WEBVTT - Harris, Trump Election Impact on Antitrust 0:00:16.320 --> 0:00:19.280 Hi, and welcome to the Votes and Verdicts podcast, hosted 0:00:19.280 --> 0:00:23.640 by Bloomberg Intelligence, part of Bloomberg's investment research department. With 0:00:23.680 --> 0:00:27.200 over five hundred analysts and strategists working across all major 0:00:27.280 --> 0:00:31.320 world markets. Our coverage includes over two thousand equities and credits, 0:00:31.360 --> 0:00:33.880 as well as outlooks on more than ninety industries and 0:00:34.000 --> 0:00:38.960 one hundred market industries, currencies, and commodities. In this podcast series, 0:00:39.000 --> 0:00:42.680 we talk about the intersection of business policy and law. 0:00:43.159 --> 0:00:47.159 The Forthcoming Conversation is part of the Bloomberg Intelligence Election series, 0:00:47.200 --> 0:00:51.200 covering the industry and company impacts of the upcoming election. 0:00:51.840 --> 0:00:54.400 On October twenty fourth, my colleague Jennifer Ree and I 0:00:54.520 --> 0:00:57.400 discussed what the election might mean for antitrust law and 0:00:57.560 --> 0:01:01.520 policy in the coming years. Any questions please feel free 0:01:01.600 --> 0:01:04.000 to reach out to any of us on the Bloomberg terminal. 0:01:04.319 --> 0:01:07.200 Hi everyone, and welcome. My name is Justin Teresi. I'm 0:01:07.200 --> 0:01:10.679 a litigation and policy analyst here at Bloomberg Intelligence focused 0:01:10.680 --> 0:01:13.520 on anti trust issues, and joining me today is the 0:01:13.560 --> 0:01:17.120 one and only Jennifer Ree, our senior anti trust litigation guru, 0:01:17.440 --> 0:01:20.160 and for both of us, our coverage really runs across 0:01:20.240 --> 0:01:23.080 all sectors. This webinar is a part of a series 0:01:23.120 --> 0:01:26.480 of conversations across the month of October focused on the 0:01:26.560 --> 0:01:32.399 upcoming election. Our first bourbinar considered financials, the second tackle 0:01:32.480 --> 0:01:38.240 TMT issues, and other discussions have included considerations on tax, healthcare, industrials, 0:01:38.240 --> 0:01:40.800 and consumer goods. All to help you get ready to 0:01:40.880 --> 0:01:44.440 understand potential impacts of the upcoming election. Where the only 0:01:44.480 --> 0:01:47.880 certainty around that issue seems to be uncertainty, we try 0:01:47.880 --> 0:01:50.520 to unpack a bit of a roadmap for what lies ahead. 0:01:50.920 --> 0:01:54.000 Playbacks for each of these sessions are available on the terminal. 0:01:54.360 --> 0:01:56.840 And first, just a little about Bloomberg Intelligence, where the 0:01:56.880 --> 0:02:00.800 investment research platform on the Bloomberg Terminal, singing over five 0:02:00.880 --> 0:02:05.040 hundred professionals covering over two thousand companies. We cover companies 0:02:05.080 --> 0:02:09.280 from the perspective of equities, credit, ESG, litigation, and policy. 0:02:09.720 --> 0:02:12.360 Bloomberg Terminal clients can always reach out to us with 0:02:12.440 --> 0:02:15.880 questions about our research. So with that, let's get started. 0:02:16.120 --> 0:02:19.320 How we've structured this today is a conversation between myself 0:02:19.360 --> 0:02:22.520 and Jen. First focus at some macro thoughts by Jen 0:02:22.639 --> 0:02:25.240 about what the FTC and DOJ might look like in 0:02:25.280 --> 0:02:28.240 the future, along with some considerations route M and A 0:02:28.520 --> 0:02:31.520 and the growing antitrust struggles that are facing big tech. 0:02:32.000 --> 0:02:35.040 Although I'll then weigh in on some policy considerations for 0:02:35.560 --> 0:02:38.639 some standalone legislation that might be considered in the next 0:02:38.680 --> 0:02:41.480 Congress and provide a quick rundown of what kind of 0:02:41.560 --> 0:02:45.600 activity we might see in the States. So with that, Jen, 0:02:46.280 --> 0:02:48.760 glad to have you here with me today. This is 0:02:49.120 --> 0:02:50.919 our second webinar for you. 0:02:53.000 --> 0:02:53.200 Yeah. 0:02:53.280 --> 0:02:56.520 So, I guess, hopping right into the material, the primary 0:02:56.600 --> 0:02:59.160 question that most people seem to be paying attention to 0:02:59.360 --> 0:03:02.960 right now with the elections as pertains to anti trust. 0:03:03.280 --> 0:03:05.880 They're asking whether the chair of the Federal Trade Commission, 0:03:05.960 --> 0:03:09.200 Lena Kahn, will continue in that seat under other Harris 0:03:09.320 --> 0:03:12.840 or Trump presidency. And this is the right question because 0:03:12.840 --> 0:03:15.799 the anti trust enforcement decisions aren't made by those folks 0:03:15.800 --> 0:03:19.120 at the FTC and DOJ personnel is policy. 0:03:19.160 --> 0:03:22.360 What do you think, Jen, Well, so justin you know, 0:03:22.400 --> 0:03:26.240 when you said earlier uncertainty, there's a lot of uncertainty here. 0:03:26.240 --> 0:03:29.840 There's a lot of uncertainty with respectiveness you too, And 0:03:29.880 --> 0:03:31.880 there are a lot of different viewpoints, I should say, 0:03:31.919 --> 0:03:34.640 and I think no consensus based on everybody I've talked 0:03:34.680 --> 0:03:37.240 to and things I've read. I have my own view 0:03:37.320 --> 0:03:42.080 based on listening, researching, thinking about personality types. But because 0:03:42.160 --> 0:03:44.720 you know, both candidates have said very little on their 0:03:44.800 --> 0:03:47.040 views of anti trust policy, this is really just my 0:03:47.160 --> 0:03:50.760 view and not particularly informed by their own comments about 0:03:50.760 --> 0:03:53.840 what their goals are. Now, the first thing I actually 0:03:53.880 --> 0:03:57.080 think is that I believe things will change from the 0:03:57.120 --> 0:04:01.000 way they are no matter what, though definitely not right away. 0:04:01.080 --> 0:04:03.680 These things absolutely take time, and it could be a 0:04:03.680 --> 0:04:06.400 little quicker if Trump is elected instead of Harris, But 0:04:06.440 --> 0:04:08.760 no matter what, it takes time. And I think the 0:04:08.840 --> 0:04:12.160 main question everybody is asking, at least in the business community, 0:04:12.480 --> 0:04:16.320 is whether this really aggressive interventionist approach we've been seeing 0:04:16.360 --> 0:04:19.279 for the last mostly three years, but going back about 0:04:19.320 --> 0:04:22.479 five years, that the current Federal Trade Commission and a 0:04:22.560 --> 0:04:27.000 Department of Justice have taken will continue. My opinion is 0:04:27.040 --> 0:04:29.920 that I don't really think so, even if Harris is elected. 0:04:30.000 --> 0:04:33.159 And I generally think that every new president will want 0:04:33.200 --> 0:04:35.440 to do things their own way, even if they're in 0:04:35.480 --> 0:04:38.000 the same party as the previous president. But I'll start 0:04:38.000 --> 0:04:41.960 with Harris. As you mentioned, justin personnel is policy, so 0:04:42.720 --> 0:04:45.520 you know, the main course of the antitrust approach of 0:04:45.560 --> 0:04:47.960 an administration is set by the decision makers of the 0:04:48.000 --> 0:04:50.640 FTC and DOJ, and I think there are quite a 0:04:50.680 --> 0:04:54.080 few people out there that actually expect President Harris to 0:04:54.160 --> 0:04:56.520 keep Lena Khan on as the Chair of the FTC. 0:04:56.560 --> 0:04:59.720 She's kind of the standard bearer for this very aggressive 0:05:00.640 --> 0:05:04.719 and activist anti trust enforcement that we've had. I actually 0:05:04.760 --> 0:05:08.159 don't think so. You know, Con is replaceable right now 0:05:08.400 --> 0:05:10.880 because her term has expired. It expired at the end 0:05:10.880 --> 0:05:14.000 of September, and if she is replaced, to me, that's 0:05:14.080 --> 0:05:15.800 kind of the catalyst for a little bit of change 0:05:15.800 --> 0:05:17.919 in tone at the agency. And I have a couple 0:05:17.880 --> 0:05:20.720 of reasons for thinking that Conn will eventually, not right away, 0:05:20.720 --> 0:05:24.120 but eventually be replaced if Vice President Harris is elected. 0:05:24.360 --> 0:05:26.599 And part of it is just that it's just sort 0:05:26.600 --> 0:05:28.400 of the right of a president to name their own 0:05:28.400 --> 0:05:31.559 senior officials. That's part of what they do. They guide 0:05:31.560 --> 0:05:34.280 their own policy, and this has happened even when they're 0:05:34.320 --> 0:05:36.919 in the same party. It's their right to do so. 0:05:36.920 --> 0:05:37.040 So. 0:05:37.160 --> 0:05:39.720 For instance, when George H. W. Bush took over from 0:05:39.800 --> 0:05:43.040 Ronald Reagan, the Republican chair of the FTC was replaced 0:05:43.080 --> 0:05:46.640 within about eight months and later both of the other 0:05:46.680 --> 0:05:49.040 Republicans as well. Now I don't know if that's because 0:05:49.040 --> 0:05:52.160 they left on their own volition, which often happens and 0:05:52.279 --> 0:05:55.200 could happen here too, or whether George Bush just chose 0:05:55.240 --> 0:05:58.479 to replace them. But you know, in this case, if 0:05:58.600 --> 0:06:01.800 Lena Khan did get the message quietly that Harris would 0:06:01.839 --> 0:06:04.839 like to name her own new Democrat or at least 0:06:04.880 --> 0:06:07.920 new chair, Con could leave on her own. Now, another 0:06:07.960 --> 0:06:10.240 reason I tend to think that there could be a 0:06:10.279 --> 0:06:12.359 replacement here is because I tend to think that the 0:06:12.400 --> 0:06:17.840 litigation approaches as prosecutors that either one have taken over 0:06:17.880 --> 0:06:20.040 the years are a bit different, and there's a little 0:06:20.040 --> 0:06:22.480 bit of a disconnect between the two. You know, Con 0:06:22.560 --> 0:06:25.159 really kind of has this scorched earth approach where she 0:06:25.200 --> 0:06:28.640 brings cases that are long shots for a win. That's 0:06:28.680 --> 0:06:31.280 not typical, I think for most prosecutors are a little 0:06:31.279 --> 0:06:34.240 more cautious, and it also carries some risk. And I 0:06:34.279 --> 0:06:36.640 tend to think Harris's approach as an attorney has been 0:06:36.640 --> 0:06:38.680 more nuanced and a bit less rigid, and she may 0:06:38.760 --> 0:06:41.680 want something like that in her own prosecutors. But in 0:06:41.720 --> 0:06:44.040 any case, I think if she wanted to keep her, 0:06:44.120 --> 0:06:46.599 she'd probably have to renominate her, and that actually could 0:06:46.640 --> 0:06:51.440 be difficult because we believe, we sort of expect Senate 0:06:51.520 --> 0:06:54.559 is going to flip to a majority Republican, and there's 0:06:54.560 --> 0:06:57.080 some doubt that if Con went back before the Senate, 0:06:57.120 --> 0:07:00.040 she'd be able to get the votes she needs. I 0:07:00.040 --> 0:07:02.080 should say that even if Harris does replace her, I 0:07:02.080 --> 0:07:04.200 don't see things going back to the way they were 0:07:04.360 --> 0:07:06.839 before the last three to five years. You know, an 0:07:06.960 --> 0:07:09.960 environment where very few deals were challenged and enforcement against 0:07:10.000 --> 0:07:12.640 monopolistic conduct was very limited. I think we're going to 0:07:12.720 --> 0:07:15.280 stay in a heightened environment. It's still going to be 0:07:15.280 --> 0:07:18.960 more aggressive than it was, just maybe tempered. Right now, 0:07:19.040 --> 0:07:21.480 Trump I think I can be a little quicker. I 0:07:21.480 --> 0:07:24.960 think absolutely replaced Con. I mean, I think there's no doubt. 0:07:25.040 --> 0:07:29.320 We know JD. Vance's vice presidential candidate, has praised Con, 0:07:29.480 --> 0:07:31.440 thinks she's done a good job. Would like to keep her. 0:07:31.480 --> 0:07:32.840 But this is going to be up to Trump, and 0:07:32.880 --> 0:07:35.040 I really think he's going to want his own people, 0:07:35.080 --> 0:07:38.120 particularly given that in his first administration he took a 0:07:38.120 --> 0:07:40.960 lot of recommendations and didn't end up being very happy 0:07:41.000 --> 0:07:42.920 with some of those people. I think he's going to 0:07:42.920 --> 0:07:45.400 be a little bit more careful this time. And I 0:07:45.440 --> 0:07:47.600 also think right off the bat, what he would do 0:07:47.720 --> 0:07:50.760 is name one of the current Republicans Melissa Holyoak or 0:07:50.760 --> 0:07:53.600 Andrew Ferguson as the chair. He can do that right 0:07:53.640 --> 0:07:56.960 away and then sort of demote le Nikan to commissioner 0:07:57.000 --> 0:08:00.360 from chair at least right away until he's able to placer. 0:08:00.920 --> 0:08:02.880 And I do think that we're probably going to see 0:08:02.920 --> 0:08:08.840 somewhat erratic, maybe idiosyncratic enforcement under a Trump administration, where 0:08:08.880 --> 0:08:12.440 he's looking more at the companies that he likes or 0:08:12.480 --> 0:08:15.080 the deals that he likes versus companies he doesn't like 0:08:15.120 --> 0:08:18.360 and DEALC doesn't like in terms of the hurdles that 0:08:18.480 --> 0:08:21.160 might be erected or the easing that might take place. 0:08:21.440 --> 0:08:24.480 So generally, I think some easing there, but maybe only 0:08:24.520 --> 0:08:27.760 for some companies and industries and not for others. What 0:08:27.840 --> 0:08:29.320 do you think justin right? 0:08:29.400 --> 0:08:31.480 Yeah, you know, and I'm not just saying this because 0:08:31.480 --> 0:08:32.480 we work together. 0:08:32.200 --> 0:08:34.440 But I tend to agree with your with your view 0:08:34.520 --> 0:08:35.120 on this too. 0:08:35.240 --> 0:08:37.640 You know, I think you're right. Trump is really the 0:08:37.720 --> 0:08:39.240 easy one to figure out here. 0:08:39.280 --> 0:08:41.679 I think there's absolutely no chance, Lena con says on 0:08:42.400 --> 0:08:44.800 with him being elected you're right, there's that populism I 0:08:44.880 --> 0:08:46.920 think on the right that they're the wing that seems 0:08:46.920 --> 0:08:49.320 to like her. But you know, for the same reason 0:08:49.320 --> 0:08:52.160 that Trump probably wann't want Lena conrun in the FTC, 0:08:52.320 --> 0:08:54.240 there's a there's a bit of a rogue factor there, 0:08:54.320 --> 0:08:57.080 right that Harris I think would encounter too. And you know, 0:08:57.320 --> 0:08:59.160 I think to your point that you know, it's all 0:08:59.200 --> 0:09:01.000 taken at each price, and it kind of wants their 0:09:01.040 --> 0:09:04.240 own folks in their administration, even though the FTC is 0:09:04.240 --> 0:09:07.280 this independent kind of commission. So I think that alone 0:09:07.320 --> 0:09:10.440 suggests to me that harr is really looking at Con 0:09:10.559 --> 0:09:12.400 that in this way. Even though they might agree and 0:09:12.760 --> 0:09:15.000 some things, or even maybe one might say all things, 0:09:15.000 --> 0:09:17.160 at some point, there is a bit of a rogue 0:09:17.160 --> 0:09:19.040 factor there in terms of the cases that could be 0:09:19.080 --> 0:09:21.199 brought by Con if she were to stay on, and 0:09:21.240 --> 0:09:23.040 it might not be on the same page all the 0:09:23.080 --> 0:09:25.000 time with what the White House is thinking. So I 0:09:25.040 --> 0:09:28.080 think that you're right, you know, there is that that 0:09:28.200 --> 0:09:30.720 kind of pushed probably replaced her at least at some 0:09:30.840 --> 0:09:33.720 point down the road. And you know, we're hearing all 0:09:33.760 --> 0:09:36.160 of that conversation right now. I think from folks like 0:09:36.200 --> 0:09:39.000 Senator Warren and you know, AOC last week i think 0:09:39.000 --> 0:09:41.080 made a comment too that there'd be a brawl if 0:09:41.080 --> 0:09:44.080 there was this move to replace Lena Khan. But you know, 0:09:44.440 --> 0:09:46.960 it seems to me that at some point down the road, 0:09:46.960 --> 0:09:49.680 and maybe not right away, you know, there's probably something 0:09:49.720 --> 0:09:53.520 that President Harris could offer Senator Warren or AOC or 0:09:53.559 --> 0:09:56.280 folks that are pushing for Khan to kind of minimize 0:09:56.520 --> 0:09:59.000 their opposition to a replacement if one comes in down 0:09:59.040 --> 0:10:00.800 the road. But you know, that's a game of chess 0:10:00.800 --> 0:10:03.080 and a lot of strategy, strategy, and you know, several 0:10:03.080 --> 0:10:07.200 moves ahead if that were to happen obviously too. So yeah, 0:10:07.760 --> 0:10:10.360 moving on from this topic, another one that's really been 0:10:10.400 --> 0:10:12.400 coming up a lot here, Jenna, is that you know 0:10:12.440 --> 0:10:15.480 these government monopolization suits that we're seeing it against big 0:10:15.520 --> 0:10:17.840 tech platforms. Can you kind of give us a rundown 0:10:17.880 --> 0:10:20.400 of the ongoing suits and whether you think those are 0:10:20.400 --> 0:10:22.400 going to be impacted at all by a new administration? 0:10:23.679 --> 0:10:23.880 Yeah? 0:10:23.960 --> 0:10:26.680 Sure, absolutely. I mean at this point, between the Trump 0:10:26.720 --> 0:10:30.680 administration and the Biden administration, just about every very very large, 0:10:30.720 --> 0:10:34.920 big tech platform has been sued for illegal monopolistic conduct. Right, 0:10:35.000 --> 0:10:37.600 so we have the DOJ that's gone after Google over 0:10:37.640 --> 0:10:40.640 search and gone after Google, I should say DJ plus States, 0:10:40.720 --> 0:10:43.360 but I'm focused sort of on the federal government right now. 0:10:43.960 --> 0:10:47.120 DOJ that's gone after Google over its conduct with respect 0:10:47.160 --> 0:10:50.240 to its ad tech products, and it's also now sued 0:10:50.280 --> 0:10:54.080 recently Live Nation related to its conduct with respect to 0:10:54.120 --> 0:10:57.360 its ticketmaster arm. The Federal Trade Commission, for its part, 0:10:57.400 --> 0:11:00.560 has sued Meta that's related to its act positions of 0:11:00.559 --> 0:11:04.000 WhatsApp in Instagram. And they've also sued Amazon, which was 0:11:04.040 --> 0:11:08.080 widely expected given you know, Lina Khon's well known antagonism 0:11:08.120 --> 0:11:11.280 toward Amazon and the way Amazon does its business. So 0:11:11.440 --> 0:11:14.080 I think these cases all just play out in courts. 0:11:14.160 --> 0:11:16.920 I don't really see the course of these cases changing 0:11:17.000 --> 0:11:20.800 much no matter who wins the presidency. First, the DOJ 0:11:20.960 --> 0:11:23.520 cases against Google are both very well advanced. I mean, 0:11:23.600 --> 0:11:26.320 trials have completed for both Search and add tech, and 0:11:26.360 --> 0:11:29.360 we already have a liability decision on Search. So we're 0:11:29.360 --> 0:11:32.440 on the remedies phase there, and I highly doubt that 0:11:32.480 --> 0:11:35.600 the remedy, even though the DOJ might ask for a 0:11:35.640 --> 0:11:38.240 breakup of Google as a remedy, I doubt that will 0:11:38.240 --> 0:11:40.920 be what the judge orders and so in that case, 0:11:41.040 --> 0:11:42.720 you know, people say, oh, it could be a repeat 0:11:42.720 --> 0:11:46.720 of Microsoft, where a court ordered under Clinton's administration a 0:11:46.720 --> 0:11:49.480 structural remedy, but then it was remanded and in the 0:11:49.480 --> 0:11:52.600 meantime George Bush became the president and then settled. I 0:11:52.600 --> 0:11:54.319 don't really see that happening because I don't think the 0:11:54.360 --> 0:11:56.720 structural remedy is going to be ordered in the first place. 0:11:57.320 --> 0:12:00.559 And nonetheless, I don't see settlements here because we know 0:12:00.720 --> 0:12:02.920 that Google. You know, Trump is no friend to Google. 0:12:03.000 --> 0:12:06.760 Google's no friend to Trump, and he has said in 0:12:06.800 --> 0:12:10.080 an interview with John Micklethwaite of Bloomberg that he does 0:12:10.160 --> 0:12:12.920 think Google needs to be regulated, that it needs to 0:12:12.920 --> 0:12:15.320 be contained. He didn't necessarily say it needed to be 0:12:15.360 --> 0:12:18.240 broken up. So to the extent there's a behavioral remedy 0:12:18.280 --> 0:12:20.120 in the case, I think Trump would agree with that, 0:12:20.200 --> 0:12:22.600 as what Harris. The other cases have a long way 0:12:22.640 --> 0:12:26.760 to go, not Antech, just the ones against Meta Amazon 0:12:26.840 --> 0:12:30.000 and lave Nation, and yeah, and I think that still 0:12:30.040 --> 0:12:32.160 they play out in court. The only way I see 0:12:32.240 --> 0:12:36.120 under either administration potential settlements, but way down the road 0:12:36.679 --> 0:12:39.240 is if they seem to be doing very poorly in 0:12:39.240 --> 0:12:41.440 the litigation, if they get some hint that they're just 0:12:41.559 --> 0:12:45.480 really struggling. Maybe they're already in trial. You know, sometimes 0:12:45.480 --> 0:12:48.360 the judge will really reveal how they view a case. 0:12:48.400 --> 0:12:51.000 Sometimes they don't, but sometimes you can get that feeling 0:12:51.360 --> 0:12:54.360 that you're going to lose, and at that point maybe 0:12:54.360 --> 0:12:57.000 there'd be some possibility of settlement. But I think that 0:12:57.040 --> 0:12:58.960 would be the case no matter who was the president. 0:12:59.240 --> 0:13:01.320 I think maybe if you know, if it was still 0:13:01.360 --> 0:13:05.040 the Biden administration's enforcers. So you know, that's where we 0:13:05.120 --> 0:13:07.880 are in Live Nations, the last one, and I think 0:13:08.040 --> 0:13:10.439 you know that goes through court no matter what, because 0:13:10.480 --> 0:13:14.240 it's it's a popular case with consumers. It's you know, 0:13:14.320 --> 0:13:18.840 politically desirable for either either administration to continue to pursue 0:13:18.880 --> 0:13:21.880 Live Nation. Nobody likes the fees they're charged when they 0:13:21.920 --> 0:13:23.280 buy tickets first sports. 0:13:23.440 --> 0:13:25.680 Everyone can agree on, right, right, you. 0:13:25.679 --> 0:13:28.880 Can all agree on that. Yeah, And they're seeking a 0:13:28.960 --> 0:13:32.040 jury trial there, and I think, you know, there's a 0:13:32.080 --> 0:13:35.760 good reason for that. Justice, But anyway, you know, these 0:13:35.800 --> 0:13:37.559 things play out the way they're going to play out 0:13:37.600 --> 0:13:38.800 no matter what. That's my view. 0:13:39.280 --> 0:13:41.400 Yeah, yeah, that makes a lot of sense. How about 0:13:41.480 --> 0:13:41.800 M and A. 0:13:41.960 --> 0:13:44.400 I mean, this is another area where the current FTC 0:13:44.559 --> 0:13:48.720 and DOUJ have been so, you know, pretty aggressive and interventionists. 0:13:49.440 --> 0:13:51.640 Do you think things change under a new president. If 0:13:51.640 --> 0:13:54.840 they do, how do they change? You know, what do 0:13:54.880 --> 0:13:56.640 we think about Harris? And then maybe can go to 0:13:56.640 --> 0:13:57.360 Trump after that? 0:13:58.160 --> 0:14:00.160 Yeah. I mean there's been a lot of changes the 0:14:00.200 --> 0:14:01.880 approach to M and A in the last three to 0:14:01.920 --> 0:14:04.600 five years, and I think two really notable ones are 0:14:04.679 --> 0:14:10.239 one that this DOJ and FTC have been very reluctant 0:14:10.240 --> 0:14:12.760 to ever accept any remedy for a deal that raises 0:14:12.800 --> 0:14:15.360 anti trust issues, which is really quite new. I mean, 0:14:15.440 --> 0:14:17.920 under the Trump administration we saw the beginning of the 0:14:18.000 --> 0:14:22.200 rejection of just at least behavioral remedies. That DOJ certainly 0:14:22.280 --> 0:14:26.000 accepted structural remedies and allowed deals to clear with that, 0:14:26.400 --> 0:14:29.120 but said, hey, we don't think behavioral remedies make sense 0:14:29.160 --> 0:14:32.720 because we're not a regulator and they don't work. You know, 0:14:32.760 --> 0:14:35.720 it's hard to keep companies to those promises they make. 0:14:36.400 --> 0:14:39.400 This administration basically says, look, if it's a problematic deal, 0:14:39.440 --> 0:14:42.720 it should be stopped. Remedies usually don't work, and in 0:14:42.760 --> 0:14:45.280 the few cases they have agreed to a remedy, it's 0:14:45.360 --> 0:14:48.840 really only been where they clearly were going to likely 0:14:48.880 --> 0:14:51.760 lose in the litigation, and there've been very few. That 0:14:51.880 --> 0:14:54.240 was one of the first big changes because it used 0:14:54.280 --> 0:14:56.720 to be that almost all deals cleared with a behavioral 0:14:56.760 --> 0:15:00.280 or structural remedy are both. Now they also the end 0:15:00.280 --> 0:15:03.040 of last year, the guidelines that are used to evaluate 0:15:03.080 --> 0:15:06.640 deals were changed. These guidelines are meant to be guidance 0:15:06.680 --> 0:15:09.440 for businesses to say, here's how we're going to evaluate 0:15:09.480 --> 0:15:12.200 your deal, guidance for the agencies and their own lawyers 0:15:12.240 --> 0:15:15.280 to go through their investigation, and guidance for judges in 0:15:15.360 --> 0:15:18.160 courts when the deals are challenged. Now they're not binding 0:15:18.200 --> 0:15:20.760 on the courts, but most courts have accepted them. But 0:15:20.840 --> 0:15:22.880 the revision at the end of last year was really 0:15:22.880 --> 0:15:25.880 done on a partisan basis because we only had Democrats 0:15:25.920 --> 0:15:28.600 at that time at the FTC and at the DOJ, 0:15:29.040 --> 0:15:31.440 and usually these revisions have been done in the past 0:15:31.800 --> 0:15:35.240 on a bipartisan basis. So it's unclear yet whether the 0:15:35.240 --> 0:15:38.200 courts will adopt them. And these guidelines are troubling for 0:15:38.280 --> 0:15:41.840 merging companies because they have lowered the threshold for finding 0:15:41.840 --> 0:15:44.760 that a deal is presumed to be anti competitive at 0:15:44.760 --> 0:15:47.840 the outset right. There are other changes beyond that, but 0:15:47.960 --> 0:15:50.880 in general, all of these changes essentially mean that more 0:15:50.920 --> 0:15:55.280 deals than before will be considered harmful. And I do 0:15:55.360 --> 0:15:59.040 think that these guidelines in general are here to stay. 0:15:59.080 --> 0:16:02.240 The question would be, with the next administration rescind them, 0:16:02.560 --> 0:16:05.160 go back to old ones, rewrite them, what would they do? 0:16:05.840 --> 0:16:09.800 I think a Harris administration probably would not. I did 0:16:09.880 --> 0:16:14.240 see a Q and A with Commissioner Andrew Ferguson not 0:16:14.320 --> 0:16:18.760 that long ago by the George Mason Mercadas Center, I believe, 0:16:18.800 --> 0:16:21.720 and asking him about this. He's a Republican, by the way, 0:16:21.760 --> 0:16:24.000 and he had said, look, I don't think they should 0:16:24.040 --> 0:16:26.560 be rescinded, but I do think they should be tweaked. 0:16:26.640 --> 0:16:28.720 So that gives us some good guidance that if we 0:16:28.760 --> 0:16:32.280 have a Republican president and the FTC flips to a 0:16:32.320 --> 0:16:35.320 majority Republican, they'd be able to do that. At the FDC, 0:16:35.480 --> 0:16:38.120 you need a majority vote to get anything done, and 0:16:38.160 --> 0:16:40.800 so they may be tweaked. It pulled back a little bit, 0:16:40.880 --> 0:16:43.280 justin and you know what, that pulling back could even 0:16:43.360 --> 0:16:46.080 happen under Harris. I just I doubt it more and 0:16:46.120 --> 0:16:49.320 I think it's more likely under Trump. So companies are 0:16:49.480 --> 0:16:52.280 going to have to live with slightly tougher guidelines. But 0:16:52.320 --> 0:16:54.400 again I said, the courts haven't accepted them yet, and 0:16:54.440 --> 0:16:57.320 they may not. With respect to remedies, I think there's 0:16:57.360 --> 0:17:00.640 a lightning up there across the board, and that's because, honestly, 0:17:00.720 --> 0:17:03.720 it's a really rigid position, and what it does is 0:17:03.720 --> 0:17:06.920 it forces the agencies to bring cases that they're unlikely 0:17:07.000 --> 0:17:10.600 to win because there are strong anti trust theories of harm, 0:17:10.640 --> 0:17:12.840 and there are weak anti trust theories of harm. And 0:17:12.920 --> 0:17:16.000 there are vertical deals where there are also arguably a 0:17:16.040 --> 0:17:19.800 lot of pro competitive benefits from vertical integration, and that's 0:17:19.840 --> 0:17:23.200 another case that's hard to win in court. So if 0:17:23.240 --> 0:17:26.600 you were completely across the board refuse to accept a remedy, 0:17:26.680 --> 0:17:30.320 you're forced to challenge a deal. Essentially, assuming the companies 0:17:30.680 --> 0:17:33.600 stick with it and fight, you're forced to fight a 0:17:33.640 --> 0:17:35.439 deal in court where you probably can't win. And I 0:17:35.440 --> 0:17:38.520 don't think Harris is going to want Harris's people, or 0:17:38.560 --> 0:17:40.439 even Harris will want to be in that position. So 0:17:40.800 --> 0:17:43.360 I do think we'll have a little lightning on whether 0:17:43.560 --> 0:17:46.919 or not a little more flexibility on the acceptance of 0:17:47.000 --> 0:17:50.520 remedies to resolve mergers that raise issues. 0:17:51.119 --> 0:17:53.480 Got it, got it, That's where I am there. 0:17:53.960 --> 0:17:57.159 So justin we've talked a little bit here about enforcers, 0:17:57.160 --> 0:17:59.840 We've talked about big tech lawsuits, we've talked about deals. 0:18:00.280 --> 0:18:02.480 Let's move on to some of the more complicated issues 0:18:02.480 --> 0:18:03.560 that you think about. 0:18:05.800 --> 0:18:05.960 Then. 0:18:06.000 --> 0:18:09.920 I'm glad you're thinking about and I'm not specifically. Let's 0:18:09.920 --> 0:18:12.520 start with AI. That's a big AI is the big thing, 0:18:12.560 --> 0:18:14.680 and how can we not talk about it any intersection 0:18:14.760 --> 0:18:16.960 with any that. I know you're thinking about a lot, 0:18:17.040 --> 0:18:18.920 and people in the antitrust bar are thinking about a lot. 0:18:18.960 --> 0:18:21.040 I don't know if everyday people are thinking about it, 0:18:21.200 --> 0:18:23.840 but let's just you know, let's just talk about whether 0:18:23.880 --> 0:18:26.560 there's any fallout here. There is activity right. 0:18:26.640 --> 0:18:28.919 There is activity that's right right, and. 0:18:29.640 --> 0:18:31.960 Will there be fallout? Will this continue on or will 0:18:31.960 --> 0:18:33.000 it change from the election? 0:18:33.840 --> 0:18:34.080 Yeah? 0:18:34.119 --> 0:18:36.320 You know so, I think this is an area where 0:18:36.359 --> 0:18:39.040 you know, this piggybacks obviously onto what you were saying 0:18:39.080 --> 0:18:41.680 about big tech, and you know this, this I think 0:18:41.760 --> 0:18:43.760 is one of those areas that really looks at what's 0:18:43.760 --> 0:18:46.199 happening from an enforcement perspective, and I think what we 0:18:46.280 --> 0:18:48.920 might see from a legislative perspective here down the road 0:18:48.920 --> 0:18:52.000 and what happens in the election there is really important 0:18:52.000 --> 0:18:53.960 to you. But just to catch everyone up, you know, 0:18:54.040 --> 0:18:56.399 we've been seeing some news and not just in the 0:18:56.480 --> 0:19:00.879 US globally regarding enforcement activity around a right. There were 0:19:00.920 --> 0:19:03.960 reports of a raid of offices in France by enforcement 0:19:04.040 --> 0:19:08.280 authorities there for Navidia this past year. There was news 0:19:08.280 --> 0:19:10.879 reports over the summer that the DOJ and FTC are 0:19:10.880 --> 0:19:16.600 splitting responsibility for investigating Navidio's at purported consolidation in the 0:19:17.000 --> 0:19:20.879 AI infrastructure space. And then you know DOJ looking at 0:19:21.040 --> 0:19:24.760 Visor excuse me, FUC looking at Microsoft's investment in open 0:19:24.800 --> 0:19:28.359 ai to twelve twelve point five billion dollar investment that 0:19:28.400 --> 0:19:31.199 happened there. Does that raise questions as to whether or 0:19:31.200 --> 0:19:34.280 not those those kinds of investments are really acting as 0:19:34.320 --> 0:19:37.640 an acquisition that would otherwise have to be reported under 0:19:37.640 --> 0:19:40.679 the Hartscott Redino Act for review. So that's kind of 0:19:40.680 --> 0:19:43.560 what we're seeing from this enforcement perspective. I think your 0:19:43.560 --> 0:19:45.760 points about big tech are well taken. Right, do we 0:19:45.800 --> 0:19:48.680 see a more measured approach from a new FTC or 0:19:48.760 --> 0:19:51.399 DOJ and what does that look like under either Harris 0:19:51.480 --> 0:19:53.720 or Trump? You know, again, I think everything you said 0:19:53.760 --> 0:19:57.040 regarding the reviews on big tech is relevant and important here, 0:19:57.080 --> 0:19:59.320 and the reason why is that we're seeing really the 0:19:59.359 --> 0:20:02.000 same act in the AI space that we're seeing with 0:20:02.119 --> 0:20:05.280