'They Don't Want To Face Juries': Josh Hawley Torches Big Tech Companies Over Antitrust Issues

Forbes Breaking News

At Senate Judiciary Committee hearing last month, Sen. Josh Hawley (R-MO) asked antitrust experts about antitrust enforcement against big technology companies.

Transcript

00:00Thank you, Mr. Chairman. Thanks to the witnesses for being here. Mr. Metter, I want to pick up

00:08where Senator Blumenthal started as well, this question about private enforcement and forced

00:12arbitration. You've said, I think, that antitrust is law enforcement, full stop. Wouldn't you agree

00:19that private enforcement is essential to a functional antitrust regime? Absolutely. American

00:24antitrust enforcement rests on three pillars of a stool. One is the federal government, the second

00:30are state attorneys general, and the third are private plaintiffs. I think I agree with Ms.

00:35Meckie's comments 100% that it's essential for the average person to have the ability to come into

00:40court and vindicate their individual economic rights. But they really don't today, do they? I mean,

00:45in case after case, particularly if you're dealing with companies of any size, and let's take our

00:49friends in the big tech world, for example, I mean, all of their user agreements are full of the

00:55classic contracts of adhesion. I mean, Google, you waive your right to sue us in court or to bring a

00:58class action case. I mean, there's virtually, I don't want to say no ability, but very, very diminished

01:05ability for any private citizen to bring any meaningful antitrust suit privately. I mean,

01:11isn't that real? Isn't that right? I agree that's a real problem, and it highlights the need for strong

01:15enforcement that can make it easier for private plaintiffs to bring follow-on lawsuits. But even

01:19then, as you point out, if you're subject to a forced arbitration clause, that can be more difficult.

01:24And wouldn't it be much more powerful in the antitrust sphere if we could also bring class

01:27action suits, private plaintiffs could bring class action suits, which again are theoretically possible,

01:32but effectively barred by many of these adhesion contracts, right? I agree. In many instances,

01:38a class action suit is actually the most efficient way to resolve these big questions. I mean, so to me,

01:43this speaks for the need, given what these companies are doing, given what some of the

01:47courts have done doctrinally, it speaks to the need for Congress to legislate on this topic and to give,

01:54frankly, antitrust enforcers more tools and allow private litigants to get into court,

01:59allow private litigants to bring class action suits to enforce our nation's antitrust laws. I mean,

02:04don't you think that if Congress were to put a stop to these forced arbitration clauses in the

02:08antitrust context, we'd see a lot more private enforcement? I mean, would that be your prediction,

02:12Mr. Mater? That is what I would expect to see. Do you want to weigh in on this, Ms. Miki, at all?

02:17I think this is extraordinarily important. Having access to lawyers to help vindicate your liberty

02:28in the form of damages is very, very important. But I would say that in the ecosystem that my

02:34friend Commissioner Mater just sort of outlined, you know, class action cases are very good at

02:40getting people monetary damages. But it is really the federal government that takes the mantle for

02:45getting injunctive relief and equitable relief. And so when I was at DOJ, I had the privilege and

02:52great fortune of helping to sue Google twice and winning twice. And so when the Justice Department

02:59is in court, fashioning remedies, they're talking about opening up markets, not just, you know,

03:07getting people money, which is important too, but making sure that our markets are delivering for the

03:11American people and are open for investment and innovation. Yeah, so it's a both and, right,

03:16I think is what you're saying. Yeah. But those damage awards, I mean, let me put it to you this way.

03:20When the FTC in 2019 fined, I think it was Facebook, $5 billion, if I remember correctly. Yeah,

03:28fined Facebook $5 billion. I remember I was brand new senator, I was new up here, and I thought,

03:33$5 billion, that's a lot of money. I thought, Facebook is really going to change its behavior

03:38now. Not so much. Their stock prices went up the next day. They did nothing meaningfully different.

03:45I agree with you completely about the need for robust federal enforcement, and I am a former

03:50state AG, Senator Blumenthal does as well, so I know that we believe in robust enforcement at the

03:55state level also. But there's something powerful about a damage award from a jury. I mean, to have

04:01private enforcers be able to get into court, get in front of a jury, particularly in a class action

04:06context, it's one of the reasons that these companies have fought Section 230 in a different

04:09context for years and years. They don't want to face juries. And I think the same is true for

04:14antitrust enforcement. They do not want to face private enforcers who are coming and bringing

04:20their cases into court. And I think one of the best things that we can do for antitrust enforcement

04:24is we ought to get rid of these forced arbitration clauses, and we ought to open up the courthouse

04:28doors for private citizens, and we ought to allow them to form class actions to do it.

04:34And we ought to do all of the above. I agree with you, Ms. Meakey, and Mr. Meador, we ought to

04:38empower your agency as well, because we need, I think you are fundamentally right, we need law enforcement,

04:43antitrust enforcement rather, is law enforcement, and we need more of it. Just in my last remaining

04:49seconds here, Mr. Meador, let me come back to you. You've said that big is bad, which I completely

04:54agree with, and that we need to consider structural remedies. Is that true outside of the tech sector?

04:58I know you've said that about tech. Is that true more broadly?

05:01I believe the competition concerns that have been most recognized in the tech sector are common in

05:07many other sectors. We need to enforce the antitrust laws evenly across the entire economy.

05:11Good. Let me just give you one example here. Four companies currently control over 80% of beef

05:18processing in this country, and very similarly high shares of poultry and pork. In Missouri,

05:26just in the last year, we have had two poultry plants closed by the dominant poultry processor,

05:32Tyson Food, canceling contracts with farmers, putting hundreds of people out of work across my state,

05:39really acting with total impunity. Why? Because they can. Because they are essentially a monopolist.

05:45Is this the kind of thing that the FTC can take action on?

05:48Yes, with the small caveat that the Department of Justice typically handles the packers, but the FTC sees

05:54this at the retail level as well. When there are a smaller number of packers, retailers pay higher

06:00prices, and then consumers pay higher prices, and then retailers want to merge and consolidate their own

06:04part of the supply chain to counteract that, and then it's sort of an arms race to see who can get the

06:08biggest, the fastest. I'll end with this. Right now, beef processing is just one example, but it's a

06:13perfect example for a state like mine. The only people who win are the monopolists. You know, if

06:17you're a cattle rancher, you're not getting paid for your product. If you are a consumer at the grocery

06:23store, you're paying an arm and a leg for some hamburger. And yet, so the consumers are paying more,

06:30the farmers are getting paid less. Who is really making out like a bandit here? It's the monopolists.

06:34It's the four people, the four companies that control 80% of beef processing. That is not

06:38competition. We need more competition in this country, economy-wide. Thank you, Mr. Chairman.

06:43Mr. Chairman, I want to associate myself with those comments that Senator Hawley just made,

06:47but I also want to ask, can we please let the wonderfully wide

Category

Transcript

Recommended