Industry Resources

The “New” Antitrust, And Why Corporations And Their Legal Departments Should Pay Attention

In the last few weeks, there have been clear signals from Washington, D.C. that a new era of antitrust enforcement has begun; and that the Biden Administration’s efforts to curb unfair and anticompetitive practices — to protect consumers, small businesses, and workers — will extend to industries as diverse as healthcare and agriculture.  This article will summarize those developments, as well as explain their importance to law firms and corporations with in-house legal departments.  As discussed below, those entities may need to quickly expand their focus beyond “traditional” antitrust and take a fresh look at the broad range of industries and business practices likely to be affected by the “new” antitrust.

On July 9, President Biden issued the Executive Order on Promoting Competition in the American Economy (the “Competition EO” — full text available on  The principal author of the Competition EO is Timothy Wu, Special Assistant to the President for Technology and Competition Policy, and before then Professor at Columbia Law School.  Prof. Wu has written extensively about the need to expand the application of the antitrust laws beyond mergers and other business conduct which raise prices to consumers — the so-called “consumer welfare” standard often applied by the U.S. Supreme Court and other federal courts.  The Competition EO embraces that approach, broadly condemning the impact of “excessive market concentration” and other business practices on “workers, small businesses, and consumers.”   

The Competition EO is a clarion call to the Department of Justice (DOJ) and the Federal Trade Commission (FTC) — along with the other federal agencies which regulate competition within specific industries — to apply their respective authority to promote competition.  For example, the EO specifically exhorts those agencies to “improve the competitiveness of small businesses”; as well as to “protect workers from wage collusion” and “address agreements that may unduly limit workers’ ability to change jobs.”  The list goes on — well beyond the traditional focus on mergers and price-fixing agreements — and includes such items as restrictions on third-party and self-repair of computer and farming equipment. 

Significantly, even before the Biden Competition EO was announced, the FTC took dramatic action to expand the scope of its antitrust enforcement authority.  On July 1, the FTC Commissioners voted by a 3-2 margin to rescind the FTC’s 2105 Statement of Enforcement Principles Regarding “Unfair Methods of Competition” Under Section 5 of the FTC Act.  The door is now open for the FTC via new guidance or rulemaking under Section 5 to challenge business conduct — even if such conduct might not otherwise constitute illegal monopolization (by a single firm) under Section 2 of the Sherman Act, or an illegal agreement (between two or more companies) under Section 1 of the Sherman Act.  

To be sure, seasoned antitrust lawyers will challenge any expanded enforcement of Section 5 of the FTC Act, perhaps all the way to the U.S. Supreme Court.  In the meantime, however — and for years to come — many companies will find themselves subject to intrusive FTC investigations and enforcement via administrative proceedings.  Indeed, the FTC on July 1 authorized FTC Staff to use compulsory process (subject to approval by a single Commissioner) to investigate a wide range of industries and conduct, including technology companies, digital platforms, and healthcare businesses (such as pharmaceutical companies, PBMs and hospitals).

Moreover, arguments that existing case law limits antitrust enforcement may not apply directly to the FTC’s use of its rulemaking authority to prohibit categories of business practices as “unfair methods of competition.”  Similarly, such arguments may not apply to the ability of other federal agencies to use non-antitrust laws and regulations to achieve the EO’s broad objectives.  Significantly, Section 2(c) of the Competition EO states that “in addition to the traditional antitrust laws, the Congress has also enacted industry-specific fair competition and anti-monopolization laws that provide additional protections.”  The EO also expressly authorizes the following agencies to use their individual authority to issue new rules and regulations concerning a broad array of business practices:  (1) the Department of Agriculture; (2) the Department of Treasury (which includes the alcohol and tobacco industries); (3) the Federal Communications Commission; (4) the Department of Transportation (which includes the airline industry); (5) the Surface Transportation Board (which includes the rail industry); (6) the Federal Maritime Commission; (7) the Department of Health and Human Services (which includes prescription drug pricing); (8) the Department of Commerce; (9) the Department of Defense; and (10) the Consumer Financial Protection Bureau.

The breadth of the Competition EO’s scope is so great that it’s hard to think of a single unaffected industry.  In the coming months, law firms and in-house legal departments will likely need to devote substantial resources to re-evaluating current business practices — such as IP licenses and employment agreements — in order to anticipate the myriad legal issues raised by the Competition EO (as well as the FTC’s new enforcement agenda).  Not to mention that the DOJ’s and FTC’s merger enforcement is bound to become more aggressive (even reaching consummated mergers) than under the prior Administration.

Cadence Counsel can assist corporations and their in-house law departments in meeting the challenges created by the just-issued Competition EO — by providing them with highly qualified and experienced attorneys (including former BigLaw associates and partners, as well as in-house veterans).  Depending on each company’s needs, these lawyers can work as permanent or interim counsel on matters related to antitrust, competition and/or other practice areas; or to augment the existing team’s capability to meet their internal goals related to compliance, contracts or document review. 

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