Witnesses worked to sway or deter Democratic senators Monday from bolstering New York’s 121-year-old antitrust law to benefit the free market economy.
The state’s antitrust law, known as the Donnelly Act, was enacted in 1899 before the federal antitrust statute the Sherman Act, and prohibits price fixing, bid rigging, territorial and customer allocations, monopolization, boycotts and other practices to ensure industrial competitiveness, according to ag.ny.gov.
Expanding state antitrust measures would force consumer welfare to take a backseat for the good of corporations, said Chris Marchese, policy counsel for NetChoice, a lobby group working for a digital-free enterprise.
“Should New York’s antitrust law protect consumers or competitors?” Marchese said Monday during opening remarks to senators. “I hope New York answers the latter as it has for the last century … and it will heed that size does not determine guilt.”
Marchese testified Monday during the Senate Consumer Protection Committee’s public hearing, which lasted more than four hours, as lawmakers consider the 21st Century Antitrust Act.
Businesses that dominate an industry, Marchese said, such as major tech giants Apple, Google, Amazon or Facebook that partner with NetChoice, do not create barriers that discourage market competition.
“When a dominant player jacks up the price, it invites competition from other companies that ordinarily would sit on the sidelines because they see an opportunity to undercut that dominant player,” Marchese said. “I don’t think that’s (as) big of a barrier entry as people say.”
“Everything you testify to right now, I find completely absurd,” said Consumer Protection Committee Chairman Sen. Kevin Thomas, D-Garden City. “It goes against a lot of facts we have previously investigated. I have no further questions for you.”
Sponsored by Sen. Mike Gianaris, D-Brooklyn, the 21st Century Antitrust Act expands state antitrust law to make abuse of dominance illegal to prevent established companies from shutting out competitors.
“Our antitrust laws are broken — they were written over a century ago,” Gianaris said. “They deal with an economy that no longer exists.”
Unilateral conduct creating monopolies would also become illegal under the bill, as well as additional business actions and practices that establish a monopoly or restrict trade. Damages may be recovered through civil or criminal lawsuits.
Gianaris’ legislation would allow the state to take action against companies engaging in these practices, as well as allow for class action lawsuits.
The bill would increase criminal penalties to $1 million for individuals and $100 million for corporations to comply with federal antitrust law and would extend the statute of limitations from three to five years.
Gianaris spoke of misconduct rampant among big tech companies, including with foreign intelligence and election interference and misinformation.