WEBVTT - Tariff Suits, Tech Antitrust and Tax Bill 0:00:14.680 --> 0:00:18.119 Hello, and welcome to the Votes and Verdicts podcast, hosted 0:00:18.160 --> 0:00:21.960 by the Litigation and Policy team at Bloomberg Intelligence, the 0:00:22.000 --> 0:00:26.360 investment research platform of Bloomberg LP on the Bloomberg terminal. 0:00:26.640 --> 0:00:30.560 Bloomberg Intelligence has five hundred analysts and strategists working across 0:00:30.560 --> 0:00:34.040 the globe and focused on all major markets. Our coverage 0:00:34.040 --> 0:00:36.960 includes over two thousand equities and credits, and we have 0:00:37.000 --> 0:00:40.159 outlooks on more than ninety industries and one hundred market indices, 0:00:40.200 --> 0:00:44.800 currencies and commodities. This podcast series examines the intersection of 0:00:44.840 --> 0:00:48.239 business policy and law, and today's our weekly check in 0:00:48.320 --> 0:00:51.680 on the litigation and policy catalysts that we're watching and 0:00:51.680 --> 0:00:54.000 that we think will impact companies across a number of 0:00:54.000 --> 0:00:57.040 different sectors. My name is Elliot Stein. I'm an analyst 0:00:57.080 --> 0:01:00.480 with the Bloomberg Intelligence covering litigation in the financial sector, 0:01:00.600 --> 0:01:03.680 and I'll be your host for today, April twenty fifth, 0:01:03.800 --> 0:01:08.360 twenty twenty five. And since things move very quickly these days, 0:01:08.440 --> 0:01:12.400 especially when it comes to policies, we're recording this at 0:01:12.440 --> 0:01:16.920 ten thirty am Eastern Time. Delighted today to be joined 0:01:16.920 --> 0:01:19.200 by a handful of my colleagues on the Litigation and 0:01:19.240 --> 0:01:23.039 Policy team. We have Nathan Dian and DC, we have 0:01:23.760 --> 0:01:26.679 justin THEREESI and Holly from here in New York, and 0:01:26.720 --> 0:01:30.000 we have Tamlin Basin out in London. You can find 0:01:30.000 --> 0:01:32.400 all of our research on the Bloomberg terminal at BI 0:01:32.440 --> 0:01:36.880 go and more specifically on our dashboard BI Laws Go. 0:01:38.120 --> 0:01:40.759 All right, So I think, Holly, why don't we start 0:01:40.800 --> 0:01:46.600 with you. You've been covering the growing number of lawsuits 0:01:46.640 --> 0:01:52.040 that have been challenging President Trump's tariffs. There's several lawsuits 0:01:52.120 --> 0:01:53.680 going on, and I think this week may have been 0:01:53.720 --> 0:01:55.280 sort of the first time we have sort of a 0:01:55.320 --> 0:01:58.640 preliminary ruling. Do you want to give us an update 0:01:58.720 --> 0:02:02.920 on the k and where they are and how you 0:02:02.920 --> 0:02:03.840 see them playing out? 0:02:04.200 --> 0:02:04.480 Sure? 0:02:04.960 --> 0:02:08.160 Thanks Elliott. So there are about five or six lawsuits 0:02:08.280 --> 0:02:13.920 right now, and two of them have actually three of 0:02:13.960 --> 0:02:17.280 them have been filed in the International Trade Court I 0:02:17.320 --> 0:02:21.760 believe it's free. The rest have been filed in federal 0:02:21.840 --> 0:02:26.480 courts around the country, and they're challenging some The first 0:02:26.520 --> 0:02:29.280 lawsuit that was filed that we know about was filed 0:02:29.280 --> 0:02:32.079 in early April, and it was challenging just the tariffs 0:02:32.080 --> 0:02:38.639 on China. The next lawsuit challenged the reciprocal tariffs for 0:02:39.840 --> 0:02:44.760 the Universal Tariff and then the other lawsuits and two 0:02:44.760 --> 0:02:47.000 of them were filed by one of them was filed 0:02:47.000 --> 0:02:48.720 by a group of states, and then the other one 0:02:48.760 --> 0:02:51.320 was filed by the state of California challenge to all tariffs. 0:02:51.600 --> 0:02:56.840 And so they're all, you know, they make very similar arguments, 0:02:57.520 --> 0:02:59.840 and if you want to get into them, I can. 0:03:00.480 --> 0:03:03.000 Yeah, maybe maybe, I mean just quickly, maybe it makes 0:03:03.040 --> 0:03:05.840 sense for you to just sort of outline. I mean, 0:03:05.840 --> 0:03:08.480 there's basically like two main arguments. One is statutory. One's 0:03:08.520 --> 0:03:09.440 constitutional right. 0:03:09.760 --> 0:03:09.959 Right. 0:03:10.240 --> 0:03:14.480 So first they stay that the statute the president relied on, 0:03:14.680 --> 0:03:20.440 which was the International Emergency Economic Powers Act, doesn't authorize 0:03:20.480 --> 0:03:24.919 the tariffs because which we call, yeah, AIPA. It's much 0:03:24.960 --> 0:03:27.800 easier than that, that long, long name that gets is stuck. 0:03:29.000 --> 0:03:32.040 So AIPA doesn't authorize the terriffs because it never even 0:03:32.120 --> 0:03:34.080 mentions the word terraffs. And there are a bunch of 0:03:34.120 --> 0:03:39.360 other statutes that provide very structured and reticulated ways to 0:03:39.400 --> 0:03:42.840 impose tariffs, and they stay mentioned the word tariffs, and 0:03:42.880 --> 0:03:45.280 this is not one of them. And so they say 0:03:45.320 --> 0:03:47.280 this was a statute that was meant to deal with 0:03:47.920 --> 0:03:52.160 emergencies and like imposed trade embargos and things like that. 0:03:52.320 --> 0:03:56.600 It was not meant to impose like Adflorm's duties, and 0:03:57.000 --> 0:03:59.720 you can you we know that because it doesn't mention 0:03:59.720 --> 0:04:02.040 the word teriffs, and so that's one of the arguments. 0:04:02.160 --> 0:04:09.520 The second argument is that on one lawsuit, a challenging 0:04:09.520 --> 0:04:14.400 reciprol cold tariff says that the statute requires a national 0:04:14.400 --> 0:04:17.640 emergency that poses an unusual and extraordinary threat. And that's 0:04:17.640 --> 0:04:20.359 a quote from the statute, an unusual and extraordinary threat, 0:04:20.400 --> 0:04:23.719 and this is not the trade deficit that was cited 0:04:23.760 --> 0:04:26.320 as a basis for the reciprocal teriff. Is not an 0:04:26.440 --> 0:04:31.080 unusual and extraordinary threat. It's been in existence for fifty years. 0:04:31.920 --> 0:04:35.920 So this statute was definitely not meant to address an 0:04:35.960 --> 0:04:38.960 emergency like that. Or this is not an emergency, so 0:04:38.960 --> 0:04:41.120 it was not meant to address this situation like that. 0:04:42.920 --> 0:04:49.200 Then the lawsuit challenging the tariffs on China say, they 0:04:49.200 --> 0:04:53.320 don't contest, they don't claim that the illicit drugs and 0:04:53.560 --> 0:04:57.800 unlawful migration that's the basis for that, that that emergency 0:04:58.120 --> 0:05:01.000 is not an emergency, but they that the teriffs are 0:05:01.040 --> 0:05:05.479 not necessary to address that emergency. And then finally, all 0:05:05.520 --> 0:05:09.920 of the lawsuits argue that if AYIPA authorizes the terroriffs, 0:05:10.160 --> 0:05:13.920 then Congress unconstitutionally delegated. 0:05:13.360 --> 0:05:20.120 As powers, right, And I mean your view is you 0:05:20.279 --> 0:05:24.440 lean towards the terriffs, you know, sticky in, and that 0:05:24.560 --> 0:05:28.159 the government will prevail in these lawsuits. But you do 0:05:28.200 --> 0:05:28.960 think it's a close. 0:05:28.839 --> 0:05:31.159 Call, right, I do think it's a close call. So 0:05:31.200 --> 0:05:34.000 we said that we think the teriffs will be upheld 0:05:34.000 --> 0:05:38.640 because aipa's granted authority. It grants the president the power 0:05:38.880 --> 0:05:42.359 to regulate imports, and we say that that encompasses the 0:05:42.400 --> 0:05:45.960 power to impose tariffs. We also don't think the court 0:05:46.000 --> 0:05:48.800 is going to want to wait into what constitutes an emergency. 0:05:49.600 --> 0:05:51.880 They haven't in the past. They've been very reluctant to 0:05:51.880 --> 0:05:53.600 the second and gets the president when it comes to 0:05:53.640 --> 0:05:59.039 declarations of emergency. And the law doesn't constitutionally delegate power 0:05:59.080 --> 0:06:02.479 because it provides called an intelligible principle to the president. 0:06:03.120 --> 0:06:05.600 And in the one case in which two Supreme Court 0:06:05.680 --> 0:06:08.960 justices indicated they want to revisit the so called non 0:06:09.040 --> 0:06:11.360 delegation doctrine because this is a doctrine that hasn't been 0:06:11.400 --> 0:06:13.719 you has been looked at for like I think over 0:06:13.760 --> 0:06:18.200 seventy years or something like that. And in the one 0:06:18.279 --> 0:06:21.520 case in which two justices said they may want to 0:06:21.520 --> 0:06:24.960 revisit the doctrine and redefine it, they had a carve 0:06:25.040 --> 0:06:30.360 out for situations where the President and Congress's powers overlapped 0:06:30.480 --> 0:06:33.720 in areas wherehere they typically overlap, like and they explicitly 0:06:33.760 --> 0:06:36.840 mentioned foreign affairs, and I think this is something like 0:06:36.880 --> 0:06:39.240 that tariff powers, something like that. So I don't think 0:06:39.240 --> 0:06:41.760 they're going to want to revisit that doctrine in a 0:06:41.839 --> 0:06:43.960 case like this. So I said, these are going to 0:06:44.000 --> 0:06:47.159 be up the law is going to be upheld. And 0:06:47.279 --> 0:06:51.279 with regard to the recent rulings in the International Trade Court, 0:06:51.320 --> 0:06:54.719 what happened there was the challengers came in, they filed 0:06:54.720 --> 0:06:58.400 and what's called a TIRO temporary restraining order. They asked 0:06:58.440 --> 0:07:00.760 the court and in a preliminary injunction they asked the 0:07:00.760 --> 0:07:06.039 court to stay the terrorists right away immediately. So the 0:07:06.120 --> 0:07:08.719 court then, within a quick turn and I think was 0:07:08.800 --> 0:07:13.160 like a couple of days, said that they're not going 0:07:13.200 --> 0:07:15.559 to grant a tierro the terrifts are still in place 0:07:15.600 --> 0:07:18.920 because they did not find that the challengers showed that 0:07:18.960 --> 0:07:25.800 they had an immediate immediate irreparable harm. So so ther 0:07:26.320 --> 0:07:29.720 the TIRO last for fourteen days, and they said that 0:07:29.760 --> 0:07:31.920 they did not show that they would be immediately harmed 0:07:32.000 --> 0:07:34.920 in that fourteen day period because they none of them 0:07:34.920 --> 0:07:37.520 claim that they even pay the terroriffs or were about 0:07:37.560 --> 0:07:40.080 to pay the terriffs. And so that's an interesting issue 0:07:40.080 --> 0:07:42.160 that's come up, is that, you know, do any of 0:07:42.200 --> 0:07:46.920 these challengers have standing to sue the government over these terraffs? 0:07:47.480 --> 0:07:51.000 Right, So the court didn't even reach their issue of 0:07:51.120 --> 0:07:53.360 likelihood of success on the marits, which is also part 0:07:53.360 --> 0:07:57.559 of it to yours standard, right, So we're still left 0:07:57.600 --> 0:07:59.360 hanging as to what the court is thinking on that. 0:07:59.400 --> 0:08:02.880 What do you look for it next? In all these 0:08:02.960 --> 0:08:05.280 lawsuits before we move on to justin. 0:08:05.920 --> 0:08:08.520 So there's a hearing on May thirteens on the on 0:08:08.720 --> 0:08:13.920 the preliminary INJUNCTIONVID before the US International Trade Court. 0:08:15.320 --> 0:08:17.480 Where you used to work, right you should, right. 0:08:17.400 --> 0:08:20.880 Interns, Yeah, many eons ago. Let's not get into how 0:08:20.920 --> 0:08:27.240 long ago that was. But but there's this hearing, and 0:08:27.280 --> 0:08:29.800 so we should get some more insight on which way 0:08:29.880 --> 0:08:32.400 the court's leaning, or we may get more insight on 0:08:32.440 --> 0:08:34.040 which way the courts leaning and I think we'll get 0:08:34.040 --> 0:08:36.920 a decision relatively quickly. I think this could be turned 0:08:36.960 --> 0:08:40.199 around in two Q and then I do expect other 0:08:40.200 --> 0:08:45.320 preliminary injunction motions to be filed. And there's you know, 0:08:45.400 --> 0:08:48.880 the court the cases that have not been filed in 0:08:48.920 --> 0:08:51.200 the US International Trade Court, the government is moving to 0:08:51.200 --> 0:08:54.360 transfer them there, so before there's a preliminary injunction motion 0:08:54.480 --> 0:08:56.800 or hearing, we'll have to see if it's transferred to 0:08:57.040 --> 0:08:57.920 the U S I C. 0:08:58.080 --> 0:09:03.000 I T right on the argument that the Court of 0:09:03.040 --> 0:09:08.079 International Trade has exclusive jurisdiction over all things tariffs. That's right, Yeah, 0:09:08.120 --> 0:09:12.320 all right, that's great, So we'll we'll follow up probably 0:09:12.400 --> 0:09:15.920 every week since there's so many cases. All right, thanks, Ally, 0:09:16.000 --> 0:09:20.640 let's move on to Justin and all things anti trust, 0:09:20.880 --> 0:09:23.880 lots lots of So Justin's been in DC for the 0:09:23.920 --> 0:09:27.480 last two weeks basically following the FTC versus Meta trial, 0:09:28.640 --> 0:09:32.000 but also in the same courthouse as our other anti 0:09:32.000 --> 0:09:34.959 trust analyst, Jenry, who can't make it today because he's 0:09:34.960 --> 0:09:39.240 still in the courthouse for the Google Search Remedies case. 0:09:40.400 --> 0:09:43.240 So Justin maybe update us on both those cases. And 0:09:43.240 --> 0:09:45.600 then there's also the Google ad Tech ruling that came out, 0:09:45.880 --> 0:09:48.600 I don't know, in the last couple of weeks, right right, yeah, 0:09:48.679 --> 0:09:49.760 tell us everything. 0:09:49.760 --> 0:09:51.880 You got it? So, so big tech is on trial 0:09:51.920 --> 0:09:54.679 and everything is happening at exactly the same time, it 0:09:55.080 --> 0:09:58.000 seems like. But yeah, I guess just you know, not 0:09:58.040 --> 0:10:00.360 sure where to start, but I think Meta may makes 0:10:00.400 --> 0:10:02.520 them the most sense and hop into Google from there. 0:10:02.559 --> 0:10:05.720 But so, we just finished week two of the FTC's 0:10:05.760 --> 0:10:09.559 trial of versus Meta Platforms and the allegations there that 0:10:09.600 --> 0:10:14.000 Meta acted anti competitively to purchase what's happened Instagram a 0:10:14.000 --> 0:10:17.800 long time ago, in twenty twelve and twenty fourteen, respectively, 0:10:17.840 --> 0:10:21.040 and the government there is seeking a divestiture of those assets. So, 0:10:21.640 --> 0:10:23.880 you know, I think we've always had this view that 0:10:24.160 --> 0:10:26.840 with regards to that case, the FDC had some problems 0:10:26.840 --> 0:10:28.440 with the way that it brought it. It's been a 0:10:28.480 --> 0:10:32.320 long time since those acquisitions were closed. You know, there 0:10:32.360 --> 0:10:34.679 are issues with the relevant product market, and there are 0:10:34.720 --> 0:10:37.560 issues I think with the pro competitive justifications or the 0:10:37.559 --> 0:10:40.200 things that really happened with those acquisitions since they took 0:10:40.240 --> 0:10:43.880 place two weeks in a trial. It's certainly my view 0:10:43.880 --> 0:10:46.440 that the that Meta certainly keeps its edge here and 0:10:46.480 --> 0:10:49.520 the reason being that CEO Mark Zuckerberg in the first 0:10:49.520 --> 0:10:51.760 week of trial did a great job in my view 0:10:52.600 --> 0:10:56.880 in terms of explaining why Meta's actions with regard to 0:10:56.880 --> 0:11:00.839 Instagram and WhatsApp, since they those acquisitions took place, you 0:11:00.880 --> 0:11:03.040 know why they were actually good for those platforms. You know, 0:11:03.080 --> 0:11:06.520 the improvements they made to Instagram, things like direct messaging, 0:11:06.600 --> 0:11:09.520 things like real things like threads. All of those things 0:11:09.720 --> 0:11:12.360 were added to the platform after the acquisition. So there 0:11:12.400 --> 0:11:15.080 are those pro competitive things that happened to the platform 0:11:15.520 --> 0:11:19.880 since metatook control. In terms of the actual product market 0:11:19.920 --> 0:11:22.839 and the way the FTC defined it, they really chose 0:11:22.880 --> 0:11:25.240 to bring that case about friends and family sharing they 0:11:25.240 --> 0:11:28.760 call a personal social networking services market. The issue is, 0:11:28.840 --> 0:11:31.280 since you know, since these acquisitions took place, you know, 0:11:31.360 --> 0:11:33.760 well over a decade ago, things have changed. The use 0:11:33.800 --> 0:11:35.520 case for a lot of these things aren't what they 0:11:35.640 --> 0:11:38.040 used to be. Folks hop onto Instagram now and they 0:11:38.080 --> 0:11:41.439 spend a lot more time, in terms of Meta testimony anyway, 0:11:41.559 --> 0:11:44.560 looking at unconnected content like videos for folks they don't 0:11:44.640 --> 0:11:46.880 know from creators they might not know in real life, 0:11:47.080 --> 0:11:49.920 versus actually connecting with friends and family. So if that 0:11:49.960 --> 0:11:52.720 core use change. If that core use has changed with 0:11:52.760 --> 0:11:56.040 those products, then the market definition offered by the FDC 0:11:56.280 --> 0:11:58.920 for those products really has taken kind of a backseat 0:11:58.960 --> 0:12:01.120 to the realities of today. So in many ways, where 0:12:01.160 --> 0:12:03.800 this case might have been successful a decade ago, the 0:12:03.840 --> 0:12:06.600 realities of the marketplace have maybe tripped away at the 0:12:06.640 --> 0:12:08.280 FTC's ability to bring it now. 0:12:08.360 --> 0:12:11.120 So yeah, that's kind I would say from personal experience, 0:12:11.160 --> 0:12:13.920 I find that's happening more and more that I'm seeing 0:12:14.160 --> 0:12:18.360 content offered to me on Instagram, Facebook of you know, 0:12:18.440 --> 0:12:20.440 people I don't follow at all. 0:12:20.840 --> 0:12:23.520 Yeah, absolutely, And you know, I think really interesting too. 0:12:23.720 --> 0:12:27.400 In testimony from from from Mark Zuckerberg and Cheryl Sandberg, 0:12:27.440 --> 0:12:30.240 you know, the use of things like group texting also 0:12:30.400 --> 0:12:32.679 is kind of you know that over I message that's 0:12:32.760 --> 0:12:34.800 kind of replacing a lot of what folks used to 0:12:34.800 --> 0:12:37.520 do through a traditional Facebook post. You know that that's 0:12:37.559 --> 0:12:39.280 really grown unused to you know, I think I have 0:12:39.320 --> 0:12:41.320 maybe at least ten group texts on my phone I 0:12:41.320 --> 0:12:45.720 can think of right now between friends and family. We 0:12:45.720 --> 0:12:48.319 can join on four month after the after the call, 0:12:48.520 --> 0:12:50.880 not a problem. But you know, there's a lot more 0:12:50.880 --> 0:12:53.880 communication happening that way now, and all of these apps. 0:12:53.880 --> 0:12:56.680 There's kind of these share screens now too, where you 0:12:56.679 --> 0:12:58.959 can take you know, a particular piece of content from 0:12:58.960 --> 0:13:01.920 something like Reddit, from something like from something like this 0:13:02.040 --> 0:13:04.080 coord and you can hit a link to share it 0:13:04.160 --> 0:13:07.040 for through I Message or through Whatsappened, through all these 0:13:07.080 --> 0:13:10.120 other means. So like that's sharing in many ways as 0:13:10.200 --> 0:13:12.640 Meta has replaced a lot of the actual posting that 0:13:12.679 --> 0:13:15.720 would happen ten plus years ago. So the market is changing. 0:13:15.760 --> 0:13:17.400 That's been their testimony so far. 0:13:17.840 --> 0:13:21.480 Got it. So the trials two weeks in, it's just 0:13:21.720 --> 0:13:23.480 expected to go roughly how long? 0:13:23.800 --> 0:13:26.160 Yeah, So you know, it could end up any any time. 0:13:26.360 --> 0:13:29.120 So certainly you know into June that the judge has 0:13:29.160 --> 0:13:31.480 has has allowed it to go through July fourth, if 0:13:31.520 --> 0:13:35.319 that through July third, if that's actually needed, Whether or 0:13:35.320 --> 0:13:37.480 not that happens, we'll see. But you know, I think, 0:13:37.679 --> 0:13:40.000 you know, probably mid to late June is looking like 0:13:40.040 --> 0:13:40.800 the end date for that. 0:13:40.800 --> 0:13:45.760 Trial and then a decision I guess sometime and later 0:13:45.800 --> 0:13:46.880 in the year, I guess, yeah. 0:13:46.800 --> 0:13:48.840 I would say later in the year. Of course, appeals 0:13:48.880 --> 0:13:50.680 after that. Either way, I think we can count on 0:13:50.720 --> 0:13:51.840 that for all these cases. 0:13:52.160 --> 0:13:55.000 Got it? And so Okay, So that's FTC Meta. Yes, 0:13:55.040 --> 0:13:58.200 Google Search remedies is going on in the same courthouse. 0:13:58.559 --> 0:14:01.439 You're not. You're not in that court room because he 0:14:01.520 --> 0:14:04.839 cannot be in two places at once. But our colleague, yeah, 0:14:05.720 --> 0:14:09.720 our colleague Genry is and I assume she's updated you. 0:14:09.920 --> 0:14:12.280 So do you want to relay what he has to say? 0:14:12.440 --> 0:14:14.360 Yeah, she has And you know, I think you know, 0:14:14.440 --> 0:14:17.920 through the first week of trial of that particular remedies trial, 0:14:17.960 --> 0:14:20.760 if you will, there's been a lot of testimony about 0:14:21.280 --> 0:14:24.040 whether what the appropriate remedy would be. Now that Judge 0:14:24.120 --> 0:14:26.680 Meta not to be confused of meta platforms in DC 0:14:27.400 --> 0:14:28.440 has ruled out. 0:14:28.320 --> 0:14:30.640 How did they not assign him to the medicase. It's 0:14:30.680 --> 0:14:33.520 like it's total missed opportunity. 0:14:33.920 --> 0:14:36.600 It's been confusing enough without him without him on the 0:14:36.640 --> 0:14:39.440 medic caase. But you know, now that he's found that 0:14:39.520 --> 0:14:43.240 Google has this monopolization issue or maintenance of monopolization issue 0:14:43.240 --> 0:14:46.240 with search, now we step into this remedies phase here, 0:14:46.440 --> 0:14:49.280 and you know, it seems our view has been that 0:14:49.320 --> 0:14:52.240 even though the government's looking for a divestiture of Google Chrome, 0:14:52.520 --> 0:14:54.920 it's unlikely that's going to happen. That seems more like 0:14:54.960 --> 0:14:58.200 an opening solvo and similar to a negotiation in terms 0:14:58.240 --> 0:15:00.400 of scaling back with the court's actually going to be 0:15:00.520 --> 0:15:02.760 likely to do here in terms of a remedy. So 0:15:02.800 --> 0:15:05.600 we think what's more likely is that sharing some user 0:15:05.800 --> 0:15:09.240 data information, that kind of information that's allowed Google's algorithms 0:15:09.240 --> 0:15:11.880 to develop and become as strong as they have with 0:15:12.040 --> 0:15:15.200 nascent search engines or search engines that haven't really developed 0:15:15.280 --> 0:15:18.040 the same degree, that's really what we're likely to see here, 0:15:18.240 --> 0:15:19.960 and there are there has been a lot of testament 0:15:20.040 --> 0:15:22.880 this week about ways to anonymize that data so that 0:15:23.000 --> 0:15:25.800 privacy concerns was sharing it aren't an issue if the 0:15:25.800 --> 0:15:28.720 court ultimately decides to go that way. And I think 0:15:28.760 --> 0:15:31.680 in a lot of ways too, these exclusivity agreements, So 0:15:32.280 --> 0:15:35.720 with companies like Apple, where Google Search is a default 0:15:35.720 --> 0:15:38.960 search behind things like Safari or Siri, you know, Apple 0:15:39.000 --> 0:15:41.520 gets paid twenty billion dollars a year from Google for 0:15:41.600 --> 0:15:43.960 that to be the default kind of search mechanism behind 0:15:44.000 --> 0:15:47.280 its platforms. So big issue for Apple if those agreements 0:15:47.320 --> 0:15:49.280 are taken away, and those agreements were found in being 0:15:49.280 --> 0:15:52.120 anti competitive, right, so there's a high possibility of thereose 0:15:52.160 --> 0:15:56.120 payments up question mark, Does Apple stop using Google Search 0:15:56.200 --> 0:16:00.000 behind Siri or Safari if they don't receive those payments, 0:15:59.800 --> 0:16:03.040 that's a big question too. If Google Search has really 0:16:03.080 --> 0:16:06.680 developed that strong better search might in some ways it 0:16:06.760 --> 0:16:09.680 might still be into Apple's benefit to use Google Search 0:16:09.720 --> 0:16:12.200 behind those platforms, even if it's not being compensated for 0:16:12.280 --> 0:16:14.920 doing so. But we think those agreements are an issue, 0:16:15.200 --> 0:16:17.360 and you know, also likely we see some sharing of 0:16:17.600 --> 0:16:20.240 user data just so that you know, other search engines 0:16:20.240 --> 0:16:22.480 can develop their algorithms in a way that they could 0:16:22.480 --> 0:16:23.320 actually compete. 0:16:23.640 --> 0:16:28.080 And when should we expect the decision on these remedies. 0:16:27.800 --> 0:16:30.560 So slated for August of this year, that's what Judge 0:16:30.600 --> 0:16:32.440 Meta has said. Whether or not at drags a little 0:16:32.440 --> 0:16:34.520 bit later than that remains to be seen. 0:16:34.600 --> 0:16:37.720 So that that's when he'll issue a decision. He has said. 0:16:37.480 --> 0:16:40.160 That that that is that is the goal. That is 0:16:40.200 --> 0:16:42.560 the goal. Whether or not we see that, we'll see 0:16:42.560 --> 0:16:43.480 if that's actually the case. 0:16:43.600 --> 0:16:45.960 Gotcha, all right? So and then just quickly on on 0:16:46.000 --> 0:16:49.160 the Google add Tech ruling, just quickly what was it 0:16:49.200 --> 0:16:49.880 and what's next? 0:16:50.240 --> 0:16:53.360 Sure? Sure, absolutely so. So turning down to Eastern District 0:16:53.360 --> 0:16:56.520 of Virginia Google add Tech, there was a trial on 0:16:56.600 --> 0:17:01.280 the on monopolization issues with Google Google's advertising technology back 0:17:01.280 --> 0:17:04.040 in September. The judge there last week found that Google 0:17:04.119 --> 0:17:06.800 does have a monopoly in terms of the publisher ad 0:17:06.840 --> 0:17:09.800 server side of its ad technology, so the cell side 0:17:09.960 --> 0:17:13.280 of the advertising stack and the advertising exchange in the middle. 0:17:13.320 --> 0:17:16.600 That kind of ties advertisers to the places where they're 0:17:16.600 --> 0:17:20.280 placing their ads. Google ties those products together in such 0:17:20.280 --> 0:17:22.200 a way that if you want real time ad demand, 0:17:22.240 --> 0:17:24.920 the court said, you have to use Google's ad server 0:17:25.000 --> 0:17:27.800 to get there, and that tie in many ways. That's 0:17:27.840 --> 0:17:30.120 the problem the court had. The court, as we expected, 0:17:30.240 --> 0:17:33.000 didn't think that the actual buy side where people look 0:17:33.040 --> 0:17:35.919 to place advertising, had a monopoly there. We didn't think 0:17:35.960 --> 0:17:38.119 the court would find an issue there. It seems to 0:17:38.160 --> 0:17:40.920 be a very competitive market as opposed to the other side. 0:17:40.720 --> 0:17:41.440 Of the spectrum. 0:17:41.480 --> 0:17:44.679 So heading into a remedies phase there now, Judge Brinkham 0:17:44.720 --> 0:17:47.840 on moves really quickly. We think September late September is 0:17:47.880 --> 0:17:50.880 looking like the start of that remedy. Is hearing that's 0:17:50.920 --> 0:17:53.040 what was proposed by the parties. She may want to 0:17:53.080 --> 0:17:55.680 move even faster than that. She's serarly try to move 0:17:55.720 --> 0:17:58.399 things along as fast as she can. At the moment, 0:17:58.480 --> 0:18:00.919 we're not thinking it. Divestiture is likely there. And the 0:18:01.000 --> 0:18:04.760 reason why it's a Google's adser for they operate in 0:18:04.800 --> 0:18:07.680 things other than the digital app that the display advertising 0:18:07.720 --> 0:18:09.440 that was an issue in this case. There's a whole 0:18:09.480 --> 0:18:11.720 bunch of other ads that they transact in for video 0:18:11.760 --> 0:18:14.520 ads and app ads that were not part of this litigation. 0:18:14.680 --> 0:18:17.720 So to force the sale the entire thing seems a 0:18:17.760 --> 0:18:20.720 little bit unlikely. We think snipping that tie I mentioned 0:18:20.720 --> 0:18:22.560 between the two products is more likely to be a 0:18:22.600 --> 0:18:23.480 remedy in this case. 0:18:24.240 --> 0:18:26.520 Got it? All right, that's a great update. Thanks justin. 0:18:27.080 --> 0:18:29.360 When when do you head back to DC? A week? 0:18:29.680 --> 0:18:31.679 Yeah, a week from Monday, So can't wait for that. 0:18:31.760 --> 0:18:37.560 Yeah, all right, talking about DC, let's bring in Nathan Dean, 0:18:37.640 --> 0:18:42.520 who is our chief policy analyst down in Washington. Nathan, 0:18:42.560 --> 0:18:44.080 what's going on in DC these days? 0:18:44.720 --> 0:18:46.600 Well, it's not going to Actually it's a fairly quiet 0:18:46.640 --> 0:18:49.840 week as Washington goes. But it's gonna kick off next 0:18:49.840 --> 0:18:53.760 week because the Congress returns after their two week recess, 0:18:53.960 --> 0:18:56.760 and I think the first thing to talk about is reconciliation. 0:18:57.400 --> 0:18:59.200 You know, this is the effort from the Republicans to 0:18:59.280 --> 0:19:02.760 extend the twenty seventeen Tax Cuts and Jobs Act. We've 0:19:02.760 --> 0:19:05.320 talked about it before on this program, and obviously, if 0:19:05.520 --> 0:19:07.440 anybody's listening, the one to get a little bit deeper 0:19:07.480 --> 0:19:10.320 dive on that, we certainly can. But you know, what 0:19:10.320 --> 0:19:13.000 we're gonna see next week is the start of the markups. 0:19:13.160 --> 0:19:16.560 And so, as you remember, the House and the Senate 0:19:16.600 --> 0:19:20.920 passed the same resolution, and in these resolutions, it went 0:19:20.960 --> 0:19:23.280 to each one of the committees and said, go forth 0:19:23.760 --> 0:19:26.679 in either identify areas that you're going to cut or 0:19:26.760 --> 0:19:29.760 identify areas that you're going to increase the deficit aka 0:19:30.000 --> 0:19:32.920 bring more benefits in this case, you know, and so forth. 0:19:33.000 --> 0:19:35.320 How many commits? How many committees? Does it go to? 0:19:36.320 --> 0:19:39.679 Eight on the House side? And I will have a 0:19:39.680 --> 0:19:44.840 better answer after no, no, no, no, it's fine. Yeah, 0:19:44.880 --> 0:19:47.719 it's several. And so you know, but for the listeners, 0:19:47.920 --> 0:19:50.200 really the big one is the House Ways and Means Committee. 0:19:50.240 --> 0:19:52.520 This is the one where they're going to essentially play 0:19:52.520 --> 0:19:54.560 with all the taxes. And so when you think about 0:19:54.560 --> 0:19:58.040 like increasing self deduction or changing the corporate tax, or 0:19:58.200 --> 0:20:00.960 President Trump coming out in support of the millionaire's tax 0:20:01.480 --> 0:20:03.800 just this morning, or going from the thirty nine point 0:20:03.840 --> 0:20:06.800 six percent tax rate to the forty percent tax rate. 0:20:06.880 --> 0:20:08.280 You know, this is where the House in Ways and 0:20:08.320 --> 0:20:11.480 Means Committee is going to play. Now, the interesting thing 0:20:11.560 --> 0:20:15.639 here is that just for next week, just note that 0:20:15.680 --> 0:20:19.720 the only committee that we think the Judiciary Armed Services 0:20:19.760 --> 0:20:22.760 Committee there meeting the Armed Services one. If you have, 0:20:23.240 --> 0:20:26.359 you know, exposure to the defense contractor space, that's the 0:20:26.400 --> 0:20:28.399 one to pay attention to because they're one of the 0:20:28.440 --> 0:20:32.280 few committees that was told to increase the budget. Republicans 0:20:32.320 --> 0:20:34.320 are seeking about one hundred and fifty billion dollars in 0:20:34.400 --> 0:20:37.880 additional funding for border security and the defense. So again, 0:20:37.920 --> 0:20:40.159 if you have the defense contractors in your portfolio, you 0:20:40.160 --> 0:20:42.680 want to pay attention to that. But the House Ways 0:20:42.680 --> 0:20:44.720 and Means Committee is the most big one to talk about, 0:20:44.760 --> 0:20:46.719 and that is most likely going to take place in 0:20:46.800 --> 0:20:50.000 mid March. The Republicans wont all this done by Memorial Day. 0:20:50.080 --> 0:20:51.560 I don't think they're going to be able to do 0:20:51.640 --> 0:20:54.640 it for a couple role of reasons. One, it's much 0:20:54.680 --> 0:20:57.119 more difficult to actually come up with the specifics than 0:20:57.119 --> 0:21:00.680 it is to have the resolution itself. It's very easy 0:21:00.680 --> 0:21:02.399 to agree on a top line number, and that's what 0:21:02.440 --> 0:21:05.399 they agreed on. But when the Republicans agreed in the 0:21:05.440 --> 0:21:09.639