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Hi, welcome everyone.
We're so glad that you can join us for this Concurrences Antitrust Podcast.
I am here with Aaron Hoag, who is the chief of the technology and digital platform section of the United States Department of Justice's Antitrust Division.
And today we're actually coming to you from the Clifford Chance Compass Lexicon Concurrences Conference in Palo Alto, California.
Now, Aaron has been a long time employee of the Antitrust Division in the Justice Department, having served as a trial attorney in other roles as well, and is now in one of the sections that is the most active participant in antitrust enforcement in the digital space.
For example, Aaron's section is leading the Google search case in Washington, DC., the RealPage algorithm pricing case, and the most recently filed case, the KKR case concerning alleged violations of the HSR Act.
Well, Aaron, I want to take advantage of your long and rich history with the Antitrust Division just to ask you a little bit about yourself and what you've seen in your time in the Antitrust Division.
So you started working there in 1997.
So what have been some of the more significant developments you've seen in the field of antitrust while you've been at the Justice Department?
Well, thank you, Peter.
It's a pleasure to be here with you.
It's always nice to see you again.
It's nice to be out at this wonderful conference at this great venue.
I should just start with the standard disclaimer for all DOJ people at these events, which is that these are my own comments.
They represent my own views and not the official views of the department.
But I would just say, thinking back to when I started practicing antitrust law at the division, which was when I was right out of law school after working for a year.
I mean, there are some fundamental ways which the practice of law, as I'm sure you know, is very different than it was back then.
I just think of a world where we did an investigation, we wanted to go out and collect information from all the companies in the industry.
We would get maybe dozens of boxes of paper that would encompass all of the relevant information that was relevant to whatever merger or conduct investigation.
They would buy in the hallways and be filling our storage areas.
But in some sense, they were finite in a way that you don't have now.
So when you're conducting investigation, you could say, all right, we have 75 boxes.
We're going to review all 75 boxes.
We're going to review every page, every document.
Those were all the documents that were most important because this was even in the early days of e-mail and go back so far, where people at firms actually wrote memos to each other when they wanted to analyze an issue.
So the amount of information that you had to master in order to lead the case was so much different then.
It was just a very different time to practice law.
So I think antitrust is just exponentially more popular as a subject right now, amongst law students, amongst the people that we hire.
The people that we hire are so much more knowledgeable about antitrust law and economics than I know that I was when I came here of law school.
Even though I had some interest in tech, I had some interest in antitrust, and I'm symposium number two.
We have so many people that have spent time working at economic agencies, economic firms, consulting firms, coming out of college, that have worked for other antitrust enforcers, that have done just a tremendous amount of work in the space.
It's really exciting that kind of experience that people have.
I think it's a different group of people that we hire from now, and that's really a lot of fun.
I think that I will share is just as very unique to the practice of the antitrust division, is that the antitrust division is just a much more unified place than it was back then.
When I started, there was basically the same number of sections that did investigations there now.
Those sections were so independent from each other, were so siloed off from each other.
We were all spread around all around DC.
You just rarely work with people in other sections.
There was not very much people going back and forth, working on a detail to another section for six months.
It just had a very different feel.
Your section was like your universe, as opposed to like the civil program of the antitrust division being your universe.
And that's really very different.
I enjoy the current way we have it.
It's a lot of fun.
I think it gives us, it's both a pleasure because you get to work with more people and get exposed to more people.
That's really exciting.
It also gives us a lot more flexibility in staffing our matters because we can have, you know, even if your section has 30 staff attorneys in it, if you need to scale up and do the Google search case, do some other litigation, do some other big investigation, and borrow people from other sections so much more easily.
That's really, it's a lot more effective and efficient in enforcing the antitrust laws.
Well, I think you have seen a lot in your years, including this evolution of how antitrust practice has developed.
But let me ask you kind of the flip side of that question, which is what has kind of stayed the same as you think about your career in the antitrust division?
You know, I think ironically, one thing that stayed the same is actually the interest in the conduct of big tech firms and how it relates to the antitrust law.
Now, back in the day when I started, that was really a big tech firm or singular, it was really Microsoft.
But that was the hot issue in antitrust back then.
When I was in law school, the head of the antitrust division, maybe he was I think the deputy that later became the head of the antitrust division, Joel Klein, came, did a class at our law school, and did it with one of the attorneys that represented Netscape, Gary Reback, who was a known antagonist of Microsoft.
They came in and engaged and debated and argued with each other.
This was before the big Microsoft case that DOJ brought was being litigated.
But that was the hot issue in antitrust then.
That's the issue that everyone was thinking about in antitrust.
That's what everyone was focusing on.
And I feel like things have very much come full circle in that respect.
Now, there are a few different of these type platforms that there's such public interest in and now such active antitrust enforcement on.
But I think it's in many ways very similar.
A lot of these cases share a lot of the same issues.
You can see, if you read the beginning of Google search, you can see how many times the Microsoft case is a non-small number.
I think that's for good reason because I think there's a lot of some of these issues come back full circle.
So that's definitely one of them.
The other one I would just say is that I think one constant throughout the time I've been at the division is just the quality and commitment of the staff of the division, knowing the care and meticulous approach and dedication that we all take to our work.
And that's something that hasn't changed at all.
It doesn't change from year to year, decade to decade.
You see very much that same commitment to that same, and not just commitment to the work, but also commitment to the institution, commitment to being collegial, to being good colleagues, to working well.
I think that kind of commitment to the institution for both the DOJ, the FTC, and the state attorney general's office is, I have to agree that that's a constant.
I very much enjoyed my almost 20 years of working at DOJ, and sometimes kind of a related aspect of antitrust law that I reflect upon is that I think a lot of antitrust lawyers, whether you're in private practice in house, or working for a government enforcer, is that there is this broader commitment to how the antitrust law develops.
I think there's a very sincere interest in trying to make sure that antitrust law gets it right.
I think sometimes the reasons why we have these passionate disagreements about what antitrust law should do and how it should be enforced is because people, they care about this area of law, and it can be somewhat painful if the law develops in a way that they disagree with, and it can be very gratifying if in fact you see the law developing in a way that makes sense to you.
That leads me to want to ask you a question about the current transition period we're in.
We're reporting this podcast four days before the inauguration of President Trump.
The natural question that people want to ask is, what can we expect in a transition period?
And then maybe more generally, I can ask, how do career staff like yourself work with new political leadership when there is this change in the administration?
And how do you continue the government's enforcement efforts?
Of course, I mean, the exact details, they're going to vary by administration, by the exact timing of when people arrive.
But I think that the fundamentals are all the same.
What our job is to bring the new people up to speed on the matters that we have that are ongoing, so that they are in a position when decisions need to be made, that they can be fully apprised of the facts and the law and arguments for the different options that are available to them.
And so they can be prepared for that.
And so that will vary from case to case, on what time frame that happens, it will vary depending on what deadlines exist that are external, what are court deadlines, statutory deadlines or whatnot.
But that's very much how we approach it, that it's an exciting opportunity to come in and tell a group of new people about the great work that we're doing, why we're excited about it, why we think they should be excited about it, and what are the challenges that we're facing and what are the decisions that we're gonna have to make in the near term.
So that's what we're really focused on during this transition period.
As I said, exactly how that works varies.
I've been through a number of these over the years.
And sometimes people arrive at the Antitrust Division right away.
Sometimes they come a little bit later, new people from the new administration.
So there'll be some variation in the logistics of it.
But that's the fundamental goal in life.
And then as we look forward a little bit more, when we get beyond the immediate issues, deal with our cases, it's an opportunity to engage with the new leadership.
What are their priorities?
What are the types of matters that they are looking to be aggressive on?
What are the types of issues where they want to either continue the direction we're going, going to a different direction, which is certainly why they're appointed to those positions, is to make those exact decisions.
And so it's an exciting time.
And we really look forward to working with the new leadership.
When they arrive, I think it's going to be an interesting transition and really a good opportunity for us.
And we're excited about it.
Let me turn to a different question, which is the topic of coordinating antitrust enforcement with state attorney general's offices, which I know is something that your section, and you have done in many investigations and in matters that you're litigating.
And that was, it leads me to ask, how do you work together with the state AGs to determine how to proceed with the matter?
And how does this practice differ or stay the same when you're working with your international counterparts?
So I've worked, I have worked on a very wide range of matters with our state colleagues.
And I have seen this tape, all different types of formulations.
And I think maybe one of the things you can really learn from that is that we are independent sources of decision making, right?
I mean, the states are their own sovereigns.
They make their own decisions about the enforcement of the antitrust laws or their state laws.
We work together, we work to try to reach harmonious decisions.
I think that there can be a lot of power when we're aligned with each other in fundamental ways, and that that can be a real advantage as we bring that into a litigation.
But I think one thing that is clear is that sometimes we reach, we have different approaches to matters, and that's why I do this.
Maybe we can't find a constructive way to work forward.
Back when I first started, I mentioned Joel Klein came to my law school, talked about Microsoft when I then joined the Antitrust Division.
About five years later, I ended up working on Microsoft.
By then, the trial was over, and I was working on the decree enforcement.
But that was an effort that was done in parallel with a large group of states.
Interestingly, in that case, there were actually two groups of states.
There was one group of states that agreed with us when we set up the case, and there was another group of states that didn't agree with us when we set up the case and continued to litigate and fought in order to get their own remedy.
But regardless of whether those different positions had happened along the way, we worked with them very closely once there was an actual decree in place, so definitely on time and in place, to enforce it and make sure that Microsoft was living up to that.
Those were conversations that we had every day, every week, working with them closely in order to move forward our collective interests and progressively bringing Microsoft to making sure that they were complying with that decree.
So you've seen it just take all types and all different forms, and we worked together a lot during investigations, worked together with an eye towards potentially litigating together.
I think it's a real opportunity to benefit from each other's thinking too.
I think that's one of the things that's most interesting about it.
When you either just in terms of approach to the Antitrust laws or the federal Antitrust laws, or learning about what the different state options are to deal with different, the same types of issues under a different framework, under their own state legislation.
I think about the international side of things.
It is in some ways very similar.
So especially in the investigative phase, you're going along in parallel.
You each have your own rights and your own authority to make your own decisions along the way and that's definitely how it works.
I think one thing that's very different about the international side of things is that there's no sense in which you are preparing to be co-ligands in a case with each other.
Each international agency has the authority to bring its own case under its own laws, obviously this is just fundamental international law.
But it's not the United States and the United Kingdom against some company or against some merger.
That's not how it works at all.
So you're not, the strategy for the back half, or thinking about the back half of how it will work, is not the same as it is with the states.
Now, that doesn't mean the cooperation and the coordination on the thinking, and the analysis, and the efforts to bring everyone on to the same page and see if there's a common way of looking at this based on the common facts, to the extent that the facts are common across the industries.
That's very similar to work that goes on with the states.
The thing that is different is depending on the international agencies may have, not always, but may often have a lot more resources devoted in the investigative state than necessarily the states will.
I mean, a lot of times, states have very limited resources.
Paul was talking about, Paul Deseret, the California Navy's office, was talking about at the panel this morning.
They have very limited resources.
They don't have the ability to have five people working on an investigation of every matter that they are working in cooperation with the federal government, and that's even from California, which is one of the larger ones.
So it can be very interesting working with the international folks because they actually have resources to conduct their own investigation.
They bring a lot of ideas to the table in terms of how they're seeing things, what they're hearing from the market, what they're seeing in the documents, purely productive exercise.
And kind of a related question is increasingly in the technology space, we are seeing matters being investigated globally.
And I think this affects companies in at least two ways.
If the company is the focus of the investigation, then they are often facing requests for information and questions from multiple competition agencies.
But even where a company is a third party, they often get multiple RFIs, which sometimes can be a little frustrating for the third parties, because to them, the particular matter may not be important to their business, but they are still roped in by getting CIDs and subpoenas throughout the world and having this obligation to respond.
So that leads me to ask, you know, when there is a company that's facing, especially an investigation worldwide, how can they best work with you, the states and the other global competition agencies to try to minimize their burden and efficiently move through the investigation?
I think one thing that's critical to that is the use of waivers, of confidentiality.
I think I've seen across these matters in my tenure as a division, that that can be a really powerful tool for enabling the agencies to actually coordinate probably too strong a war, but move along more effectively in parallel with each other and to be able to share information in order to share the types of things that they're thinking about, to discuss documents, to discuss actual details and testimony and that record as it develops.
I think that a lot of firms recognize this and are generally recognized that it can absolutely be in their self-interest, even as someone is subject to the investigation, to enable the agencies to cooperate with each other.
But occasionally we see firms withholding the waivers, which certainly they're right and we may suggest it's not their right.
But we see them withholding them in an effort to prevent cooperation amongst enforcers.
I think you just have to recognize that with that approach, it comes some harm to that search for efficiency.
If you're not sharing what submissions you made to one agency with another agency, if you're not allowing them to share or discuss the documents that have been submitted, you're making it harder for those agencies to actually try to reach an outcome that is harmonized with each other.
Now, if you have confidence and you believe in your arguments in defense of a merger or in defense of a course of conduct, I'll tell you my view is you want enforcers to be making the most informed possible decisions based on the record, and allowing them to cooperate with each other.
I think it can ultimately be in your own self-interest as a company that's facing investigation.
That's how I view it.
That's one of the key issues there.
Another one is much more simple, but that I've certainly seen happen or maybe not happen in a lot of cases, is that making sure that your lawyers are informed about what's going on across multiple jurisdictions in different times.
Because even in matters where there aren't waivers, there are still discussions that take place amongst the agencies respecting the confidentiality requirements, of course.
But there are still discussions going on if you're taking inconsistent positions generally on substance or even if just there are developments that are procedural that another council in another country doesn't know about.
It both undermines your effectiveness as an advocate in front of the agencies because it just leads to an impression that the right hand doesn't know what hand is doing.
But it can also just get in the way of logistical planning, dealing with administrative issues, dealing with timing in matters like that.
Well, thank you for that advice and insight.
Very helpful.
Let me conclude our podcast by asking you two questions with criticism that we often hear about the antitrust laws.
And here's the first question.
Investigations and litigation over conduct, especially conduct as opposed to mergers, that's alleged to have violated the antitrust laws, that litigation often takes multiple years to resolve.
With the discovery, finding of liability, there can be a separate remedy phase, and then the appeal process.
Given that amount of time that it takes to bring an antitrust case to conclusion, are the antitrust laws sufficient for timely addressing competition concerns?
Well, we discussed a similar issue to this at the panel this morning.
And as I'm sure you'll appreciate from your time, having one of the same jobs that I have right now.
You know, ultimately, I'm responsible for managing a team that enforces the antitrust laws as they exist today.
Like the fundamental question of whether we should have different antitrust laws, like that's a question I'm happy to leave to our policymakers and our legislators.
I think one observation I'll make is that we've seen a lot of activity in the enforcement side of things in recent years and I think there's some real life in the enforcement.
I take your point as inarguable that these matters can take a long period of time.
They are a way to go directly at specific pieces of conduct and end up with very thoughtful and recent decisions and that appears to have some benefits, too.
The ability to construct remedies that are directly targeted at the allegations that were found and that was not illegal, those are benefits, too.
Whether the status quo is inherently better than some alternate world in which there's a complimentary DMA-type regime, that's not for me to say, but I think that there's a lot of opportunity right now to learn from what's happening in all these associations, learn what's happening from other agencies across the world, other countries that are establishing new regulatory regimes, and to learn about what the benefits and the pros and the cons of those are, and how they match up to what we do with traditional antitrust, so I think it's a really exciting opportunity there, but ultimately that's not what we can say.
All right, and here's my second question about some of the criticism you'll hear about the antitrust laws is that the critique is that antitrust enforcement can stifle innovation and economic growth.
So how does the antitrust division seek to avoid chilling pro-competitive conduct that's good for consumers?
Look, in theory, of course, you could have an enforcement regime that was so overzealous that it would deter companies from engaging in innovation and other pro-competitive conduct.
I think here we're mostly talking about the conduct side, things rather than murder.
I think there's a different set of populations there.
I would just say that from my vantage point, it seems to me that the rewards for successful innovation in these tech markets are so significant.
I really struggle to see, and don't really see a lot of evidence to sort the proposition, that companies are holding back on new innovations, on new products, on not entering new markets based on the fear of antitrust liability.
That to me seems a little counterfactual.
I think there's a reason for that though, and it makes a lot of sense because you look at the kind of cases that we are bringing as antitrust enforcers, they focus on companies that, I mean, this sounds very circular, but it is really fundamentally very true, they're engaging in conflict that harms competition, it harms the competitive process.
You just don't see us bringing cases where the theory is of harm is that a company innovated and developed a new product, and that therefore that is in and of itself an antitrust violation that needs to go out and be replicated.
Even the most aggressive cases we have brought are laser focused on this distinction between, it's not illegal to have monopoly power, it's not illegal to become a monopolist when you are good through your own product development, and quality, and investments, that that's not illegal and you shouldn't be punished for that.
I think our cases are really thoughtfully focused on the line between that, and you've taken affirmative steps that make it harder, more difficult, and properly so for other people to compete in those marketplaces.
I also just say that you can't lose sight of the fact that there is something on the other side of this letter, right?
I mean, anti-competitive behavior itself stifles innovation and economic growth.
So even if one were concerned about the possibility that there were some overactive enforcement that was having some deterrent effect, you'd want to make sure you're weighing that against the deterrent effect of having people with substantial market-playing power out there and high barriers to entry and entrenched government positions.
Aaron, thank you.
This has been tremendously interesting.
We really appreciate your taking the time to talk with us today.
It's been an absolute pleasure.
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By listening to this podcast, you will learn the fundamentals of competition law and hear about the latest antitrust news thanks to our guests, the best experts in the antitrust world.
Hi, welcome everyone.
We're so glad that you can join us for this Concurrences Antitrust Podcast.
I am here with Aaron Hoag, who is the chief of the technology and digital platform section of the United States Department of Justice's Antitrust Division.
And today we're actually coming to you from the Clifford Chance Compass Lexicon Concurrences Conference in Palo Alto, California.
Now, Aaron has been a long time employee of the Antitrust Division in the Justice Department, having served as a trial attorney in other roles as well, and is now in one of the sections that is the most active participant in antitrust enforcement in the digital space.
For example, Aaron's section is leading the Google search case in Washington, DC., the RealPage algorithm pricing case, and the most recently filed case, the KKR case concerning alleged violations of the HSR Act.
Well, Aaron, I want to take advantage of your long and rich history with the Antitrust Division just to ask you a little bit about yourself and what you've seen in your time in the Antitrust Division.
So you started working there in 1997.
So what have been some of the more significant developments you've seen in the field of antitrust while you've been at the Justice Department?
Well, thank you, Peter.
It's a pleasure to be here with you.
It's always nice to see you again.
It's nice to be out at this wonderful conference at this great venue.
I should just start with the standard disclaimer for all DOJ people at these events, which is that these are my own comments.
They represent my own views and not the official views of the department.
But I would just say, thinking back to when I started practicing antitrust law at the division, which was when I was right out of law school after working for a year.
I mean, there are some fundamental ways which the practice of law, as I'm sure you know, is very different than it was back then.
I just think of a world where we did an investigation, we wanted to go out and collect information from all the companies in the industry.
We would get maybe dozens of boxes of paper that would encompass all of the relevant information that was relevant to whatever merger or conduct investigation.
They would buy in the hallways and be filling our storage areas.
But in some sense, they were finite in a way that you don't have now.
So when you're conducting investigation, you could say, all right, we have 75 boxes.
We're going to review all 75 boxes.
We're going to review every page, every document.
Those were all the documents that were most important because this was even in the early days of e-mail and go back so far, where people at firms actually wrote memos to each other when they wanted to analyze an issue.
So the amount of information that you had to master in order to lead the case was so much different then.
It was just a very different time to practice law.
So I think antitrust is just exponentially more popular as a subject right now, amongst law students, amongst the people that we hire.
The people that we hire are so much more knowledgeable about antitrust law and economics than I know that I was when I came here of law school.
Even though I had some interest in tech, I had some interest in antitrust, and I'm symposium number two.
We have so many people that have spent time working at economic agencies, economic firms, consulting firms, coming out of college, that have worked for other antitrust enforcers, that have done just a tremendous amount of work in the space.
It's really exciting that kind of experience that people have.
I think it's a different group of people that we hire from now, and that's really a lot of fun.
I think that I will share is just as very unique to the practice of the antitrust division, is that the antitrust division is just a much more unified place than it was back then.
When I started, there was basically the same number of sections that did investigations there now.
Those sections were so independent from each other, were so siloed off from each other.
We were all spread around all around DC.
You just rarely work with people in other sections.
There was not very much people going back and forth, working on a detail to another section for six months.
It just had a very different feel.
Your section was like your universe, as opposed to like the civil program of the antitrust division being your universe.
And that's really very different.
I enjoy the current way we have it.
It's a lot of fun.
I think it gives us, it's both a pleasure because you get to work with more people and get exposed to more people.
That's really exciting.
It also gives us a lot more flexibility in staffing our matters because we can have, you know, even if your section has 30 staff attorneys in it, if you need to scale up and do the Google search case, do some other litigation, do some other big investigation, and borrow people from other sections so much more easily.
That's really, it's a lot more effective and efficient in enforcing the antitrust laws.
Well, I think you have seen a lot in your years, including this evolution of how antitrust practice has developed.
But let me ask you kind of the flip side of that question, which is what has kind of stayed the same as you think about your career in the antitrust division?
You know, I think ironically, one thing that stayed the same is actually the interest in the conduct of big tech firms and how it relates to the antitrust law.
Now, back in the day when I started, that was really a big tech firm or singular, it was really Microsoft.
But that was the hot issue in antitrust back then.
When I was in law school, the head of the antitrust division, maybe he was I think the deputy that later became the head of the antitrust division, Joel Klein, came, did a class at our law school, and did it with one of the attorneys that represented Netscape, Gary Reback, who was a known antagonist of Microsoft.
They came in and engaged and debated and argued with each other.
This was before the big Microsoft case that DOJ brought was being litigated.
But that was the hot issue in antitrust then.
That's the issue that everyone was thinking about in antitrust.
That's what everyone was focusing on.
And I feel like things have very much come full circle in that respect.
Now, there are a few different of these type platforms that there's such public interest in and now such active antitrust enforcement on.
But I think it's in many ways very similar.
A lot of these cases share a lot of the same issues.
You can see, if you read the beginning of Google search, you can see how many times the Microsoft case is a non-small number.
I think that's for good reason because I think there's a lot of some of these issues come back full circle.
So that's definitely one of them.
The other one I would just say is that I think one constant throughout the time I've been at the division is just the quality and commitment of the staff of the division, knowing the care and meticulous approach and dedication that we all take to our work.
And that's something that hasn't changed at all.
It doesn't change from year to year, decade to decade.
You see very much that same commitment to that same, and not just commitment to the work, but also commitment to the institution, commitment to being collegial, to being good colleagues, to working well.
I think that kind of commitment to the institution for both the DOJ, the FTC, and the state attorney general's office is, I have to agree that that's a constant.
I very much enjoyed my almost 20 years of working at DOJ, and sometimes kind of a related aspect of antitrust law that I reflect upon is that I think a lot of antitrust lawyers, whether you're in private practice in house, or working for a government enforcer, is that there is this broader commitment to how the antitrust law develops.
I think there's a very sincere interest in trying to make sure that antitrust law gets it right.
I think sometimes the reasons why we have these passionate disagreements about what antitrust law should do and how it should be enforced is because people, they care about this area of law, and it can be somewhat painful if the law develops in a way that they disagree with, and it can be very gratifying if in fact you see the law developing in a way that makes sense to you.
That leads me to want to ask you a question about the current transition period we're in.
We're reporting this podcast four days before the inauguration of President Trump.
The natural question that people want to ask is, what can we expect in a transition period?
And then maybe more generally, I can ask, how do career staff like yourself work with new political leadership when there is this change in the administration?
And how do you continue the government's enforcement efforts?
Of course, I mean, the exact details, they're going to vary by administration, by the exact timing of when people arrive.
But I think that the fundamentals are all the same.
What our job is to bring the new people up to speed on the matters that we have that are ongoing, so that they are in a position when decisions need to be made, that they can be fully apprised of the facts and the law and arguments for the different options that are available to them.
And so they can be prepared for that.
And so that will vary from case to case, on what time frame that happens, it will vary depending on what deadlines exist that are external, what are court deadlines, statutory deadlines or whatnot.
But that's very much how we approach it, that it's an exciting opportunity to come in and tell a group of new people about the great work that we're doing, why we're excited about it, why we think they should be excited about it, and what are the challenges that we're facing and what are the decisions that we're gonna have to make in the near term.
So that's what we're really focused on during this transition period.
As I said, exactly how that works varies.
I've been through a number of these over the years.
And sometimes people arrive at the Antitrust Division right away.
Sometimes they come a little bit later, new people from the new administration.
So there'll be some variation in the logistics of it.
But that's the fundamental goal in life.
And then as we look forward a little bit more, when we get beyond the immediate issues, deal with our cases, it's an opportunity to engage with the new leadership.
What are their priorities?
What are the types of matters that they are looking to be aggressive on?
What are the types of issues where they want to either continue the direction we're going, going to a different direction, which is certainly why they're appointed to those positions, is to make those exact decisions.
And so it's an exciting time.
And we really look forward to working with the new leadership.
When they arrive, I think it's going to be an interesting transition and really a good opportunity for us.
And we're excited about it.
Let me turn to a different question, which is the topic of coordinating antitrust enforcement with state attorney general's offices, which I know is something that your section, and you have done in many investigations and in matters that you're litigating.
And that was, it leads me to ask, how do you work together with the state AGs to determine how to proceed with the matter?
And how does this practice differ or stay the same when you're working with your international counterparts?
So I've worked, I have worked on a very wide range of matters with our state colleagues.
And I have seen this tape, all different types of formulations.
And I think maybe one of the things you can really learn from that is that we are independent sources of decision making, right?
I mean, the states are their own sovereigns.
They make their own decisions about the enforcement of the antitrust laws or their state laws.
We work together, we work to try to reach harmonious decisions.
I think that there can be a lot of power when we're aligned with each other in fundamental ways, and that that can be a real advantage as we bring that into a litigation.
But I think one thing that is clear is that sometimes we reach, we have different approaches to matters, and that's why I do this.
Maybe we can't find a constructive way to work forward.
Back when I first started, I mentioned Joel Klein came to my law school, talked about Microsoft when I then joined the Antitrust Division.
About five years later, I ended up working on Microsoft.
By then, the trial was over, and I was working on the decree enforcement.
But that was an effort that was done in parallel with a large group of states.
Interestingly, in that case, there were actually two groups of states.
There was one group of states that agreed with us when we set up the case, and there was another group of states that didn't agree with us when we set up the case and continued to litigate and fought in order to get their own remedy.
But regardless of whether those different positions had happened along the way, we worked with them very closely once there was an actual decree in place, so definitely on time and in place, to enforce it and make sure that Microsoft was living up to that.
Those were conversations that we had every day, every week, working with them closely in order to move forward our collective interests and progressively bringing Microsoft to making sure that they were complying with that decree.
So you've seen it just take all types and all different forms, and we worked together a lot during investigations, worked together with an eye towards potentially litigating together.
I think it's a real opportunity to benefit from each other's thinking too.
I think that's one of the things that's most interesting about it.
When you either just in terms of approach to the Antitrust laws or the federal Antitrust laws, or learning about what the different state options are to deal with different, the same types of issues under a different framework, under their own state legislation.
I think about the international side of things.
It is in some ways very similar.
So especially in the investigative phase, you're going along in parallel.
You each have your own rights and your own authority to make your own decisions along the way and that's definitely how it works.
I think one thing that's very different about the international side of things is that there's no sense in which you are preparing to be co-ligands in a case with each other.
Each international agency has the authority to bring its own case under its own laws, obviously this is just fundamental international law.
But it's not the United States and the United Kingdom against some company or against some merger.
That's not how it works at all.
So you're not, the strategy for the back half, or thinking about the back half of how it will work, is not the same as it is with the states.
Now, that doesn't mean the cooperation and the coordination on the thinking, and the analysis, and the efforts to bring everyone on to the same page and see if there's a common way of looking at this based on the common facts, to the extent that the facts are common across the industries.
That's very similar to work that goes on with the states.
The thing that is different is depending on the international agencies may have, not always, but may often have a lot more resources devoted in the investigative state than necessarily the states will.
I mean, a lot of times, states have very limited resources.
Paul was talking about, Paul Deseret, the California Navy's office, was talking about at the panel this morning.
They have very limited resources.
They don't have the ability to have five people working on an investigation of every matter that they are working in cooperation with the federal government, and that's even from California, which is one of the larger ones.
So it can be very interesting working with the international folks because they actually have resources to conduct their own investigation.
They bring a lot of ideas to the table in terms of how they're seeing things, what they're hearing from the market, what they're seeing in the documents, purely productive exercise.
And kind of a related question is increasingly in the technology space, we are seeing matters being investigated globally.
And I think this affects companies in at least two ways.
If the company is the focus of the investigation, then they are often facing requests for information and questions from multiple competition agencies.
But even where a company is a third party, they often get multiple RFIs, which sometimes can be a little frustrating for the third parties, because to them, the particular matter may not be important to their business, but they are still roped in by getting CIDs and subpoenas throughout the world and having this obligation to respond.
So that leads me to ask, you know, when there is a company that's facing, especially an investigation worldwide, how can they best work with you, the states and the other global competition agencies to try to minimize their burden and efficiently move through the investigation?
I think one thing that's critical to that is the use of waivers, of confidentiality.
I think I've seen across these matters in my tenure as a division, that that can be a really powerful tool for enabling the agencies to actually coordinate probably too strong a war, but move along more effectively in parallel with each other and to be able to share information in order to share the types of things that they're thinking about, to discuss documents, to discuss actual details and testimony and that record as it develops.
I think that a lot of firms recognize this and are generally recognized that it can absolutely be in their self-interest, even as someone is subject to the investigation, to enable the agencies to cooperate with each other.
But occasionally we see firms withholding the waivers, which certainly they're right and we may suggest it's not their right.
But we see them withholding them in an effort to prevent cooperation amongst enforcers.
I think you just have to recognize that with that approach, it comes some harm to that search for efficiency.
If you're not sharing what submissions you made to one agency with another agency, if you're not allowing them to share or discuss the documents that have been submitted, you're making it harder for those agencies to actually try to reach an outcome that is harmonized with each other.
Now, if you have confidence and you believe in your arguments in defense of a merger or in defense of a course of conduct, I'll tell you my view is you want enforcers to be making the most informed possible decisions based on the record, and allowing them to cooperate with each other.
I think it can ultimately be in your own self-interest as a company that's facing investigation.
That's how I view it.
That's one of the key issues there.
Another one is much more simple, but that I've certainly seen happen or maybe not happen in a lot of cases, is that making sure that your lawyers are informed about what's going on across multiple jurisdictions in different times.
Because even in matters where there aren't waivers, there are still discussions that take place amongst the agencies respecting the confidentiality requirements, of course.
But there are still discussions going on if you're taking inconsistent positions generally on substance or even if just there are developments that are procedural that another council in another country doesn't know about.
It both undermines your effectiveness as an advocate in front of the agencies because it just leads to an impression that the right hand doesn't know what hand is doing.
But it can also just get in the way of logistical planning, dealing with administrative issues, dealing with timing in matters like that.
Well, thank you for that advice and insight.
Very helpful.
Let me conclude our podcast by asking you two questions with criticism that we often hear about the antitrust laws.
And here's the first question.
Investigations and litigation over conduct, especially conduct as opposed to mergers, that's alleged to have violated the antitrust laws, that litigation often takes multiple years to resolve.
With the discovery, finding of liability, there can be a separate remedy phase, and then the appeal process.
Given that amount of time that it takes to bring an antitrust case to conclusion, are the antitrust laws sufficient for timely addressing competition concerns?
Well, we discussed a similar issue to this at the panel this morning.
And as I'm sure you'll appreciate from your time, having one of the same jobs that I have right now.
You know, ultimately, I'm responsible for managing a team that enforces the antitrust laws as they exist today.
Like the fundamental question of whether we should have different antitrust laws, like that's a question I'm happy to leave to our policymakers and our legislators.
I think one observation I'll make is that we've seen a lot of activity in the enforcement side of things in recent years and I think there's some real life in the enforcement.
I take your point as inarguable that these matters can take a long period of time.
They are a way to go directly at specific pieces of conduct and end up with very thoughtful and recent decisions and that appears to have some benefits, too.
The ability to construct remedies that are directly targeted at the allegations that were found and that was not illegal, those are benefits, too.
Whether the status quo is inherently better than some alternate world in which there's a complimentary DMA-type regime, that's not for me to say, but I think that there's a lot of opportunity right now to learn from what's happening in all these associations, learn what's happening from other agencies across the world, other countries that are establishing new regulatory regimes, and to learn about what the benefits and the pros and the cons of those are, and how they match up to what we do with traditional antitrust, so I think it's a really exciting opportunity there, but ultimately that's not what we can say.
All right, and here's my second question about some of the criticism you'll hear about the antitrust laws is that the critique is that antitrust enforcement can stifle innovation and economic growth.
So how does the antitrust division seek to avoid chilling pro-competitive conduct that's good for consumers?
Look, in theory, of course, you could have an enforcement regime that was so overzealous that it would deter companies from engaging in innovation and other pro-competitive conduct.
I think here we're mostly talking about the conduct side, things rather than murder.
I think there's a different set of populations there.
I would just say that from my vantage point, it seems to me that the rewards for successful innovation in these tech markets are so significant.
I really struggle to see, and don't really see a lot of evidence to sort the proposition, that companies are holding back on new innovations, on new products, on not entering new markets based on the fear of antitrust liability.
That to me seems a little counterfactual.
I think there's a reason for that though, and it makes a lot of sense because you look at the kind of cases that we are bringing as antitrust enforcers, they focus on companies that, I mean, this sounds very circular, but it is really fundamentally very true, they're engaging in conflict that harms competition, it harms the competitive process.
You just don't see us bringing cases where the theory is of harm is that a company innovated and developed a new product, and that therefore that is in and of itself an antitrust violation that needs to go out and be replicated.
Even the most aggressive cases we have brought are laser focused on this distinction between, it's not illegal to have monopoly power, it's not illegal to become a monopolist when you are good through your own product development, and quality, and investments, that that's not illegal and you shouldn't be punished for that.
I think our cases are really thoughtfully focused on the line between that, and you've taken affirmative steps that make it harder, more difficult, and properly so for other people to compete in those marketplaces.
I also just say that you can't lose sight of the fact that there is something on the other side of this letter, right?
I mean, anti-competitive behavior itself stifles innovation and economic growth.
So even if one were concerned about the possibility that there were some overactive enforcement that was having some deterrent effect, you'd want to make sure you're weighing that against the deterrent effect of having people with substantial market-playing power out there and high barriers to entry and entrenched government positions.
Aaron, thank you.
This has been tremendously interesting.
We really appreciate your taking the time to talk with us today.
It's been an absolute pleasure.
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