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On Sept. 22, 2016, former Federal Trade Commission Chairwoman Edith Ramirez gave keynote remarks to the Fordham Competition Law Institute entitled “Deconstructing the Antitrust Implications of Big Data.” There, Ramirez concluded that “there is no question that the aggregation of data may have important implications for competition.” However, she did not believe that data collection necessitated new rules and analysis for competition enforcement. Rather, she called for a “careful untangling of the issues so that there is a clear understanding of the relationship, if any, between Big Data and the exercise of market power.”

The Sherman Antitrust Act provides that “every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.” The FTC can also bring enforcement under Section 5 of the Federal Trade Commission Act for “unfair methods of competition” and “unfair or deceptive acts or practices in or affecting commerce.” Privacy professionals are no doubt familiar with Section 5, as it has been the FTC’s primary means of enforcing privacy language in terms of use and other agreements between consumers and businesses.

Yet antitrust enforcement trends in the U.S. tend towards a more laissez-faire approach and allow for business consolidation at the highest levels. The biggest businesses tend to get bigger. We have seen this in the airline industry, where the number of airlines seems to shrink each year. This seems just as true in the technology industry — Apple, Alphabet (Google’s parent) and Amazon are among the most valuable companies in the world.

Chairwoman Ramirez may have downplayed the FTC’s interest in bringing enforcement cases against big data collectors, but the rest of the world may not feel the same way. The trends in 2017 suggest that the rest of the world may be far more aggressive in policing big data businesses for anticompetitive behavior. In June, the European Commission levied a €2.4 billion fine against Google for “abusing its market dominance as a search engine by giving illegal advantages” to Google Products, its shopping-comparison service. If Google does not cease the conduct within 90 days of the order, the EU intends to levy penalties as high as five percent of Alphabet's average daily global turnover.

Germany’s federal antitrust regulator, the Bundeskartellamt, is investigating Facebook for allegedly antitrust behavior with its data collection. Essentially, the German regulator asserts that Facebook uses its popularity to extort information from its users. Facebook then uses that information to generate its targeted ads. Whoever does not agree to Facebook’s terms of use and data collection will be completely locked out of the world’s largest online community. Andreas Mundt, president of the Bundeskartellamt, is “eager” to present the results of the agency’s investigation later this year. According to Mundt, the regulator is tackling “central questions ensuring competition in the digital world in the future.”

However, some have said that Germany’s case against Facebook pushes the boundaries of antitrust law. Essentially, the regulator's novel allegations blur the line between antitrust and privacy regulation. Additionally, Facebook is already under investigation by privacy regulators for its plans to merge its data with the WhatsApp messenger application.

Although big data businesses may find themselves less scrutinized by U.S. federal regulators, they may still face risks from state, local, and private actors. On August 14, Judge Edward M. Chen enjoined the business-focused social network LinkedIn from actively preventing a startup business from accessing its public profile data. The startup, hiQ Labs, argued that LinkedIn’s decision to block access was for an “impermissible anticompetitive purpose” and that its actions constituted unfair competition under the California Unfair Competition Law. According to the court, hiQ Labs presented enough evidence that LinkedIn “revoked hiQ’s access to its data … for the purpose of eliminating hiQ as a competitor in the data analytics field.”

European regulators are poised for aggressive enforcement of antitrust laws and the potential for civil liability in the U.S. is a real risk for big data companies. It appears that, in addition to privacy liability, data businesses must also prepare for increased scrutiny of potentially anticompetitive behavior.


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