The Obama Trials: the US antitrust agencies in the courtroom, 2009-2017
Our forthcoming essay collection, The Obama Trials: the US antitrust agencies in the courtroom, 2009-2017, will describe in vivid detail the lawsuits and courtroom battles that have defined the antitrust legacy of President Barack Obama. Built around Obama's campaign trail promise to reinvigorate antitrust enforcement in the US, the book explores in a dozen chapters whether and how that promise was kept - from the early structural reorganization of the Department of Justice's Antitrust Division, to the near-unprecedented string of courtroom victories by it and the Federal Trade Commission.
Each chapter is divided into three sections, providing the reader a unique perspective on the legacy of a case or group of cases that Obama-era antitrust enforcers took to trial. Each section expands on the case law built during those trials, and shares the lessons the government and private lawyers learned from each litigation and trial. Contributors include both DOJ Assistant Attorneys General confirmed by the US Senate during the Obama Administration; the former head of the FTC's Bureau of Competition; multiple lead trial lawyers for the government during its most important cases; and a top antitrust trial attorney from the law firm that routinely faced Obama-era enforcers in the courtroom.
The chapters also include an essay written by current and former GCR reporters and editors who had on-the-ground experience covering Obama Administration antitrust trials in court. Those essays are intended to buttress the work of our all-star contributors and in some cases expand on the antitrust issues and lawsuits now firmly entrenched in the legacy of the era. These essays are presented alongside small collections of GCR's most crucial pre-trial and trial reporting from those litigations. Each story offers a thorough description of the issues and people at the heart of each case and a glimpse inside the courtroom drama as it unfolded. The entire collection is assembled and curated by GCR's Editor-at-large, Ron Knox, who watched the Obama era of antitrust enforcement unfolding during his decade as a reporter and editor for the magazine.
Each chapter offers thorough insights on case law and courtroom tactics from the litigators and reporters who were there. The book as a whole also sheds light on the successes and failures of the antitrust agencies during the past eight years, as a way to predict and prepare for what cases and court decisions come next.
Copies of The Obama Trials will be available for purchase from December 2017 priced at £125, and content will be accessible online to GCR Premium subscribers.
The chapters are as follows:
Christine Varney on changes inside the US Department of Justice's Antitrust Division
After she was confirmed by the Senate as Assistant Attorney General and took over as head of the Antitrust Division, Varney directed the complete reorganization of the division, removing silos from the division's different enforcement tracks and building a culture of courtroom preparedness from the ground up. Varney's reorganization - which was considered controversial at the time - and her personnel decisions helped the division build its litigation capabilities if and when it brought a merger or a conduct case to trial. In this essay, Varney outlines the mission she was tasked with completing, her drive to craft new merger guidelines and how she reoriented the agency toward preparing for the courtroom from the very onset of its antitrust investigations.
Lawrence Buterman on H&R Block/TaxAct
Just more than a year into Varney's tenure as head of the Antitrust Division, it received notice that two tax preparation companies, H&R Block and TaxAct, planned a merger that would leave this industry with just two major providers of online tax preparation services. Under the guidance of lead trial attorney and seasoned litigator Lawrence Buterman, the division sued to block the deal and began what would become the division's first successful merger trial in nearly a decade. Here, Buterman explains how the case unfolded, how Antitrust Division lawyers built their case and prepared for trial, and how the renewed focus on litigation at the division helped build the strategy that became the template for government-led antitrust trials throughout the administration. This section also includes a feature story by book editor and long-time GCR reporter Ron Knox, detailing the investigative and trial techniques that helped secure the DOJ its first successfully litigated merger challenge in nearly a decade.
Peter Huston on AU Optronics
There has perhaps never been a criminal antitrust trial as important as the government's prosecution of liquid-crystal display maker AU Optronics. Faced with charges that the company conspired to fix the price of LCD screens for years, it chose to put the DOJ to its evidence and make it prove the conspiracy - and its request for a $1 billion fine - in the courtroom. At risk was the division's ability to fine cartelists above the statutory maximum based on the estimated gains or losses from the cartel, and its ability to go after foreign conspiracies that affected the US economy. It succeeded on all counts - a landmark victory for criminal antitrust enforcement at the DOJ. Huston, who led the AUO trial for the government, examines the history of the conspiracy, the psychology of persuading a jury facing an antitrust trial, and the lasting importance of the verdict. Book editor Ron Knox also contributes an original essay outlining the DOJ's other criminal antitrust trials during the Obama Administration.
James Tierney on Bazaarvoice
When the DOJ sued to stop and unwind a merger between online ratings and review software rivals Bazaarvoice and PowerReviews, it faced a defense team armed with the tools the DOJ might have used a decade earlier - compelling customer testimony and the potential for new, powerful entrants in the market. Instead, the government used what have been called the worst documents in the history of antitrust to attack the deal, and it successfully demonstrated that Amazon, Google and others had no plans to enter the market. Here, Tierney, the former chief of the Antitrust Division's Networks and Technology Section, writes that Bazaarvoice stuck to the government's litigation strategy and proved that courts would rely more on internal documents and economics than on customer testimony. In a separate essay, GCR Editor Pallavi Guniganti examines the role of Amazon, and the potential for future competition, in the court's decision to uphold the government's challenge of Bazaarvoice.
Stephen Weissman on Sysco/US Foods
Sysco and US Foods, two of the country’s largest nationwide foodservice distributors, thought they had found a solution to antitrust concerns about their merger. When the Federal Trade Commission sued to block the deal in February 2015, the companies said they would fight the challenge - and in doing so, put their proposed remedy before a federal judge to decide whether that fix would indeed repair the alleged harm that would come from the merger. Former FTC official and lead trial counsel Stephen Weissman explains why that strategy was inherently risky, and how the government used the openings created by the “litigate-the-fix” strategy to ultimately prove its case. Then, former GCR reporter Harry Phillips writes about Judge Amit Priyavadan Mehta, who had just been confirmed to the federal bench and had never heard an antitrust case prior to deciding the fate of Sysco/US Foods.
John Majoras on Steris/Synergy
As the only antitrust merger trial the government lost during the Obama Administration, the challenge of the Steris/Synergy merger stands as a vital lesson to future antitrust enforcers and litigators about the potential pitfalls when challenging a deal based on the potential harm it might cause competition in the future. The FTC challenged the deal under the theory that because of the deal, Synergy had ended its plans to bring its x-ray sterilisation technology to the US market to compete with Steris. But despite some compelling documents and other evidence showing this was indeed the case, the court found that the evidence failed to support the government's theory - showing just how difficult it is to convince a court to stop a merger based on harming competition that might or might not happen. Majoras, the lead trial lawyer for defense counsel Jones Day, walks the reader through the flaws in the government's case and the steps the defense team took to expose those flaws in court. Former GCR reporter and current Arnold & Porter Kaye Scholer lawyer Yasmine Harik contributes an essay exploring how the facts of the case, rather than the theory of future competition, was truly at issue in Steris/Synergy.
Matt Reilly on health care & antitrust
For years, the FTC hesitated to challenge mergers between rival hospitals after courts began accepting market tests and data that led to several difficult courtroom losses for the government. But under the Obama Administration, the agency began challenging hospital deals again and, armed with new data, began winning cases. This happened in spite of the Affordable Care Act, which urged some consolidation in the healthcare industry in order to bring down costs. Former FTC Bureau of Competition assistant director Matthew Reilly, now at Kirkland & Ellis, explains the history of the government's enforcement of hospital mergers and details how the FTC found success at every level in court when challenging such deals. Meanwhile, former GCR reporter Alex Wilts writes about her experience covering perhaps the two largest simultaneous trials in DOJ history - the dual healthcare insurance mergers between Aetna and Humana, and Anthem and Cigna.
Ethan Glass on American Express
There was perhaps no more controversial antitrust case during the Obama Administration than the government's pursuit of credit card company American Express. The government accused Amex of abusing its power over retailers who accepted the company's credit cards by restricting merchants' ability to suggest less-expensive methods of payment, including cash or other company cards. American Express argued that the government's claims were nonsense; Amex was the third-largest card provider struggling to gain market share - not a company powerful enough to exert its will on retailers. Ethan Glass, DOJ trial counsel and current partner at Quinn Emanuel Urquhart & Sullivan, writes about the factors that led to the government's District Court victory - one that was ultimately overturned on appeal. Also, GCR Editor Pallavi Guniganti writes about the issue of class in deciding the Amex case, both in district court and on appeal.
Deborah Feinstein on Staples/Office Depot
Nearly two decades after the two largest office supply stores in the country tried and failed to get their merger cleared by antitrust authorities, Staples and Office Depot tried again - this time, in a world in which Amazon, Walmart and others had chipped into their dominance of the retail office supply world. But just as in 1997, the FTC sued to stop the merger, this time because of the companies' collective control over the supply of bulk office supply to major corporate clients. Deborah Feinstein, the former head of the FTC's Bureau of Competition, explains how the agency analysed the merger, and its trial strategy for proving the market and overcoming the companies' claims that Amazon and others were ready and willing to enter the business-to-business office supply market. Then, GCR reporter Charles McConnell shares his reporting of a pivotal moment during the preliminary injunction hearing to stop the deal.
Ted Hassi on McWane
The FTC's case against McWane Inc. was one of the very few monopolisation cases brought by the Obama Administration and the only to go to trial. The case was contentious even within the FTC, and proved that even when using its own in-house administrative process, there is no such thing as a rubber-stamped case. Ted Hassi, the former FTC chief trial counsel and current O'Melveny & Myers partner, describes why and how the agency's administrative law judge accepted and rejected different charges against McWane, and why the commission ultimately decided on a single charge of monopolisation against the company. Also, Pallavi Guniganti, GCR's editor, describes the law surrounding the issues raised by McWane and the Obama Administration's record on monopoly enforcement.
Mark Ryan on Apple
The DOJ's head of litigation describes the investigation, litigation strategy and trial of what will likely be remembered as the most high-profile and successful antitrust litigation of the Obama Administration: The DOJ's pursuit of Apple for its role in an industry-wide conspiracy to raise and fix the price of ebooks. Despite plea agreements between the DOJ and the book publishers also targeted in the investigation, Apple stood its ground, arguing that its entry to the ebooks market was necessary to break the grip of Amazon, the market leader by a wide margin. While the Amazon argument did raise significant questions about the company's power in the market and Apple's disruptive role, Ryan and the Antitrust Division convinced both the District and Circuit courts that Apple had broken the law - as Ryan details, by either a per se or rule-of-reason standard of judgment.
Bill Baer on the legacy of Obama Antitrust enforcement
William Baer, the second and final Assistant Attorney General nominated by Obama and confirmed by the Senate, for the first time gives his broad thoughts at the legacy of antitrust enforcement at both the DOJ and the FTC, particularly during the administration's second term.