The U.S. Justice Department (DOJ) Antitrust Division filed a statement of interest late last week in a private antitrust case brought against a number of major news publishers by, among others, the Children’s Health Defense—the organization previously chaired by U.S. Health and Human Services Secretary Robert F. Kennedy Jr.
Nominally, the DOJ’s statement can be distinguished from an amicus brief filed on behalf of or in support of a party, and the department is careful to note that it “takes no position on the application of the law to the facts alleged in Plaintiffs’ complaint or on the resolution of Defendants’ motion.” Still, there is no mistaking the fact that the DOJ’s statement is supportive of the plaintiffs.
This marks the agencies’ latest foray into issues at the intersection of antitrust and content moderation (or, as some FTC statements would have it, private “censorship.”) Our prior ruminations in this space were motivated by, e.g., the Federal Trade Commission’s (FTC) Feb. 20 request for comments on “technology platform censorship” and informal comments by FTC Chairman Andrew Ferguson (here and here). And the DOJ’s statement was preceded, if only barely, by its statement of intent to file the statement and by relevant remarks on “product fixing” by Deputy Assistant U.S. Attorney General Dina Kallay, who is also an FTC veteran.
Having spilled a fair amount of ink on the intersection of antitrust and speech, we read the statement and the plaintiffs’ complaint with great interest. Below, we offer some initial thoughts. Spoiler alert: this may be the strongest of these recent agency forays onto a hazy field of battle; but that’s not to argue that it isn’t, as the kids say, “problematic.”
The Good
As previously mentioned, the statement “takes no position on the application of the law to the facts alleged in Plaintiffs’ complaint”; that is, among other things, the basic question of whether the plaintiffs should prevail in their antitrust case. Indeed, the statement does not even take a position on whether, based on the pleadings, the plaintiffs ought to prevail against the defendants’ motion to dismiss.
And the statement is correct in noting that nonprice dimensions of competition, including product (or service) quality, could be the gravamen of an antitrust complaint under either Section 1 or Section 2 of the Sherman Antitrust Act. We noted as much in our comments to the FTC on “technology platform censorship.” The statement’s focus on nonprice competition is sensible and, for that matter, an application of the much (and wrongly) derided consumer welfare standard.
Like the plaintiffs’ complaint itself, the statement sensibly focuses on the question of whether the defendants’ conduct violates Section 1 of the Sherman Act. In our prior writings, we noted some of the difficulties involved in bringing a Section 2 case predicated chiefly on allegations of degraded product quality, both as a general matter and especially with regard to speech. At the very least, it is uncontroverted that the question of whether certain conduct is undertaken unilaterally or jointly may be critical.
Whether and in what regards it might be easier for the plaintiffs to prevail in bringing such a case under Section 1 is, at least, of interest. The complaint alleges collusion by major news publishers (including the named defendants) and social-media platforms (who are named in the statement and in the complaint, but are not named as defendants). If there is a route for a successful antitrust case involving content moderation and sources of the news, this might well be it.
On that point, the statement is both more modest and more reasonable than the complaint itself. The complaint’s first count alleges a per-se violation of the antitrust laws that seems strained on its face. A violation under the rule of reason is alleged in the alternative.
More sensibly, the statement casts the alternatives as truncated analysis for agreements to fix (and restrain) product quality without—as the U.S. Supreme Court said in FTC v. Indiana Federation of Dentists—any “countervailing procompetitive virtue” versus rule-of-reason analysis for, e.g., standard-setting agreements, which commonly have the potential for such virtues.
The Bad
Less good (bad, even) is that the statement’s high-flying language about “viewpoint competition in the marketplace of ideas” avoids or even obscures everything that’s hard about this case on at least two fundamental points:
- What would it take for the plaintiffs to prevail on—or even establish antitrust standing to bring—their underlying antitrust complaint?
- How might antitrust liability or remedies be subject to First Amendment limitations?
The issue of liability—and, indeed, the requirements of antitrust standing (above and beyond Article III standing)—go to the basic question of what it would take for the plaintiffs to establish, or even adequately plead, harm to competition, and not just harm to the plaintiffs themselves—see, e.g., Brunswick Corp. v. Pueblo Bowl-O-Mat. and Marion Diagnostic Ctr v. Becton Dickinson & Co.
And the First Amendment questions are many. The statement’s numerous citations to Associated Press ignore what may be key aspects of that decision, even as it seeks to clarify the relationship between antitrust and the First Amendment as the Court understood it in 1945. How to read it through the lens of subsequent First Amendment cases about, e.g., news organizations (Miami Herald Pub. Co. v. Tornillo) and online content moderation (Moody v. NetChoice) is not addressed at all.
Moreover, much as with the FTC’s platform censorship inquiry, the DOJ’s statement of interest elides the First Amendment’s distinction between government action and private action. The statement cites, among other sources, Nobel laureate economist F.A. Hayek and Justice Oliver Wendell Holmes’ dissent in Abrams v. United States to bolster the idea that diverse sources of speech are good for the marketplace of ideas. But these citations argue against government restrictions on speech, not against private ordering.
The Supreme Court has repeatedly made clear that the First Amendment only applies to government actors and gives wide latitude to private actors to police speech on their property. Antitrust law, after all, is government action, itself subject to the First Amendment.
Hayek, in particular, wrote in “The Use of Knowledge in Society” about how market actors, rather than government bureaucrats, are best-positioned to utilize dispersed information. The DOJ cites this to argue that antitrust law may be used to ensure diverse voices in the marketplace of ideas, which is not quite consistent with the thrust of Hayek’s argument against central control by government actors.
One could apply a Hayekian framework to the problem of misinformation in society, as one of us attempted to do in a Gonzaga Law Journal article on the subject. But the conclusion was that a Hayekian framework would lead to a strong distinction between private actors—such as social-media platforms making moderation decisions about misinformation on their platforms—and government actors intervening by telling them what must be censored.
Less Interesting than Meets the Eye
The DOJ’s statement correctly notes that antitrust law applies to media, citing Associated Press v. United States, among other cases. This is true as far as it goes. But the DOJ fails to mention the limitations on remedies from that case. In Associated Press, the Court noted that:
The decree does not compel AP or its members to permit publication of anything which their “reason” tells them should not be published. It only provides that after their “reason: has permitted publication of news, they shall not, for their own financial advantage, unlawfully combine to limit its publication.
In other words, antitrust remedies may not compel social-media platforms to publish material they don’t wish to publish, whether because it is purported misinformation or for any other reason.
The statement also assumes that the quality of social media suffers when there are fewer voices on contested public issues. But it could be the case that quality improves when there is less misinformation on particular issues. At the very least, it isn’t clear what the highest-quality version of content moderation of misinformation might be, in light of alleged political bias (or viewpoint discrimination). As we noted in our comments to the FTC:
The complexity inherent to the tradeoffs… are even more difficult to assess when different consumer groups have sharply contrasting views of what constitutes indicia of quality along each of these dimensions. With political media, most would prefer to have more of what they want to read available, and less of what they don’t want available, even if it comes at the expense of other consumers’ preferences. There is no easy way to quantify and weigh general consumer welfare where one group’s moderation preferences necessarily come at the expense of another’s.
In this sense, a non-price-effects analysis of political bias would be even more complex than a complaint based on user privacy. All but the most exhibitionistic would prefer more to less privacy, all other things being equal. But when it comes to the algorithm that determines what is seen and in what order, or what is fact checked, or even what is monetized, there is no clear preference that all consumers share.
But the DOJ’s statement fails to consider the tradeoffs, assuming that excluding some voices from social-media platforms for alleged misinformation is a harm to product quality. At bottom, filtering the news—and sources of the news—is central to the product or service that news organizations provide in the market. The notion that they best provide that good or service by publishing everything, or that n + 1 is always qualitatively superior to n, is risible, if not incoherent.
In that regard, we recall the Associated Press quote that “[t]he decree does not compel AP or its members to permit publication of anything which their ‘reason’ tells them should not be published.” None of that is changed by the fact they might at times (or even often) reject sources that turn out to have been partly, largely, or even wholly correct.
Not incidentally, nothing in the 1945 Associated Press decision turns on the question of whether the AP had unduly restricted its own access to news, and thus had diminished the quality of its own product, or access to any specific quantity or quality of news on the part of its members.
To be fair, the DOJ does rightly note that industry standards can be procompetitive or anticompetitive, depending on the facts and circumstances, as both the agencies and the courts have recognized. Unless one assumes that excluding voices (in this case, alleged purveyors of health misinformation) is ipso facto bad for consumer welfare, this would lend itself to rule-of-reason analysis.
And under the rule of reason, and First Amendment concerns aside, we come back to all of the factors that make it hard (typically, although not always) to bring a case predicated on either joint or unilateral suppression of product quality (see, here, here, and here, for instance). The DOJ’s statement simply fails to make the case that the type of industry standards at-issue are clearly, likely, or even plausibly anticompetitive. To be fair, the statement disclaims such ambitions.
But if this is simply a question of whether news organizations might—unilaterally or in concert—violate the antitrust laws or whether nonprice dimensions of competition such as product quality may figure in antitrust analysis, then maybe the statement is not so interesting after all. It will be up to the plaintiffs in the litigation to prove that these standards to identify misinformation were actually just a cover to harm consumer welfare, rather than promote it. If they get that far.
Conclusion
This case is worth following as it goes forward. The government is often very influential with courts when it enters into private litigation as an amicus. But the DOJ’s statement of interest fails to persuade us, at least at this point, that an antitrust case resembling the one at-issue could serve the values protected by the First Amendment.
