Senator Amy Klobuchar Introduces Another New Antitrust Bill To Further Target The “Big” Guys

After ending her presidential campaign, Senator Amy Klobuchar was back on the Senate floor to introduce another new antitrust bill—this one called the Anticompetitive Exclusionary Conduct Prevention Act—which aims to amend the over-century-old Clayton Antitrust Act in order to “reinvigorate” antitrust enforcement across the economy and (apparently) specifically intended to target industries like pharmaceuticals and telecommunications that—according to Klobuchar—are riddled with players that have grown too “big”.^[1]  

Senator Klobuchar herself seems particularly troubled by so-called “Big Tech” and the issue of “self-preferencing” (when a company leverages its power in one market to enhance access to its own products and services, making it tougher for consumers to access competing products and services offered by third parties—e.g., an internet search platform that bumps up its own mapping services to the top of the search hit list).^[2]

Klobuchar’s bill, therefore, seeks—as one of its principal goals—to “Shift[] the Burden of Proof so that powerful companies that have a market share of greater than 50% or that otherwise have substantial market power would have to prove” that their alleged “exclusionary conduct” does not present an “appreciable risk of harming competition.” ^[3]

To that end, the text of the bill—as it currently stands—includes the following key provisions:

• “Exclusionary conduct” (unilateral or concerted) that “presents an appreciable risk of harming competition” (i.e., not actual harm to competition) is prohibited.^[4]
• The “appreciable risk of harming competition” is presumed if the exclusionary conduct is undertaken in a relevant market by a person or group with a market share greater than 50 percent in the relevant market, or that “otherwise has significant market power in the relevant market.”^[5]
• The presumption can be rebutted if the defendant can show “distinct procompetitive benefits” that “eliminate” (not just outweigh) the “risk of harming competition,” a new entry by or expanded presence of a market participant that “eliminat[es]” the risk of harm to competition, or that the conduct “does not present an appreciable risk of harming competition.”^[6] (It is unclear how the analysis is meant to play out once the presumption is rebutted.)
• If the presumption does not apply, the “appreciable risk” is assessed based on the “totality of the circumstances,” including whether the aforementioned “distinctive procompetitive benefits” or the new entry by or expanded presence of a market participant “substantially eliminat[e]” that risk, but a definition of the relevant market apparently is not one of them.^[7] Indeed, the bill says that “the definition of a relevant market” is not required to establish liability under any federal antitrust law except to establish a presumption or to resolve a claim under a statute that explicitly references “relevant market, market concentration, or market share.”^[8]
• Applying for or enforcing a patent, trademark, or copyright shall not constitute exclusionary conduct standing alone (unless baseless or in bad faith), but may be considered as part of a course of conduct that does establish exclusionary conduct.^[9]
• The bill limits the power of the judiciary to imply immunity from the antitrust laws for conduct that is regulated under federal statute or regulations.^[10]
• The bill allows the Department of Justice (DOJ) or the Federal Trade Commission (FTC) to impose liability for a civil penalty on a defendant in civil actions, which can be up to 15 percent of the total U.S. revenues of the defendant for the previous calendar year or 30 percent of the U.S. revenues of the defendant in “any line of commerce affected or targeted by the unlawful conduct during the period of the unlawful conduct.”^[11]

Of course, it is unknown how the bill would operate in practice even assuming it gets past the Senate Judiciary Committee, let alone signed into law. Indeed, this is one of a string of recent bills introduced by Klobuchar—all of which are still in Committee: e.g., the Monopolization Deterrence Act (empowering DOJ and FTC with authority to seek civil penalties for attempted monopolization); the Merger Filing Fee Modernization Act (lowering fees for small and medium-sized businesses); the Consolidation Prevention and Competition Promotion Act (merger that effects “monopsony” power on a company could violate antitrust laws); and the Merger Enforcement Improvement Act (aimed at improving agencies’ ability to access the impact of merger settlements, requiring studies of new issues, etc.).

Putting that aside, the current language and goals of the bill could result in far-reaching changes—that we expect will be subject to serious scrutiny. Shifting the burden of proof to companies defending against antitrust enforcement and private damages lawsuits would be a sea change in the law, and would be vigorously opposed in the legislative process. Moreover, the bill, as written, could have unintended negative effects, for example, inadvertently targeting some “big” players in some very small ponds that Klobuchar herself wasn’t intending to go after.

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^[1] Senator Amy Klobuchar, Remarks Before the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights, YouTube (Mar. 10, 2020), https://www.youtube.com/watch?v=VTxC5kOP8VU.

^[2] See id.

^[3] Klobuchar Introduces Legislation to Deter Anticompetitive Abuses, Klobuchar.Senate.Gov (Mar. 10, 2020), https://www.klobuchar.senate.gov/public/index.cfm/news-releases?ID=E59886E1-12EE-48A5-94F5-044658A75513.

^[4] S. 3426, 116th Cong. § 4(a) (as reported by S. Comm. on the Judiciary, Mar. 10, 2020) https://www.congress.gov/bill/116th-congress/senate-bill/3426/text (emphasis added).

^[5] Id.

^[6] Id.

^[7] Id.; see also id. § 6(a).

^[8] Id. § 6(a).

^[9] Id. § 4(a).

^[10] Id. § 7(a)-(b).

^[11] Id. § 4(a).