In a case involving Swedish conglomerate Assa Abloy's attempt to dominate smart locks, a Biden judge is acting like an anti-government management consultant. The American judiciary is out of control.
Valuable to do first hand reconnaissance. My journalist wife, Libby Lewis, has sat through innumerable bankruptcy court hearings and witnessed exactly the same phenomena described here by Mr Stoller in cases in which the judges entirely discount the public interest and seem to view their jobs as requiring them to rule in favor of whatever is going to being the maximal economic benefit to the private interests before them regardless of broader social costs including economic concentration. It's astonishing until you begin to deconstruct it in the way Matt has here which is to look at who selects them and their backgrounds - almost always- as corporate lawyers for the largest private businesses before they become judges and before that their education at one of a handful of elite law schools. The whole system has become self perpetuating and rotten on the sense that UK was once governed by a Parliament selected from rotten boroughs. Judicial gerrymandering. Not representative government.
Matt, thanks as always for a very illuminating essay. Judge Reyes' decision will tell us a lot about another judge coming out of a large law firm. My question is why would a top lawyer leave a million dollar salary for a judgeship. I understand there may be compassion and humane considerations, but todays world is driven by money and power. Mergers lead to consolidation and market power. These deals involve enormous amounts of money with many individuals with their fingers in the pie, most of them attorneys. Without a judiciary supporting strong government intervention, continued consolidation will be a disaster for our economy.
Good observation about the increased isolation of the judicial and corporate elites from the 99%. Another side of the problem may be that once upon a time many judges and Supreme Court justices were former politicians--some very successful--keenly aware of public opinion and even used to rubbing shoulders with the hoi polloi. (Think Earl Warren, Governor of California and Vice Presidential candidate.) Hasn't been a single SC justice who's even run for office since Sandra Day O'Connor (former State Senator). Thanks for pointing out that most Federal judges today are former corporate lawyers from the largest law firms. I wouldn't be surprised to learn that most of them attended private colleges and the top-rated law schools, even though something like 80% of American college grads. attend public institutions. Of course, their defenders would argue that this just means that they're the Best and Brightest!
Another example involves an old merger case, Baker Hughes, decided by Judge Clarence Thomas. It was governed by Section 7 of the Clayton Act which prohibits mergers the effect of which “may be substantially to lessen competition...." His opinion instead asked whether the merger, "will substantially lessen competition...". He literally changed the statute into one he liked better! And then found no violation of it.
At the end, you ask the “why aren’t “ questions which are the crux of the matter. I can only think that the major political parties are only giving lip service to anti monopoly positions and are backing low impact anticompetitive cases. If they seriously went after monopolies they would quickly come into the crosshairs of the forces that actually run the country and even the world. And, even if it is not your intent Matt, you keep making that case.
So well written as to be so easily understood by those of us who don't often think about monopoly and how it is always bad for society. Thank you. In truth you have given us one more thing to be worried and disturbed about. Yet, I still thank you. The bear is outside, it is better to know that than not to know that.
Great summary of your experience. You draw some very compelling inferences about how and why the federal judicial system bends towards corporate interests, and how this distorts the enforcement of anti-trust law. Kudos for challenging Judge Easterbrook. I think you could have declared victory as soon as he “harumpffed” you.
Incredibly ingenuous of judges to call business owners "smart people" and then also assume that what they're doing is good for anyone else besides themselves. Reminds me of this Planet Money episode where they talk about how neoliberal economists set up conferences for federal judges and by 1990 40% of federal judges had attended these retreats where they learned what they thought was just objective economic facts, rather than a specific neoliberal ideological worldview. "Econ's Brush with the Law" https://www.npr.org/transcripts/1124477182
Thank you for your service in bringing these important issues to the light of day.
Cannot thank you enough Matt, for everything you're doing. I'd grown so cynical but over the last year I'm really seeing your impact. I'd never really considered this area as the source of so many of our problems, but you have opened my eyes
Does anyone here know how I might learn how to research corporations for the purpose of whether they are owned by Private Equity. TY in advance.
It is really helpful to read about the details of a specific case, thanks Matt. And it leaves me with a question about "all doubts must be resolved in favor of the government". It sounds like this would give the govt agency tremendous power, as all they have to do is raise a "doubt" and the case is decided. I totally agree this is not our problem now, but how do checks and balances work here? Or is it really the case that, if the law were enforced as written and decided, we'd just see massively fewer merger cases, because they're mostly hogwash?
It’s not the patents. Pre-GATT (1995) patents were powerful anti-trust rights. Post eBay (2006) there is no licensing market or injunctive relief. The example of pharmaceuticals is more a function of how FDA approval works (& Bayh-Doyle success), then false assertions that novel, nonobvious disclosures for limited exclusivity some how equates with actual market power.
This goes back to your last post Matt, I later which to write- suggest. Is to show clear history -pass persents which should be many as to how Mergers have failed the consumer, on quality, service and or pricing or all above.
Funny thing of knowing of pass issues, and NOTE Google, or googling, I was trying to fine where the Top Oil companies was brought into THE HOUSE energy committee. Now you pull up the Senate side, in fact I think Two committee hearing on that one. Going back to 2008 or so when Oil hit $147 a barrow. Where the "Narrative' was focus on "Its the Commodities Futures Fault- Speculators fault to the high prices of gasoline. So, push was to get rid of The Commodity future market. I stated and still statewould be a big mistake, being THEN Whom would control pricing?
Point, and to be shorter here, The House Side hearing, Had Rex Tillerson, CLEARY, stated that "They" USA Oil was closing down refineries and pipe lines. ONCE, the B>S> over one person report, that stated we was using 1% more oil then what was being, Able to be Produce in a day. Again BS to start with.
Then when that all was cleared, Oil went down to $35 a barrow. BUT we where still paying high prices for the gasoline. BEING, Oil companies, or their explanation was, even lower prices of Crude Oil, they just could not able to produce it to gasoline fast enough. Again, BS, for they was closing it down, The supply side.
BUT, see if you can fine that hearing? I couldnt as to googling it. But was able to fine multi clips on the other side, of agruement as just get rid of the speculator. like it or not the only midman to pricing of Oil. or any other commodities. - needs.
Point, hold hard copies of pass cases or examplies. As too showing how it will not work, IF we`re too hold on to a free world and or markets. Forces are out there, changing our pass, rewriting history, or not showing True facts but allowing disinformation stay or put in place.
And Matt , yes you did so here (wrote a good example) as to the above line.
and I like to state by no means, I am or "hope not" to be the smartist person in the room.
I learned a lot in the housing bust, BUT add, I learned I do not know all, by far more.
My Name is NoBody (1vs160)
P.S. Matt please keep at it, But stay safe by keeping as many as able informed.
Maybe the solution is requiring that judges NOT be lawyers. Or perhaps term limits on judges with the only exception being maybe the Supremes.
Thanks for the summary on divestiture. Perhaps the judge was a tad dense in understanding the government's position, presumably because of her corporate groupthink, but I have to ask about the expertise of the government's attorneys. Perhaps the government is a bit sluggish on how to prosecute these merger cases, that they need more practice? Well at least we have an appeals court who will review the trial court's decision, although the same corporate groupthink will likely be present among those judges as well.