June 8, 2021 By Allie Griffin
The State Senate passed a bill sponsored by Sen. Michael Gianaris Monday that would broaden the state’s antitrust laws and give them more teeth.
The legislation, dubbed the “21st Century Antitrust Act,” would make it easier for the state and private industry to fight large corporations that monopolize the market and engage in anti-competitive practices.
Gianaris said that he aims to reform the state’s antitrust laws to bring them up-to-date with the current times.
“Our antitrust laws were written a century ago for a radically different economy and they are in desperate need of reform,” he said in a statement. “Corporate power has reached unprecedented and dangerous levels, and we need powerful new laws to protect the public and our economy.”
Under current state law, Gianaris said, antitrust laws require two parties to conspire to manipulate the economy before enforcement actions can begin. In today’s economy, however, major commercial players—particularly big tech companies—successfully manipulate the market unilaterally by exerting dominance, he says.
His bill would forbid a company that has a dominant market share from abusing that position in what is known as an “abuse of dominance” standard. For example, some tech companies have temporarily undercut competitors’ prices at a loss to drive them out of business or force them to sell, Gianaris said.
The legislation would provide the State Attorney General with the necessary scope to file suit against companies in violation of the new law. Additionally, the legislation would open the door for plaintiffs to file class action lawsuits.
“We have a problem in this country,” Gianaris said during a Zoom press conference. “We have a problem that there’s tremendous market power in very very few hands and it is being abused to the detriment of the public.”
“Small startups and medium-sized businesses don’t have the opportunity to grow and innovate because they are being squashed by the big players who are abusing some of the tactics that they have at their disposal in a modern economy,” he said.
The bill has been praised by labor unions, small business owners and even some larger companies like Yelp that say it would protect workers at smaller firms and stop anticompetitive practices.
“This bill is epic,” said Zephyr Teachout, a Fordham law professor and progressive activist.
“The abuse [by] big corporate monopolies of both workers and small businesses is truly out of control,” she said, adding that the new law would gives the state the tools necessary to rein big companies in.
However, some pro-business and tech industry leaders say the bill would lead to unnecessary lawsuits and stifle growing companies.
The Business Council of New York issued a statement saying the “dominant position” standard is too vague.
“The vagueness of this definition leaves it very poorly tailored to the problem it was meant to solve, and creates an enormous risk that the statute will be applied in an untold number of additional circumstances that the drafters of the legislation probably never intended,” the group wrote.
The bill passed the Senate 43 to 20 Monday, but will need to be passed in the State Assembly by the end of the legislative session this week and signed by Governor Andrew Cuomo to become law.