 2 cases where the complaint was filed under the Biden Administration; and
• a significant string of losses in criminal labor markets cases.

Ultimately, Crane and Limarzi laid out the case that while the Biden Administration deserves credit for the hard work of pursuing investigations and litigating cases, it established no new legal frontier and, therefore, failed to “turn the page” in antitrust.

Both sides agreed, however, that as we transition away from the Biden Administration, the key areas to watch will include what happens to the 2023 merger guidelines, what remedies the government will seek in the Google search case, whether the FTC will abandon its appeal of the order enjoining its non-compete rule, whether the new administration will publish new information-sharing guidelines and/or reinstate the old guidelines, and whether the new administration will return to a culture of permitting merger settlements.

     2. Resolved: Merger Efficiencies Are Over-Promised and Under-Delivered

In the second debate of the day, panelists debated whether existing evidence warrants a relatively high or low regulatory burden on transactions compared to the prevailing paradigm. In doing so, they addressed the difficulties of accurately assessing efficiencies and the role that these difficulties have and will continue to play in convincing enforcers and courts to recognize and credit efficiencies as part of their merger analyses.

On one side of the debate, Nancy Rose (Massachusetts Institute of Technology) argued in the affirmative, contending that among mergers in “the enforcement zone,” those scrutinized by regulators for posing meaningful competition concerns, very few end up providing real resource savings leading to lower downstream prices that offset effects from consolidated market power. Rose cited John Kwoka’s study evaluating 49 merger retrospectives and the 2017 Miller and Weinberg paper finding that the efficiencies from the MillerCoors joint venture did not outweigh price increases from coordinated effects.

On the other side of the debate, Louis Kaplow (Harvard Law School) and Elizabeth Bailey (Charles River Associates) argued in opposition, contending in the first instance that the standard to which efficiency claims are held in the 2023 Merger Guidelines is too high. Kaplow made the case for enforcers assessing merger efficiencies as one of the first steps in a merger review, rather than relegating the analysis to an afterthought on the assumption that efficiencies will not be “cognizable.” Among the benefits of considering efficiencies early, according to Kaplow, is that the greater the likelihood of efficiencies, the less likely it is that the merger is being undertaken for its anticompetitive effects. Bailey focused on the evidence of efficiencies in recent cases including JetBlue/Spirit; she also focused on the assumptions underlying Miller and Weinberg paper, noting difficulties controlling for the 2008 economic recession's impact on consumer behavior.

The participants concluded by expressing the importance of humility and agreeing that more empirical research is necessary to produce, among other things, a more robust model of coordinated effects and price leadership, which is one way that merger efficiencies can be overwhelmed.

     3. Resolved: Anticompetitive Conduct Is Best Determined by the FTC

In the final debate of the day, panelists argued for and against the proposition that "Anticompetitive Conduct Is Best Determined by the FTC." The panelists provided an overview of how the FTC's 2022 Policy Statement Regarding the Scope of Unfair Methods of Competition under Section 5 of the FTC Act allows the Commission considerable flexibility to set the rules of the road for business conduct, and highlighted recent enforcement and rulemaking actions by the FTC that rely on this unique authority.

Shaoul Sussman (Associate Director for Litigation at the FTC) and Sandeep Vaheesan (Legal Director, Open Markets Institute) argued the "for" position, contending that the FTC is best suited to determine anticompetitive conduct because 1) it possesses expertise that generalist Article III courts lack and can obtain further expertise through the public comment process; 2) unlike Article III courts, the FTC is publicly accountable because Congress controls its funding, can direct it to act or refrain from acting, and the public can participate directly through the comment process; and 3) the Part 3 process provides advantage to companies because it permits them to have their cases tried quickly and permits the defendant to choose the court of appeals that would review any in-house decision.

On the other side, Bruce Hoffman (formerly the Director of the Bureau of Competition at the FTC) and Jennifer Milici (formerly the Chief Trial Counsel at the Bureau of Competition at the FTC), argued that courts are capable of adjudicating whether something is anticompetitive based on the facts particular to the case, and that fact-specific findings are their expertise. Moreover, they argued against Part 3 litigation because 1) it suffers from a perception that the FTC always wins; and 2) the overall time to decision is not faster, but rather, the discovery part of that process is condensed, which hampers a company's ability to mount a defense. Hoffman expressed reservations about the FTC’s Section 5 policy statement being used as a means to achieve political ends rather than predictable conditions for businesses. Vaheesan countered that this was a feature not a bug because “elections have consequences” and the FTC should be no different than the U.S. Securities and Exchange Commission, Federal Communications Commission, and other agencies that change direction when the party in leadership switches.

As we transition away from the Biden Administration, all the panelists agreed that they are keeping their eyes on whether a new policy statement is issued and whether the FTC will opt to pursue more challenges in Article III courts, rather than in-house.

Forward-Looking Panels

     1. Lessons from Past Presidential Transitions

The Presidential Transition Act of 1963 established procedures that the federal government must follow to prepare for the transfer of power after a presidential election. Panelists Kathy O’Neill (who served as career staff leadership during the Trump-to-Biden transition), Renata Hesse (who twice served as Acting Assistant Attorney General in the Antitrust Division, including in the period of the Obama-to-Trump transition), David Higbee (who served on the Obama-to-Trump transition team for antitrust), and Gene Kimmelman (who served on the Trump-to-Biden transition team for antitrust) discussed how Presidential transitions operate at the FTC and the DOJ and what impact they have on competition policy and enforcement agencies.

The discussion opened with panelists describing how leadership will change at the FTC and the Antitrust Division of DOJ. Based on observations from prior administrations, the panelists agreed that President-elect Trump would name a new acting chair of the FTC upon inauguration but noted that it was not unprecedented for the existing chair to remain in place, which was more common when the undertakings of the FTC were seen as more technocratic and less partisan. All agreed it was possible, though unlikely, that FTC Chair Lina Khan could remain in a minority commissioner role at the FTC until a replacement is confirmed. Kimmelman noted that at the DOJ, the president’s priority will be to get the Attorney General, and possibly other leadership like the Deputy and Associate Attorneys General, in place before focusing on division-specific leadership. Using statistics back to 1988, Higbee emphasized the confirmation process takes time and it will likely be six to 12 months before the agencies have their leadership fully in place.

Panelists also offered insight into what happens behind the scenes during the transition period. Career staff meet with transition personnel to evaluate each pending matter and to create a schedule for major decision milestones coming after inauguration. They also help appointees prepare for Senate confirmation, including through briefing on major policy issues and by preparing for meetings with senators.

Before concluding the session, panelists opined on their predictions regarding policy initiatives that may be affected by the change in administration. Panelists generally agreed that the new HSR rules will likely come into force, most likely after a delay if the new administration follows recent precedent and issues a “freeze memo,” discussed in more detail in our Wilson Sonsini client alert here. Hesse shared that she believes there will be more continuity than change on the litigations pending against technology companies, and O’Neill predicted the agencies may return to using more settlements in merger cases.

     2. Hot Topics in the Next Administration

The hallmark of competition policy in the Biden Administration has been a government-wide approach to achieving competition-related outcomes. Panelists Deb Garza (former Deputy AAG in the Antitrust Division), Debbie Feinstein (former Director of the Bureau of Competition at the FTC), John Newman (former Deputy Director of the Bureau of Competition at the FTC), and Noah Phillips (former FTC Commissioner), discussed predictions about how the next administration will compare.

The conversation began with a discussion about what flexibility, if any, a new administration has in changing the course of a pending case. Phillips noted that the DOJ has a lot of flexibility, as seen with the Bush Administration’s change in direction to settle the landmark antitrust case against Microsoft. However, he explained that the FTC is differently positioned because there are four incumbent commissioners who have developed relationships with staff, who typically support the on-going cases. Feinstein remarked that, traditionally, “antitrust is about passing the baton more than extreme changes. There isn’t a history of a new commission coming in to dismantle a case.”

Panelists then discussed their prediction that the Trump Administration will modify or rescind altogether the 2023 Merger Guidelines. Newman expressed regret at this outcome because it could usher in uncertainty for businesses if the guidelines were not immediately replaced and if new guidelines were expected in every new administration. Other panelists noted that the Biden Administration pulled the then-recently passed 2020 vertical merger guidelines, leaving nothing in their place.

Phillips and Newman both discussed the agencies’ recent interest in AI and wondered whether the Trump Administration would study AI and make competition-related decisions with a greater emphasis on U.S. national security interests.

Another hot topic was the likely outcome of the various challenges to FTC’s constitutionality. Phillips opined that the FTC was likely to lose in court at some point and was joined by other panelists in the view that such a loss would not be existential for the FTC. Rather, it would likely result in some relatively minor changes to the agency’s functioning (for instance, a requirement to file merger challenges in Article III courts). Panelists additionally explained the likely outcome of the current judicial review of the FTC’s competition rulemaking authority. All panelists seemed to agree that at least one of the U.S. Circuit Courts of Appeal hearing challenges would decide against the FTC. Newman predicted that Trump Administration leadership would let such a loss stand, which would result in the non-compete rule being permanently vacated. Feinstein predicted that the next administration would return to using enforcement actions to shape business guidance on issues like non-competes. She remarked that leadership of the FTC had considered pursuing a rulemaking to establish the contours of prohibited reverse patent settlements but succeeded in proceeding by enforcement action instead. She recommended the next administration take the same approach.

Before concluding the conversation, panelists played a quick game of “sweep or keep,” in which they predicted which Biden Administration initiatives would be tossed. There was consensus the Trump Administration will keep the HSR rule changes, but most likely sweep the 2023 Merger Guidelines, the FTC’s non-compete rule, and the FTC’s Section 5 policy statement. Feinstein shared the hope that the Trump Administration would prioritize “bread and butter cases” to demonstrate a continued commitment to the rules of the road that businesses should be on notice to follow. She suggested much good could be accomplished with enforcement actions of this kind against trade associations or exclusive dealing practices.

Fireside Chats

     1. Fireside Chat with Jon Sallet

Terrell McSweeny (former FTC commissioner) interviewed Jon Sallet, a special AAG for antitrust in the Office of the Colorado Attorney General, on the greater role that state attorneys general (AGs) have been playing in the enforcement of state as well as federal antitrust law. Sallet spoke of the strong, bipartisan coalitions of state AGs that have emerged over the past several years leading to joint actions like those In re Generics as well as in United States v. Live Nation (Ticketmaster).

Using the Kroger-Albertsons merger as an example, Sallet reminded the audience that even when mergers are national or international in scope, their competitive impact on consumers is felt locally. When stores close or prices rise in a particular location because of consolidation, this means that consumers must travel longer distances or alter their spending habits accordingly. The local nature of national mergers makes them very relevant to state enforcers, and Sallet predicted that state AGs will continue to play active roles in making sure that impact on local markets is not lost in the overall analysis.

Sallet also reflected on the takeaways from Judge Mehta’s opinion finding of liability in United States v. Google, a case where Sallet helped to lead a state coalition in cooperation with the DOJ. In Sallet’s view, the opinion demonstrates:

• Courts care about market realities, a phrase that judge Mehta used repeatedly throughout the opinion.
• Behavioral economics will continue to influence courts as a way to explain the gap between what consumers or companies should do in theory, and what they actually do in reality.

Sallet opined that Judge Mehta’s opinion could be influential on future cases for the proposition that superior quality is not necessarily a defense in monopolization cases. In Sallet’s view, the opinion could be cited to establish that when superior quality is derived from an antitrust violation, courts should consider it “fruit of the poisonous tree” and not credit it in their analyses.

Sallet concluded by predicting that he expects to work with the Trump Administration, whose DOJ originally brought United States v. Google, in a fruitful way.

     2. Fireside Chat with Commissioner Holyoak

In perhaps the most important preview of the day, attendees had an opportunity to hear from Melissa Holyoak, one of the two sitting Republican FTC commissioners who could be named Acting Chair on Inauguration Day. In a fireside chat moderated by former commissioner Christine Wilson, Commissioner Holyoak described her approach to the policy issues arising at the FTC and what she sees as likely changes in direction with the incoming administration.

First, Commissioner Holyoak praised the "FTC community"—those current and former staff and members of leadership that have such a "love and passion for the work and the institution." Commissioner Holyoak expressed a desire to see the institution flourish in the next administration.

Commissioner Holyoak also described her approach to the recent HSR Rule, which was able to pass 5-0 because of compromises on both sides of the aisle. She noted that the commissioners compromised to remove elements of the proposed rule that she found most troubling and unrelated to the proper scope of merger review, including facts about a party’s workforce (i.e., workplace violations, SOC, and commuting zones) and details about long-ago acquisitions. The Commissioner stated that, with the incoming administration, she believes this era of compromise will need to continue, as the FTC must work with the DOJ and with commissioners from both parties to "objectively review evidence and make decisions based on the evidence and the law."

Additionally, Commissioner Holyoak identified the following areas as items to watch in the coming months under the new administration:

• additional guidance on how to complete the new HSR form. Consistent with her statement that the final HSR rules ultimately represented a compromise, Holyoak signaled willingness to work with the DOJ to reconsider aspects of the HSR rule if they prove to be more burdensome than beneficial to merger review;
• a possible revision to the 2023 Merger Guidelines. Holyoak indicated she would "strongly consider revising" the guidelines but that the FTC would need to work with the DOJ as a “dancing partner” to do so;
• building cases around evidence of consumer harm, including as applied to technology companies;
• clarity on the FTC’s power to make legislative rules governing methods of competition. Holyoak indicated her belief that the FTC does not have such authority but also hinted that it could be a positive outcome to have a clear statement from courts, including possibly the U.S. Supreme Court, to resolve the question; and
• re-balancing the approach to artificial intelligence (AI). Holyoak expressed a desire to encourage AI development, which she indicated must be held in balance with the goal of protecting consumers from harm.

Commissioner Holyoak also expressed concern at the way the FTC had been managed during the campaign season. She rebuked the practice of rushing through rulemakings and reports tied "to campaign promises of the chair's favored presidential candidate." She expressed a desire to see the FTC return to its role as an objective protector of competition acting in a considered manner based on all the relevant facts.

Conclusion

While much about the future policies at the antitrust agencies is still unclear, the consensus at the Fall Forum was that some of the Biden Administration’s signature positions would likely be reversed. For more information about how the change in administration could affect how your company competes, please contact any member of Wilson Sonsini’s antitrust and competition practice.