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Texas AG Sends Another Round Of Questions To Google -
July 13, 2020Texas Attorney General Ken Paxton sent another round of questions to Google seeking detailed answers about the company’s advertising technology.
The 53-page civil investigative demand, dated June 22 and obtained by POLITICO through a public records request, zeroes in on changes the search giant has made in recent years to how online ads are sold. Google must respond by July 22.
Among the Google product changes targeted by investigators is the company’s decision in 2016 to require advertisers to buy YouTube ads through Google’s products; the adoption of accelerated mobile pages, known as AMP, a technology that stores mobile websites on Google servers; and the January announcement that the tech giant will eliminate third-party cookies from the Chrome web browser.
All three changes have drawn complaints from advertisers. Subscription news service MLex first reported on the query. Google said it will “continue to engage” with the investigation.
Full Content: Politico
July 13, 2020Texas Attorney General Ken Paxton sent another round of questions to Google seeking detailed answers about the company’s advertising technology.
The 53-page civil investigative demand, dated June 22 and obtained by POLITICO through a public records request, zeroes in on changes the search giant has made in recent years to how online ads are sold. Google must respond by July 22.
Among the Google product changes targeted by investigators is the company’s decision in 2016 to require advertisers to buy YouTube ads through Google’s products; the adoption of accelerated mobile pages, known as AMP, a technology that stores mobile websites on Google servers; and the January announcement that the tech giant will eliminate third-party cookies from the Chrome web browser.
All three changes have drawn complaints from advertisers. Subscription news service MLex first reported on the query. Google said it will “continue to engage” with the investigation.
Full Content: Politico
Should the government force prudence on novice stock investors?
Market observers worry that a new group of largely inexperienced stock investors is at risk for great financial harm.
Commenters like Jim Cramer have remarked that many novice investors use recently lowered brokerage fees to make risky investments in shaky stocks. Examples are cruise and air travel stocks. These stocks have been pummeled by COVID concerns, but rebounded from very low prices to somewhat higher prices. The rebound was partly in response to infusions of federal cash and credit. Jim Cramer and others fretted that novice traders who relied on the recent upward trajectory of COVID vulnerable stocks risked disaster because of market ignorance.
Casey Primozic, whose company Robintrack follows behavior of novice investors, suggested in a CNBC interview that novice investors will often join what they sense is a growth trend in a stock, without worrying about business fundamentals like profitability.
Novice investors are subject to manipulation by sophisticated investors, according to Jim Cramer. He says that professionals on Wall Street have taken advantage of amateur investors by bidding up beat-up but popular stocks like airlines in premarket trading. “It’s a game. If it weren’t securities, let’s say it was Monopoly, let’s say it’s Draft Kings ... it would be so much fun,” Cramer said on “Squawk Box.” “Pick a couple of stocks, you gun them in the morning, and then you hope people are stupid enough and they buy them.”
Many observers saw a ploy to snare gullible novice stock traders when Hertz Global Holdings Inc. announced a plan to sell $1 billion more of its shares destined to be wiped out when Hertz’ bankruptcy case is finished. Investors promptly bid up Hertz by 68%. Hertz halted stock sales when staff members at the U.S. Securities and Exchange Commission raised legal issues.
A New York Times article explains that millions of individuals without stock trading experience have recently begun investing through a company called Robinhood, which has an “app” that makes trading particularly easy and cheap. The article says that “More than at any other retail brokerage firm, Robinhood’s users trade the riskiest products and at the fastest pace . . . .”
A Bankrate review of Robinhood says that “While investors can find free stock and ETF trades at most brokerages, the real differentiator for Robinhood is its free options trading. . . . Robinhood charges no per-contract fee.” Also, “Robinhood allows you to trade some cryptocurrencies commission-free, too.”
The New York Times article explains that Robinhood software coaches its investors on how to avoid government regulatory strictures that block the inexperienced from trading in options. The Robinhood app is organized so that customers who want to trade options answer just a few multiple-choice questions. The Times explains that “Beginners are legally barred from trading options, but those who click that they have no investing experience are coached by the app on how to change the answer to ‘not much’ experience. Then people can immediately begin trading.”
Such egging on of inexperienced investors by Robinhood and others seems undesirable, particularly since there are many unfortunate stories of novice investors who have been brought to financial ruin. It is hard not to agree with Jim Cramer’s conclusion that novice investors are subject to exploitation by unscrupulous people. Sometimes such exploitation will attract the attention of regulators, as happened with the Hertz offering. But it seems likely that much exploitative behavior will escape government scrutiny. And, of course, not all examples of aggressive selling to novice investors deserve government action: Novice investors have at least some obligation to exercise common sense.
Possible government action against exploitation of novice investors may be supplemented by industry self-regulation. In addition to being subject to SEC regulation, most brokerage firms voluntarily participate in self-regulatory organizations (SROs) like the Financial Industry Regulatory Authority (FINRA). Brokerages that are FINRA members submit to the organization's rules and regulations, which includes a transparent disclosure framework that protects investors. In an article which asks whether Robinhood is safe for investors, Investopedia points out that Robinhood maintains membership in FINRA.
By Don Allen Resnikoff
Citations:
https://www.nytimes.com/2020/07/08/technology/robinhood-risky-trading.html?searchResultPosition=1
https://www.cnbc.com/video/2020/07/08/robintrack-founder-casey-primozic-parses-through-latest-trading-trends.html
https://www.bankrate.com/investing/brokerage-reviews/robinhood/
https://www.investopedia.com/investing/is-robinhood-safe/
Bloomberg:
Amateur investors who loaded up on J.C. Penney Co. shares as the retailer went bankrupt are now pleading with a judge to spare them from a complete wipeout.
“I hope and pray for you to consider the shareholders,” wrote 50-year-old individual investor John Hardt in a letter dated May 25, one of dozens sent to the Corpus Christi, Texas-based court overseeing the case in recent months.
Hardt is part of a growing number of retail traders -- many driven by lockdown boredom and free online trading -- who have piled into the stock market. Speculation by amateurs is nothing new, but for the first time experts can recall, investors are buying shares of even bankrupt companies. Hertz Global Holdings Inc., oil driller Whiting Petroleum Corp. and J.C. Penney have all seen their stock price surge in recent sessions, despite being in Chapter 11.
Those gains almost always prove fleeting, leaving retail traders with little to show for their stakes other than an expensive lesson in the U.S. corporate bankruptcy process -- where shareholder value disappears almost as a rule. That’s because all creditors have to be made whole before equity owners get anything. For J.C. Penney investors, there’s little to suggest this time will prove any different.
A representative for the company declined to comment on the shareholder letters. An unrelated hearing scheduled for Monday may yield an update about extending the deadline for lenders to approve its turnaround plan.
“If there is any possible way -- any way -- to give a meaningful recovery to shareholders, we will fight for it,” Joshua Sussberg of Kirkland & Ellis, J.C. Penney’s bankruptcy lawyer, said at a June 9 hearing.
Mom-and-pop investors who insist on betting on struggling companies would be well advised to stay away from those in or near bankruptcy, said Fred Ringel, a partner and co-chair of the bankruptcy department at law firm Robinson Brog Leinwand Greene Genovese & Gluck.
“People who buy equity hoping that they’re not going to get wiped out in a bankruptcy just don’t understand the process,” Ringel said.
He added he’s been baffled to see retail investors putting cash into bankrupt stocks given the complexity of the restructuring process. “I don’t understand this phenomenon at all,” he said.
J.C. Penney filed for Chapter 11 in mid-May. After climbing as high as 67.9 cents last month, the company’s stock is trading at around 30 cents. Some of the retailer’s most junior debt -- which still ranks ahead of shares in the repayment line -- is quoted at less than 2 cents on the dollar. This implies extremely thin odds that bondholders will get repaid, and in turn that nothing will be left over for stockholders.
Hardt, when contacted by Bloomberg last week, said he had “zero knowledge of the bankruptcy process” before buying about 10,000 J.C. Penney shares. The Plano, Texas native said he’s already sold the position.
Several of the letters from J.C. Penney shareholders criticize the company’s failure so far to announce a buyer, after media reports cited several potential bidders, including Amazon.com Inc. Bloomberg reported in May on talks between Authentic Brands Group LLC and mall landlords Simon Property Group Inc. and Brookfield Property Partners LP to acquire the chain.
Retail investors hoping for a sale may have thought a buyer would pay cash for outstanding shares. Yet that’s practically unheard of in bankruptcy, where any asset value that remains after court costs belongs to lenders with senior collateral claims. Once they’re made whole, other creditors, including unsecured lenders and vendors are next in line. J.C. Penney entered bankruptcy with more than $2 billion in secured debt and $8 billion in total debt.
Some recent J.C. Penney investors said in interviews that that they bought shares on the expectation that the company would be able to rebound once stores shuttered by the Covid-19 outbreak were able to reopen, and therefore the retailer would be able to secure better terms in its restructuring negotiations than the typical Chapter 11 debtor.
The company has struggled for years, but analysts generally expected before the pandemic that it could hold out until at least 2021.
Some of the letters also criticize the decisions of corporate management and claim that Chief Executive Officer Jill Soltau offered false hope to investors. The company maintained in public statements through the end of March that it remained “optimistic about J.C. Penney’s ability to weather this pandemic.”
“I saw no bankruptcy coming only the promise of turnaround and great news,” wrote shareholder David Dean of Baltimore, who submitted a letter to the court on June 3. “Now this bankruptcy filing. Who could have known.”
The case is J.C. Penney Company Inc., 20-20182, U.S. Bankruptcy Court for the Southern District of Texas (Corpus Christi)
— With assistance by Jeremy Hill
https://www.bloomberg.com/markets/fixed-income
Market observers worry that a new group of largely inexperienced stock investors is at risk for great financial harm.
Commenters like Jim Cramer have remarked that many novice investors use recently lowered brokerage fees to make risky investments in shaky stocks. Examples are cruise and air travel stocks. These stocks have been pummeled by COVID concerns, but rebounded from very low prices to somewhat higher prices. The rebound was partly in response to infusions of federal cash and credit. Jim Cramer and others fretted that novice traders who relied on the recent upward trajectory of COVID vulnerable stocks risked disaster because of market ignorance.
Casey Primozic, whose company Robintrack follows behavior of novice investors, suggested in a CNBC interview that novice investors will often join what they sense is a growth trend in a stock, without worrying about business fundamentals like profitability.
Novice investors are subject to manipulation by sophisticated investors, according to Jim Cramer. He says that professionals on Wall Street have taken advantage of amateur investors by bidding up beat-up but popular stocks like airlines in premarket trading. “It’s a game. If it weren’t securities, let’s say it was Monopoly, let’s say it’s Draft Kings ... it would be so much fun,” Cramer said on “Squawk Box.” “Pick a couple of stocks, you gun them in the morning, and then you hope people are stupid enough and they buy them.”
Many observers saw a ploy to snare gullible novice stock traders when Hertz Global Holdings Inc. announced a plan to sell $1 billion more of its shares destined to be wiped out when Hertz’ bankruptcy case is finished. Investors promptly bid up Hertz by 68%. Hertz halted stock sales when staff members at the U.S. Securities and Exchange Commission raised legal issues.
A New York Times article explains that millions of individuals without stock trading experience have recently begun investing through a company called Robinhood, which has an “app” that makes trading particularly easy and cheap. The article says that “More than at any other retail brokerage firm, Robinhood’s users trade the riskiest products and at the fastest pace . . . .”
A Bankrate review of Robinhood says that “While investors can find free stock and ETF trades at most brokerages, the real differentiator for Robinhood is its free options trading. . . . Robinhood charges no per-contract fee.” Also, “Robinhood allows you to trade some cryptocurrencies commission-free, too.”
The New York Times article explains that Robinhood software coaches its investors on how to avoid government regulatory strictures that block the inexperienced from trading in options. The Robinhood app is organized so that customers who want to trade options answer just a few multiple-choice questions. The Times explains that “Beginners are legally barred from trading options, but those who click that they have no investing experience are coached by the app on how to change the answer to ‘not much’ experience. Then people can immediately begin trading.”
Such egging on of inexperienced investors by Robinhood and others seems undesirable, particularly since there are many unfortunate stories of novice investors who have been brought to financial ruin. It is hard not to agree with Jim Cramer’s conclusion that novice investors are subject to exploitation by unscrupulous people. Sometimes such exploitation will attract the attention of regulators, as happened with the Hertz offering. But it seems likely that much exploitative behavior will escape government scrutiny. And, of course, not all examples of aggressive selling to novice investors deserve government action: Novice investors have at least some obligation to exercise common sense.
Possible government action against exploitation of novice investors may be supplemented by industry self-regulation. In addition to being subject to SEC regulation, most brokerage firms voluntarily participate in self-regulatory organizations (SROs) like the Financial Industry Regulatory Authority (FINRA). Brokerages that are FINRA members submit to the organization's rules and regulations, which includes a transparent disclosure framework that protects investors. In an article which asks whether Robinhood is safe for investors, Investopedia points out that Robinhood maintains membership in FINRA.
By Don Allen Resnikoff
Citations:
https://www.nytimes.com/2020/07/08/technology/robinhood-risky-trading.html?searchResultPosition=1
https://www.cnbc.com/video/2020/07/08/robintrack-founder-casey-primozic-parses-through-latest-trading-trends.html
https://www.bankrate.com/investing/brokerage-reviews/robinhood/
https://www.investopedia.com/investing/is-robinhood-safe/
Bloomberg:
Amateur investors who loaded up on J.C. Penney Co. shares as the retailer went bankrupt are now pleading with a judge to spare them from a complete wipeout.
“I hope and pray for you to consider the shareholders,” wrote 50-year-old individual investor John Hardt in a letter dated May 25, one of dozens sent to the Corpus Christi, Texas-based court overseeing the case in recent months.
Hardt is part of a growing number of retail traders -- many driven by lockdown boredom and free online trading -- who have piled into the stock market. Speculation by amateurs is nothing new, but for the first time experts can recall, investors are buying shares of even bankrupt companies. Hertz Global Holdings Inc., oil driller Whiting Petroleum Corp. and J.C. Penney have all seen their stock price surge in recent sessions, despite being in Chapter 11.
Those gains almost always prove fleeting, leaving retail traders with little to show for their stakes other than an expensive lesson in the U.S. corporate bankruptcy process -- where shareholder value disappears almost as a rule. That’s because all creditors have to be made whole before equity owners get anything. For J.C. Penney investors, there’s little to suggest this time will prove any different.
A representative for the company declined to comment on the shareholder letters. An unrelated hearing scheduled for Monday may yield an update about extending the deadline for lenders to approve its turnaround plan.
“If there is any possible way -- any way -- to give a meaningful recovery to shareholders, we will fight for it,” Joshua Sussberg of Kirkland & Ellis, J.C. Penney’s bankruptcy lawyer, said at a June 9 hearing.
Mom-and-pop investors who insist on betting on struggling companies would be well advised to stay away from those in or near bankruptcy, said Fred Ringel, a partner and co-chair of the bankruptcy department at law firm Robinson Brog Leinwand Greene Genovese & Gluck.
“People who buy equity hoping that they’re not going to get wiped out in a bankruptcy just don’t understand the process,” Ringel said.
He added he’s been baffled to see retail investors putting cash into bankrupt stocks given the complexity of the restructuring process. “I don’t understand this phenomenon at all,” he said.
J.C. Penney filed for Chapter 11 in mid-May. After climbing as high as 67.9 cents last month, the company’s stock is trading at around 30 cents. Some of the retailer’s most junior debt -- which still ranks ahead of shares in the repayment line -- is quoted at less than 2 cents on the dollar. This implies extremely thin odds that bondholders will get repaid, and in turn that nothing will be left over for stockholders.
Hardt, when contacted by Bloomberg last week, said he had “zero knowledge of the bankruptcy process” before buying about 10,000 J.C. Penney shares. The Plano, Texas native said he’s already sold the position.
Several of the letters from J.C. Penney shareholders criticize the company’s failure so far to announce a buyer, after media reports cited several potential bidders, including Amazon.com Inc. Bloomberg reported in May on talks between Authentic Brands Group LLC and mall landlords Simon Property Group Inc. and Brookfield Property Partners LP to acquire the chain.
Retail investors hoping for a sale may have thought a buyer would pay cash for outstanding shares. Yet that’s practically unheard of in bankruptcy, where any asset value that remains after court costs belongs to lenders with senior collateral claims. Once they’re made whole, other creditors, including unsecured lenders and vendors are next in line. J.C. Penney entered bankruptcy with more than $2 billion in secured debt and $8 billion in total debt.
Some recent J.C. Penney investors said in interviews that that they bought shares on the expectation that the company would be able to rebound once stores shuttered by the Covid-19 outbreak were able to reopen, and therefore the retailer would be able to secure better terms in its restructuring negotiations than the typical Chapter 11 debtor.
The company has struggled for years, but analysts generally expected before the pandemic that it could hold out until at least 2021.
Some of the letters also criticize the decisions of corporate management and claim that Chief Executive Officer Jill Soltau offered false hope to investors. The company maintained in public statements through the end of March that it remained “optimistic about J.C. Penney’s ability to weather this pandemic.”
“I saw no bankruptcy coming only the promise of turnaround and great news,” wrote shareholder David Dean of Baltimore, who submitted a letter to the court on June 3. “Now this bankruptcy filing. Who could have known.”
The case is J.C. Penney Company Inc., 20-20182, U.S. Bankruptcy Court for the Southern District of Texas (Corpus Christi)
— With assistance by Jeremy Hill
https://www.bloomberg.com/markets/fixed-income
WSJ article on business fat cats who received PPP money
Excerpt:
By Cezary Podkul
, Juliet Chung
and Will Parker
July 7, 2020 7:33 am ET
The former U.S. operations of a sanctioned Russian bank, a hedge fund partly owned by one of the biggest private-equity firms in the world and a real-estate developer behind two of Manhattan’s most expensive condominium towers were among the financial firms that benefited from a government program designed to help small businesses weather the coronavirus pandemic.
The entities all received loans under the federal government’s Paycheck Protection Program. Since March, the program has extended about $521 billion out of more than $650 billion in authorized loans, but until now, the public hasn’t gotten a detailed look at who was benefitting from the cash.
That changed on Monday, when the Small Business Administration published the names of businesses that accounted for about three-fourths of the loan dollars distributed. While small family-owned businesses and nonprofits benefited from the aid, so did many Wall Street firms that potentially have other sources of cash and didn’t suffer like restaurants and retailers.
The Extell development Central Park Tower of luxury condos and a department store while it was being constructed last year; Extell said the recent federal Paycheck Protection Program allowed the firm to continue paying its employees.PHOTO: RICHARD B. LEVINE/ZUMA PRESS
“The PPP program was designed for small businesses that had to shut down and lose revenues because of the crisis,” said Marcus Stanley, policy director for Americans for Financial Reform, which advocates for tighter financial regulations. “The markets never shut down at any point.”
Loan recipients say they were justified to seek the aid and did so within the spirit and guidelines of the program. Xtellus Capital Partners, the former U.S. operations of Russian bank VTB Capital, said the pandemic hurt trading volumes, which made its effort to diversify after its 2018 spinoff riskier. VTB has been under U.S. sanctions for several years. Xtellus got a loan between $150,000 to $350,000, according to the SBA, which only disclosed loan amount ranges.
“It’s been a big help. We haven’t had to let anyone go,” Xtellus Chief Executive Paul Swigart said in an interview.
More than a dozen floor brokerages at the New York Stock Exchange got loans of at least $150,000, Monday’s disclosures showed. NYSE floor brokers, who often work for smaller firms of a few dozen employees, were unable to work for about two months starting in March when the exchange shut down floor trading to prevent the spread of the virus.
Excerpt:
By Cezary Podkul
, Juliet Chung
and Will Parker
July 7, 2020 7:33 am ET
The former U.S. operations of a sanctioned Russian bank, a hedge fund partly owned by one of the biggest private-equity firms in the world and a real-estate developer behind two of Manhattan’s most expensive condominium towers were among the financial firms that benefited from a government program designed to help small businesses weather the coronavirus pandemic.
The entities all received loans under the federal government’s Paycheck Protection Program. Since March, the program has extended about $521 billion out of more than $650 billion in authorized loans, but until now, the public hasn’t gotten a detailed look at who was benefitting from the cash.
That changed on Monday, when the Small Business Administration published the names of businesses that accounted for about three-fourths of the loan dollars distributed. While small family-owned businesses and nonprofits benefited from the aid, so did many Wall Street firms that potentially have other sources of cash and didn’t suffer like restaurants and retailers.
The Extell development Central Park Tower of luxury condos and a department store while it was being constructed last year; Extell said the recent federal Paycheck Protection Program allowed the firm to continue paying its employees.PHOTO: RICHARD B. LEVINE/ZUMA PRESS
“The PPP program was designed for small businesses that had to shut down and lose revenues because of the crisis,” said Marcus Stanley, policy director for Americans for Financial Reform, which advocates for tighter financial regulations. “The markets never shut down at any point.”
Loan recipients say they were justified to seek the aid and did so within the spirit and guidelines of the program. Xtellus Capital Partners, the former U.S. operations of Russian bank VTB Capital, said the pandemic hurt trading volumes, which made its effort to diversify after its 2018 spinoff riskier. VTB has been under U.S. sanctions for several years. Xtellus got a loan between $150,000 to $350,000, according to the SBA, which only disclosed loan amount ranges.
“It’s been a big help. We haven’t had to let anyone go,” Xtellus Chief Executive Paul Swigart said in an interview.
More than a dozen floor brokerages at the New York Stock Exchange got loans of at least $150,000, Monday’s disclosures showed. NYSE floor brokers, who often work for smaller firms of a few dozen employees, were unable to work for about two months starting in March when the exchange shut down floor trading to prevent the spread of the virus.
About Joseph Corcoran, developer of mixed use housing in Boston
Mr. Corcoran is the subject of a recent obituary in the Wall Street Journal that talks of Mr. Corcoran's role in developing mixed use housing in Boston.
The article explains that the mixed use project Harbor Point was completed in 1990 at a cost of more than $250 million. Harbor Point created a neighborhood where lawyers and graduate students lived alongside people qualifying for subsidized rent. They shared swimming pools, a gym and views of Boston’s harbor and skyline.
Mr. Corcoran died June 3 of congestive heart failure at his home in Milton, Mass. He was 84. Over nearly five decades, his firm built and managed more than 20,000 housing units in 15 states, his family said.
His mixed-income projects relied on government rental subsidies and tax credits, as well as his patience in negotiating with local, state and federal officials. Perhaps most crucial was his ability to persuade poor residents of neighborhoods he was proposing to redevelop that they wouldn’t be pushed out. At Harbor Point, they were at the table as redevelopment plans were worked out.
“The political establishment can ignore us as money-hungry developers, but they can’t ignore the plight of these people who want something better,” he told Jane Roessner, author of “A Decent Place to Live,” a history of the Columbia Point makeover.
The Wall Street Journal article [paywalled] is at https://www.wsj.com/articles/joseph-corcoran-rescued-a-squalid-boston-housing-project-11592485201?mod=lead_feature_below_a_pos1 Author Roessner was a speaker on a panel that put the Columbia Point project in a broader context. A video of the panel presentation is at https://www.youtube.com/watch?reload=9&time_continue=8&v=QYiVxfSlPFU&feature=emb_logo
Mr. Corcoran is the subject of a recent obituary in the Wall Street Journal that talks of Mr. Corcoran's role in developing mixed use housing in Boston.
The article explains that the mixed use project Harbor Point was completed in 1990 at a cost of more than $250 million. Harbor Point created a neighborhood where lawyers and graduate students lived alongside people qualifying for subsidized rent. They shared swimming pools, a gym and views of Boston’s harbor and skyline.
Mr. Corcoran died June 3 of congestive heart failure at his home in Milton, Mass. He was 84. Over nearly five decades, his firm built and managed more than 20,000 housing units in 15 states, his family said.
His mixed-income projects relied on government rental subsidies and tax credits, as well as his patience in negotiating with local, state and federal officials. Perhaps most crucial was his ability to persuade poor residents of neighborhoods he was proposing to redevelop that they wouldn’t be pushed out. At Harbor Point, they were at the table as redevelopment plans were worked out.
“The political establishment can ignore us as money-hungry developers, but they can’t ignore the plight of these people who want something better,” he told Jane Roessner, author of “A Decent Place to Live,” a history of the Columbia Point makeover.
The Wall Street Journal article [paywalled] is at https://www.wsj.com/articles/joseph-corcoran-rescued-a-squalid-boston-housing-project-11592485201?mod=lead_feature_below_a_pos1 Author Roessner was a speaker on a panel that put the Columbia Point project in a broader context. A video of the panel presentation is at https://www.youtube.com/watch?reload=9&time_continue=8&v=QYiVxfSlPFU&feature=emb_logo
SBA changes course, will reveal some PPP loan data
The U.S. Small Business Administration and Treasury Department announced Friday that they would release a data set showing which businesses received many taxpayer-funded Paycheck Protection Program loans, walking back an earlier stance that all of the business names would remain hidden because the Trump administration considered them proprietary.
The disclosures will include the names of recipients who received loans of more than $150,000 and it will also reveal a dollar range for each loan, such as whether it was between $1 million and $2 million. Precise dollar amounts will not be disclosed, the Trump administration said. Borrowers who obtained loans of less than $150,000 will not have their identities disclosed. The administration said nearly 75 percent of all loans were for $150,000 or more, so most borrowers would be revealed.
https://www.washingtonpost.com/business/2020/06/19/treasury-sba-ppp-disclosure/
The U.S. Small Business Administration and Treasury Department announced Friday that they would release a data set showing which businesses received many taxpayer-funded Paycheck Protection Program loans, walking back an earlier stance that all of the business names would remain hidden because the Trump administration considered them proprietary.
The disclosures will include the names of recipients who received loans of more than $150,000 and it will also reveal a dollar range for each loan, such as whether it was between $1 million and $2 million. Precise dollar amounts will not be disclosed, the Trump administration said. Borrowers who obtained loans of less than $150,000 will not have their identities disclosed. The administration said nearly 75 percent of all loans were for $150,000 or more, so most borrowers would be revealed.
https://www.washingtonpost.com/business/2020/06/19/treasury-sba-ppp-disclosure/
News Media Cartels are Bad News for Consumers
By John M. Yun (George Mason University)
The Journalism Competition and Preservation Act was introduced with the professed objective of allowing small newspaper publishers to band together in negotiations with Facebook and Google in order to secure a more fair and equitable distribution of profits from online advertising. As virtuous as that may sound, the reality is quite different. The bill would allow all online newspaper publishers (including conglomerates such as the News Corporation, AT&T, and Viacom) to form a cartel to fix prices and other terms of trade. This is not a bill aimed at small publishers, nor is it a bill aimed at ensuring “quality” (which is often a red herring in antitrust as it invokes a desire for incumbents to create artificial barriers to entry). Rather, the bill would create antitrust immunity for colluding media conglomerates. In this short article, we first describe precisely what is in the bill. Next, we describe the structure of the online news market, and the role that online platforms play in distributing news content. Finally, we detail the impact that such collusion would have on the market.
Drawn from https://www.competitionpolicyinternational.com/wp-content/uploads/2019/04/North-America-Column-April-2019-5-Full.pdf
By John M. Yun (George Mason University)
The Journalism Competition and Preservation Act was introduced with the professed objective of allowing small newspaper publishers to band together in negotiations with Facebook and Google in order to secure a more fair and equitable distribution of profits from online advertising. As virtuous as that may sound, the reality is quite different. The bill would allow all online newspaper publishers (including conglomerates such as the News Corporation, AT&T, and Viacom) to form a cartel to fix prices and other terms of trade. This is not a bill aimed at small publishers, nor is it a bill aimed at ensuring “quality” (which is often a red herring in antitrust as it invokes a desire for incumbents to create artificial barriers to entry). Rather, the bill would create antitrust immunity for colluding media conglomerates. In this short article, we first describe precisely what is in the bill. Next, we describe the structure of the online news market, and the role that online platforms play in distributing news content. Finally, we detail the impact that such collusion would have on the market.
Drawn from https://www.competitionpolicyinternational.com/wp-content/uploads/2019/04/North-America-Column-April-2019-5-Full.pdf
Hertz Global Holdings Inc. suspended plans to raise cash by selling new shares that the bankrupt car renter described as potentially “worthless,” after its proposal failed to pass muster with regulators.
The company halted sales while it deals with issues brought up by staff members at the U.S. Securities and Exchange Commission, according to a filing. The stock, whose trading had been halted earlier in the day, ended the regular trading session up 5 cents at $2, while ilts bonds tumbled.
From: https://www.msn.com/en-us/money/topstocks/hertz-suspends-sale-of-worthless-stock-amid-sec-scrutiny/ar-BB15CODb
The company halted sales while it deals with issues brought up by staff members at the U.S. Securities and Exchange Commission, according to a filing. The stock, whose trading had been halted earlier in the day, ended the regular trading session up 5 cents at $2, while ilts bonds tumbled.
From: https://www.msn.com/en-us/money/topstocks/hertz-suspends-sale-of-worthless-stock-amid-sec-scrutiny/ar-BB15CODb
Is Hertz using bankruptcy Court to exploit gullible investors?
Commenters like Jim Cramer have remarked that many novice investors are taking advantage of recently lowered brokerage fees to make risky investments in shaky stocks. Examples are cruise and air travel sector stocks. These stocks have been pummeled by COVID concerns; but rebounded from very low prices to somewhat higher prices. The rebound is partly in response to infusions of federal cash and credit. Jim Cramer and others have fretted that novice traders who rely on the recent upward trajectory of COVID vulnerable stocks risk disaster because of market ignorance.
Also, novice investors are subject to manipulation by sophisticated investors, according to Cramer. He says that professionals on Wall Street are taking advantage of amateur investors by bidding up beat-up but popular stocks like airlines in premarket trading. “It’s a game. If it weren’t securities, let’s say it was Monopoly, let’s say it’s Draft Kings ... it would be so much fun,” Cramer said on “Squawk Box.” “Pick a couple of stocks, you gun them in the morning, and then you hope people are stupid enough and they buy them.”
Now, in what Cramer and some others see as yet another ploy to snare gullible novice stock traders, Hertz Global Holdings Inc. announced a plan to sell $1 billion more of its shares. Hertz readily concedes those might wind up worthless, too. The stock appears destined to be wiped out when its bankruptcy case is finished. Investors promptly bid up Hertz by 68%.
The car rental company wants to take advantage of the quixotic rally in its stock by offering as many as 246.78 million common shares, according to a court filing. The proceeds would provide some much-needed working capital while Hertz tries to dig out from massive debts that forced it into court protection.
The filing explains that “The recent market prices of and the trading volumes in Hertz’s common stock potentially present a unique opportunity for the Debtors to raise capital on terms that are far superior to any debtor-in-possession financing.”
On Friday, June 12, the bankruptcy court approved Hertz’s request to sell up to $1 billion in stock.
But the risk to novice investors plainly is great. Investors who own stock in bankrupt firms are last in line as the company pays back creditors like banks and bondholders. Shares of a bankrupt company are typically wiped out, and if new stock is issued there is no guarantee the prior shareholders will receive new shares.
Commenters have not been sympathetic. One said: “Failing rental car company Hertz‘s latest Hail Mary might be its most dastardly yet: Exploit newly-found popularity among Robinhood traders to sell $1 billion worth of potentially worthless stock.” [i]
According to Marketwatch, Amy Lynch, a former U.S. Securities and Exchange Commission staffer, said that the proposed stock sale needs to spell out that “any money put into this company could be a total loss.” She explained that “The disclosures would have to be air tight in order to avoid lawsuits in the future.”
CNBC’s Jim Cramer was even more apoplectic than usual, comparing Hertz promoters to P.T. Barnum.
Cramer warns new investors about the serious risk of buying the stock of companies that filed for bankruptcy such as Hertz.
“You may think a stock like Hertz . . .looks like a steal at these levels, but the only people being robbed here are you the buyers,” he said.
Cramer said it is “highly unlikely” that Hertz, as a business, goes away in its bankruptcy. But the company’s bondholders will be the first in line to get a piece of the post-bankruptcy Hertz. Owners of the common stock, on the other hand, “are at the bottom of the bankruptcy pecking order,” Cramer said.
“[Y]ou’re buying the old Hertz with $19 billion in debt that it can’t repay,” Cramer explained. “Since the creditors can’t collect, they’re going to seize the collateral, which is the business. So this $4 stock will most likely just be cancelled.”
That is a reality well-known by people like legendary activist investor Carl Icahn, Cramer said. Icahn held a nearly 39% stake in Hertz but dumped it last month after the company filed for bankruptcy.
“Believe me, if there was a real chance the common stock would be worth anything, Icahn would’ve stuck around. He didn’t,” Cramer said.
Cramer also said if he were running the bankruptcy court, he would prevent shares of Hertz from being traded, helping “keep inexperienced investors from losing money on it.”
-by Don Allen Resnikoff
A copy of the Hertz filing is here:
https://restructuring.primeclerk.com/hertz/Home-DownloadPDF?id1=NDE4NzYy&id2=0
[i] https://usa-newsposts.com/technology/bankrupt-hertz-targets-robinhood-traders-in-plot-to-dump-1-billion-in-stock/
Commenters like Jim Cramer have remarked that many novice investors are taking advantage of recently lowered brokerage fees to make risky investments in shaky stocks. Examples are cruise and air travel sector stocks. These stocks have been pummeled by COVID concerns; but rebounded from very low prices to somewhat higher prices. The rebound is partly in response to infusions of federal cash and credit. Jim Cramer and others have fretted that novice traders who rely on the recent upward trajectory of COVID vulnerable stocks risk disaster because of market ignorance.
Also, novice investors are subject to manipulation by sophisticated investors, according to Cramer. He says that professionals on Wall Street are taking advantage of amateur investors by bidding up beat-up but popular stocks like airlines in premarket trading. “It’s a game. If it weren’t securities, let’s say it was Monopoly, let’s say it’s Draft Kings ... it would be so much fun,” Cramer said on “Squawk Box.” “Pick a couple of stocks, you gun them in the morning, and then you hope people are stupid enough and they buy them.”
Now, in what Cramer and some others see as yet another ploy to snare gullible novice stock traders, Hertz Global Holdings Inc. announced a plan to sell $1 billion more of its shares. Hertz readily concedes those might wind up worthless, too. The stock appears destined to be wiped out when its bankruptcy case is finished. Investors promptly bid up Hertz by 68%.
The car rental company wants to take advantage of the quixotic rally in its stock by offering as many as 246.78 million common shares, according to a court filing. The proceeds would provide some much-needed working capital while Hertz tries to dig out from massive debts that forced it into court protection.
The filing explains that “The recent market prices of and the trading volumes in Hertz’s common stock potentially present a unique opportunity for the Debtors to raise capital on terms that are far superior to any debtor-in-possession financing.”
On Friday, June 12, the bankruptcy court approved Hertz’s request to sell up to $1 billion in stock.
But the risk to novice investors plainly is great. Investors who own stock in bankrupt firms are last in line as the company pays back creditors like banks and bondholders. Shares of a bankrupt company are typically wiped out, and if new stock is issued there is no guarantee the prior shareholders will receive new shares.
Commenters have not been sympathetic. One said: “Failing rental car company Hertz‘s latest Hail Mary might be its most dastardly yet: Exploit newly-found popularity among Robinhood traders to sell $1 billion worth of potentially worthless stock.” [i]
According to Marketwatch, Amy Lynch, a former U.S. Securities and Exchange Commission staffer, said that the proposed stock sale needs to spell out that “any money put into this company could be a total loss.” She explained that “The disclosures would have to be air tight in order to avoid lawsuits in the future.”
CNBC’s Jim Cramer was even more apoplectic than usual, comparing Hertz promoters to P.T. Barnum.
Cramer warns new investors about the serious risk of buying the stock of companies that filed for bankruptcy such as Hertz.
“You may think a stock like Hertz . . .looks like a steal at these levels, but the only people being robbed here are you the buyers,” he said.
Cramer said it is “highly unlikely” that Hertz, as a business, goes away in its bankruptcy. But the company’s bondholders will be the first in line to get a piece of the post-bankruptcy Hertz. Owners of the common stock, on the other hand, “are at the bottom of the bankruptcy pecking order,” Cramer said.
“[Y]ou’re buying the old Hertz with $19 billion in debt that it can’t repay,” Cramer explained. “Since the creditors can’t collect, they’re going to seize the collateral, which is the business. So this $4 stock will most likely just be cancelled.”
That is a reality well-known by people like legendary activist investor Carl Icahn, Cramer said. Icahn held a nearly 39% stake in Hertz but dumped it last month after the company filed for bankruptcy.
“Believe me, if there was a real chance the common stock would be worth anything, Icahn would’ve stuck around. He didn’t,” Cramer said.
Cramer also said if he were running the bankruptcy court, he would prevent shares of Hertz from being traded, helping “keep inexperienced investors from losing money on it.”
-by Don Allen Resnikoff
A copy of the Hertz filing is here:
https://restructuring.primeclerk.com/hertz/Home-DownloadPDF?id1=NDE4NzYy&id2=0
[i] https://usa-newsposts.com/technology/bankrupt-hertz-targets-robinhood-traders-in-plot-to-dump-1-billion-in-stock/
California & Washington Are Scrutinizing Amazon For Abuse Of Power
June 14, 2020
State investigators in California and Washington have been looking into whether Amazon abuses its power over sellers on the tech giant’s site, according to people involved with the inquiry.
In the last several months, California has asked about the company’s private label products and whether it uses data from sellers to determine which products it sells, according to two people, who spoke on condition of anonymity out of fear of retribution by the company.
The Washington attorney general’s office has also been interested in whether Amazon makes it harder for sellers to list their products on other websites, according to correspondence viewed by The New York Times.
See https://www.nytimes.com/2020/06/12/technology/state-inquiry-antitrust-amazon.html
June 14, 2020
State investigators in California and Washington have been looking into whether Amazon abuses its power over sellers on the tech giant’s site, according to people involved with the inquiry.
In the last several months, California has asked about the company’s private label products and whether it uses data from sellers to determine which products it sells, according to two people, who spoke on condition of anonymity out of fear of retribution by the company.
The Washington attorney general’s office has also been interested in whether Amazon makes it harder for sellers to list their products on other websites, according to correspondence viewed by The New York Times.
See https://www.nytimes.com/2020/06/12/technology/state-inquiry-antitrust-amazon.html
Bumblebee tuna Chris Lischewski sentenced to 40 months in prison, USD 100,000 fine
By
Chris Chase
June 16, 2020
Former Bumble Bee President and CEO Chris Lischewski was sentenced to 40 months in prison and given a USD 100,000 fine (EUR 88,000) as part of his role in a conspiracy to fix the prices of canned tuna sold in the United States from 2011 to 2013.
The sentence comes after a three-week-long trial in December ended with a jury finding Lischewski guilty of being involved in a scheme between Bumble Bee, StarKist, and Chicken of the Sea to fix the price of tuna. Lischewski was facing a maximum penalty of 10 years in prison and a fine of USD 1 million (EUR 887,500).
The sentence, according to U.S. District Court Judge Edward M. Chen, is in accordance to the severity of the conspiracy, which was “widespread, pervasive, and affecting the entire industry.”
“The conduct was deliberate, it was planned, it was sustained, over a three-year period,” Chen said. “This was not a rash act of having to commit a crime under distress, under episodic circumstances as we see sometimes, this was a contemplated and deliberate plan.”
The sentencing came after an over two-hour hearing, in which part of the sentencing hinged on the qualitative affect that the price-fixing conspiracy had on the economy. California’s penal code includes stipulations on how sentencing should be calculated based on its financial impact.
Excerpt from https://www.seafoodsource.com/news/business-finance/chris-lischewski-sentenced-to-40-months-in-prison-usd-100-000-fine
By
Chris Chase
June 16, 2020
Former Bumble Bee President and CEO Chris Lischewski was sentenced to 40 months in prison and given a USD 100,000 fine (EUR 88,000) as part of his role in a conspiracy to fix the prices of canned tuna sold in the United States from 2011 to 2013.
The sentence comes after a three-week-long trial in December ended with a jury finding Lischewski guilty of being involved in a scheme between Bumble Bee, StarKist, and Chicken of the Sea to fix the price of tuna. Lischewski was facing a maximum penalty of 10 years in prison and a fine of USD 1 million (EUR 887,500).
The sentence, according to U.S. District Court Judge Edward M. Chen, is in accordance to the severity of the conspiracy, which was “widespread, pervasive, and affecting the entire industry.”
“The conduct was deliberate, it was planned, it was sustained, over a three-year period,” Chen said. “This was not a rash act of having to commit a crime under distress, under episodic circumstances as we see sometimes, this was a contemplated and deliberate plan.”
The sentencing came after an over two-hour hearing, in which part of the sentencing hinged on the qualitative affect that the price-fixing conspiracy had on the economy. California’s penal code includes stipulations on how sentencing should be calculated based on its financial impact.
Excerpt from https://www.seafoodsource.com/news/business-finance/chris-lischewski-sentenced-to-40-months-in-prison-usd-100-000-fine
From DCAG Racine's budget request memo:
This week, I testified before the Council in support of OAG’s fiscal year 2021 budget proposal. I made clear that OAG—an agency that not only saves revenue but also generates revenue—is committed to helping the District weather a significant budget deficit. In fiscal year 2019, for example, OAG recovered over $10.8 million in settlements and contributed an additional $184.1 million in tax revenue preserved and collections for District children. To cut back on budget expenses, I ordered $1.5 million of OAG’s 2020 budget to be returned to the District’s General Fund and voluntarily imposed a spending freeze on our agency. These measures reflect OAG’s commitment to the District’s financial well-being.
OAG has also been working around the clock to educate residents about their rights, respond to a surge of nearly 800 COVID-related consumer complaints, enforce protections against price gouging, stand up for tenants and vulnerable residents, fight wage theft, enforce the District’s environmental laws, and protect public safety. Our Cure the Streets team continues to mitigate violence in their neighborhoods, while also partnering with community organizations to deliver food and educational materials to underserved residents. As the nation cries out for new approaches to public safety, funding these community-based violence interruption efforts is more important than ever.
I hope you'll support OAG’s budget that promotes the public interest by submitting comments to the Council’s Committee on the Judiciary and Public Safety by June 16, 2020.
This week, I testified before the Council in support of OAG’s fiscal year 2021 budget proposal. I made clear that OAG—an agency that not only saves revenue but also generates revenue—is committed to helping the District weather a significant budget deficit. In fiscal year 2019, for example, OAG recovered over $10.8 million in settlements and contributed an additional $184.1 million in tax revenue preserved and collections for District children. To cut back on budget expenses, I ordered $1.5 million of OAG’s 2020 budget to be returned to the District’s General Fund and voluntarily imposed a spending freeze on our agency. These measures reflect OAG’s commitment to the District’s financial well-being.
OAG has also been working around the clock to educate residents about their rights, respond to a surge of nearly 800 COVID-related consumer complaints, enforce protections against price gouging, stand up for tenants and vulnerable residents, fight wage theft, enforce the District’s environmental laws, and protect public safety. Our Cure the Streets team continues to mitigate violence in their neighborhoods, while also partnering with community organizations to deliver food and educational materials to underserved residents. As the nation cries out for new approaches to public safety, funding these community-based violence interruption efforts is more important than ever.
I hope you'll support OAG’s budget that promotes the public interest by submitting comments to the Council’s Committee on the Judiciary and Public Safety by June 16, 2020.
AGs v.Generics; 3rd Price-Fixing Complaint
State enforcers added to their price-fixing case against generic drugmakers with a third complaint n Connecticut federal court accusing 26 companies and 10 individuals of "rampant" collusion on topically applied treatments.
View Complaint: https://www.nj.gov/oag/newsreleases20/Public-Derm_Complaint.pdf
State enforcers added to their price-fixing case against generic drugmakers with a third complaint n Connecticut federal court accusing 26 companies and 10 individuals of "rampant" collusion on topically applied treatments.
View Complaint: https://www.nj.gov/oag/newsreleases20/Public-Derm_Complaint.pdf
Utah AG Joins Calls For Meatpacking Probe
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June 9, 2020
Utah’s state Attorney General Sean Reyes wants the Department of Justice to join Utah and other states to investigate suspected price fixing in the beleaguered meatpacking industry.
In a letter to US Attorney General Willam Barr, Reyes wrote that the state has become aware of complaints from beef growers and feeders regarding apparent manipulation of cattle pricing by processing and packing plants.
“Especially now, we need to encourage fair competition in the meatpacking industry and protect consumers,” Reyes wrote.
The Utah AG's letter is here: https://attorneygeneral.utah.gov/wp-content/uploads/2020/06/2020-05-21-Beef-Packing-Industry-Ltr-to-Attorney-General-William-Barr.pdf
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June 9, 2020
Utah’s state Attorney General Sean Reyes wants the Department of Justice to join Utah and other states to investigate suspected price fixing in the beleaguered meatpacking industry.
In a letter to US Attorney General Willam Barr, Reyes wrote that the state has become aware of complaints from beef growers and feeders regarding apparent manipulation of cattle pricing by processing and packing plants.
“Especially now, we need to encourage fair competition in the meatpacking industry and protect consumers,” Reyes wrote.
The Utah AG's letter is here: https://attorneygeneral.utah.gov/wp-content/uploads/2020/06/2020-05-21-Beef-Packing-Industry-Ltr-to-Attorney-General-William-Barr.pdf
Food accessibility challenges are growing.
In Georgia, the number of residents now living in "food insecure" areas has jumped 69% since the beginning of the pandemic, according to data firm Urban Footprint. The firm uses an index, including jobless claims, pre-existing health conditions, and access to grocery stores and healthy food, to measure food security — or "reliable access to a sufficient quantity of affordable, nutritionally adequate food."
In Louisiana, Mississippi and Kentucky the number of residents living in food insecure areas has spiked 43%, 36% and 118% respectively, driven by the rise in unemployment, according to the analysis.
From https://www.cnn.com/2020/06/09/business/food-deserts-coronavirus-grocery-stores/index.html
In Georgia, the number of residents now living in "food insecure" areas has jumped 69% since the beginning of the pandemic, according to data firm Urban Footprint. The firm uses an index, including jobless claims, pre-existing health conditions, and access to grocery stores and healthy food, to measure food security — or "reliable access to a sufficient quantity of affordable, nutritionally adequate food."
In Louisiana, Mississippi and Kentucky the number of residents living in food insecure areas has spiked 43%, 36% and 118% respectively, driven by the rise in unemployment, according to the analysis.
From https://www.cnn.com/2020/06/09/business/food-deserts-coronavirus-grocery-stores/index.html
COVID-19 pandemic hazard pay has started to disappear for workers.
New research by the New York-based not-for-profit Just Capital found that 12% of companies gave their workers this extra bit of cash, because the employees were working on the frontlines during the height of spread of COVID-19. Since then, four of the biggest employers—Walmart, Kroger, Lowe’s, and Costco—have stopped doing so.
From https://www.fastcompany.com/90514509/what-happened-to-covid-19-hazard-pay-walmart-kroger-and-others-called-out-in-new-report
New research by the New York-based not-for-profit Just Capital found that 12% of companies gave their workers this extra bit of cash, because the employees were working on the frontlines during the height of spread of COVID-19. Since then, four of the biggest employers—Walmart, Kroger, Lowe’s, and Costco—have stopped doing so.
From https://www.fastcompany.com/90514509/what-happened-to-covid-19-hazard-pay-walmart-kroger-and-others-called-out-in-new-report
Oil and gas materials manufacturer NRI ATM accused a rival company of poaching two of its essential employees and using them to steal intellectual property in a complaint filed Friday in a Texas federal court.
Read more at: https://www.law360.com/articles/1280408/energy-tools-co-says-rival-poached-employees-stole-ip?copied=
Read more at: https://www.law360.com/articles/1280408/energy-tools-co-says-rival-poached-employees-stole-ip?copied=
AG Racine Sues Predatory Online Lender For Illegal High-Interest Loans To District Consumers
June 5, 2020
Elevate Misleadingly Marketed High-Cost Loans, Ensnared 2,500+ Residents with Interest Rates Well in Excess of District’s Cap
WASHINGTON, D.C. — Attorney General Karl A. Racine today filed a lawsuit against Elevate, an online lender, for deceptively marketing high-cost loans carrying interest rates far above the District’s cap on interest rates. Elevate is not a licensed moneylender in the District, but offered two kinds of short-term loan products carrying interest rates of between 99 and 251 percent, or up to 42 times the legal limit. District law sets the maximum interest rates that lenders can charge at 6 percent or 24 percent per year, depending on the type of loan contract. Although the company touted its product as less expensive than payday loans, payday loans are illegal in the District. Over roughly two years, Elevate made 2,551 loans to District consumers and collected millions of dollars in interest. Following a cease and desist letter sent to the company in April 2020, OAG has filed suit to permanently stop Elevate from engaging in misleading business practices, require Elevate to void the loans made to District residents, return interest paid by consumers as restitution, and pay civil penalties.
“District law sets maximum interest rates that lenders can charge to protect residents from falling prey to unscrupulous, exploitative lenders,” said AG Racine. “Elevate misrepresented the nature of their loans—which had interest rates that ran up to 42 times over the District’s interest caps. By actively encouraging and participating in making loans at illegally high interest rates, Elevate unlawfully burdened over 2,500 financially vulnerable District residents with millions of dollars of debt. We’re suing to protect DC residents from being on the hook for these illegal loans and to ensure that Elevate permanently ceases its business activities in the District.”
A copy of the complaint is available at: https://oag.dc.gov/sites/default/files/2020-06/Elevate-Complaint.pdf
From https://oag.dc.gov/release/ag-racine-sues-predatory-online-lender-illegal
June 5, 2020
Elevate Misleadingly Marketed High-Cost Loans, Ensnared 2,500+ Residents with Interest Rates Well in Excess of District’s Cap
WASHINGTON, D.C. — Attorney General Karl A. Racine today filed a lawsuit against Elevate, an online lender, for deceptively marketing high-cost loans carrying interest rates far above the District’s cap on interest rates. Elevate is not a licensed moneylender in the District, but offered two kinds of short-term loan products carrying interest rates of between 99 and 251 percent, or up to 42 times the legal limit. District law sets the maximum interest rates that lenders can charge at 6 percent or 24 percent per year, depending on the type of loan contract. Although the company touted its product as less expensive than payday loans, payday loans are illegal in the District. Over roughly two years, Elevate made 2,551 loans to District consumers and collected millions of dollars in interest. Following a cease and desist letter sent to the company in April 2020, OAG has filed suit to permanently stop Elevate from engaging in misleading business practices, require Elevate to void the loans made to District residents, return interest paid by consumers as restitution, and pay civil penalties.
“District law sets maximum interest rates that lenders can charge to protect residents from falling prey to unscrupulous, exploitative lenders,” said AG Racine. “Elevate misrepresented the nature of their loans—which had interest rates that ran up to 42 times over the District’s interest caps. By actively encouraging and participating in making loans at illegally high interest rates, Elevate unlawfully burdened over 2,500 financially vulnerable District residents with millions of dollars of debt. We’re suing to protect DC residents from being on the hook for these illegal loans and to ensure that Elevate permanently ceases its business activities in the District.”
A copy of the complaint is available at: https://oag.dc.gov/sites/default/files/2020-06/Elevate-Complaint.pdf
From https://oag.dc.gov/release/ag-racine-sues-predatory-online-lender-illegal
Read COVID tracing employee lawsuit against Amazon
https://www.publicjustice.net/wp-content/uploads/2020/06/Palmer-v.-Amazon-filed-complaint.pdf
"This case is about Amazon’s failures to comply with New York law and state and federal public health guidance during the COVID-19 pandemic at the JFK8 facility. "
https://www.publicjustice.net/wp-content/uploads/2020/06/Palmer-v.-Amazon-filed-complaint.pdf
"This case is about Amazon’s failures to comply with New York law and state and federal public health guidance during the COVID-19 pandemic at the JFK8 facility. "
CNBC's Jim Cramer explains that the rising stock market is about the strength of large dominant companies, and does not reflect the poorly performing main street economy of struggling small businesses
https://www.youtube.com/watch?v=PKGDdvRBezQ
Martha White makes a similar point:
The divide between Wall Street and Main Street has grown sharply in recent weeks, amid the coronavirus pandemic and widespread civil unrest. To many, the market’s rise appeared as both cause and symptom of the widening gap between the country's haves and have-nots.
The Dow Jones Industrial Average rose by more than 400 points on Wednesday, with the S&P 500 now recovering a full 40 percent from its March lows. Yet millions of workers and small business owners are struggling to cope with the one-two punch of an economically devastating pandemic and unrest following the death of George Floyd at the hands of Minneapolis police that have filled America’s TV screens and news feeds with images of burned police cars, smashed store windows and looting in cities across the country.
“The stock market represents the fortunes of the fortunate… consolidating their power over the economy,” said Mark Zandi, chief economist at Moody’s Analytics. “As long as they feel like the economy isn't going to be disrupted significantly by the riots, they’re not going to price that in the stock market,” he said.
From https://www.nbcnews.com/business/markets/why-wall-street-soaring-while-main-street-burning-n1223506
Linda Greenhouse on a politically partisan US Supreme Court
Excerpt from Greenhouse opinion oiece at https://www.nytimes.com/2020/06/04/opinion/supreme-court-religion-coronavirus.html?action=click&module=Opinion&pgtype=Homepage:
The Supreme Court made the indisputably right call last week when it refused to block California from limiting attendance at religious services in an effort to control the spread of Covid-19.
A Southern California church, represented by a Chicago-based organization, the Thomas More Society, which most often defends anti-abortion activists, had sought the justices’ intervention with the argument that by limiting worshipers to the lesser of 25 percent of building capacity or 100 people, while setting a 50 percent occupancy cap on retail stores, California was discriminating against religion in violation of the Constitution’s Free Exercise Clause.
Given the obvious difference between walking through a store and sitting among fellow worshipers for an hour or more, as well as the documented spread of the virus through church attendance in such places as Sacramento (71 cases), Seattle (32 cases) and South Korea (over 5,000 cases traced to one person at a religious service), California’s limits are both sensitive and sensible, hardly the basis for constitutional outrage or judicial second-guessing.
So why did the court’s order, issued as midnight approached on Friday night, fill me with dread rather than relief?
It was because in a ruling that should have been unanimous, the vote was 5 to 4. And it was because of who the four dissenters were: the four most conservative justices, . . .
* * *
The U.S. Supreme Court Order Greenhouse discusses is here: https://www.supremecourt.gov/opinions/19pdf/19a1044_pok0.pdf
Excerpt from Greenhouse opinion oiece at https://www.nytimes.com/2020/06/04/opinion/supreme-court-religion-coronavirus.html?action=click&module=Opinion&pgtype=Homepage:
The Supreme Court made the indisputably right call last week when it refused to block California from limiting attendance at religious services in an effort to control the spread of Covid-19.
A Southern California church, represented by a Chicago-based organization, the Thomas More Society, which most often defends anti-abortion activists, had sought the justices’ intervention with the argument that by limiting worshipers to the lesser of 25 percent of building capacity or 100 people, while setting a 50 percent occupancy cap on retail stores, California was discriminating against religion in violation of the Constitution’s Free Exercise Clause.
Given the obvious difference between walking through a store and sitting among fellow worshipers for an hour or more, as well as the documented spread of the virus through church attendance in such places as Sacramento (71 cases), Seattle (32 cases) and South Korea (over 5,000 cases traced to one person at a religious service), California’s limits are both sensitive and sensible, hardly the basis for constitutional outrage or judicial second-guessing.
So why did the court’s order, issued as midnight approached on Friday night, fill me with dread rather than relief?
It was because in a ruling that should have been unanimous, the vote was 5 to 4. And it was because of who the four dissenters were: the four most conservative justices, . . .
* * *
The U.S. Supreme Court Order Greenhouse discusses is here: https://www.supremecourt.gov/opinions/19pdf/19a1044_pok0.pdf
Workers Fearful of the Coronavirus Are Getting Fired and Losing Their Benefits
Thousands who refuse to return to work are being reported to the state to have their unemployment benefits potentially revoked
https://www.nytimes.com/2020/06/04/us/virus-unemployment-fired.html?action=click&module=Top%20Stories&pgtype=Homepage
Thousands who refuse to return to work are being reported to the state to have their unemployment benefits potentially revoked
https://www.nytimes.com/2020/06/04/us/virus-unemployment-fired.html?action=click&module=Top%20Stories&pgtype=Homepage
The Senate approved a broad set of changes to the Small Business Administration's Paycheck Protection Program Wednesday evening, making the program's lending terms more favorable to restaurants, retailers and other businesses.
Among the changes, the legislation extends the “covered period” under which small businesses can spend PPP loan proceeds from eight weeks to 24 weeks. The bipartisan bill, titled the Paycheck Protection Program Flexibility Act of 2020, was passed by the House of Representatives on May 28. It now heads to President Trump for his signature.
Details are here: https://www.bizjournals.com/bizjournals/news/2020/06/03/congress-ppp-loan-change-bill-passes.html?
The US is No Longer the Authority Figure for Multinational Mergers
Excerpt from https://moginrubin.com/end-of-an-era-the-u-s-is-no-longer-the-authority-figure-for-multinational-mergers/:
Unlike other forms of international cooperation grounded in notions of comity and geopolitical realities, leadership in international merger clearance defaults to the jurisdiction with the most restrictive policy. For decades, the U.S. served in this role; merger clearance by the FTC or DOJ would practically ensure worldwide approval. But the E.C.’s decision to block the GE-Honeywell acquisition marked something of an inflection point in the path of global enforcement.
The actions by the DOJ and CMA regarding the Cengage/McGraw-Hill merger exemplify the simultaneous weakening in the U.S. and strengthening in Europe of substantive merger clearance standards and demands. The CMA applied the more restrictive standard and therefore led the clearance process. The CMA not only required the parties to propose remedies to the competition problems it identified, but then rejected those remedies as insufficient. Cengage and McGraw-Hill called off the merger roughly one month later, strongly implying the CMA’s rejection played a key role in stopping the deal. The DOJ, on the other hand, was reportedly poised to approve the merger with relatively minor divestitures, largely ignoring competition concerns raised by lawmakers and advocacy groups.
The CMA again took the lead in the Illumina/PacBio merger review. The CMA was first to conclude Illumina and PacBio operated in a single dynamic market and that the merger was an attempt by Illumina to eliminate a nascent competitor. The CMA also indicated it would attempt to block the merger, as it did not see an alternative that would protect competition from a patent-protected monopolist in a market for an extremely important technology. Although the DOJ eventually reached similar conclusions and challenged the merger, it was not until months after the CMA.
But global divergence in substantive standards and expedience is only half the story, as the Sabre/Farelogix debacle demonstrates that jurisdictions have differing procedural requirements as well. In that case the U.S. government challenged a significant consolidation in a complex, high-tech sub-market in the airline industry only to be confronted with seemingly insurmountable procedural hurdles. Judge Stark’s mechanical and misguided interpretation of the Supreme Court’s holding in Amex—that the competitive effects in any antitrust case involving a transaction platform must be analyzed within a two-sided market definition—created an impossible legal hurdle for the government since only two-sided transaction platforms could compete against Sabre, a qualification Farelogix did not meet.
Putting aside the wrong-headedness of the court’s interpretation of Amex (examples abound of anticompetitive conduct by a two-sided transaction platform that does not require defining a two-sided market), the greater sin may have been to elevate formalism over substance. It is well known that substantive rights can be rolled back through purely procedural maneuvers. In the Sabre-Farelogix case, the court created an excessively inflexible market definition requirement and reached a conclusion seemingly at odds with the evidence largely because the government failed to offer a prima facie case. In other words, the merging parties needn’t have bothered presenting their unreliable and misleading evidence. The court ruled the DOJ failed to make out its case in chief, so all the merging parties had to do was show up.
By contrast, the CMA satisfied its market definition and elemental requirements through overwhelming evidence that demonstrated Farelogix represented the most likely source of industry innovation and, as such, the most significant competitive constraint on Sabre’s market leadership. The U.S. court was aware of this, having noted that Farelogix represents the only real threat to Sabre and the testimony of one airline executive who said it would cost $40 million for an airline to develop its own platform and more than $20 million a year to maintain. An innovator like Farelogix could be easily and/or intentionally stymied if controlled by Sabre, a proposition that seemed self-evident to the CMA but was swallowed whole by the procedural obstacles erected by the U.S. court.
Indeed, the U.S.-European procedural divergence in merger control is institutional. U.S. authorities must prove a case in court to obtain an injunction whereas agencies like the E.C. can impose injunctions without judicial intervention, placing the onus on the merging parties to challenge the injunction in court. One can have no quarrel with the U.S. system and a deep suspicion of the European approach, but the U.S. institutional structure should not be used as an instrument to roll back substantive antitrust law, as the court did in the Sabre-Farelogix case.
In terms of both substantive competition law standards and the procedural requirements for merger control, the U.S and Europe appear headed in opposite directions. And, based on the three deals discussed above, the adjustment necessary to realign the world’s competition merger policies should be made in Washington – not in London or Brussels.
Excerpt from https://moginrubin.com/end-of-an-era-the-u-s-is-no-longer-the-authority-figure-for-multinational-mergers/:
Unlike other forms of international cooperation grounded in notions of comity and geopolitical realities, leadership in international merger clearance defaults to the jurisdiction with the most restrictive policy. For decades, the U.S. served in this role; merger clearance by the FTC or DOJ would practically ensure worldwide approval. But the E.C.’s decision to block the GE-Honeywell acquisition marked something of an inflection point in the path of global enforcement.
The actions by the DOJ and CMA regarding the Cengage/McGraw-Hill merger exemplify the simultaneous weakening in the U.S. and strengthening in Europe of substantive merger clearance standards and demands. The CMA applied the more restrictive standard and therefore led the clearance process. The CMA not only required the parties to propose remedies to the competition problems it identified, but then rejected those remedies as insufficient. Cengage and McGraw-Hill called off the merger roughly one month later, strongly implying the CMA’s rejection played a key role in stopping the deal. The DOJ, on the other hand, was reportedly poised to approve the merger with relatively minor divestitures, largely ignoring competition concerns raised by lawmakers and advocacy groups.
The CMA again took the lead in the Illumina/PacBio merger review. The CMA was first to conclude Illumina and PacBio operated in a single dynamic market and that the merger was an attempt by Illumina to eliminate a nascent competitor. The CMA also indicated it would attempt to block the merger, as it did not see an alternative that would protect competition from a patent-protected monopolist in a market for an extremely important technology. Although the DOJ eventually reached similar conclusions and challenged the merger, it was not until months after the CMA.
But global divergence in substantive standards and expedience is only half the story, as the Sabre/Farelogix debacle demonstrates that jurisdictions have differing procedural requirements as well. In that case the U.S. government challenged a significant consolidation in a complex, high-tech sub-market in the airline industry only to be confronted with seemingly insurmountable procedural hurdles. Judge Stark’s mechanical and misguided interpretation of the Supreme Court’s holding in Amex—that the competitive effects in any antitrust case involving a transaction platform must be analyzed within a two-sided market definition—created an impossible legal hurdle for the government since only two-sided transaction platforms could compete against Sabre, a qualification Farelogix did not meet.
Putting aside the wrong-headedness of the court’s interpretation of Amex (examples abound of anticompetitive conduct by a two-sided transaction platform that does not require defining a two-sided market), the greater sin may have been to elevate formalism over substance. It is well known that substantive rights can be rolled back through purely procedural maneuvers. In the Sabre-Farelogix case, the court created an excessively inflexible market definition requirement and reached a conclusion seemingly at odds with the evidence largely because the government failed to offer a prima facie case. In other words, the merging parties needn’t have bothered presenting their unreliable and misleading evidence. The court ruled the DOJ failed to make out its case in chief, so all the merging parties had to do was show up.
By contrast, the CMA satisfied its market definition and elemental requirements through overwhelming evidence that demonstrated Farelogix represented the most likely source of industry innovation and, as such, the most significant competitive constraint on Sabre’s market leadership. The U.S. court was aware of this, having noted that Farelogix represents the only real threat to Sabre and the testimony of one airline executive who said it would cost $40 million for an airline to develop its own platform and more than $20 million a year to maintain. An innovator like Farelogix could be easily and/or intentionally stymied if controlled by Sabre, a proposition that seemed self-evident to the CMA but was swallowed whole by the procedural obstacles erected by the U.S. court.
Indeed, the U.S.-European procedural divergence in merger control is institutional. U.S. authorities must prove a case in court to obtain an injunction whereas agencies like the E.C. can impose injunctions without judicial intervention, placing the onus on the merging parties to challenge the injunction in court. One can have no quarrel with the U.S. system and a deep suspicion of the European approach, but the U.S. institutional structure should not be used as an instrument to roll back substantive antitrust law, as the court did in the Sabre-Farelogix case.
In terms of both substantive competition law standards and the procedural requirements for merger control, the U.S and Europe appear headed in opposite directions. And, based on the three deals discussed above, the adjustment necessary to realign the world’s competition merger policies should be made in Washington – not in London or Brussels.
- Michael Carrier's primer:
Georgetown Journal of International Affairs (Jan. 2020)
4 Pages Posted: 27 May 2020
AbstractBig Tech is in the news. At the center of our political and economic dialogue is the effect that Amazon, Apple, Facebook, and Google have on our lives and what, if anything, governments should do about it.
In this short piece, I explain how Big Tech has come under scrutiny, the antitrust implications of the industry’s behavior, and the potential remedy of breaking up the companies.
Keywords: antitrust, Big Tech, Amazon, Apple, Facebook, Google
JEL Classification: K21, L40, L41, L63, O34
Suggested Citation:
Carrier, Michael A., Big Tech, Antitrust, and Breakup (January 14, 2020). Georgetown Journal of International Affairs (Jan. 2020). Available at SSRN: https://ssrn.com/abstract=3593863
In at least a dozen states, health departments have inflated testing numbers or deflated death tallies by changing criteria for who counts as a coronavirus victim and what counts as a coronavirus test
Some states have shifted the metrics for a “safe” reopening; Arizona sought to clamp down on bad news at one point by simply shuttering its pandemic modeling. About a third of the states aren’t even reporting hospital admission data — a big red flag for the resurgence of the virus.
Excerpt from https://www.msn.com/en-us/news/us/bad-state-data-hides-coronavirus-threat-as-trump-pushes-reopening/ar-BB14GGZj?ocid=msedgdhp
Some states have shifted the metrics for a “safe” reopening; Arizona sought to clamp down on bad news at one point by simply shuttering its pandemic modeling. About a third of the states aren’t even reporting hospital admission data — a big red flag for the resurgence of the virus.
Excerpt from https://www.msn.com/en-us/news/us/bad-state-data-hides-coronavirus-threat-as-trump-pushes-reopening/ar-BB14GGZj?ocid=msedgdhp
Goldman Sachs Forecloses on 10,000 Homes for ‘Consumer Relief’
A federal settlement over the 2008 financial crisis required the bank to offer homeowners $1.8 billion in relief. In the process, it became a big buyer of distressed mortgages.
To make amends for its part in the collapse of the housing market during the 2008 financial crisis, Goldman Sachs promised $1.8 billion in consumer relief to struggling homeowners.
That penance was also a business opportunity.
Four years after agreeing to help homeowners in a civil settlement with federal prosecutors, the Wall Street firm has become one of the biggest buyers of distressed mortgages, an area of investing that deals in loan modifications and foreclosures for borrowers who can’t make their payments.
And while Goldman has reworked loans to make it possible for thousands of homeowners to avoid foreclosure, it has also taken back more than 10,000 homes — properties it has started to sell to help offset the cost of the assistance it provides, a review of data shows.
“They are profiting off of this,” said George Daly, who almost lost his home in Millville, N.J., to Goldman after it bought his mortgage as part of the consumer relief program.
Excerpt from https://www.nytimes.com/2020/05/22/business/goldman-sachs-mortgage-foreclosure.html?action=click&algo=bandit-story&block=more_in_recirc&fellback=false&imp_id=301303615&impression_id=130080462&index=3&pgtype=Article®ion=footer
A federal settlement over the 2008 financial crisis required the bank to offer homeowners $1.8 billion in relief. In the process, it became a big buyer of distressed mortgages.
To make amends for its part in the collapse of the housing market during the 2008 financial crisis, Goldman Sachs promised $1.8 billion in consumer relief to struggling homeowners.
That penance was also a business opportunity.
Four years after agreeing to help homeowners in a civil settlement with federal prosecutors, the Wall Street firm has become one of the biggest buyers of distressed mortgages, an area of investing that deals in loan modifications and foreclosures for borrowers who can’t make their payments.
And while Goldman has reworked loans to make it possible for thousands of homeowners to avoid foreclosure, it has also taken back more than 10,000 homes — properties it has started to sell to help offset the cost of the assistance it provides, a review of data shows.
“They are profiting off of this,” said George Daly, who almost lost his home in Millville, N.J., to Goldman after it bought his mortgage as part of the consumer relief program.
Excerpt from https://www.nytimes.com/2020/05/22/business/goldman-sachs-mortgage-foreclosure.html?action=click&algo=bandit-story&block=more_in_recirc&fellback=false&imp_id=301303615&impression_id=130080462&index=3&pgtype=Article®ion=footer
Read the Court Ruling Against NCAA Restrictions on Athlete Pay
By Greta Anderson
May 19, 2020
A California federal appeals court has concluded that rules set by the National Collegiate Athletic Association to limit education-related compensation for athletes violate antitrust law.
The opinion issued May 18 by a three-judge panel [https://cdn.ca9.uscourts.gov/datastore/opinions/2020/05/18/19-15566.pdf click to read] in the United States Court of Appeals for the Ninth Circuit upheld a district court’s decision that the NCAA cannot restrict colleges from granting “non-cash education-related benefits” to athletes in Division I of the Football Bowl Subdivision, which encompass the nation’s most successful football, men’s basketball and women’s basketball programs.
Institutions are permitted to give money to athletes to pay for computers, musical instruments and other products and services used for academic pursuits, beyond the cost of attendance, or COA, which includes tuition, room and board, meals, and textbooks, the panel said. The NCAA also may not bar scholarships to athletes for study abroad programs or financial aid given after athletes have exhausted their eligibility to compete, according to the ruling.
The case, Alston v. NCAA, was originally ruled on by the U.S. District Court for the Northern District of California in March 2019 and was partly favorable to the NCAA, which argued that allowing certain types of athlete pay would eliminate distinctions between professional and college athletics. The panel agreed that the NCAA’s restrictions on athlete pay unrelated to education, and a requirement that athletic scholarships not exceed COA, were essential for “preserving amateurism and thus improving consumer choice by maintaining a distinction between college and professional sports,” according to the Ninth Circuit ruling.
The panel also addressed the enactment of the Fair Pay for Play Act in California last October. The law goes into effect in January 2023 and will allow college athletes in the state to be paid for use of their name, image and likeness, or NIL. Athletes who brought the Alston case to court argued that the NCAA’s creation of a working group to explore allowing NIL benefits nullifies the association’s argument that such benefits would diminish the amateurism model. But the Ninth Circuit panel said this argument is “premature” and “the NCAA has not endorsed cash compensation untethered to education.”
Judge Milan Smith concurred with the panel’s decision to focus on education-related expenses rather than payments unrelated to academics because of precedent set during a previous case in the Ninth Circuit, O’Bannon v. NCAA, but Smith also expressed concern that the court’s interpretation of antitrust law is damaging to athletes. He said the court relies on the NCAA’s argument that the compensation differences between college and professional sports are what “drive consumer demand” and strengthen the sports entertainment market, however, the same considerations aren’t made for the higher education market, where athletes could benefit from having greater choice over where they compete and the compensation they receive for their athletic success.
“The treatment of Student-Athletes is not the result of free market competition,” Smith wrote. “To the contrary, it is the result of a cartel of buyers acting in concert to artificially depress the price that sellers could otherwise receive for their services. Our antitrust laws were originally meant to prohibit exactly this sort of distortion.”
Credit: https://www.insidehighered.com/quicktakes/2020/05/19/court-panel-rules-against-ncaa-restrictions-athlete-pay
By Greta Anderson
May 19, 2020
A California federal appeals court has concluded that rules set by the National Collegiate Athletic Association to limit education-related compensation for athletes violate antitrust law.
The opinion issued May 18 by a three-judge panel [https://cdn.ca9.uscourts.gov/datastore/opinions/2020/05/18/19-15566.pdf click to read] in the United States Court of Appeals for the Ninth Circuit upheld a district court’s decision that the NCAA cannot restrict colleges from granting “non-cash education-related benefits” to athletes in Division I of the Football Bowl Subdivision, which encompass the nation’s most successful football, men’s basketball and women’s basketball programs.
Institutions are permitted to give money to athletes to pay for computers, musical instruments and other products and services used for academic pursuits, beyond the cost of attendance, or COA, which includes tuition, room and board, meals, and textbooks, the panel said. The NCAA also may not bar scholarships to athletes for study abroad programs or financial aid given after athletes have exhausted their eligibility to compete, according to the ruling.
The case, Alston v. NCAA, was originally ruled on by the U.S. District Court for the Northern District of California in March 2019 and was partly favorable to the NCAA, which argued that allowing certain types of athlete pay would eliminate distinctions between professional and college athletics. The panel agreed that the NCAA’s restrictions on athlete pay unrelated to education, and a requirement that athletic scholarships not exceed COA, were essential for “preserving amateurism and thus improving consumer choice by maintaining a distinction between college and professional sports,” according to the Ninth Circuit ruling.
The panel also addressed the enactment of the Fair Pay for Play Act in California last October. The law goes into effect in January 2023 and will allow college athletes in the state to be paid for use of their name, image and likeness, or NIL. Athletes who brought the Alston case to court argued that the NCAA’s creation of a working group to explore allowing NIL benefits nullifies the association’s argument that such benefits would diminish the amateurism model. But the Ninth Circuit panel said this argument is “premature” and “the NCAA has not endorsed cash compensation untethered to education.”
Judge Milan Smith concurred with the panel’s decision to focus on education-related expenses rather than payments unrelated to academics because of precedent set during a previous case in the Ninth Circuit, O’Bannon v. NCAA, but Smith also expressed concern that the court’s interpretation of antitrust law is damaging to athletes. He said the court relies on the NCAA’s argument that the compensation differences between college and professional sports are what “drive consumer demand” and strengthen the sports entertainment market, however, the same considerations aren’t made for the higher education market, where athletes could benefit from having greater choice over where they compete and the compensation they receive for their athletic success.
“The treatment of Student-Athletes is not the result of free market competition,” Smith wrote. “To the contrary, it is the result of a cartel of buyers acting in concert to artificially depress the price that sellers could otherwise receive for their services. Our antitrust laws were originally meant to prohibit exactly this sort of distortion.”
Credit: https://www.insidehighered.com/quicktakes/2020/05/19/court-panel-rules-against-ncaa-restrictions-athlete-pay
Bloomberg TV Interview: Economist Stiglitz on Covid-19 Impact on Jobs, Government Stimulus, Supply and Demand
May 18th, 2020
Joseph Stiglitz says the U.S. will likely have double-digit unemployment for an extended period. He worries that large and dominant companies will become even more dominant. He worries that government support for small U.S. businesses and workers has been inefficient. He wishes for government support of essential industries like health care. DAR
https://www.bloomberg.com/news/videos/2020-05-18/economist-stiglitz-on-covid-19-impact-on-jobs-government-stimulus-supply-and-demand-video
May 18th, 2020
Joseph Stiglitz says the U.S. will likely have double-digit unemployment for an extended period. He worries that large and dominant companies will become even more dominant. He worries that government support for small U.S. businesses and workers has been inefficient. He wishes for government support of essential industries like health care. DAR
https://www.bloomberg.com/news/videos/2020-05-18/economist-stiglitz-on-covid-19-impact-on-jobs-government-stimulus-supply-and-demand-video
NY Post: Health Department hits NYC nursing home with violations after Post report
By Melissa Klein
May 23, 2020 |
Investigators slapped the Hebrew Home in Riverdale with several violations after a Post report revealed scores of coronavirus deaths there went uncounted by state officials.
The state Department of Health said it issued a “statement of deficiencies” to the nursing home with violations that included “infection control concerns, failure to report accurately upon request by the department, and failure to communicate with families and residents in a timely fashion regarding COVID-19 deaths.”
The 751-bed nursing home has to submit a correction plan to be reviewed by the DOH. It could face fines ranging up to $10,000 if any violation directly resulted in patient harm, the DOH said.
The agency’s probe came after The Post reported that 119 people had died at the home from March 1 through early May, although the home said it had just 14 COVID-19 related deaths at the facility and another 11 residents who died in the hospital.
After the DOH launched its probe, the Hebrew Home was forced to go through the records of everyone who died and substantially revised its count. It said as of Monday 28 deaths were reclassified as possibly COVID-19 related bringing the total to 63 since March 1.
A Hebrew Home spokesman said the DOH found only “minor deficiencies” after its inspection, including problems related to signs on residents’ doors and the types of questions asked of staff about exposure to COVID-19.
The communication lapses were tied to the reclassification of the COVID-19 deaths, spokeswoman Wendy Steinberg said.
“Since these were not classified as COVID-related cases, we did not communicate about them at the time. All reclassified residents have been reported,” she said.
She said the home had been adhering to federal regulations to notify families of COVID-19 deaths at the facility, which took effect on May 8.
https://nypost.com/2020/05/23/nyc-nursing-home-hit-with-health-department-violations/?
By Melissa Klein
May 23, 2020 |
Investigators slapped the Hebrew Home in Riverdale with several violations after a Post report revealed scores of coronavirus deaths there went uncounted by state officials.
The state Department of Health said it issued a “statement of deficiencies” to the nursing home with violations that included “infection control concerns, failure to report accurately upon request by the department, and failure to communicate with families and residents in a timely fashion regarding COVID-19 deaths.”
The 751-bed nursing home has to submit a correction plan to be reviewed by the DOH. It could face fines ranging up to $10,000 if any violation directly resulted in patient harm, the DOH said.
The agency’s probe came after The Post reported that 119 people had died at the home from March 1 through early May, although the home said it had just 14 COVID-19 related deaths at the facility and another 11 residents who died in the hospital.
After the DOH launched its probe, the Hebrew Home was forced to go through the records of everyone who died and substantially revised its count. It said as of Monday 28 deaths were reclassified as possibly COVID-19 related bringing the total to 63 since March 1.
A Hebrew Home spokesman said the DOH found only “minor deficiencies” after its inspection, including problems related to signs on residents’ doors and the types of questions asked of staff about exposure to COVID-19.
The communication lapses were tied to the reclassification of the COVID-19 deaths, spokeswoman Wendy Steinberg said.
“Since these were not classified as COVID-related cases, we did not communicate about them at the time. All reclassified residents have been reported,” she said.
She said the home had been adhering to federal regulations to notify families of COVID-19 deaths at the facility, which took effect on May 8.
https://nypost.com/2020/05/23/nyc-nursing-home-hit-with-health-department-violations/?
Judge dismisses OAN’s $10M defamation lawsuit against Rachel Maddow, MSNBC
: City News Service
Posted: May 22, 2020 / 01:01 PM PDT / Updated: May 22, 2020 / 01:04 PM PDT
SAN DIEGO (CNS) – A federal judge Friday dismissed a $10 million defamation lawsuit filed by the owners and operators of the San Diego-based One America News Network against MSNBC and political commentator Rachel Maddow for telling her viewers last summer that the conservative network “really literally is paid Russian propaganda.”
U.S. District Judge Cynthia Bashant dismissed Herring Networks’ suit with prejudice, ruling “there is no set of facts that could support a claim for defamation based on Maddow’s statement,” which was made during a July 22, 2019, segment of her show.
In that segment, Maddow cited a Daily Beast article stating that an OAN on-air reporter was “on the payroll for the Kremlin.”
Herring Networks’ court papers say the reporter, Kristian Rouz, is originally from the Ukraine and started his journalism career by writing articles for Sputnik News, which is affiliated with the Russian government. According to Herring Networks, Rouz was merely a freelancer for Sputnik who selected his own article topics for submission, and his work there had no significance toward his work for OAN.
Herring Networks alleged in the lawsuit filed last fall that Maddow made “utterly and completely false” statements because OAN “is wholly financed by the Herrings, an American family” and “has never been paid or received a penny from Russia or the Russian government.”
Bashant ruled that Maddow’s statement “is an opinion that cannot serve as the basis for a defamation claim,” and thus is protected under the First Amendment.
The San Diego-based judge ruled that most viewers would be able to conclude that Maddow was forwarding her opinion when she made the July 22 statements.
“For her to exaggerate the facts and call OAN Russian propaganda was consistent with her tone up to that point, and the court finds a reasonable viewer would not take the statement as factual given this context,” Bashant wrote. “The context of Maddow’s statement shows reasonable viewers would consider the contested statement to be opinion.”
In a motion to dismiss the case, Maddow’s attorneys allege Herrings Networks was not objecting to anything from the Daily Beast article, and conceded that Rouz worked for an organization affiliated with the Russian government.
Maddow’s attorneys maintained that her comments during the segment were opinions based entirely on the Daily Beast story, and “she nowhere indicates that she has separate knowledge about Mr. Rouz or the funding of OAN other than from that article.”
Bashant agreed, writing that viewers would “follow the facts of the Daily Beast article; that OAN and Sputnik share a reporter and both pay this reporter to write articles. Anything beyond this is Maddow’s opinion or her exaggeration of the facts.”
https://fox5sandiego.com/author/city-news-service/
A copy of the opinion is here: https://www.courthousenews.com/wp-content/uploads/2020/05/OAN-Maddow-DISMISSAL.pdf
Note: OAN has announced plans to appeal
: City News Service
Posted: May 22, 2020 / 01:01 PM PDT / Updated: May 22, 2020 / 01:04 PM PDT
SAN DIEGO (CNS) – A federal judge Friday dismissed a $10 million defamation lawsuit filed by the owners and operators of the San Diego-based One America News Network against MSNBC and political commentator Rachel Maddow for telling her viewers last summer that the conservative network “really literally is paid Russian propaganda.”
U.S. District Judge Cynthia Bashant dismissed Herring Networks’ suit with prejudice, ruling “there is no set of facts that could support a claim for defamation based on Maddow’s statement,” which was made during a July 22, 2019, segment of her show.
In that segment, Maddow cited a Daily Beast article stating that an OAN on-air reporter was “on the payroll for the Kremlin.”
Herring Networks’ court papers say the reporter, Kristian Rouz, is originally from the Ukraine and started his journalism career by writing articles for Sputnik News, which is affiliated with the Russian government. According to Herring Networks, Rouz was merely a freelancer for Sputnik who selected his own article topics for submission, and his work there had no significance toward his work for OAN.
Herring Networks alleged in the lawsuit filed last fall that Maddow made “utterly and completely false” statements because OAN “is wholly financed by the Herrings, an American family” and “has never been paid or received a penny from Russia or the Russian government.”
Bashant ruled that Maddow’s statement “is an opinion that cannot serve as the basis for a defamation claim,” and thus is protected under the First Amendment.
The San Diego-based judge ruled that most viewers would be able to conclude that Maddow was forwarding her opinion when she made the July 22 statements.
“For her to exaggerate the facts and call OAN Russian propaganda was consistent with her tone up to that point, and the court finds a reasonable viewer would not take the statement as factual given this context,” Bashant wrote. “The context of Maddow’s statement shows reasonable viewers would consider the contested statement to be opinion.”
In a motion to dismiss the case, Maddow’s attorneys allege Herrings Networks was not objecting to anything from the Daily Beast article, and conceded that Rouz worked for an organization affiliated with the Russian government.
Maddow’s attorneys maintained that her comments during the segment were opinions based entirely on the Daily Beast story, and “she nowhere indicates that she has separate knowledge about Mr. Rouz or the funding of OAN other than from that article.”
Bashant agreed, writing that viewers would “follow the facts of the Daily Beast article; that OAN and Sputnik share a reporter and both pay this reporter to write articles. Anything beyond this is Maddow’s opinion or her exaggeration of the facts.”
https://fox5sandiego.com/author/city-news-service/
A copy of the opinion is here: https://www.courthousenews.com/wp-content/uploads/2020/05/OAN-Maddow-DISMISSAL.pdf
Note: OAN has announced plans to appeal
Federal banking regulator pushes through rule changes that weaken Community Reinvestment Act investment incentives in low-income communities.
Excerpt:
In a statement, National Community Reinvestment Coalition CEO Jesse Van Tol laid out the high stakes: “The timing is shocking, in the middle of a pandemic that has been hardest on lower-income communities this law is supposed to protect. What an insulting and cruel moment to unleash new rules that will in some cases help banks to do less for some poor communities and communities of color. Those are the communities hit hardest by COVID-19.”
Read More Here: https://nonprofitquarterly.org/under-cover-of-covid-regulator-rolls-back-community-reinvestment-act-rules/
Excerpt:
In a statement, National Community Reinvestment Coalition CEO Jesse Van Tol laid out the high stakes: “The timing is shocking, in the middle of a pandemic that has been hardest on lower-income communities this law is supposed to protect. What an insulting and cruel moment to unleash new rules that will in some cases help banks to do less for some poor communities and communities of color. Those are the communities hit hardest by COVID-19.”
Read More Here: https://nonprofitquarterly.org/under-cover-of-covid-regulator-rolls-back-community-reinvestment-act-rules/
The Trump administration is supporting a lawsuit challenging the Illinois governor's stay-at-home order.
The legal maneuver marks the first time the U.S. Department of Justice has weighed in on state level COVID-19 policies that are unrelated to religious matters.
The department on Friday filed a statement of interest in the case against Democratic Gov. J.B. Pritzker, saying the protective coronavirus measures in place exceed the limits of his office.
"In response to the COVID-19 pandemic, the Governor of Illinois has, over the past two months, sought to rely on authority under the Illinois Emergency Management Agency Act to impose sweeping limitations on nearly all aspects of life for citizens of Illinois, significantly impairing in some instances their ability to maintain their economic livelihoods," the department said in a statement.
The government is siding with Republican state Rep. Darren Bailey who filed the initial suit in state court earlier this month. He argued that Pritzker's executive order violates a 30-day limit on the governor's emergency powers put in place by the state legislature.
Pritzker was ordered to respond to Bailey's motion for summary judgement by Thursday. But instead, he removed the case to federal district court.
Assistant Attorney General Eric Dreiband for the Civil Rights Division said Pritzker "owes it to the people of Illinois to allow his state's courts to adjudicate the question of whether Illinois law authorizes orders he issued to respond to COVID-19."
See https://www.npr.org/sections/coronavirus-live-updates/2020/05/22/861413069/justice-department-backs-challenge-to-illinois-stay-at-home-order
The legal maneuver marks the first time the U.S. Department of Justice has weighed in on state level COVID-19 policies that are unrelated to religious matters.
The department on Friday filed a statement of interest in the case against Democratic Gov. J.B. Pritzker, saying the protective coronavirus measures in place exceed the limits of his office.
"In response to the COVID-19 pandemic, the Governor of Illinois has, over the past two months, sought to rely on authority under the Illinois Emergency Management Agency Act to impose sweeping limitations on nearly all aspects of life for citizens of Illinois, significantly impairing in some instances their ability to maintain their economic livelihoods," the department said in a statement.
The government is siding with Republican state Rep. Darren Bailey who filed the initial suit in state court earlier this month. He argued that Pritzker's executive order violates a 30-day limit on the governor's emergency powers put in place by the state legislature.
Pritzker was ordered to respond to Bailey's motion for summary judgement by Thursday. But instead, he removed the case to federal district court.
Assistant Attorney General Eric Dreiband for the Civil Rights Division said Pritzker "owes it to the people of Illinois to allow his state's courts to adjudicate the question of whether Illinois law authorizes orders he issued to respond to COVID-19."
See https://www.npr.org/sections/coronavirus-live-updates/2020/05/22/861413069/justice-department-backs-challenge-to-illinois-stay-at-home-order
Non-Compete Agreements: Might They be Procompetitive in Healthcare?
By Paul Wong, Yun Ling, Emily Walden
There have been recent calls for nationwide bans on non-compete agreements. Such sentiment is no surprise in healthcare, particularly in physician labor markets. And yet there are many procompetitive justifications for non-compete agreements where they are an important tool to encourage investment. It is well-recognized that these agreements protect investments that would otherwise be expropriated due to hold-up, including trade secrets, customer relationships, recruitment of unique employees, specific training, and specialized capital investment.
The full article:
https://www.competitionpolicyinternational.com/non-compete-agreements-might-they-be-procompetitive-in-healthcare/Non-Compete
The FTC and States’ Complaint Regarding Daraprim--preventing generic competitionI
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May 18, 2020By Brendan Coffman, Thu Hoang & Nathan Mendelsohn (Wilson Sonsini Goodrich & Rosati)1
On January 27, 2020, the Federal Trade Commission (“FTC”) and the State of New York (“NY AG”) (collectively “Plaintiffs”) filed a Complaint against Phoenixus AG and Vyera Pharmaceuticals, LLC (collectively “Turing”), Martin Shkreli, and Kevin Mulleady. On April 14, 2020, Plaintiffs filed an amended Complaint, adding the states of California, Illinois, North Carolina, Ohio, and the commonwealths of Pennsylvania and Virginia.2 Plaintiffs allege an anticompetitive scheme to prevent generic versions of pyrimethamine (brand name Daraprim®) from launching. Specifically, Plaintiffs allege that Defendants are preventing generic manufacturers from launching by: (1) restricting sales of reference listed drug samples to generic manufacturers by instituting a restricted distribution program with distributors, (2) restricting sales of pyrimethamine API to generic manufacturers, and (3) agreeing with distributors to withhold sales data to prevent generic manufacturers from having a sense of Daraprim’s financial viability.
Full article, including access to Complaint https://www.competitionpolicyinternational.com/turing-the-screws-on-illegal-comprehensive-schemes-the-ftc-and-states-bold-complaint-regarding-daraprim/
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May 18, 2020By Brendan Coffman, Thu Hoang & Nathan Mendelsohn (Wilson Sonsini Goodrich & Rosati)1
On January 27, 2020, the Federal Trade Commission (“FTC”) and the State of New York (“NY AG”) (collectively “Plaintiffs”) filed a Complaint against Phoenixus AG and Vyera Pharmaceuticals, LLC (collectively “Turing”), Martin Shkreli, and Kevin Mulleady. On April 14, 2020, Plaintiffs filed an amended Complaint, adding the states of California, Illinois, North Carolina, Ohio, and the commonwealths of Pennsylvania and Virginia.2 Plaintiffs allege an anticompetitive scheme to prevent generic versions of pyrimethamine (brand name Daraprim®) from launching. Specifically, Plaintiffs allege that Defendants are preventing generic manufacturers from launching by: (1) restricting sales of reference listed drug samples to generic manufacturers by instituting a restricted distribution program with distributors, (2) restricting sales of pyrimethamine API to generic manufacturers, and (3) agreeing with distributors to withhold sales data to prevent generic manufacturers from having a sense of Daraprim’s financial viability.
Full article, including access to Complaint https://www.competitionpolicyinternational.com/turing-the-screws-on-illegal-comprehensive-schemes-the-ftc-and-states-bold-complaint-regarding-daraprim/
Facebook, YouTube remove viral 'Plandemic' video
BY ALICIA COHN - 05/08/20 08:34 AM EDT
Facebook, YouTube and other social media platforms have removed a viral documentary-style video titled "Plandemic" that promoted conspiracy theories about the coronavirus.
The 26-minute video, which was framed as part of a longer documentary on the coronavirus pandemic, promoted several false claims, including that wearing a face mask makes it easier to get the virus and that shelter-in-place orders hurt the immune system.
It also claimed without evidence that the coronavirus was invented in a laboratory in order to promote vaccinations. Judy Mikovits, an anti-vaccination activist, makes many of the claims in the video.
The video received more than 1 million videos on multiple platforms before it was removed, according to reports. It went viral on Thursday and was shared by users with large follower counts, including NFL players and Instagram influencers, according to NBC.
“Suggesting that wearing a mask can make you sick could lead to imminent harm, so we’re removing the video,” Facebook told Reuters.
YouTube told CNBC the video was removed for making claims about a cure for COVID-19 that is not backed by health officials.
Vimeo told The Washington Post the company “stands firm in keeping our platform safe from content that spreads harmful and misleading health information. The video in question has been removed ... for violating these very policies.”
Twitter also blocked the hashtags #PlagueofCorruption and #PlandemicMovie from trends and search and labeled the URL to the video as “unsafe," according to CNBC.
https://thehill.com/policy/technology/496757-facebook-and-youtube-remove-viral-plandemic-video-that-links-face-masks-to#bottom-story-socials
Labor activism against unsafe working conditions as obstacle to factory production
There’s been a surge in labor activism as people made to work in unsafe conditions stage strikes, walkouts and sickouts. “It sounds corny, but we’re moving towards a worker rebellion,” Ron Herrera, president of the Los Angeles County Federation of Labor, told The Los Angeles Times.
Meatpacking workers have been sickened with coronavirus at wildly disproportionate rates, and all over the country there have been protests outside of meatpacking plants demanding that they be temporarily closed, sometimes by the workers’ own children.
See https://www.nytimes.com/2020/05/18/opinion/coronavirus-reopen-workers.html?action=click&module=Opinion&pgtype=Homepage
Several states have been pushing employers to disclose when laid-off employees refuse to return to work.
About two weeks ago, the Vermont Labor Department launched a webpage for businesses to report employees who decline offers to return to work.
Several other states have set up similar websites for reporting employees, including Montana, Oklahoma, Tennessee and South Carolina.
It’s left some business owners, managers and workers in a difficult position where workers fear for their safety on the job.
https://www.marketplace.org/2020/05/14/should-employers-report-employees-who-dont-go-back-to-work
About two weeks ago, the Vermont Labor Department launched a webpage for businesses to report employees who decline offers to return to work.
Several other states have set up similar websites for reporting employees, including Montana, Oklahoma, Tennessee and South Carolina.
It’s left some business owners, managers and workers in a difficult position where workers fear for their safety on the job.
https://www.marketplace.org/2020/05/14/should-employers-report-employees-who-dont-go-back-to-work
Retailers Phase Out Coronavirus Hazard Pay for Essential Workers
Kroger and Rite Aid are among the firms paring back, as unions and employees say they still face risk
Some of the biggest U.S. retailers are ending the extra pay they gave to front-line workers as coronavirus-related costs pile up and the ranks of unemployed Americans surge.
Amazon.com Inc., Kroger Co. and Rite Aid Corp. are among the major companies that have ended or plan to stop paying higher wages for tens of thousands of workers in stores and warehouses and on the road.
Credit: WSJ 5-19 (paywall)
Kroger and Rite Aid are among the firms paring back, as unions and employees say they still face risk
Some of the biggest U.S. retailers are ending the extra pay they gave to front-line workers as coronavirus-related costs pile up and the ranks of unemployed Americans surge.
Amazon.com Inc., Kroger Co. and Rite Aid Corp. are among the major companies that have ended or plan to stop paying higher wages for tens of thousands of workers in stores and warehouses and on the road.
Credit: WSJ 5-19 (paywall)
Has Tyson’s been price gouging on beef?
State AGs have connected concerns about great market power and beef price gouging during the pandemic: "Given the concentrated market structure of the beef industry, it may be particularly susceptible to market manipulation, particularly during times of food insecurity, such as the current COVID-19 crisis." See the letter of multiple State AGs at https://www.azag.gov/sites/default/files/docs/press-releases/2020/letters/2020_05_05_Barr_AG_William.pdf
The backstory (see MSN news) is that since the beginning of March, coronavirus outbreaks among meatpacking workers forced the temporary closure of about two dozen major U.S. meat processing plants. The U.S. Department of Agriculture estimated that nationwide production of beef, pork and other red meat last week was about 28% lower than the same period last year, and the agency projected Tuesday that beef production in the second quarter of this year would be one-fifth below first-quarter levels.
Grocery stores and restaurants were paying more as a result. Wholesale ground-beef prices recently topped $6.21 a pound, according to the USDA, more than triple their cost at the beginning of March. Some steak prices doubled.
Tyson and other beef processors also have faced government scrutiny over their pricing. Despite beef growing more expensive in supermarkets, cattle prices have tumbled in the U.S. Plains states, prompting federal officials to investigate the way companies like Tyson price and purchase cattle.
Tyson most recently cut prices to supermarkets and other retailers by 20 to 30 percent. That may make beef more affordable for consumers, an admirable goal. But the move could be am effort by Tyson to deflect allegations of manipulating food prices in a time of food insecurity caused by the COVID pandemic. That would be, some have pointed out, an indication that Tyson has great market power.
By Don Allen Resnikoff
State AGs have connected concerns about great market power and beef price gouging during the pandemic: "Given the concentrated market structure of the beef industry, it may be particularly susceptible to market manipulation, particularly during times of food insecurity, such as the current COVID-19 crisis." See the letter of multiple State AGs at https://www.azag.gov/sites/default/files/docs/press-releases/2020/letters/2020_05_05_Barr_AG_William.pdf
The backstory (see MSN news) is that since the beginning of March, coronavirus outbreaks among meatpacking workers forced the temporary closure of about two dozen major U.S. meat processing plants. The U.S. Department of Agriculture estimated that nationwide production of beef, pork and other red meat last week was about 28% lower than the same period last year, and the agency projected Tuesday that beef production in the second quarter of this year would be one-fifth below first-quarter levels.
Grocery stores and restaurants were paying more as a result. Wholesale ground-beef prices recently topped $6.21 a pound, according to the USDA, more than triple their cost at the beginning of March. Some steak prices doubled.
Tyson and other beef processors also have faced government scrutiny over their pricing. Despite beef growing more expensive in supermarkets, cattle prices have tumbled in the U.S. Plains states, prompting federal officials to investigate the way companies like Tyson price and purchase cattle.
Tyson most recently cut prices to supermarkets and other retailers by 20 to 30 percent. That may make beef more affordable for consumers, an admirable goal. But the move could be am effort by Tyson to deflect allegations of manipulating food prices in a time of food insecurity caused by the COVID pandemic. That would be, some have pointed out, an indication that Tyson has great market power.
By Don Allen Resnikoff
Opinion from Lancet: The Trump administration has chipped away at the CDC's capacity to combat infectious diseases.
CDC staff in China were cut back with the last remaining CDC officer recalled home from the China CDC in July, 2019, leaving an intelligence vacuum when COVID-19 began to emerge. In a press conference on Feb 25, Nancy Messonnier, director of the CDC's National Center for Immunization and Respiratory Diseases, warned US citizens to prepare for major disruptions to movement and everyday life. Messonnier subsequently no longer appeared at White House briefings on COVID-19. More recently, the Trump administration has questioned guidelines that the CDC has provided. These actions have undermined the CDC's leadership and its work during the COVID-19 pandemic.
From https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(20)31140-5/fulltext
CDC staff in China were cut back with the last remaining CDC officer recalled home from the China CDC in July, 2019, leaving an intelligence vacuum when COVID-19 began to emerge. In a press conference on Feb 25, Nancy Messonnier, director of the CDC's National Center for Immunization and Respiratory Diseases, warned US citizens to prepare for major disruptions to movement and everyday life. Messonnier subsequently no longer appeared at White House briefings on COVID-19. More recently, the Trump administration has questioned guidelines that the CDC has provided. These actions have undermined the CDC's leadership and its work during the COVID-19 pandemic.
From https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(20)31140-5/fulltext
The effect of mail-in balloting on the California special Congressional election in CA won by Mike Garcia
Every registered voter in the CA district received a postage-paid, mail-in ballot.
Voters who returned the mail-in ballot skewed overwhelmingly old, white and Republican, according to an analysis by the firm Political Data Inc., The younger the voter, the less likely to vote. Fewer than 20 percent of 18- to 34-year-olds cast ballots; twice as many voted who were between 50 and 65; and only among the oldest voters did turnout exceed 50 percent. Latinos were least likely to vote (21 percent), while 40 percent of whites cast ballots. The Political Data Analysis is at https://tableau.the-pdi.com/t/CampaignTools/views/25thCDSpecialAVTracker/2020SpecialElectionTrackerVB?%3AisGuestRedirectFromVizportal=y&%3Aembed=yO
Every registered voter in the CA district received a postage-paid, mail-in ballot.
Voters who returned the mail-in ballot skewed overwhelmingly old, white and Republican, according to an analysis by the firm Political Data Inc., The younger the voter, the less likely to vote. Fewer than 20 percent of 18- to 34-year-olds cast ballots; twice as many voted who were between 50 and 65; and only among the oldest voters did turnout exceed 50 percent. Latinos were least likely to vote (21 percent), while 40 percent of whites cast ballots. The Political Data Analysis is at https://tableau.the-pdi.com/t/CampaignTools/views/25thCDSpecialAVTracker/2020SpecialElectionTrackerVB?%3AisGuestRedirectFromVizportal=y&%3Aembed=yO
With regard to the conflict between the perceived personal right to do whatever, and the social obligation to protect others by wearing a face mask: Washington Metro will ask train and bus passengers to wear a mask starting Monday. But, if they don't, it's also unlikely there will be any kind of penalty
WMATA officials have suggested riders use masks for some time now, said Paul Wiedefeld, the system's general manager. He said he expects most people will follow the new policy, per general guidelines across Greater Washington to stymie the spread of Covid-19.
Though, when pressed by board members on how the system would carry out such a requirement, Wiedefeld acknowledged the challenge in enforcing it, describing it as more of an ask than a mandate.
"It's extremely difficult to enforce — we've all seen the videos on how this goes bad," Wiedefeld said at the board meeting. "We want to encourage to everyone that it's a social responsibility."
Metro workers won't specifically ask it of bus and train riders, and police likely won't write citations, he said. But WMATA might dig into its own stockpile of masks so officers can hand some out to commuters not wearing one. But Wiedefeld said it was unclear if the agency has the supply to provide such a service.
The requirements have varied across the region's borders. The District requires people to wear a mask or face covering while using public transit. Montgomery County has a similar rule for shoppers. While some Virginia counties have encouraged masks while in public, the state has not made that requirement for public transportation, to the chagrin of Metro's largest union, ATU Local 689.
From: https://www.bizjournals.com/washington/news/2020/05/14/metro-to-require-passengers-to-wear-masks.html?
WMATA officials have suggested riders use masks for some time now, said Paul Wiedefeld, the system's general manager. He said he expects most people will follow the new policy, per general guidelines across Greater Washington to stymie the spread of Covid-19.
Though, when pressed by board members on how the system would carry out such a requirement, Wiedefeld acknowledged the challenge in enforcing it, describing it as more of an ask than a mandate.
"It's extremely difficult to enforce — we've all seen the videos on how this goes bad," Wiedefeld said at the board meeting. "We want to encourage to everyone that it's a social responsibility."
Metro workers won't specifically ask it of bus and train riders, and police likely won't write citations, he said. But WMATA might dig into its own stockpile of masks so officers can hand some out to commuters not wearing one. But Wiedefeld said it was unclear if the agency has the supply to provide such a service.
The requirements have varied across the region's borders. The District requires people to wear a mask or face covering while using public transit. Montgomery County has a similar rule for shoppers. While some Virginia counties have encouraged masks while in public, the state has not made that requirement for public transportation, to the chagrin of Metro's largest union, ATU Local 689.
From: https://www.bizjournals.com/washington/news/2020/05/14/metro-to-require-passengers-to-wear-masks.html?
The Justice Department is considering whether to file criminal charges against pharmaceutical giant Teva for allegedly colluding with rivals to inflate the prices of widely used drugs, but Teva is betting that in the middle of a deadly pandemic, the Trump administration won’t dare to come down hard on the largest supplier of generic drugs in the United States.
According to the NY Times:oLawyers for Teva, which prosecutors believe was deeply involved in the conspiracy, until recently had been holding settlement negotiations with officials in the Justice Department’s antitrust division. But in April, the company all but walked away from the talks, essentially daring the Trump administration to file charges, according to people on both sides of the discussions.
The Times article is at https://www.nytimes.com/2020/05/15/us/politics/teva-antitrust-hydroxychloroquine-settlement.html
According to the NY Times:oLawyers for Teva, which prosecutors believe was deeply involved in the conspiracy, until recently had been holding settlement negotiations with officials in the Justice Department’s antitrust division. But in April, the company all but walked away from the talks, essentially daring the Trump administration to file charges, according to people on both sides of the discussions.
The Times article is at https://www.nytimes.com/2020/05/15/us/politics/teva-antitrust-hydroxychloroquine-settlement.html
The nonprofit organization run by President Donald Trump’s nominee to lead the federal agency with oversight of Voice of America is under investigation by the District of Columbia attorney general’s office.
The DC attorney general’s office is investigating whether Michael Pack’s use of funds from his nonprofit, Public Media Lab, was unlawful and whether he improperly used those funds to benefit himself.
The U.S. Agency for Global Media, the agency Pack is nominated to head, is the agency that oversees U.S. government broadcasting, including the Voice of America, among others.
New Jersey Senator Menendez said that since Pack's confirmation hearing in September, “Mr. Pack has refused to provide the Senate Foreign Relations Committee with documents it requested that get to the heart of the matter that the OAG (Office of Attorney General) is now investigating, or to correct false statements he made to the IRS.”
From https://www.voanews.com/usa/nominee-lead-us-media-agency-under-investigation
The DC attorney general’s office is investigating whether Michael Pack’s use of funds from his nonprofit, Public Media Lab, was unlawful and whether he improperly used those funds to benefit himself.
The U.S. Agency for Global Media, the agency Pack is nominated to head, is the agency that oversees U.S. government broadcasting, including the Voice of America, among others.
New Jersey Senator Menendez said that since Pack's confirmation hearing in September, “Mr. Pack has refused to provide the Senate Foreign Relations Committee with documents it requested that get to the heart of the matter that the OAG (Office of Attorney General) is now investigating, or to correct false statements he made to the IRS.”
From https://www.voanews.com/usa/nominee-lead-us-media-agency-under-investigation
From Public Citizen
Senate Judiciary Committee holds hearing on proposal to eliminate business liability to consumers for infecting them with Covid-19
Posted: 13 May 2020 09:22 AM PDT
by Jeff Sovern
The video and prepared testimony is here. If you have time to read only one, I recommend David Vladeck's excellent statement.
Though Senate Majority Leader Mitch McConnell has described this terrible proposal as a "red line" for future coronavirus bills, it appears he does not have the full support of his caucus. Republican Senator Mike Lee expressed concerns about the intrusion of a federal law into the state torts domain.
Senate Judiciary Committee holds hearing on proposal to eliminate business liability to consumers for infecting them with Covid-19
Posted: 13 May 2020 09:22 AM PDT
by Jeff Sovern
The video and prepared testimony is here. If you have time to read only one, I recommend David Vladeck's excellent statement.
Though Senate Majority Leader Mitch McConnell has described this terrible proposal as a "red line" for future coronavirus bills, it appears he does not have the full support of his caucus. Republican Senator Mike Lee expressed concerns about the intrusion of a federal law into the state torts domain.
Business Journal: How much liability should companies bear from workers and from customers by reopening in the midst of the pandemic?
The National Federation of Independent Business has proposed Liability Protection Principles that address coronavirus-related claims with employees through the worker's compensation system. The group proposes protections from customer claims unless a customer can prove injury and that a business knowingly neglected to develop a reasonable plan for reducing exposure to the coronavirus. NFIB also suggests that only those hospitalized with Covid-19 should be allowed to sue, with fines for “unscrupulous trial attorneys bringing frivolous Covid-19-related lawsuits.”
Worker and consumer advocates have cautioned against such measures. A coalition of labor unions, consumer rights groups and legal organizations strongly opposes any legislation that would grant nationwide immunity for businesses “that operate in an unreasonably unsafe manner” during the pandemic, according to a letter sent by a coalition of groups to U.S. House and Senate leaders. [The letter is at https://centerjd.org/content/group-letter-congress-opposing-business-immunity?]
Credit: Business Journal National Observer
An estimated 27 million Americans have lost employer-based health coverage during the pandemic
That is according to an analysis from the Kaiser Family Foundation. The estimate includes Americans who lost their employer-based health insurance and those whose family member lost their job and accompanying insurance. KFF estimates that 12.7 million people — nearly half of those who recently lost coverage — are eligible for Medicaid. Another 8.4 million are eligible for ACA marketplace subsidies. KFF also projects that 19 million people will switch to coverage offered by their partner's employer.
That is according to an analysis from the Kaiser Family Foundation. The estimate includes Americans who lost their employer-based health insurance and those whose family member lost their job and accompanying insurance. KFF estimates that 12.7 million people — nearly half of those who recently lost coverage — are eligible for Medicaid. Another 8.4 million are eligible for ACA marketplace subsidies. KFF also projects that 19 million people will switch to coverage offered by their partner's employer.
From DMN: Will Giants Rule the Post-COVID Music Industry? Artist Rights Alliance, Future of Music Coalition Support the Pandemic Anti-Monopoly Act
Amid widespread fiscal tumult and economic uncertainty, 25 organizations, including the Artist Rights Alliance (ARA), the Future of Music Coalition, and MoveOn, have sent a letter to Congress in support of the Pandemic Anti-Monopoly Act.
The story continues here. https://www.digitalmusicnews.com/2020/05/08/post-covid-music-industry/
From DMN: 46 Music and Film Organizations Tell Congress: ‘The Reality of Our Situation Is Dire’
46 film and music organizations have submitted a letter to Congress highlighting perceived shortcomings in the $2.2 trillion CARES Act, as well as possible ways to address these points in future economic-aid legislation. The letter points to a seriously dire financial situation for creative professionals.
The story continues here. https://www.digitalmusicnews.com/2020/05/08/music-film-organizations-call-on-congress/
Amid widespread fiscal tumult and economic uncertainty, 25 organizations, including the Artist Rights Alliance (ARA), the Future of Music Coalition, and MoveOn, have sent a letter to Congress in support of the Pandemic Anti-Monopoly Act.
The story continues here. https://www.digitalmusicnews.com/2020/05/08/post-covid-music-industry/
From DMN: 46 Music and Film Organizations Tell Congress: ‘The Reality of Our Situation Is Dire’
46 film and music organizations have submitted a letter to Congress highlighting perceived shortcomings in the $2.2 trillion CARES Act, as well as possible ways to address these points in future economic-aid legislation. The letter points to a seriously dire financial situation for creative professionals.
The story continues here. https://www.digitalmusicnews.com/2020/05/08/music-film-organizations-call-on-congress/
More from Washington Business Journal: Covid-19 lawsuits? Battle lines form over whether businesses should be liable.
By Andy Medici / As economies and businesses reopen, the potential grounds for lawsuits will become a defining debate during the next congressional stimulus discussions.
Read Full Article https://www.bizjournals.com/washington/news/2020/05/08/worried-about-covid-19-lawsuits-battle-lines-form.html?
By Andy Medici / As economies and businesses reopen, the potential grounds for lawsuits will become a defining debate during the next congressional stimulus discussions.
Read Full Article https://www.bizjournals.com/washington/news/2020/05/08/worried-about-covid-19-lawsuits-battle-lines-form.html?
Much-anticipated CDC guidelines advising businesses and schools how they should reopen reportedly remain in limbo
Many companies reportedly are seeking out other sources for assistance on how to operate through an unprecedented crisis.
Click to read the leaked CDC "draft" guidelines: https://www.mercurynews.com/2020/05/07/read-full-text-of-cdc-reopening-guidelines-that-white-house-rejected/
Many companies reportedly are seeking out other sources for assistance on how to operate through an unprecedented crisis.
Click to read the leaked CDC "draft" guidelines: https://www.mercurynews.com/2020/05/07/read-full-text-of-cdc-reopening-guidelines-that-white-house-rejected/
To save their music venue businesses, more than 1,200 venues and promoters have formed an advocacy group, the National Independent Venue Association, with Dayna Frank as its board president.
The group does not include any venues owned by AEG or Live Nation.
Like other small companies, the venue operators say that Congress’s initial relief bills, like the $2 trillion CARES Act, were ill-suited to their business. Three-quarters of loan funds, for example, must go to payroll expenses within two months — though many promoters have had to furlough their employees, and worry it may be half a year before they have another show to staff. The new trade group has retained Akin Gump Strauss Hauer & Feld, the powerhouse lobbying firm, and its requests for lawmakers include tax relief and more flexible loan programs.
From https://www.nytimes.com/2020/05/06/arts/music/independent-venues-coronavirus.html
The group does not include any venues owned by AEG or Live Nation.
Like other small companies, the venue operators say that Congress’s initial relief bills, like the $2 trillion CARES Act, were ill-suited to their business. Three-quarters of loan funds, for example, must go to payroll expenses within two months — though many promoters have had to furlough their employees, and worry it may be half a year before they have another show to staff. The new trade group has retained Akin Gump Strauss Hauer & Feld, the powerhouse lobbying firm, and its requests for lawmakers include tax relief and more flexible loan programs.
From https://www.nytimes.com/2020/05/06/arts/music/independent-venues-coronavirus.html
WSJ video: slow consumer spending=possible slow recovery
https://www.wsj.com/video/the-latest-consumer-spending-report-explained/14661D9B-8251-43EB-B082-EDDE09187E2F.html
https://www.wsj.com/video/the-latest-consumer-spending-report-explained/14661D9B-8251-43EB-B082-EDDE09187E2F.html
EU Consumer Group Says Amazon/eBay Should Be Liable For Faulty Goods
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May 5, 2020Online marketplaces such as Amazon and eBay should be liable for any faulty and unsafe goods they sell, claimed the EU’s biggest consumer group, as Brussels prepares to overhaul its rules for internet platforms, reported the Financial Times.
The EU consumers’ organization (Beuc), which represents consumer bodies across 32 countries, accused online platforms of selling a wide range of goods that do not comply with EU safety standards.
In a test in February of 250 electrical goods, toys, cosmetics, and other products from Amazon, AliExpress, eBay, and Wish, two-thirds failed European safety laws. “The consequences for consumers, including children, of buying such failing products could range from electric shock, to fire or suffocation,” stated Beuc.
Platforms also needed to take more responsibility during the coronavirus crisis for the “numerous products with untenable health claims being marketed online.” Maryant Fernández, senior digital policy officer at Beuc, said the pandemic illustrated perfectly “the power and influence that online platforms can have on our society and our economy.”
“E-commerce shops have become more relevant than ever during the pandemic and we need to hold them accountable,” she said. “It cannot continue to be the case that it’s very easy for a platform to make money from illegal online sales, but that it’s very difficult to put an end to them.”
Full Content: Financ
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May 5, 2020Online marketplaces such as Amazon and eBay should be liable for any faulty and unsafe goods they sell, claimed the EU’s biggest consumer group, as Brussels prepares to overhaul its rules for internet platforms, reported the Financial Times.
The EU consumers’ organization (Beuc), which represents consumer bodies across 32 countries, accused online platforms of selling a wide range of goods that do not comply with EU safety standards.
In a test in February of 250 electrical goods, toys, cosmetics, and other products from Amazon, AliExpress, eBay, and Wish, two-thirds failed European safety laws. “The consequences for consumers, including children, of buying such failing products could range from electric shock, to fire or suffocation,” stated Beuc.
Platforms also needed to take more responsibility during the coronavirus crisis for the “numerous products with untenable health claims being marketed online.” Maryant Fernández, senior digital policy officer at Beuc, said the pandemic illustrated perfectly “the power and influence that online platforms can have on our society and our economy.”
“E-commerce shops have become more relevant than ever during the pandemic and we need to hold them accountable,” she said. “It cannot continue to be the case that it’s very easy for a platform to make money from illegal online sales, but that it’s very difficult to put an end to them.”
Full Content: Financ
California sue Uber and Lyft, alleging the ride-hailing companies have illegally treated their drivers as independent contractors
Misclassification is alleged to deprive drivers of worker protections and benefits such as minimum wage and unemployment insurance.
The lawsuit, brought by state Atty. Gen. Xavier Becerra and the city attorneys of Los Angeles, San Diego and San Francisco, seeks restitution for unpaid wages it says are owed to drivers, and it requests that the court force the companies to immediately classify their drivers as employees.
Full article: https://www.latimes.com/business/technology/story/2020-05-05/california-sues-uber-lyft-alleging-ab5-worker-misclassification
Misclassification is alleged to deprive drivers of worker protections and benefits such as minimum wage and unemployment insurance.
The lawsuit, brought by state Atty. Gen. Xavier Becerra and the city attorneys of Los Angeles, San Diego and San Francisco, seeks restitution for unpaid wages it says are owed to drivers, and it requests that the court force the companies to immediately classify their drivers as employees.
Full article: https://www.latimes.com/business/technology/story/2020-05-05/california-sues-uber-lyft-alleging-ab5-worker-misclassification
The consensus of investment gurus is that the stock market is overvalued, suggesting future problems for the rest of us.
By Don Allen Resnikoff
For those of us who pay some attention to financial news, Bloomberg and CNBC on TV, The WSJ Journal, etc., it is hard not to notice that most investment gurus think that the stock market is overvalued. The stories noted below are illustrative.
Here's what the Marketwatch piece has to say, in part:
An environment of low interest rates has set off a search for yield and created stretched valuations in risk assets, including the U.S. equity market, according to an International Monetary Fund report released Wednesday.
“Equity markets appear to be overvalued in Japan and the United States,” the IMF said, in its latest Global Financial Stability report.
The U.S. stock market just became overvalued since the spring. When markets have stretched valuations, it raises the possibility of sharp sudden adjustments, the report warned.
The IMF said investors seem to believe that the Federal Reserve and other central banks will respond quickly to sharp tightening in financial conditions, “hence implicitly providing insurance against significant declines in stock prices.”
If the stock market is overvalued, then what may follow is a correction, obviously. For those whose money comes from wages, and not stockholdings, the problems that may follow are similarly obvious. In the 2008 meltdown, a serious stock market correction was a companion to a recession that was very painful for ordinary consumers. The number of jobless workers more than doubled in the aftermath while the stock market lost more than half its value.
The New York Times reports that some veterans of that 2008 tailspin — the worst since the Great Depression — say today’s epidemic is hammering the economy in complex ways that could prove even more difficult to combat. “The problem is everyone in America is cutting back their consumption,” said Jason Furman, who led the Council of Economic Advisers during the Obama administration. “A lot of sectors are being hit, especially the services sector. A lot of income and spending is being reduced. That’s just an enormous shock to the economy.”
https://www.forbes.com/sites/garrettgunderson/2020/03/10/the-stock-market-is-overvalued-heres-why/#54814edefb7e
https://www.marketwatch.com/story/us-stock-market-is-overvalued-imf-says-2019-10-16
https://www.fool.com/investing/2020/04/29/the-market-is-overvalued-these-two-stocks-prove-it.aspx
By Don Allen Resnikoff
For those of us who pay some attention to financial news, Bloomberg and CNBC on TV, The WSJ Journal, etc., it is hard not to notice that most investment gurus think that the stock market is overvalued. The stories noted below are illustrative.
Here's what the Marketwatch piece has to say, in part:
An environment of low interest rates has set off a search for yield and created stretched valuations in risk assets, including the U.S. equity market, according to an International Monetary Fund report released Wednesday.
“Equity markets appear to be overvalued in Japan and the United States,” the IMF said, in its latest Global Financial Stability report.
The U.S. stock market just became overvalued since the spring. When markets have stretched valuations, it raises the possibility of sharp sudden adjustments, the report warned.
The IMF said investors seem to believe that the Federal Reserve and other central banks will respond quickly to sharp tightening in financial conditions, “hence implicitly providing insurance against significant declines in stock prices.”
If the stock market is overvalued, then what may follow is a correction, obviously. For those whose money comes from wages, and not stockholdings, the problems that may follow are similarly obvious. In the 2008 meltdown, a serious stock market correction was a companion to a recession that was very painful for ordinary consumers. The number of jobless workers more than doubled in the aftermath while the stock market lost more than half its value.
The New York Times reports that some veterans of that 2008 tailspin — the worst since the Great Depression — say today’s epidemic is hammering the economy in complex ways that could prove even more difficult to combat. “The problem is everyone in America is cutting back their consumption,” said Jason Furman, who led the Council of Economic Advisers during the Obama administration. “A lot of sectors are being hit, especially the services sector. A lot of income and spending is being reduced. That’s just an enormous shock to the economy.”
https://www.forbes.com/sites/garrettgunderson/2020/03/10/the-stock-market-is-overvalued-heres-why/#54814edefb7e
https://www.marketwatch.com/story/us-stock-market-is-overvalued-imf-says-2019-10-16
https://www.fool.com/investing/2020/04/29/the-market-is-overvalued-these-two-stocks-prove-it.aspx
D.C. is getting a pair of new hospitals
Excerpt of article by By Sara Gilgore and Drew Hansen – Washington Business Journal May 1, 2020, 2:39pm EDT
While two new D.C. hospitals aren’t done deals just yet, the District’s agreements for both projects bring more clarity to two situations that have been riddled with unknowns.
The new hospitals — a Ward 8 facility at the St. Elizabeths East campus in Southeast, to be run by George Washington University Hospital majority owner Universal Health Services Inc. (NYSE: UHS), and a new hospital on Howard University’s campus in Northwest — would create a comprehensive and integrated system of care for some of the city’s most vulnerable residents, a need only underscored by the coronavirus pandemic and health disparities that stand to further worsen patient outcomes.
See for full article: https://www.bizjournals.com/washington/news/2020/05/01/d-c-is-getting-a-pair-of-new-hospitals-here-are-5.html?ana=e_wash_bn_editorschoice_editorschoice&j=90506553&t=Breaking%20News&mkt_tok=eyJpIjoiTVRReFlUSTBZelprTkRreCIsInQiOiJGaDRwVVwvTEdlaWt2cnE3UGt5WGhDZDkwS0F5dm94MUdIa2pHVE9rOG5IVk5ERmFWMWwxaFlJY1E4MUVPMVhGV1h3SU1qNExlZFcwUE0zbktnUDVGNXZZN1JSQ0x0bjBpV3RiTUNLcmJDS1NSZUtPVUpRTU5sM3F2NEZ2QWpoeUlEd3YwNndzV29Yb0JvcmNrOTdMWG5nPT0ifQ%3D%3D
Excerpt of article by By Sara Gilgore and Drew Hansen – Washington Business Journal May 1, 2020, 2:39pm EDT
While two new D.C. hospitals aren’t done deals just yet, the District’s agreements for both projects bring more clarity to two situations that have been riddled with unknowns.
The new hospitals — a Ward 8 facility at the St. Elizabeths East campus in Southeast, to be run by George Washington University Hospital majority owner Universal Health Services Inc. (NYSE: UHS), and a new hospital on Howard University’s campus in Northwest — would create a comprehensive and integrated system of care for some of the city’s most vulnerable residents, a need only underscored by the coronavirus pandemic and health disparities that stand to further worsen patient outcomes.
See for full article: https://www.bizjournals.com/washington/news/2020/05/01/d-c-is-getting-a-pair-of-new-hospitals-here-are-5.html?ana=e_wash_bn_editorschoice_editorschoice&j=90506553&t=Breaking%20News&mkt_tok=eyJpIjoiTVRReFlUSTBZelprTkRreCIsInQiOiJGaDRwVVwvTEdlaWt2cnE3UGt5WGhDZDkwS0F5dm94MUdIa2pHVE9rOG5IVk5ERmFWMWwxaFlJY1E4MUVPMVhGV1h3SU1qNExlZFcwUE0zbktnUDVGNXZZN1JSQ0x0bjBpV3RiTUNLcmJDS1NSZUtPVUpRTU5sM3F2NEZ2QWpoeUlEd3YwNndzV29Yb0JvcmNrOTdMWG5nPT0ifQ%3D%3D
From Andy Medici – Washington Business Journal
Apr 30, 2020, 12:11pm EDT Updated Apr 30, 2020, 1:59pm EDT
The Federal Reserve has expanded its $600 billion Main Street Lending Program to serve much smaller businesses.
The move, announced Thursday, comes after the Federal Reserve accepted more than 2,200 comments about the proposed lending program from people, businesses and nonprofits. And while the program was first announced April 9, the Fed has yet to set a start date, saying that will be "announced soon."
As for the expanded program, here's what you need to know:
The Main Street Lending Program is funded by $75 billion from the the $2.3 trillion CARES Act signed into law March 27 and is part of a larger $454 billion in CARES Act funding earmarked for the Fed to help backstop programs meant to help businesses. The money bolsters the Fed’s ability to add credit to the existing monetary system, thus increasing the overall amount of dollars available to lend and fuels a slate of new programs meant to combat the economic damage caused by Covid-19 and social distancing measures put in place in recent weeks.
The other Federal Reserve programs include a loan facility for the PPP to allow banks to lend more to their customers by using existing loans as collateral for fresh money, as well as a new Municipal Liquidity Facility that will buy up to $500 billion in state and local governments' debt to allow them to continue to borrow at reasonable rates — and avoid drastic cuts in services and jobs when citizens and small businesses need them most.
The changes also come as hundreds of thousands of small businesses rush to claim a portion of the hundreds of billions of dollars set aside for the second round of the SBA's PPP, a forgivable loan in which most of the proceeds must go to payroll expenses. That money is expected to be fully authorized in the next few days.
Apr 30, 2020, 12:11pm EDT Updated Apr 30, 2020, 1:59pm EDT
The Federal Reserve has expanded its $600 billion Main Street Lending Program to serve much smaller businesses.
The move, announced Thursday, comes after the Federal Reserve accepted more than 2,200 comments about the proposed lending program from people, businesses and nonprofits. And while the program was first announced April 9, the Fed has yet to set a start date, saying that will be "announced soon."
As for the expanded program, here's what you need to know:
- The minimum loan amount under the program will now be $500,000 for new loans and priority loans, down from the originally proposed $1 million, opening up the program to smaller businesses. The "expanded" loan type will be a minimum of $10 million, designed for larger businesses.
- The ceiling for loans will also be raised to companies with up to 15,000 employees or up to $5 billion in annual revenue, compared with original thresholds of 10,000 employees or $2.5 billion in revenue when the program was first announced. That means much larger companies will now qualify for the program.
- There will be a new type of "priority loan" in which the Federal Reserve will buy 85% of the loan made by a bank, as opposed to the 95% the Fed will buy through its Main Street New Loan Facility and Main Street Expanded Loan Facility, announced earlier this month.
- All the loans will be for four-year terms with an adjustable rate of the London Interbank Offered Rate, or Libor, plus 3%,which means a range of around 2.5% to 4%, with interest and payments deferred for a year.
- Companies that have received funding from the Small Business Administration's Paycheck Protection Program can still be eligible for Main Street funding provided they meet the latter program's criteria.
- For qualifying businesses, the process is the same as with the PPP: Go through partner banks to either take out new Main Street loans or receive boosts to existing loans. The businesses must “commit to make reasonable efforts” to maintain staffs and payroll.
The Main Street Lending Program is funded by $75 billion from the the $2.3 trillion CARES Act signed into law March 27 and is part of a larger $454 billion in CARES Act funding earmarked for the Fed to help backstop programs meant to help businesses. The money bolsters the Fed’s ability to add credit to the existing monetary system, thus increasing the overall amount of dollars available to lend and fuels a slate of new programs meant to combat the economic damage caused by Covid-19 and social distancing measures put in place in recent weeks.
The other Federal Reserve programs include a loan facility for the PPP to allow banks to lend more to their customers by using existing loans as collateral for fresh money, as well as a new Municipal Liquidity Facility that will buy up to $500 billion in state and local governments' debt to allow them to continue to borrow at reasonable rates — and avoid drastic cuts in services and jobs when citizens and small businesses need them most.
The changes also come as hundreds of thousands of small businesses rush to claim a portion of the hundreds of billions of dollars set aside for the second round of the SBA's PPP, a forgivable loan in which most of the proceeds must go to payroll expenses. That money is expected to be fully authorized in the next few days.
PBS Newshour presents Main Street Alliance's Amanda Ballantyne and Brad Close of the National Federation of Independent Businesses and others on shortfalls of CARES Act help to very small businesses and non-profits
https://www.youtube.com/watch?v=hgjoYlrxLW8
The distribution of CARES Act that money continues to be a source of controversy, and the program has been mired with technical problems. PBS reports and talks to the Main Street Alliance's Amanda Ballantyne and Brad Close of the National Federation of Independent Businesses.
The discussants do a good job of pointing out shortfalls in the CARES Act.
Postin by DAR-- opinon expressed is his responsibility
https://www.youtube.com/watch?v=hgjoYlrxLW8
The distribution of CARES Act that money continues to be a source of controversy, and the program has been mired with technical problems. PBS reports and talks to the Main Street Alliance's Amanda Ballantyne and Brad Close of the National Federation of Independent Businesses.
The discussants do a good job of pointing out shortfalls in the CARES Act.
Postin by DAR-- opinon expressed is his responsibility
It is bad but it could be even worse: Because farmers have been plowing under vegetable fields, dumping milk and smashing eggs that cannot be sold because the coronavirus pandemic has shut down restaurants, hotels and schools, there is action by the Trump administration and state governments, as well as grass-roots efforts.
Over the next few weeks, the Department of Agriculture will begin spending $300 million a month to buy surplus vegetables, fruit, milk and meat from distributors and ship them to food banks. The federal grants will also subsidize boxing up the purchases and transporting them to charitable groups — tasks that farmers have said they cannot afford, giving them few options other than to destroy the food.
Gov. Andrew M. Cuomo’s office has said New York will give food banks $25 million to buy products made from excess milk on farms in the state; the state is working with manufacturers like Chobani, Hood and Cabot to turn the milk into cheese, yogurt and butter. Some of the state subsidy can also be used to buy apples, potatoes and other produce that farms have in storage.
Nationally, the Dairy Farmers of America, the largest dairy co-op in the United States, has diverted almost a quarter of a million gallons of milk to food banks.
“It’s just a drop in the bucket,” said Jackie Klippenstein, a senior vice president at the co-op. “But we had to do something.”
* * *
“These are not insolvable problems,” said Marion Nestle, a food studies professor at New York University. “These are problems that require a lot of people, sums of money and some thought. If the government were really interested in making sure that hungry people got fed and farmers were supported, they would figure out a way to do it.”
From https://www.msn.com/en-us/news/us/we-had-to-do-something-trying-to-prevent-massive-food-waste/ar-BB13wa4I?ocid=msedgdhp
Private school Sidwell Friends decision to accept Federal Cares Act fund makes the news
On Wednesday, the board of trustees at Sidwell Friends, Chelsea Clinton’s alma mater, said in a memo to the school community that it would accept a $5.2 million loan “in light of actual and anticipated shortfalls, mounting uncertainty” and “the importance of maintaining employment levels.”
“We recognize that our decision to accept this loan may draw criticism from some quarters of the community,” said the school, which has a $53.4 million endowment, “but are fully united in our decision.”
Continue reading the story https://www.nytimes.com/2020/04/29/us/prep-schools-coronavirus-loans.html#after-story-ad-2
Sidwell Friends Philosophy Statement-- https://www.sidwell.edu/about
Sidwell Friends School is a dynamic educational community grounded in the Quaker belief that there is “that of God in everyone.” Individually and collectively, we challenge ourselves to pursue excellence in academic, athletic, and artistic realms. We are committed to the joys of exploration and discovery. Differences among us enhance intellectual inquiry, expand understanding, and deepen empathy. The Quaker pillars of the School inspire active engagement in environmental stewardship, global citizenship, and service. We find strength in reflection and shared silence. At the heart of each endeavor, we strive to discern deeper truths about ourselves and our common humanity, preparing students and adults to “let their lives speak.”
Board of Trustees
Approved September 10, 2015
On Wednesday, the board of trustees at Sidwell Friends, Chelsea Clinton’s alma mater, said in a memo to the school community that it would accept a $5.2 million loan “in light of actual and anticipated shortfalls, mounting uncertainty” and “the importance of maintaining employment levels.”
“We recognize that our decision to accept this loan may draw criticism from some quarters of the community,” said the school, which has a $53.4 million endowment, “but are fully united in our decision.”
Continue reading the story https://www.nytimes.com/2020/04/29/us/prep-schools-coronavirus-loans.html#after-story-ad-2
Sidwell Friends Philosophy Statement-- https://www.sidwell.edu/about
Sidwell Friends School is a dynamic educational community grounded in the Quaker belief that there is “that of God in everyone.” Individually and collectively, we challenge ourselves to pursue excellence in academic, athletic, and artistic realms. We are committed to the joys of exploration and discovery. Differences among us enhance intellectual inquiry, expand understanding, and deepen empathy. The Quaker pillars of the School inspire active engagement in environmental stewardship, global citizenship, and service. We find strength in reflection and shared silence. At the heart of each endeavor, we strive to discern deeper truths about ourselves and our common humanity, preparing students and adults to “let their lives speak.”
Board of Trustees
Approved September 10, 2015
Maryland cancels a $12.5 million order of masks and other personal protective equipment from a politically connected firm, and had asked the state attorney general’s office to investigate whether the company misrepresented its ability to deliver the badly needed supplies.
The state signed a purchase order on April 1 to buy the supplies from Blue Flame Medical, a recently launched firm led by John Thomas, a Republican political strategist, and Mike Gula, a Republican fund-raiser, according to a state official. Maryland paid the firm a 50 percent down payment of $6,271,000, the official said.
The shipping date for the order was April 14, and Maryland’s Department of General Services issued a warning letter to the company on Thursday, when there was no indication that the supplies were on their way, the official said. State officials then moved to cancel the order.
“We have determined that since it has been one month since the order was placed with no confirmation of shipment, we are in the process of canceling the order and have referred this matter to the attorney general,” said Nick Cavey, a spokesman for the Maryland Department of General Services.
From: https://www.nytimes.com/2020/05/02/us/coronavirus-updates.html
The state signed a purchase order on April 1 to buy the supplies from Blue Flame Medical, a recently launched firm led by John Thomas, a Republican political strategist, and Mike Gula, a Republican fund-raiser, according to a state official. Maryland paid the firm a 50 percent down payment of $6,271,000, the official said.
The shipping date for the order was April 14, and Maryland’s Department of General Services issued a warning letter to the company on Thursday, when there was no indication that the supplies were on their way, the official said. State officials then moved to cancel the order.
“We have determined that since it has been one month since the order was placed with no confirmation of shipment, we are in the process of canceling the order and have referred this matter to the attorney general,” said Nick Cavey, a spokesman for the Maryland Department of General Services.
From: https://www.nytimes.com/2020/05/02/us/coronavirus-updates.html
The text of the CDC recommendations affected by the President's Executive Order that meat plants open
https://covid.sd.gov/docs/smithfield_recs.pdf
Court orders Smithfield Foods to comply with health guidelines
See https://www.meatpoultry.com/articles/23035-court-orders-smithfield-foods-to-comply-with-health-guidelines
Washington Post: President's Executive Order attempts to countermand the Court Order and CDC directives on safety in meat plants affected by COVID-19
https://www.washingtonpost.com/business/2020/04/28/trump-meat-plants-dpa/
https://covid.sd.gov/docs/smithfield_recs.pdf
Court orders Smithfield Foods to comply with health guidelines
See https://www.meatpoultry.com/articles/23035-court-orders-smithfield-foods-to-comply-with-health-guidelines
Washington Post: President's Executive Order attempts to countermand the Court Order and CDC directives on safety in meat plants affected by COVID-19
https://www.washingtonpost.com/business/2020/04/28/trump-meat-plants-dpa/
US Chamber of Commerce warns of impending harmful coronavirus lawsuit epidemic
April 24, 2020The world has not seen a pandemic like the coronavirus in a century. It will cost millions of Americans their jobs and tens of thousands of Americans their lives. While our nation struggles to address this pandemic and the recession it has created, we also face the possibility of a “lawsuit epidemic,” according to an editorial in The Wall Street Journal.
As the Journal writes, due to COVID-19 related stay at home orders, media consumption is at an all-time high, and the plaintiff bar is using that to their advantage by airing thousands of advertisements seeking clients. With America being inundated with these ads, it is likely that we will see a wave of COVID-19 related lawsuits. These lawsuits will cripple our nation’s economic recovery, and so it falls to Congress to ensure those businesses and healthcare workers operating in good faith aren’t rewarded with a lawsuit.
https://www.instituteforlegalreform.com/resource/the-wall-street-journal--stopping-a-lawsuit-epidemic
On the other hand, some say that Congressional action to limit company liability is a bad idea:
Unions and labor groups are concerned that any congressional action to limit company liability could put workers at risk. Jona Rosen, associate general counsel for the AFL-CIO, said the union opposes such proposals as they diminish employers' responsibility to provide a safe environment for workers during the crisis. She said the deadly outbreaks among meatpacking workers and transit workers reveal the "insufficient protections and insufficient concerns about the health and safety of people working in these jobs."
https://www.cnn.com/2020/04/29/business/business-liability-congress/index.html
April 24, 2020The world has not seen a pandemic like the coronavirus in a century. It will cost millions of Americans their jobs and tens of thousands of Americans their lives. While our nation struggles to address this pandemic and the recession it has created, we also face the possibility of a “lawsuit epidemic,” according to an editorial in The Wall Street Journal.
As the Journal writes, due to COVID-19 related stay at home orders, media consumption is at an all-time high, and the plaintiff bar is using that to their advantage by airing thousands of advertisements seeking clients. With America being inundated with these ads, it is likely that we will see a wave of COVID-19 related lawsuits. These lawsuits will cripple our nation’s economic recovery, and so it falls to Congress to ensure those businesses and healthcare workers operating in good faith aren’t rewarded with a lawsuit.
https://www.instituteforlegalreform.com/resource/the-wall-street-journal--stopping-a-lawsuit-epidemic
On the other hand, some say that Congressional action to limit company liability is a bad idea:
Unions and labor groups are concerned that any congressional action to limit company liability could put workers at risk. Jona Rosen, associate general counsel for the AFL-CIO, said the union opposes such proposals as they diminish employers' responsibility to provide a safe environment for workers during the crisis. She said the deadly outbreaks among meatpacking workers and transit workers reveal the "insufficient protections and insufficient concerns about the health and safety of people working in these jobs."
https://www.cnn.com/2020/04/29/business/business-liability-congress/index.html
Leading Cancer Treatment Center Admits to Antitrust Crime and Agrees to Pay $100 Million Criminal Penalty -- Florida Cancer Specialists & Research
Institute LLC (FCS), an oncology group headquartered in Fort Myers, Florida, was charged with conspiring to allocate medical and radiation oncology treatments for cancer patients in Southwest Florida, the Department of Justice announced. This charge is the first in the department’s ongoing investigation into market allocation in the oncology industry.
According to a one-count felony charge filed today in the U.S. District Court in Fort Myers, Florida, FCS participated in a criminal antitrust conspiracy with a competing oncology group in Collier, Lee, and Charlotte counties (Southwest Florida). FCS and its co-conspirators agreed not to compete to provide chemotherapy and radiation treatments to cancer patients in Southwest Florida. Beginning as early as 1999 and continuing until at least 2016, FCS entered into an illegal agreement that allocated chemotherapy treatments to FCS and radiation treatments to a competing oncology group. This conspiracy allowed FCS to operate with minimal competition in Southwest Florida and limited valuable integrated care options and choices for cancer patients.
The Antitrust Division also announced a deferred prosecution agreement (DPA) resolving the charge against FCS, under which the company admitted to conspiring to allocate chemotherapy and radiation treatments for cancer patients. FCS has agreed to pay a $100 million criminal penalty —the statutory maximum— and to cooperate fully with the Antitrust Division’s ongoing investigation. FCS has also agreed to maintain an effective compliance program designed to prevent and detect criminal antitrust violations.
From: https://www.justice.gov/opa/pr/leading-cancer-treatment-center-admits-antitrust-crime-and-agrees-pay-100-million-criminal
Robert Connolly, Former Antitrust Division prosecutor, published the following comment:.
Interesting, but sad to see case. Market Allocation. Another Deferred Prosecution Agreement. A continuing investigation. And very sad to see collusion against cancer patients. Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division said "For almost two decades, FCS and its co-conspirators agreed to cheat by limiting treatment options available to cancer patients in order to line their pockets. The Antitrust Division is continuing its investigation to ensure that all responsible participants are held accountable to the maximum extent possible.”
Institute LLC (FCS), an oncology group headquartered in Fort Myers, Florida, was charged with conspiring to allocate medical and radiation oncology treatments for cancer patients in Southwest Florida, the Department of Justice announced. This charge is the first in the department’s ongoing investigation into market allocation in the oncology industry.
According to a one-count felony charge filed today in the U.S. District Court in Fort Myers, Florida, FCS participated in a criminal antitrust conspiracy with a competing oncology group in Collier, Lee, and Charlotte counties (Southwest Florida). FCS and its co-conspirators agreed not to compete to provide chemotherapy and radiation treatments to cancer patients in Southwest Florida. Beginning as early as 1999 and continuing until at least 2016, FCS entered into an illegal agreement that allocated chemotherapy treatments to FCS and radiation treatments to a competing oncology group. This conspiracy allowed FCS to operate with minimal competition in Southwest Florida and limited valuable integrated care options and choices for cancer patients.
The Antitrust Division also announced a deferred prosecution agreement (DPA) resolving the charge against FCS, under which the company admitted to conspiring to allocate chemotherapy and radiation treatments for cancer patients. FCS has agreed to pay a $100 million criminal penalty —the statutory maximum— and to cooperate fully with the Antitrust Division’s ongoing investigation. FCS has also agreed to maintain an effective compliance program designed to prevent and detect criminal antitrust violations.
From: https://www.justice.gov/opa/pr/leading-cancer-treatment-center-admits-antitrust-crime-and-agrees-pay-100-million-criminal
Robert Connolly, Former Antitrust Division prosecutor, published the following comment:.
Interesting, but sad to see case. Market Allocation. Another Deferred Prosecution Agreement. A continuing investigation. And very sad to see collusion against cancer patients. Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division said "For almost two decades, FCS and its co-conspirators agreed to cheat by limiting treatment options available to cancer patients in order to line their pockets. The Antitrust Division is continuing its investigation to ensure that all responsible participants are held accountable to the maximum extent possible.”
AG James' Statement on Firing of Amazon Worker Who Organized Walkout
NEW YORK – New York Attorney General Letitia James tonight released the following statement in response to news that Amazon employee Chris Smalls was terminated today after he organized a walkout to protest health conditions at his workplace, amidst the coronavirus disease 2019 (COVID-19) outbreak:
“It is disgraceful that Amazon would terminate an employee who bravely stood up to protect himself and his colleagues. At the height of a global pandemic, Chris Smalls and his colleagues publicly protested the lack of precautions that Amazon was taking to protect them from COVID-19. Today, Chris Smalls was fired. In New York, the right to organize is codified into law, and any retaliatory action by management related thereto is strictly prohibited. At a time when so many New Yorkers are struggling and are deeply concerned about their safety, this action was also immoral and inhumane. The Office of the Attorney General is considering all legal options, and I am calling on the National Labor Relations Board to investigate this incident.”
Employees that believe their employers are in violation of either existing labor laws or recently issued New York State executive orders should contact the Office of the Attorney General by emailing Labor.Bureau@ag.ny.gov or calling (212) 416-8700 to file a complaint.
https://ag.ny.gov/press-release/2020/ag-james-statement-firing-amazon-worker-who-organized-walkout
NEW YORK – New York Attorney General Letitia James tonight released the following statement in response to news that Amazon employee Chris Smalls was terminated today after he organized a walkout to protest health conditions at his workplace, amidst the coronavirus disease 2019 (COVID-19) outbreak:
“It is disgraceful that Amazon would terminate an employee who bravely stood up to protect himself and his colleagues. At the height of a global pandemic, Chris Smalls and his colleagues publicly protested the lack of precautions that Amazon was taking to protect them from COVID-19. Today, Chris Smalls was fired. In New York, the right to organize is codified into law, and any retaliatory action by management related thereto is strictly prohibited. At a time when so many New Yorkers are struggling and are deeply concerned about their safety, this action was also immoral and inhumane. The Office of the Attorney General is considering all legal options, and I am calling on the National Labor Relations Board to investigate this incident.”
Employees that believe their employers are in violation of either existing labor laws or recently issued New York State executive orders should contact the Office of the Attorney General by emailing Labor.Bureau@ag.ny.gov or calling (212) 416-8700 to file a complaint.
https://ag.ny.gov/press-release/2020/ag-james-statement-firing-amazon-worker-who-organized-walkout
Fixing the CARES Act and its Payroll Protection Plan to help really small businesses, and non-profits
Posting by Don Allen Resnikoff
The media is full of sorrowful stories of very small business owners who have applied for help under the CARES Act and its Payroll Protection Plan (PPP) and been rejected. The media also reports stories of large public companies that qualified as small under the Cares Act and received large sums of money.
The New York Times reports that the average PPP loan size was about $200,000, but 4 percent of the loans accounted for 43 percent of the dollars. Nearly three-quarters of the loans made were for less than $150,000, but those loans accounted for only 17 percent of the funds. That report is based on government data at https://www.sba.gov/sites/default/files/2020-04/PPP%20Deck%20copy.pdf
The skew of lending to bigger businesses has fueled an outcry against companies like Ruth’s Chris Steak House, which got $20 million, and Shake Shack, which received $10 million. They were part of the 0.25 percent of the 1.66 million applicants that each received more than $5 million. Both companies have public-relations concerns and later announced that they would return the money, but many other similarly large companies that are less concerned with public relations did not return money.
There has also been an outcry against banks that gave CARES Act lending priority to relatively large businesses that were established bank customers, while giving short shrift to very small businesses. The experience of JPMorgan Chase customers, as recounted by the Philadephia Enquirer, tells the story. JPMorgan said it approved only 26,500 loans out of the 300,000 PPP applications, or about 9%. Of those, about 8,500 went to clients of JPMorgan’s elite wealth management and corporate banking departments. Most who applied through those bank departments were approved, unlike those who applied without that edge.
Some small businesses went so far as to bring litigation challenging Bank of America’s shutting them out, based on a Bank requirement that PPP applicants have a previous relationship with the Bank and have no lending relationship with any other bank. (See https://www.reuters.com/article/us-otc-ppp-idUSKCN21V20K)
Arguably the most important complaints about the CARES Act are not about business practices by banks that exclude very small business borrowers, or greed of big company borrowers like Shake Shack and Ruth’s Chris. As important as these are, the more important complaints may be about shortfalls in the legislative drafting of the CARES Act, particularly shortfalls not remedied by the April 23 Congressional statute providing more than $300 billion in new funding for the PPP. The April 23 statute did include some reforms, including broadening of lending institutions who can make PPP loans. The April 23 statute includes $60 billion of set-asides for issuance of PPP loans by community development lenders, credit unions and certain other smaller lenders.
It is important to focus on further needed improvements that will allow the CARES Act to better achieve its announced purpose, because the statute passed by the House on April 23, 2020 may not be the last.
Proposals discussed here for further improving the CARES Act simply reflect a few of the reform proposals previously raised by industry players. They illustrate the need for more discussion of improvements.
Perhaps the most obvious suggestion for improvement concerns the amounts of money available for small business and non-profit relief. The amounts made available in the new legislation are likely to run out well before all qualified small businesses and non-profits receive money. More money is likely to be needed.
Another obvious suggestion concerns the sort of legislative loopholes that allowed Ruth's Chis and Shake Shack to get money. The government has since published new guidance discouraging public companies from using the government program and urging those that did take the money to return it. But that guidance may not be a sufficient cure; better legislative drafting might help. It should be clear that large companies do not qualify for PPP loans.
Also, the entities chosen to administer the CARES program might be further improved -- the most recent statute's broadening of lending institutions that administer the PPP may not be enough. Alternatives include administering the CARES Act programs through strengthened government entities, and further expanding the list of private entities that can administer PPP loans.
With regard to financial institutions authorized to administer the PPP program, a major proposal is eliminating or reducing the requirement of the CARES Act that lenders apply the Bank Secrecy Act (BSA) provisions that require the lending institution to have a robust anti-money laundering (AML) and Know-Your-Customer (KYC) compliance program. The thought is that eliminating or reducing those requirements will facilitate lending to very small businesses and non-profits that are not well known to the lender. (See the April 21 commentary by Manatt, Phelps & Phillips, LLP at https://www.jdsupra.com/legalnews/bank-secrecy-act-compliance-issues-for-79714/)
A recent American Bankers Association letter reflected the concern that mandatory Know-Your-Customer (KYC) and anti-money laundering (AML) requirements impede CARES Act PPP loan process for small business applicants. The letter suggested the legislative improvement that banks be “exempt from collecting, identifying, verifying and certifying KYC/AMLinformation for accounts set up to accept funds provided under the CARES Act. This can easily be accomplished by exempting these loans from the definition of new accounts for the purposes of FinCEN requirements.” See https://www.aba.com/-/media/documents/letters-to-congress-and-regulators/aba-response-to-senators-kaine-coons-and-king-04132020.pdf?rev=2e24478b58c244cc8bf433d9eb3d7d7f
The perceived need for lending institutions to reach out into the broader community is not a new idea. The Community Reinvestment Act (CRA (12 U.S.C. 2901 et seq.) is a decades old statute designed to encourage regulated financial institutions to help meet the credit needs of their entire communities. CRA regulations require relevant government agencies to assess lending institutions’ record of helping to meet the credit needs of its community, including in low- and moderate-income neighborhoods.
Some have questioned the basic concept of keying small business loans to payroll costs. They suggest that the current focus on payroll prejudices businesses whose major expenses lie elsewhere, such as in storefront rent. One publication wrote: “PPP is a good start, but there's more to a business than meeting payroll . . . . The SBA has allowed PPP recipients some discretion in using loans to support overhead such as utilities, rent and debt service. But if, as the Business Journals survey suggests, most of those funds will be used for salaries and health care benefits for workers, then many PPP recipients will still be needing cash for other operating needs.”
Finally, with regard to regulatory agency implementation, some have wondered whether application requirements could be simplified so that forms like the one at https://home.treasury.gov/system/files/136/PPP-Borrower-Application-Form-Fillable.pdf could be more accessible to small businesses and non-profits that lack sophisticated accounting help. One suggestion would allow applicants to rely on IRS and other previously filed forms that contain needed information such as employee payroll data.
In summary, it is important to focus on further needed improvements that will allow the CARES Act to better achieve its announced purpose, because the statute passed by the House on April 23, 2020 may not be the last. Proposals discussed here for further improving the CARES Act simply reflect a few of the reform proposals previously raised by industry players. They illustrate the need for more discussion of improvements.
Don Allen Resnikoff takes full responsibility for the content of his posting
_
Posting by Don Allen Resnikoff
The media is full of sorrowful stories of very small business owners who have applied for help under the CARES Act and its Payroll Protection Plan (PPP) and been rejected. The media also reports stories of large public companies that qualified as small under the Cares Act and received large sums of money.
The New York Times reports that the average PPP loan size was about $200,000, but 4 percent of the loans accounted for 43 percent of the dollars. Nearly three-quarters of the loans made were for less than $150,000, but those loans accounted for only 17 percent of the funds. That report is based on government data at https://www.sba.gov/sites/default/files/2020-04/PPP%20Deck%20copy.pdf
The skew of lending to bigger businesses has fueled an outcry against companies like Ruth’s Chris Steak House, which got $20 million, and Shake Shack, which received $10 million. They were part of the 0.25 percent of the 1.66 million applicants that each received more than $5 million. Both companies have public-relations concerns and later announced that they would return the money, but many other similarly large companies that are less concerned with public relations did not return money.
There has also been an outcry against banks that gave CARES Act lending priority to relatively large businesses that were established bank customers, while giving short shrift to very small businesses. The experience of JPMorgan Chase customers, as recounted by the Philadephia Enquirer, tells the story. JPMorgan said it approved only 26,500 loans out of the 300,000 PPP applications, or about 9%. Of those, about 8,500 went to clients of JPMorgan’s elite wealth management and corporate banking departments. Most who applied through those bank departments were approved, unlike those who applied without that edge.
Some small businesses went so far as to bring litigation challenging Bank of America’s shutting them out, based on a Bank requirement that PPP applicants have a previous relationship with the Bank and have no lending relationship with any other bank. (See https://www.reuters.com/article/us-otc-ppp-idUSKCN21V20K)
Arguably the most important complaints about the CARES Act are not about business practices by banks that exclude very small business borrowers, or greed of big company borrowers like Shake Shack and Ruth’s Chris. As important as these are, the more important complaints may be about shortfalls in the legislative drafting of the CARES Act, particularly shortfalls not remedied by the April 23 Congressional statute providing more than $300 billion in new funding for the PPP. The April 23 statute did include some reforms, including broadening of lending institutions who can make PPP loans. The April 23 statute includes $60 billion of set-asides for issuance of PPP loans by community development lenders, credit unions and certain other smaller lenders.
It is important to focus on further needed improvements that will allow the CARES Act to better achieve its announced purpose, because the statute passed by the House on April 23, 2020 may not be the last.
Proposals discussed here for further improving the CARES Act simply reflect a few of the reform proposals previously raised by industry players. They illustrate the need for more discussion of improvements.
Perhaps the most obvious suggestion for improvement concerns the amounts of money available for small business and non-profit relief. The amounts made available in the new legislation are likely to run out well before all qualified small businesses and non-profits receive money. More money is likely to be needed.
Another obvious suggestion concerns the sort of legislative loopholes that allowed Ruth's Chis and Shake Shack to get money. The government has since published new guidance discouraging public companies from using the government program and urging those that did take the money to return it. But that guidance may not be a sufficient cure; better legislative drafting might help. It should be clear that large companies do not qualify for PPP loans.
Also, the entities chosen to administer the CARES program might be further improved -- the most recent statute's broadening of lending institutions that administer the PPP may not be enough. Alternatives include administering the CARES Act programs through strengthened government entities, and further expanding the list of private entities that can administer PPP loans.
With regard to financial institutions authorized to administer the PPP program, a major proposal is eliminating or reducing the requirement of the CARES Act that lenders apply the Bank Secrecy Act (BSA) provisions that require the lending institution to have a robust anti-money laundering (AML) and Know-Your-Customer (KYC) compliance program. The thought is that eliminating or reducing those requirements will facilitate lending to very small businesses and non-profits that are not well known to the lender. (See the April 21 commentary by Manatt, Phelps & Phillips, LLP at https://www.jdsupra.com/legalnews/bank-secrecy-act-compliance-issues-for-79714/)
A recent American Bankers Association letter reflected the concern that mandatory Know-Your-Customer (KYC) and anti-money laundering (AML) requirements impede CARES Act PPP loan process for small business applicants. The letter suggested the legislative improvement that banks be “exempt from collecting, identifying, verifying and certifying KYC/AMLinformation for accounts set up to accept funds provided under the CARES Act. This can easily be accomplished by exempting these loans from the definition of new accounts for the purposes of FinCEN requirements.” See https://www.aba.com/-/media/documents/letters-to-congress-and-regulators/aba-response-to-senators-kaine-coons-and-king-04132020.pdf?rev=2e24478b58c244cc8bf433d9eb3d7d7f
The perceived need for lending institutions to reach out into the broader community is not a new idea. The Community Reinvestment Act (CRA (12 U.S.C. 2901 et seq.) is a decades old statute designed to encourage regulated financial institutions to help meet the credit needs of their entire communities. CRA regulations require relevant government agencies to assess lending institutions’ record of helping to meet the credit needs of its community, including in low- and moderate-income neighborhoods.
Some have questioned the basic concept of keying small business loans to payroll costs. They suggest that the current focus on payroll prejudices businesses whose major expenses lie elsewhere, such as in storefront rent. One publication wrote: “PPP is a good start, but there's more to a business than meeting payroll . . . . The SBA has allowed PPP recipients some discretion in using loans to support overhead such as utilities, rent and debt service. But if, as the Business Journals survey suggests, most of those funds will be used for salaries and health care benefits for workers, then many PPP recipients will still be needing cash for other operating needs.”
Finally, with regard to regulatory agency implementation, some have wondered whether application requirements could be simplified so that forms like the one at https://home.treasury.gov/system/files/136/PPP-Borrower-Application-Form-Fillable.pdf could be more accessible to small businesses and non-profits that lack sophisticated accounting help. One suggestion would allow applicants to rely on IRS and other previously filed forms that contain needed information such as employee payroll data.
In summary, it is important to focus on further needed improvements that will allow the CARES Act to better achieve its announced purpose, because the statute passed by the House on April 23, 2020 may not be the last. Proposals discussed here for further improving the CARES Act simply reflect a few of the reform proposals previously raised by industry players. They illustrate the need for more discussion of improvements.
Don Allen Resnikoff takes full responsibility for the content of his posting
_
Bill Baer: Antitrust enforcers must be vigilant in attacking efforts by firms to limit competition in a time of crisis.
Baer writes: Those of us involved over the years in investigating and prosecuting price fixing and bid rigging know well that the urge to cartelize markets is strongest in the face of falling prices triggered by reduced demand. Although it is often rationalized during tough economic times as “not raising prices, just stabilizing them,” or “just protecting our margins, not increasing them,” agreements between companies that restrict competition are per se unlawful and subject the companies and their executives to criminal prosecution. Consumers deserve the benefit of market competition regardless of where we are in the economic cycle.
Excerpt from: https://www.brookings.edu/blog/techtank/2020/04/22/why-we-need-antitrust-enforcement-during-the-covid-19-pandemic/
Baer writes: Those of us involved over the years in investigating and prosecuting price fixing and bid rigging know well that the urge to cartelize markets is strongest in the face of falling prices triggered by reduced demand. Although it is often rationalized during tough economic times as “not raising prices, just stabilizing them,” or “just protecting our margins, not increasing them,” agreements between companies that restrict competition are per se unlawful and subject the companies and their executives to criminal prosecution. Consumers deserve the benefit of market competition regardless of where we are in the economic cycle.
Excerpt from: https://www.brookings.edu/blog/techtank/2020/04/22/why-we-need-antitrust-enforcement-during-the-covid-19-pandemic/
New Visa and MasterCard coding procedures increase the price of mobile payment apps drawing on your credit card
To use an app for cash transfers, customers typically connect it to an outside payment source. Most users link their debit card or a bank account, since in most cases that lets them transfer money without charge. A few apps, however, also give customers the option to link to a credit card and pay a small fee (about 3 percent) for “peer to peer” payments, like splitting the dinner tab. Those apps include PayPal and its Venmo arm, as well as Cash App, which is owned by Square. (Zelle, the app backed by traditional banks, doesn’t accept credit cards.)
But there has been a change in the way the money transfers are coded as they move through the Visa and Mastercard payment networks. That change enables banks to also charge their own, separate cash advance fees — typically $10 but sometimes much more — for payments made using credit cards on those networks. The fees don’t apply when customers make a purchase.
Card-issuing banks now ask that the apps and payment networks code cash transfers to distinguish them from purchases, and put higher fees on cash transfers. The coding change formally took effect in September.
Source: https://www.nytimes.com/2020/04/24/your-money/fees-mobile-app-payments.html DAR Comment: There is no indication in the NYT article concerning whether Visa and MasterCard or client banks coordinated the coding changes, or whether all or most banks follow similar fee practices for transactions newly coded as money transfers.
To use an app for cash transfers, customers typically connect it to an outside payment source. Most users link their debit card or a bank account, since in most cases that lets them transfer money without charge. A few apps, however, also give customers the option to link to a credit card and pay a small fee (about 3 percent) for “peer to peer” payments, like splitting the dinner tab. Those apps include PayPal and its Venmo arm, as well as Cash App, which is owned by Square. (Zelle, the app backed by traditional banks, doesn’t accept credit cards.)
But there has been a change in the way the money transfers are coded as they move through the Visa and Mastercard payment networks. That change enables banks to also charge their own, separate cash advance fees — typically $10 but sometimes much more — for payments made using credit cards on those networks. The fees don’t apply when customers make a purchase.
Card-issuing banks now ask that the apps and payment networks code cash transfers to distinguish them from purchases, and put higher fees on cash transfers. The coding change formally took effect in September.
Source: https://www.nytimes.com/2020/04/24/your-money/fees-mobile-app-payments.html DAR Comment: There is no indication in the NYT article concerning whether Visa and MasterCard or client banks coordinated the coding changes, or whether all or most banks follow similar fee practices for transactions newly coded as money transfers.
Bank Secrecy Act Compliance Issues for Small-Business Lending Under the CARES Act
With many banks and credit unions electing to limit Paycheck Protection Program (PPP) loans to existing customers, many nonbank lenders are scrambling to fill the gap and take part in the $349 billion program prior to the end of the application period on June 30, 2020. There is, however, at least one major obstacle preventing many nonbank lenders from qualifying to lend under the PPP—the requirement under Section 1102 of the CARES Act that they apply “the [Bank Secrecy Act (BSA)] requirements of an equivalent federally regulated financial institution,” which requires having a robust anti-money laundering (AML) and Know-Your-Customer (KYC) compliance program.
Basic Elements of BSA Compliance for Nonbank Financial Institutions
Compliance with the BSA requires financial institutions to, among other things, maintain an adequate AML and KYC program, which must be founded upon the well-known “five pillars” of BSA compliance: (1) a system of internal controls to ensure ongoing compliance, (2) independent testing for compliance, (3) a designated AML officer to coordinate and monitor day-to-day compliance, (4) ongoing training for applicable personnel, and (5) procedures for ongoing customer due diligence that include, among other things, procedures for identifying the “beneficial ownership” of legal entity customers.
Compliance with the BSA also requires that the institution file currency transaction reports (CTRs) for cash transactions involving more than $10,000, and file suspicious activity reports (SARs) when the institution “knows, suspects, or has reason to suspect that the transaction (or pattern of transactions of which the transaction is a part)” involves money laundering, is designed to evade the requirements of the BSA, serves no apparent lawful purpose, or facilitates criminal activity.
Developing and maintaining an adequate AML and KYC compliance program can be both time-consuming and expensive, which is why many fintechs and other prospective nonbank lenders have been effectively shut out of PPP lending (fintechs with payments businesses are a notable exception, as they already have these programs in place). Developing an AML program can take many weeks, if not months, making it unlikely that a prospective PPP lender without an existing compliant program could qualify well enough in advance of the program’s application deadline of June 30, 2020. Additionally, becoming BSA compliant may be cost-prohibitive for many prospective PPP lenders when weighed against the risks of making loans with a 1% interest rate and no payments for six months, even with processing fees of up to 5% of the loan amount.
The time commitment and expense of conducting KYC diligence into customer identity and beneficial ownership explains in part many banks’ reluctance or refusal to accept PPP applications from new small-business customers. Recognizing the urgency of facilitating PPP lending and the growing regulatory bottleneck over BSA compliance, the Financial Crimes Enforcement Network (FinCEN) issued guidance on April 3, 2020, relaxing beneficial ownership information collection for existing small-business customers and suspending implementation of a February 6, 2020 ruling on CTR filing obligations when reporting transactions involving sole proprietorships and entities operating under a “doing business as” name. FinCEN also set up a new online contact mechanism for institutions to communicate to FinCEN COVID-19-related concerns, including delays in the filing of BSA reports. In response to FinCEN’s April 3 notice, and to assure banks that its regulator is on board, the Office of the Comptroller of the Currency (OCC) issued a bulletin on April 7, 2020, expressing support for FinCEN’s guidance. Should BSA compliance obligations continue to inhibit the flow of PPP loan applications for bank and nonbank financial institutions, FinCEN and the prudential regulators may need to issue further guidance relaxing certain BSA requirements.
Source: https://www.jdsupra.com/legalnews/bank-secrecy-act-compliance-issues-for-79714/ April 21, 2020
With many banks and credit unions electing to limit Paycheck Protection Program (PPP) loans to existing customers, many nonbank lenders are scrambling to fill the gap and take part in the $349 billion program prior to the end of the application period on June 30, 2020. There is, however, at least one major obstacle preventing many nonbank lenders from qualifying to lend under the PPP—the requirement under Section 1102 of the CARES Act that they apply “the [Bank Secrecy Act (BSA)] requirements of an equivalent federally regulated financial institution,” which requires having a robust anti-money laundering (AML) and Know-Your-Customer (KYC) compliance program.
Basic Elements of BSA Compliance for Nonbank Financial Institutions
Compliance with the BSA requires financial institutions to, among other things, maintain an adequate AML and KYC program, which must be founded upon the well-known “five pillars” of BSA compliance: (1) a system of internal controls to ensure ongoing compliance, (2) independent testing for compliance, (3) a designated AML officer to coordinate and monitor day-to-day compliance, (4) ongoing training for applicable personnel, and (5) procedures for ongoing customer due diligence that include, among other things, procedures for identifying the “beneficial ownership” of legal entity customers.
Compliance with the BSA also requires that the institution file currency transaction reports (CTRs) for cash transactions involving more than $10,000, and file suspicious activity reports (SARs) when the institution “knows, suspects, or has reason to suspect that the transaction (or pattern of transactions of which the transaction is a part)” involves money laundering, is designed to evade the requirements of the BSA, serves no apparent lawful purpose, or facilitates criminal activity.
Developing and maintaining an adequate AML and KYC compliance program can be both time-consuming and expensive, which is why many fintechs and other prospective nonbank lenders have been effectively shut out of PPP lending (fintechs with payments businesses are a notable exception, as they already have these programs in place). Developing an AML program can take many weeks, if not months, making it unlikely that a prospective PPP lender without an existing compliant program could qualify well enough in advance of the program’s application deadline of June 30, 2020. Additionally, becoming BSA compliant may be cost-prohibitive for many prospective PPP lenders when weighed against the risks of making loans with a 1% interest rate and no payments for six months, even with processing fees of up to 5% of the loan amount.
The time commitment and expense of conducting KYC diligence into customer identity and beneficial ownership explains in part many banks’ reluctance or refusal to accept PPP applications from new small-business customers. Recognizing the urgency of facilitating PPP lending and the growing regulatory bottleneck over BSA compliance, the Financial Crimes Enforcement Network (FinCEN) issued guidance on April 3, 2020, relaxing beneficial ownership information collection for existing small-business customers and suspending implementation of a February 6, 2020 ruling on CTR filing obligations when reporting transactions involving sole proprietorships and entities operating under a “doing business as” name. FinCEN also set up a new online contact mechanism for institutions to communicate to FinCEN COVID-19-related concerns, including delays in the filing of BSA reports. In response to FinCEN’s April 3 notice, and to assure banks that its regulator is on board, the Office of the Comptroller of the Currency (OCC) issued a bulletin on April 7, 2020, expressing support for FinCEN’s guidance. Should BSA compliance obligations continue to inhibit the flow of PPP loan applications for bank and nonbank financial institutions, FinCEN and the prudential regulators may need to issue further guidance relaxing certain BSA requirements.
Source: https://www.jdsupra.com/legalnews/bank-secrecy-act-compliance-issues-for-79714/ April 21, 2020
Excerpt from American Bankers Association letter expressing concern that mandatory Know-Your-Customer (KYC) and anti-money laundering (AML) requirements impede CARES Act PPP loan process for small business applicants
[Excerpt from letter of Rob Nichols, ABA President and CEO]
I want to assure you that bankers share your frustration with the PPP loan process, yet they are committed to ensuring that all small businesses--both current business banking customers and non-customers--have access to the SBA program. However, the overwhelming demand for the program, along with mandatory Know-Your-Customer (KYC) and anti-money laundering (AML) requirements, have led many banks to initially limit the application process to existing customers for whom banks have previously conducted the bank’s Customer Due Diligence (CDD) process. While the CARES Act calls for speed, other existing banking laws require banks to take the time to verify important borrower information.
The key to speeding up the process for all financial institutions is the temporary –and appropriate –adjustment of KYC/AML requirements. As noted by former Treasury Secretary Jacob Lew, during this very unusual time, it is important to introduce flexibility into the program to ensure that funds flow to where they are needed, particularly to borrowers that do not traditionally borrow from banks.
The clock is ticking to distribute –fairly –an unprecedented amount of funding through agency infrastructure built for much smaller volumes. Forthis reason, we urge policymakers to identify the appropriate balance between KYC/AML requirements and the urgent need to get funds into the communities. SenatorsKaine, Coons, and KingApril13, 2020Page 2
This situation is further complicated by the ongoing pandemic. Due to social distancing requirements, bank personnel, including their anti-money laundering staffs, are working from home. Not only do they face challenges handling normal day-to-day operations, but they also have no present capacity to devise, implement and test new methods for identifying fraud in these new government programs, and operational errors in authenticating borrowers.
Accordingly, former Federal Reserve Board Chair Yellen recently urged policymakers to address “...banks’ concern about liability [that] could cause them to restrict the loans they initiate andengage in due diligence that could slow down payments,” possibly through creation of a safe harbor.
Building on Chair Yellen’s comments, we recommend that FinCEN and the banking agencies issue joint guidance stating that:
• Banks are exempt from collecting, identifying, verifying and certifying KYC/AMLinformation for accounts set up to accept funds provided under the CARES Act. This can easily beaccomplished by exempting theseloans from the definition of new accounts for the purposes of FinCEN requirements.
• Similarly, for any renewals, modifications or extensions of existing loans or lines of credit, banks may rely on the CDDalready on file without taking further steps.
• For any new account opened during thenational emergency for a current legal entity customer and for which the institution already has beneficial owner information on file, the bank can rely on the existing information with no further expectation that the bank will examine or confirm that theinformation is still current.
• Similarly, for any account opened for a new customer during the national emergency, the bank will be permitted to collect beneficial ownership information after the account is established, similar to current requirements forCustomer Identification Programs established under Section 326 of the USA PATRIOT Act
.• For any account opened for a new customer during the national emergency by a business that already has an established bank account with any other financial institution, it will be presumed by law that the customer has been examined for the appropriate due diligence.
• A bank may rely on the information submitted by any loan applicant on one of the Small Business Administration forms provided for the purpose of these loans. Absent a reason to suspect otherwise evident on the face of the application, the bank may take the information provided as accurate.
•A bank shall not be required to conduct a KYC/AML risk assessment for any customer applying to open an account for disbursement of these funds. The bank shall have a reasonable time after the loan is established to conduct a risk assessment of the customer.
ABA believes that these modest changes will streamline the process and help banks get much needed funds into the small businesses that serve their local communities.
Excerpt from https://www.aba.com/-/media/documents/letters-to-congress-and-regulators/aba-response-to-senators-kaine-coons-and-king-04132020.pdf?rev=2e24478b58c244cc8bf433d9eb3d7d7f
[Excerpt from letter of Rob Nichols, ABA President and CEO]
I want to assure you that bankers share your frustration with the PPP loan process, yet they are committed to ensuring that all small businesses--both current business banking customers and non-customers--have access to the SBA program. However, the overwhelming demand for the program, along with mandatory Know-Your-Customer (KYC) and anti-money laundering (AML) requirements, have led many banks to initially limit the application process to existing customers for whom banks have previously conducted the bank’s Customer Due Diligence (CDD) process. While the CARES Act calls for speed, other existing banking laws require banks to take the time to verify important borrower information.
The key to speeding up the process for all financial institutions is the temporary –and appropriate –adjustment of KYC/AML requirements. As noted by former Treasury Secretary Jacob Lew, during this very unusual time, it is important to introduce flexibility into the program to ensure that funds flow to where they are needed, particularly to borrowers that do not traditionally borrow from banks.
The clock is ticking to distribute –fairly –an unprecedented amount of funding through agency infrastructure built for much smaller volumes. Forthis reason, we urge policymakers to identify the appropriate balance between KYC/AML requirements and the urgent need to get funds into the communities. SenatorsKaine, Coons, and KingApril13, 2020Page 2
This situation is further complicated by the ongoing pandemic. Due to social distancing requirements, bank personnel, including their anti-money laundering staffs, are working from home. Not only do they face challenges handling normal day-to-day operations, but they also have no present capacity to devise, implement and test new methods for identifying fraud in these new government programs, and operational errors in authenticating borrowers.
Accordingly, former Federal Reserve Board Chair Yellen recently urged policymakers to address “...banks’ concern about liability [that] could cause them to restrict the loans they initiate andengage in due diligence that could slow down payments,” possibly through creation of a safe harbor.
Building on Chair Yellen’s comments, we recommend that FinCEN and the banking agencies issue joint guidance stating that:
• Banks are exempt from collecting, identifying, verifying and certifying KYC/AMLinformation for accounts set up to accept funds provided under the CARES Act. This can easily beaccomplished by exempting theseloans from the definition of new accounts for the purposes of FinCEN requirements.
• Similarly, for any renewals, modifications or extensions of existing loans or lines of credit, banks may rely on the CDDalready on file without taking further steps.
• For any new account opened during thenational emergency for a current legal entity customer and for which the institution already has beneficial owner information on file, the bank can rely on the existing information with no further expectation that the bank will examine or confirm that theinformation is still current.
• Similarly, for any account opened for a new customer during the national emergency, the bank will be permitted to collect beneficial ownership information after the account is established, similar to current requirements forCustomer Identification Programs established under Section 326 of the USA PATRIOT Act
.• For any account opened for a new customer during the national emergency by a business that already has an established bank account with any other financial institution, it will be presumed by law that the customer has been examined for the appropriate due diligence.
• A bank may rely on the information submitted by any loan applicant on one of the Small Business Administration forms provided for the purpose of these loans. Absent a reason to suspect otherwise evident on the face of the application, the bank may take the information provided as accurate.
•A bank shall not be required to conduct a KYC/AML risk assessment for any customer applying to open an account for disbursement of these funds. The bank shall have a reasonable time after the loan is established to conduct a risk assessment of the customer.
ABA believes that these modest changes will streamline the process and help banks get much needed funds into the small businesses that serve their local communities.
Excerpt from https://www.aba.com/-/media/documents/letters-to-congress-and-regulators/aba-response-to-senators-kaine-coons-and-king-04132020.pdf?rev=2e24478b58c244cc8bf433d9eb3d7d7f
Congressional summary of the 4/21/20 coronavirus relief bill passed by the House on 4/24:
The text of the Senate’s 4/21/20 coronavirus relief bill (additional small business funding and more), passed by the House on 4/24 is available here, along with the NPR summary:
https://www.npr.org/2020/04/22/838870536/read-whats-in-the-latest-coronavirus-relief-bill … pic.twitter.com/662ZBR3CUp
Summary: $484 billion Phase 3.5 PackagePaycheck Protection Program Increase Act of 2020:
Source: https://www.akingump.com/en/experience/industries/national-security/covid-19-resource-center/covid-19-policy-update-april-21-2020.html
https://www.npr.org/2020/04/22/838870536/read-whats-in-the-latest-coronavirus-relief-bill … pic.twitter.com/662ZBR3CUp
Summary: $484 billion Phase 3.5 PackagePaycheck Protection Program Increase Act of 2020:
- Provides an additional $310 billion for the PPP, including $30 billion that must be set aside for PPP loans made by Insured Depository Institutions and Credit Unions that have assets between $10 billion and $50 billion, and $30 billion for loans made by Community Financial Institutions, Small Insured Depository Institutions and Credit Unions with assets less than $10 billion.
- Provides an additional $10 billion for the Emergency Economic Injury Disaster (EIDL) Grants.
- Allows agricultural enterprises with fewer than 500 employees to receive EIDL grants and loans.
- Provides an additional $2.1 billion for the Salaries and Expenses account.
- Provides an additional $50 billion for the Disaster Loans Program Account.
- Provides an additional $10 billion for Emergency EIDL Grants.
- Provides $75 billion for reimbursement to hospitals and healthcare providers to support the need for COVID-19 related expenses and lost revenue.
- Provides $25 billion to research, develop, validate, manufacture, purchase, administer and expand capacity for COVID-19 tests.
- Includes $6 million for HHS Office of Inspector General for oversight activities.
- Requires plan from States, localities, territories and tribes on how resources will be used for testing and easing COVID-19 community mitigation policies.
- Requires strategic plan related to providing assistance to States for testing and increasing testing capacity.
Source: https://www.akingump.com/en/experience/industries/national-security/covid-19-resource-center/covid-19-policy-update-april-21-2020.html
The growing shadow over a hydroxychloroquine Covid cure
The odds of success for President Donald Trump’s favored coronavirus treatment keep getting longer. On Tuesday, it was the U.S. government that erected new obstacles.
First, a panel of medical experts assembled by the National Institutes of Health recommended against using hydroxychloroquine, a malaria treatment, in combination with the antibiotic azithromycin to treat Covid-19. Though a few small, early studies raised hopes that the drug could help patients fight off coronavirus infections, hydroxychloroquine can also cause heart issues. Doctors, pharmacy experts and government researchers and officials advising NIH warned that taking the two potent medications together could lead to harm.
Trump had touted hydroxychloroquine as a potential “game-changer” in spite of the scant scientific evidence to support his claims. Dozens of other therapies are also being explored for treating the coronavirus, but Trump’s backing for the malaria drug has made it a cause celebre among his most ardent supporters. Some doctors have taken it as a prophylactic to ward off the disease, and hospitals have rushed to stockpile it. That’s left patients who need hydroxychloroquine to treat chronic diseases like lupus and rheumatoid arthritis searching for alternatives.
The second blow to hydroxychloroquine was delivered by an analysis of 368 patients from the Veterans Administration that looked at how people with Covid-19 fared after getting the standard of care, hydroxychloroquine alone, or the combination. In that study, which hasn’t yet been published or subjected to peer review, patients who got hydroxychloroquine alone had a higher death rate than those not getting it.
There is a long way to go. Other studies of the drug are continuing around the world. But the results so far underline how slippery science can be, most especially when the immediate health hopes of millions of people—and the political fortunes of a potential cure’s most enthusiastic partisans—are riding on it.--Tim Annett
Credit: Bloomberg coronavirus daily
The odds of success for President Donald Trump’s favored coronavirus treatment keep getting longer. On Tuesday, it was the U.S. government that erected new obstacles.
First, a panel of medical experts assembled by the National Institutes of Health recommended against using hydroxychloroquine, a malaria treatment, in combination with the antibiotic azithromycin to treat Covid-19. Though a few small, early studies raised hopes that the drug could help patients fight off coronavirus infections, hydroxychloroquine can also cause heart issues. Doctors, pharmacy experts and government researchers and officials advising NIH warned that taking the two potent medications together could lead to harm.
Trump had touted hydroxychloroquine as a potential “game-changer” in spite of the scant scientific evidence to support his claims. Dozens of other therapies are also being explored for treating the coronavirus, but Trump’s backing for the malaria drug has made it a cause celebre among his most ardent supporters. Some doctors have taken it as a prophylactic to ward off the disease, and hospitals have rushed to stockpile it. That’s left patients who need hydroxychloroquine to treat chronic diseases like lupus and rheumatoid arthritis searching for alternatives.
The second blow to hydroxychloroquine was delivered by an analysis of 368 patients from the Veterans Administration that looked at how people with Covid-19 fared after getting the standard of care, hydroxychloroquine alone, or the combination. In that study, which hasn’t yet been published or subjected to peer review, patients who got hydroxychloroquine alone had a higher death rate than those not getting it.
There is a long way to go. Other studies of the drug are continuing around the world. But the results so far underline how slippery science can be, most especially when the immediate health hopes of millions of people—and the political fortunes of a potential cure’s most enthusiastic partisans—are riding on it.--Tim Annett
Credit: Bloomberg coronavirus daily
From NCLC: Are There Special Limits on Judgment Creditors’ Garnishment of Stimulus Payments? (With cite to DC statute)
The CARES Act protects stimulus payments from certain offsets to collect debts owed to federal and state governments. The Act does not address either private creditors’ seizure of the checks from bank accounts to satisfy outstanding court judgments or the banks’ ability to seize the funds to pay other debts owed the bank or for overdrawn accounts. While advocacy efforts are ongoing to change the federal law or the way Treasury treats these payments [DAR: see next posting], as of the time the first set of payments were distributed (in mid-April 2020), these efforts have not been successful.
In a few states (such as New York), a certain dollar value in funds in a bank account is automatically protected from seizure, without requiring consumers to take any affirmative action.
Every state provides a method by which consumers can assert to a court that bank account funds are exempt under state law, but only after the account is frozen. Depending on the state, an exemption can be based on deposits up to a certain dollar amount, for public assistance benefits, under a “wild card” exemption which goes up to a certain dollar amount, or some similar category. See NCLC’s Collection Actions Appendix G (now open to all readers even without a subscription through May 3, 2020). But in a frustrating situation with constitutional due process implications, consumers may not have an opportunity to raise these rights. Many state courts are closed for most proceedings and consumers are unable to reach the courts in any event.
In a number of states and counties, orders are being issued to prevent garnishments of bank accounts. Examples include:
- • District of Columbia Act 23-286 http://lims.dccouncil.us/Download/44543/B23-0733-SignedAct.pdf [DR: see in particular Section 207]
From US PIRG: Debt collectors and CARES Act payments
Posted: 15 Apr 2020 09:34 AM PDT
This week, the Treasury Department will begin to send out the $1,200 CARES Act payments that Congress approved in response to the coronavirus crisis. The money will be wired to eligible recipients who previously authorized the IRS to post their refunds through direct deposit. The American Prospect reports, though that "Congress did not exempt CARES Act payments from private debt collection, and the Treasury Department has been reluctant to exempt them through its rulemaking authority. This means that individuals could see their payments transferred from their hands into the hands of their creditors, potentially leaving them with nothing."
The full article is here. And a follow-up article about the Department of Treasury allowing the debt collection is here.
From Washington Business Journal:
A guide to local resources for Greater Washington businesses
By Michael Neibauer
– Managing Editor, Washington Business Journal
Mar 24, 2020, 3:16pm EDT
Updated Apr 9, 2020, 5:38pm EDT
These are uncertain times for Greater Washington business, as the COVID-19 virus continues to spread rampantly throughout our region. As its effects grow — thousands of people losing their jobs and many others setting up at home offices — state and local leaders, nonprofits and corporations are stepping up with support of varying types, from emergency loans and grants to counseling and resource guides, free access to services and the basic necessities of life.
The Washington Business Journal is compiling a list of these resources to support our region's business community.
Keep checking back as this list will only grow. If you have something we should add, please email mneibauer@bizjournals.com.
A guide to local resources for Greater Washington businesses
By Michael Neibauer
– Managing Editor, Washington Business Journal
Mar 24, 2020, 3:16pm EDT
Updated Apr 9, 2020, 5:38pm EDT
These are uncertain times for Greater Washington business, as the COVID-19 virus continues to spread rampantly throughout our region. As its effects grow — thousands of people losing their jobs and many others setting up at home offices — state and local leaders, nonprofits and corporations are stepping up with support of varying types, from emergency loans and grants to counseling and resource guides, free access to services and the basic necessities of life.
The Washington Business Journal is compiling a list of these resources to support our region's business community.
Keep checking back as this list will only grow. If you have something we should add, please email mneibauer@bizjournals.com.
- See more resources from the federal government.https://www.bizjournals.com/washington/news/2020/03/27/federal-resources-small-businesses.html
- See more resources from the D.C., Virginia and Maryland state governments.https://www.bizjournals.com/washington/news/2020/03/27/state-resources-for-small-businesses-navigating.html
- See more resources from local governments across the D.C. region.https://www.bizjournals.com/washington/news/2020/03/27/local-resources-for-small-business-navigating-the.html
CNBC’s Jim Cramer on the paradox of a stock market that is heating up while the state of the economy appears to be crumbling
“At the end of the day, the stock market’s made up of big, huge companies, not the small- to medium-sized businesses that are the backbone of our economy,” the “Mad Money” host said. “You don’t have to like it — I know I don’t — but it’s the big dogs with pristine balance sheets and gigantic scale that can survive this lockdown.”
Cramer made the comments in response to a viral screenshot of a scene from his Thursday show that circulated online.
“There’s a seething anger sweeping this country and it’s directed point-blank at Wall Street,” Cramer said after the market staged another rally in Tuesday’s session. “This relentless rally seems unfair, it seems senseless and it seems heartless” amid a deadly coronavirus emergency.
The image, which juxtaposed a strong weekly gain for the Dow Jones index against multiple weeks of record job losses, was shared widely on social media platforms, including in a tweet by Rep. Alexandria Ocasio Cortez, D-New York, who sought to highlight a contradiction between Wall Street and Main Street.
https://www.cnbc.com/2020/04/14/jim-cramer-on-mad-money-viral-pic-seething-anger-for-wall-street.html?recirc=taboolainternal
“At the end of the day, the stock market’s made up of big, huge companies, not the small- to medium-sized businesses that are the backbone of our economy,” the “Mad Money” host said. “You don’t have to like it — I know I don’t — but it’s the big dogs with pristine balance sheets and gigantic scale that can survive this lockdown.”
Cramer made the comments in response to a viral screenshot of a scene from his Thursday show that circulated online.
“There’s a seething anger sweeping this country and it’s directed point-blank at Wall Street,” Cramer said after the market staged another rally in Tuesday’s session. “This relentless rally seems unfair, it seems senseless and it seems heartless” amid a deadly coronavirus emergency.
The image, which juxtaposed a strong weekly gain for the Dow Jones index against multiple weeks of record job losses, was shared widely on social media platforms, including in a tweet by Rep. Alexandria Ocasio Cortez, D-New York, who sought to highlight a contradiction between Wall Street and Main Street.
https://www.cnbc.com/2020/04/14/jim-cramer-on-mad-money-viral-pic-seething-anger-for-wall-street.html?recirc=taboolainternal
Avoiding Price Gouging, Price Fixing and Other Antitrust Risks During the COVID-19 Pandemic
Carl Hittinger, Ann Marie O'Brien
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April 15, 2020
By Carl Hittinger & Ann O’Brien (BakerHostetler)1
The COVID-19 global pandemic has upended typical supply and demand in unprecedented ways. As the world struggles to contain the pandemic and faces tragic human suffering, the resulting states of emergency, need for medical supplies, and panic buying have caused overnight changes in supply and demand on an unparalleled global scale. Businesses face increased antitrust risk as they struggle to continue operations and meet historic demand. The Department of Justice (“DOJ”) has actively enforced the antitrust laws in response to previous natural disasters2 and financial crises,3 and federal and state antitrust authorities are again paying close attention as this global pandemic unfolds.
On March 9, 2020, the DOJ announced that it would ensure resources were available to enforce antitrust laws against “bad actors” that might take advantage of the current emergency situation.4 And as the pandemic has worsened, the DOJ announced recent changes that ramp up enforcement against hoarding of essential supplies, price gouging, price fixing, bid rigging and fraud, while working with the Federal Trade Commission (“FTC”) to increase flexibility in certain areas, such as competitor collaborations. Meanwhile, as demand and prices spike, so has state and local price-gouging enforcement.
This article discusses some of the evolving areas of antitrust risk during the COVID-19 crisis and contains information and best practices on how to avoid them.
The article is at https://www.competitionpolicyinternational.com/avoiding-price-gouging-price-fixing-and-other-antitrust-risks-during-the-covid-19-pandemic/
Carl Hittinger, Ann Marie O'Brien
-
April 15, 2020
By Carl Hittinger & Ann O’Brien (BakerHostetler)1
The COVID-19 global pandemic has upended typical supply and demand in unprecedented ways. As the world struggles to contain the pandemic and faces tragic human suffering, the resulting states of emergency, need for medical supplies, and panic buying have caused overnight changes in supply and demand on an unparalleled global scale. Businesses face increased antitrust risk as they struggle to continue operations and meet historic demand. The Department of Justice (“DOJ”) has actively enforced the antitrust laws in response to previous natural disasters2 and financial crises,3 and federal and state antitrust authorities are again paying close attention as this global pandemic unfolds.
On March 9, 2020, the DOJ announced that it would ensure resources were available to enforce antitrust laws against “bad actors” that might take advantage of the current emergency situation.4 And as the pandemic has worsened, the DOJ announced recent changes that ramp up enforcement against hoarding of essential supplies, price gouging, price fixing, bid rigging and fraud, while working with the Federal Trade Commission (“FTC”) to increase flexibility in certain areas, such as competitor collaborations. Meanwhile, as demand and prices spike, so has state and local price-gouging enforcement.
This article discusses some of the evolving areas of antitrust risk during the COVID-19 crisis and contains information and best practices on how to avoid them.
The article is at https://www.competitionpolicyinternational.com/avoiding-price-gouging-price-fixing-and-other-antitrust-risks-during-the-covid-19-pandemic/
WSJ on investor sentiment about economic recovery
Comment by DAR: President Trump and State governors are planning to revive the US economy in a manner that involves contention and uncertainty. According to the WSJ piece excerpted below, investors share that uncertainty. There is some suggestion from financial experts that investors are too optimistic about economic revival.
Safer assets from gold to Treasurys are rising alongside major indexes, a sign that the stock-market rebound hasn’t assuaged investors’ fears about the world economy.
The S&P 500 has rebounded 24% from its March 23 multiyear low. At the same time, gold on Tuesday climbed to its highest level in nearly 7½ years, bringing its gains for the year to 15%. Billions of dollars have flowed into gold exchange-traded funds, and sales of physical bars and coins have soared.'
Treasurys prices have joined the rally, pushing the yield on the benchmark 10-year U.S. Treasury note down to 0.64% from 1.26% on March 18. The Swiss franc and Japanese yen also have posted gains.
This is a reversal from mid-March, when investors sold a range of risky and safe assets to raise cash. Analysts attributed part of the widespread selling to banks demanding repayment from investors who had used their stock portfolios as collateral to buy other securities. Those margin calls then forced investors to sell unrelated assets.
But stocks and havens have risen in tandem since the Federal Reserve slashed interest rates near zero last month and stepped up lending programs and asset purchases. A roughly $2 trillion stimulus package passed by Congress last month—and discussions about more stimulus programs—also have helped markets stabilize despite the broad economic damage caused by the coronavirus.
Still, some analysts view the simultaneous rebounds as evidence of investors’ excessive optimism about how quickly the economy can rebound. Stock prices suggest a short recession with a swift rebound in corporate profits, while gains in havens signal worries about a longer downturn.
Tony Roth, chief investment officer at Wilmington Trust Investment Advisors, said the firm is holding a smaller position in stocks than the benchmark it tracks, believing it will take longer than expected to restart global commerce.
“We are seeing an increasing disconnect between how we expect the economy to perform and what stocks are doing,” he said.
From WSJ 4-16-2020
Comment by DAR: President Trump and State governors are planning to revive the US economy in a manner that involves contention and uncertainty. According to the WSJ piece excerpted below, investors share that uncertainty. There is some suggestion from financial experts that investors are too optimistic about economic revival.
Safer assets from gold to Treasurys are rising alongside major indexes, a sign that the stock-market rebound hasn’t assuaged investors’ fears about the world economy.
The S&P 500 has rebounded 24% from its March 23 multiyear low. At the same time, gold on Tuesday climbed to its highest level in nearly 7½ years, bringing its gains for the year to 15%. Billions of dollars have flowed into gold exchange-traded funds, and sales of physical bars and coins have soared.'
Treasurys prices have joined the rally, pushing the yield on the benchmark 10-year U.S. Treasury note down to 0.64% from 1.26% on March 18. The Swiss franc and Japanese yen also have posted gains.
This is a reversal from mid-March, when investors sold a range of risky and safe assets to raise cash. Analysts attributed part of the widespread selling to banks demanding repayment from investors who had used their stock portfolios as collateral to buy other securities. Those margin calls then forced investors to sell unrelated assets.
But stocks and havens have risen in tandem since the Federal Reserve slashed interest rates near zero last month and stepped up lending programs and asset purchases. A roughly $2 trillion stimulus package passed by Congress last month—and discussions about more stimulus programs—also have helped markets stabilize despite the broad economic damage caused by the coronavirus.
Still, some analysts view the simultaneous rebounds as evidence of investors’ excessive optimism about how quickly the economy can rebound. Stock prices suggest a short recession with a swift rebound in corporate profits, while gains in havens signal worries about a longer downturn.
Tony Roth, chief investment officer at Wilmington Trust Investment Advisors, said the firm is holding a smaller position in stocks than the benchmark it tracks, believing it will take longer than expected to restart global commerce.
“We are seeing an increasing disconnect between how we expect the economy to perform and what stocks are doing,” he said.
From WSJ 4-16-2020
SCOTUS Shows Interest in NFL Sunday Ticket Antitrust Case
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April 16, 2020The US Supreme Court signaled interest in the NFL’s bid to shut down an antitrust challenge to its “Sunday Ticket” DirecTV package, asking the plaintiffs to respond to the league’s petition after they initially declined the opportunity, reported Bloomberg.
The justices had been set to discuss whether to review the case at their April 24 conference. The request Monday, April 13, gave the sports bars leading the lawsuit a May 15 deadline to respond.
It came about a week after the US Chamber of Commerce and two groups of experts urged the high court to reverse the US Court of Appeals decision.
The NFL Sunday Ticket subscription package allows customers to watch every out-of-market game, rather than just the two or three broadcast free each Sunday.
The lawsuit challenges the licensing deals that make Sunday Ticket possible: an agreement among the teams to pool their broadcast rights, and the NFL’s sale of those rights to DirecTV. Teams would otherwise market their rights on competitive terms, giving out-of-town viewers better and cheaper options than subscribing to Sunday Ticket on an all-or-nothing basis, the suit claims.
A federal judge dismissed those claims in 2017. The deal between the league and DirecTV is exempt from antitrust scrutiny under the Sports Broadcasting Act, she said. The rights-pooling agreement isn’t, but it’s an “upstream” deal shielded by the federal bar on antitrust damages for “indirect purchasers,” the judge found.
A divided Ninth Circuit revived the case, saying the licensing deals fall within the indirect purchaser rule’s “co-conspirator” exception. The suit alleges that both agreements are part of “a single conspiracy to limit the output of NFL telecasts,” the majority noted.
But the dissent got it right, according to the Supreme Court petition filed by the NFL, its teams, and DirecTV. The Ninth Circuit also wrongly treated the teams as pure competitors, rather than participants in a joint venture, they argued.
Full Content: Bloomberg
-
April 16, 2020The US Supreme Court signaled interest in the NFL’s bid to shut down an antitrust challenge to its “Sunday Ticket” DirecTV package, asking the plaintiffs to respond to the league’s petition after they initially declined the opportunity, reported Bloomberg.
The justices had been set to discuss whether to review the case at their April 24 conference. The request Monday, April 13, gave the sports bars leading the lawsuit a May 15 deadline to respond.
It came about a week after the US Chamber of Commerce and two groups of experts urged the high court to reverse the US Court of Appeals decision.
The NFL Sunday Ticket subscription package allows customers to watch every out-of-market game, rather than just the two or three broadcast free each Sunday.
The lawsuit challenges the licensing deals that make Sunday Ticket possible: an agreement among the teams to pool their broadcast rights, and the NFL’s sale of those rights to DirecTV. Teams would otherwise market their rights on competitive terms, giving out-of-town viewers better and cheaper options than subscribing to Sunday Ticket on an all-or-nothing basis, the suit claims.
A federal judge dismissed those claims in 2017. The deal between the league and DirecTV is exempt from antitrust scrutiny under the Sports Broadcasting Act, she said. The rights-pooling agreement isn’t, but it’s an “upstream” deal shielded by the federal bar on antitrust damages for “indirect purchasers,” the judge found.
A divided Ninth Circuit revived the case, saying the licensing deals fall within the indirect purchaser rule’s “co-conspirator” exception. The suit alleges that both agreements are part of “a single conspiracy to limit the output of NFL telecasts,” the majority noted.
But the dissent got it right, according to the Supreme Court petition filed by the NFL, its teams, and DirecTV. The Ninth Circuit also wrongly treated the teams as pure competitors, rather than participants in a joint venture, they argued.
Full Content: Bloomberg
American Antitrust Institute’s Unsure Trump Can Tackle Big Tech Issues-
April 16, 2020The American Antitrust Institute doesn’t have a lot of hope for the Trump Administration addressing concerns about whether Big Tech companies buying up potential competitors is an antitrust problem, reported John Eggerton.
.
Both the Justice Department and Federal Trade Commission have been looking into how Big Tech got that way, and whether any anticompetitive red flags were missed in the series of mergers, often with smaller start-ups fueled by venture capital, that allowed edge providers to become mammoth players in the US and world economy.
In a new analysis, “Antitrust Enforcement and Competition Policy in the US,” which suggests the Trump Administration antitrust enforcement has been lax, the institute claimed the urge to break up or regulate Big Tech has been a reaction to Trump Administration antitrust inaction, and that without aggressive action using a variety of antitrust enforcement tools, neither Congress not the Administration are likely to address concerns about the size and power of Big Tech.
According to Eggerton, it suggests that had the Administration had a more balanced antitrust toolkit that included competition, regulatory, interoperability, and intellectual property policies, the blunter instrument of breakup might not take such a potentially “outsized” role to solving the “economic, social, and even political problems” the institute concedes are raised by digital tech companies.
Full Content: Broadcasting Cable
April 16, 2020The American Antitrust Institute doesn’t have a lot of hope for the Trump Administration addressing concerns about whether Big Tech companies buying up potential competitors is an antitrust problem, reported John Eggerton.
.
Both the Justice Department and Federal Trade Commission have been looking into how Big Tech got that way, and whether any anticompetitive red flags were missed in the series of mergers, often with smaller start-ups fueled by venture capital, that allowed edge providers to become mammoth players in the US and world economy.
In a new analysis, “Antitrust Enforcement and Competition Policy in the US,” which suggests the Trump Administration antitrust enforcement has been lax, the institute claimed the urge to break up or regulate Big Tech has been a reaction to Trump Administration antitrust inaction, and that without aggressive action using a variety of antitrust enforcement tools, neither Congress not the Administration are likely to address concerns about the size and power of Big Tech.
According to Eggerton, it suggests that had the Administration had a more balanced antitrust toolkit that included competition, regulatory, interoperability, and intellectual property policies, the blunter instrument of breakup might not take such a potentially “outsized” role to solving the “economic, social, and even political problems” the institute concedes are raised by digital tech companies.
Full Content: Broadcasting Cable
What Issues Will Uninsured People Face with Testing and Treatment for COVID-19?
Jennifer Tolbert
Published: Mar 16, 2020
With COVID-19 cases rising in the US, issues surrounding access to testing and treatment for uninsured individuals have taken on heightened importance. Efforts to limit the spread of the coronavirus in the United States are dependent on people who may have been exposed to the virus or who are sick getting tested and seeking medical treatment. However, the uninsured are likely to face significant barriers to testing for COVID-19 and any care they may need should they contract the virus.
In 2018, there were nearly 28 million nonelderly people in the US who lacked health insurance. States that have not expanded Medicaid under the ACA generally have higher uninsured rates than states that did. Adults, low-income individuals and people of color are at greater risk of being uninsured. Most uninsured lack coverage because of high cost or because of a recent change in their situation that led to a loss of coverage, such as a loss of a job. Though most uninsured people have a full time worker (72%) or part-time worker (11%) in their family, many people do not have access to coverage through a job, and some people, particularly poor adults in states that did not expand Medicaid, remain ineligible for financial assistance for coverage.
Many uninsured adults work in jobs that may increase their risk of exposure to COVID-19. Most uninsured adults are working. Because of the jobs they have, uninsured workers may be at greater risk of exposure to the disease. Among the top ten occupations reported by the uninsured, many are service-oriented, such as drivers, cashiers, restaurant servers and cooks, and retail sales that cannot be performed through telework and bring the uninsured into regular contact with the public (Figure 1). In addition, data analysis finds that nearly six million adults who are at higher risk of getting a serious illness if they become infected with coronavirus are uninsured.
Uninsured workers who must take off work because they or family members are sick could face significant financial consequences. The U.S. does not have a federal law guaranteeing paid sick leave, and only 11 states and DC currently require paid sick leave. The burden of the lack of paid sick leave falls more heavily on low-wage and uninsured workers. In 2018, just over a quarter (26%) of uninsured workers said they had paid sick leave. Facing the risk of not getting paid or possibly losing their position if they do not show up for work, uninsured workers who are not provided sick leave may be reluctant to take time off, which could put their health at risk and could undermine efforts to control the spread of coronavirus.
Congress enacted legislation that would require certain employers to provide paid sick leave during this public health crisis; however, this new policy will not reach all uninsured workers. Under the emergency paid sick leave provisions in the Families First Coronavirus Response Act, workers in all public agencies as well as at some private firms with between 50 and 500 employees must be compensated at least a portion of their regular pay for 14 days if they take time off to address health needs for themselves or family members or to care for children due to school closures. If workers need more than 14 days off work to care for children due to school closures, they may be able to obtain up to 2/3 of their typical compensation for up to three months, but this policy does not extend to all workers and excludes employees at businesses with more than 500 employees. These new leave policies take effect two weeks after enactment of the legislation and the benefits are not retroactive, which means that uninsured workers who already took leave due to coronavirus would not be compensated for that time.
People who are uninsured will likely face unique barriers accessing COVID-19 testing and treatment services. Over half of the uninsured do not have a usual place to go when they need medical care, and one in five uninsured adults in 2018 went without needed medical care due to cost (Figure 2). Studies repeatedly demonstrate that uninsured people are less likely than those with insurance to receive services for major health conditions and chronic diseases. Without a usual source of care, the uninsured may not know where to go to get tested if they think they have been exposed to the virus and may forego testing or care out of fear of having to pay out-of-pocket for the test. The Emergency Medical Treatment and Labor Act requires hospitals to screen and stabilize patients with emergent conditions, however, they are not required to provide the care at no cost for patients who cannot pay, and they are not required to provide treatment for non-emergent conditions. As a result, uninsured individuals are less likely to use the emergency department than people with insurance, and the high costs of ED care may dissuade those without coverage from seeking care in that setting.
Uninsured individuals who contract COVID-19 and need medical care will likely receive large medical bills, even if they have low incomes and are unable to pay. When uninsured individuals need medical care, the costs can be prohibitive. Uninsured people pay the full cost of care, often at higher rates than those with insurance whose coverage may negotiate lower rates than a hospital otherwise charges. While some uninsured can get care at community health centers and other safety net providers, these providers have limited resources and capacity, and not all uninsured have geographic access to a safety net provider. Because the U.S. lacks a comprehensive hospital charity care policy, uninsured individuals who use hospital care will be billed for the services. Uninsured individuals who meet certain criteria may qualify for a hospital’s charity care program to reduce any hospital bills; however, not all hospitals are required to offer charity care programs, and among those that do, the eligibility criteria can vary widely. Fear of large and unaffordable medical bills can deter uninsured individuals from getting the care they need. In the context of a public health emergency, decisions to forego care because of costs can have devastating consequences.
Federal legislation enacted in response to the coronavirus crisis ensures free testing for uninsured individuals. The Families First Coronavirus Response Act signed into law on March 18, 2020 includes a provision that gives states the option to expand Medicaid coverage to uninsured individuals in their state to provide coverage for COVID-19 diagnosis and testing with 100% federal financing. Although the coverage is limited to testing services, it will ensure more uninsured can access free testing, since the legislation also requires state Medicaid programs to cover diagnosis and testing for COVID-19 with no cost sharing. The legislation also appropriates $1 billion to the National Disaster Medical System to provide reimbursement to providers for the costs associated with diagnosis and testing of uninsured individuals. However, the legislation does not address coverage of COVID-19 treatment costs for people who are uninsured.
While the federal legislation will reduce barriers to COVID-19 testing, additional steps will be required to reduce barriers to accessing treatment for uninsured individuals who get sick. Expanding comprehensive coverage options to the uninsured would facilitate access to COVID-19 treatment for those who need it. Decisions by states that have not yet adopted the Medicaid expansion to do so would provide eligibility for coverage to the 2.3 million nonelderly uninsured adults in the coverage gap. In addition to adopting the Medicaid expansion, the federal government could provide flexibility to states to use Medicaid Section 1115 waiver and/or Section 1135 waiver authority to cover individuals who would not otherwise be eligible for coverage during the public health crisis, and potentially beyond. These waivers have been used in past emergencies to expand coverage. Additionally, states that operate their own health insurance marketplaces could provide a special enrollment period (SEP) in response to the coronavirus outbreak to allow uninsured individuals to enroll in coverage. Washington, Massachusetts, and Maryland recently announced coronavirus-related SEPs for uninsured residents. The federal government could also establish a national special enrollment period that would apply across all states, allowing many more uninsured to sign up for coverage.
In lieu of expanding coverage, providing funding to providers to expand COVID-19 services to uninsured individuals or to reimburse them for uncompensated costs they incur could also facilitate access to needed care. The supplemental appropriations legislation to finance the response to coronavirus included $100 million to community health centers to support increased access to testing and primary care services in medically underserved areas. However, this funding does not address costs to hospitals for treatment of infected individuals. Congress could appropriate additional funds to cover hospital costs related to treating uninsured individuals who contract the disease and need hospital care. Programs such as the National Disaster Medical System (NDMS) or Disproportionate Share Hospital (DSH) program could be used to reimburse hospitals for uncompensated costs; however, additional funding would be needed to cover the treatment costs related to COVID-19. Democratic Presidential candidate, Joe Biden, has proposed utilizing the NDMS by expanding its authority to reimburse providers for the costs of testing, treatment, and vaccines associated with COVID-19 for uninsured individuals and by providing full funding of those costs.
From KFF: https://www.kff.org/uninsured/fact-sheet/what-issues-will-uninsured-people-face-with-testing-and-treatment-for-covid-19/
(See KFF document for graphics that are omitted here)
Jennifer Tolbert
Published: Mar 16, 2020
With COVID-19 cases rising in the US, issues surrounding access to testing and treatment for uninsured individuals have taken on heightened importance. Efforts to limit the spread of the coronavirus in the United States are dependent on people who may have been exposed to the virus or who are sick getting tested and seeking medical treatment. However, the uninsured are likely to face significant barriers to testing for COVID-19 and any care they may need should they contract the virus.
In 2018, there were nearly 28 million nonelderly people in the US who lacked health insurance. States that have not expanded Medicaid under the ACA generally have higher uninsured rates than states that did. Adults, low-income individuals and people of color are at greater risk of being uninsured. Most uninsured lack coverage because of high cost or because of a recent change in their situation that led to a loss of coverage, such as a loss of a job. Though most uninsured people have a full time worker (72%) or part-time worker (11%) in their family, many people do not have access to coverage through a job, and some people, particularly poor adults in states that did not expand Medicaid, remain ineligible for financial assistance for coverage.
Many uninsured adults work in jobs that may increase their risk of exposure to COVID-19. Most uninsured adults are working. Because of the jobs they have, uninsured workers may be at greater risk of exposure to the disease. Among the top ten occupations reported by the uninsured, many are service-oriented, such as drivers, cashiers, restaurant servers and cooks, and retail sales that cannot be performed through telework and bring the uninsured into regular contact with the public (Figure 1). In addition, data analysis finds that nearly six million adults who are at higher risk of getting a serious illness if they become infected with coronavirus are uninsured.
Uninsured workers who must take off work because they or family members are sick could face significant financial consequences. The U.S. does not have a federal law guaranteeing paid sick leave, and only 11 states and DC currently require paid sick leave. The burden of the lack of paid sick leave falls more heavily on low-wage and uninsured workers. In 2018, just over a quarter (26%) of uninsured workers said they had paid sick leave. Facing the risk of not getting paid or possibly losing their position if they do not show up for work, uninsured workers who are not provided sick leave may be reluctant to take time off, which could put their health at risk and could undermine efforts to control the spread of coronavirus.
Congress enacted legislation that would require certain employers to provide paid sick leave during this public health crisis; however, this new policy will not reach all uninsured workers. Under the emergency paid sick leave provisions in the Families First Coronavirus Response Act, workers in all public agencies as well as at some private firms with between 50 and 500 employees must be compensated at least a portion of their regular pay for 14 days if they take time off to address health needs for themselves or family members or to care for children due to school closures. If workers need more than 14 days off work to care for children due to school closures, they may be able to obtain up to 2/3 of their typical compensation for up to three months, but this policy does not extend to all workers and excludes employees at businesses with more than 500 employees. These new leave policies take effect two weeks after enactment of the legislation and the benefits are not retroactive, which means that uninsured workers who already took leave due to coronavirus would not be compensated for that time.
People who are uninsured will likely face unique barriers accessing COVID-19 testing and treatment services. Over half of the uninsured do not have a usual place to go when they need medical care, and one in five uninsured adults in 2018 went without needed medical care due to cost (Figure 2). Studies repeatedly demonstrate that uninsured people are less likely than those with insurance to receive services for major health conditions and chronic diseases. Without a usual source of care, the uninsured may not know where to go to get tested if they think they have been exposed to the virus and may forego testing or care out of fear of having to pay out-of-pocket for the test. The Emergency Medical Treatment and Labor Act requires hospitals to screen and stabilize patients with emergent conditions, however, they are not required to provide the care at no cost for patients who cannot pay, and they are not required to provide treatment for non-emergent conditions. As a result, uninsured individuals are less likely to use the emergency department than people with insurance, and the high costs of ED care may dissuade those without coverage from seeking care in that setting.
Uninsured individuals who contract COVID-19 and need medical care will likely receive large medical bills, even if they have low incomes and are unable to pay. When uninsured individuals need medical care, the costs can be prohibitive. Uninsured people pay the full cost of care, often at higher rates than those with insurance whose coverage may negotiate lower rates than a hospital otherwise charges. While some uninsured can get care at community health centers and other safety net providers, these providers have limited resources and capacity, and not all uninsured have geographic access to a safety net provider. Because the U.S. lacks a comprehensive hospital charity care policy, uninsured individuals who use hospital care will be billed for the services. Uninsured individuals who meet certain criteria may qualify for a hospital’s charity care program to reduce any hospital bills; however, not all hospitals are required to offer charity care programs, and among those that do, the eligibility criteria can vary widely. Fear of large and unaffordable medical bills can deter uninsured individuals from getting the care they need. In the context of a public health emergency, decisions to forego care because of costs can have devastating consequences.
Federal legislation enacted in response to the coronavirus crisis ensures free testing for uninsured individuals. The Families First Coronavirus Response Act signed into law on March 18, 2020 includes a provision that gives states the option to expand Medicaid coverage to uninsured individuals in their state to provide coverage for COVID-19 diagnosis and testing with 100% federal financing. Although the coverage is limited to testing services, it will ensure more uninsured can access free testing, since the legislation also requires state Medicaid programs to cover diagnosis and testing for COVID-19 with no cost sharing. The legislation also appropriates $1 billion to the National Disaster Medical System to provide reimbursement to providers for the costs associated with diagnosis and testing of uninsured individuals. However, the legislation does not address coverage of COVID-19 treatment costs for people who are uninsured.
While the federal legislation will reduce barriers to COVID-19 testing, additional steps will be required to reduce barriers to accessing treatment for uninsured individuals who get sick. Expanding comprehensive coverage options to the uninsured would facilitate access to COVID-19 treatment for those who need it. Decisions by states that have not yet adopted the Medicaid expansion to do so would provide eligibility for coverage to the 2.3 million nonelderly uninsured adults in the coverage gap. In addition to adopting the Medicaid expansion, the federal government could provide flexibility to states to use Medicaid Section 1115 waiver and/or Section 1135 waiver authority to cover individuals who would not otherwise be eligible for coverage during the public health crisis, and potentially beyond. These waivers have been used in past emergencies to expand coverage. Additionally, states that operate their own health insurance marketplaces could provide a special enrollment period (SEP) in response to the coronavirus outbreak to allow uninsured individuals to enroll in coverage. Washington, Massachusetts, and Maryland recently announced coronavirus-related SEPs for uninsured residents. The federal government could also establish a national special enrollment period that would apply across all states, allowing many more uninsured to sign up for coverage.
In lieu of expanding coverage, providing funding to providers to expand COVID-19 services to uninsured individuals or to reimburse them for uncompensated costs they incur could also facilitate access to needed care. The supplemental appropriations legislation to finance the response to coronavirus included $100 million to community health centers to support increased access to testing and primary care services in medically underserved areas. However, this funding does not address costs to hospitals for treatment of infected individuals. Congress could appropriate additional funds to cover hospital costs related to treating uninsured individuals who contract the disease and need hospital care. Programs such as the National Disaster Medical System (NDMS) or Disproportionate Share Hospital (DSH) program could be used to reimburse hospitals for uncompensated costs; however, additional funding would be needed to cover the treatment costs related to COVID-19. Democratic Presidential candidate, Joe Biden, has proposed utilizing the NDMS by expanding its authority to reimburse providers for the costs of testing, treatment, and vaccines associated with COVID-19 for uninsured individuals and by providing full funding of those costs.
From KFF: https://www.kff.org/uninsured/fact-sheet/what-issues-will-uninsured-people-face-with-testing-and-treatment-for-covid-19/
(See KFF document for graphics that are omitted here)
Ticket buyers and sellers say StubHub owes them after widespread event cancellations
WA public letter from StubHub explains:
When an event is canceled:
• You don’t need to contact us; we’ll email you to confirm
• We’ll add a coupon worth 120% of your original order to your StubHub account. You can apply this coupon to one or multiple StubHub orders in the same currency until Dec. 31, 2021. Just choose the coupon at checkout when you order.
See http://stubhub.custhelp.com/app/answers/answer_view/a_id/1001856/categoryRecordID/RN_CATEGORY_429/categorySelected/RN_CATEGORY_429
The problem is that the coupon offer is an alternative to a refund.
That refusal of a refund has led to a class action lawsuit. The Complaint is at https://www.courthousenews.com/wp-content/uploads/2020/04/StubHub.pdf The Complaint says in its opening paragraphs:
In the midst of the greatest public health and economic crisis in living memory, Defendants, which constitute a four-billion dollar enterprise, have sought to surreptitiously shift their losses onto their innocent customers. . . .
WA public letter from StubHub explains:
When an event is canceled:
• You don’t need to contact us; we’ll email you to confirm
• We’ll add a coupon worth 120% of your original order to your StubHub account. You can apply this coupon to one or multiple StubHub orders in the same currency until Dec. 31, 2021. Just choose the coupon at checkout when you order.
See http://stubhub.custhelp.com/app/answers/answer_view/a_id/1001856/categoryRecordID/RN_CATEGORY_429/categorySelected/RN_CATEGORY_429
The problem is that the coupon offer is an alternative to a refund.
That refusal of a refund has led to a class action lawsuit. The Complaint is at https://www.courthousenews.com/wp-content/uploads/2020/04/StubHub.pdf The Complaint says in its opening paragraphs:
In the midst of the greatest public health and economic crisis in living memory, Defendants, which constitute a four-billion dollar enterprise, have sought to surreptitiously shift their losses onto their innocent customers. . . .
Comment: Solutions needed for non-profit organizations eligible for CARES Act help
The Cares Act includes help for non-profits, a legislative innovation with positive potential. But, banks that are administering the Cares Act are reported to be giving priority to established bank customers, particularly customers with existing business loans. Non-profits are particularly unlikely to have the relationships with banks required to get to the head of the help line. The following article from the Non-Profit Quarterly offers some proposals to improve the situation for non-profits. [Comment by DAR]
The Cares Act includes help for non-profits, a legislative innovation with positive potential. But, banks that are administering the Cares Act are reported to be giving priority to established bank customers, particularly customers with existing business loans. Non-profits are particularly unlikely to have the relationships with banks required to get to the head of the help line. The following article from the Non-Profit Quarterly offers some proposals to improve the situation for non-profits. [Comment by DAR]
CARES Act: New Nonprofit Provisions Needed for Next Round of Relief Money
Ruth McCambridge
April 9, 2020
As many readers know, the Paycheck Protection Program of the Cares Act, which is supposed to relieve serious COVID-19 related financial pressures on small for-profit and nonprofit employers through $349 billion in forgivable loans, got off to a rocky start last Friday, as nonprofits by the thousands flocked to lenders only to get turned away in many cases. It appears the banks were largely unprepared to process applications, in large part because the Small Business Administration did not get either the applications or the guidelines to them before Thursday night.
But for nonprofits, there were even more fundamental problems, often related to tenuous or unformed relationships between lenders and nonprofits. This led to a lot of time wasted by nonprofits stalking bank officers who were giving priority to longstanding and more robust organizations (a problem when you advertise the program as “first come, first served”) or blocked by being unable to fill out some of the application questions that did not quite fit the nonprofit corporate structure.
Many small businesses, nonprofits and for-profits alike, ended up in a kind of limbo, listening to reports about the billions being approved yet having no idea where in the process their own applications were, or even if they were in the system yet. As far as we know, such dynamics also apply to small businesses that may not be frequent users of debt. So, while the country was promised an admittedly inconceivable one-day approval and payout process, a week out, many nonprofits are still wondering whether or not they made it into the queue in time. (We will address these issues tomorrow in a longer piece by Steve Dubb.)
A new set of unemployment figures came out today, documenting that another 6.6 million are unemployed, bringing the total added to the unemployment rolls over the past four weeks to an unfathomable 17 million. Talks have begun for a CARES Act 2.0, otherwise known as Phase 4 of Congress’s response to the coronavirus, and in light of this, national advocates are requesting some extra provisions for this next round of stimulus capital to make sure sufficient money is available to nonprofits. A Nonprofit Community Letter posted on the National Council of Nonprofits website and circulated to Congress yesterday lays out these potential provisions in detail.
Among the changes proposed by the more than 200 national signatories is “expanded nonprofit access to credit.” Funding exclusive to nonprofits would be made available within the two principal loan programs established in the CARES Act. Doing so would ensure that organizations dedicated to addressing immediate pandemic-related problems were included in relief efforts and not excluded or pushed to the back of the line.
In terms of the Paycheck Protection Program, they want the bill to “provide incentives to private lenders to prioritize processing of applications of small nonprofits and expand the eligibility for nonprofits to participate in the Paycheck Protection Program by modifying the current 500-employee cap or by other means.”
We like the first half of that proposition, but if the purpose is to open access to nonprofits unused to borrowing from banks, we are not completely sure how that cause would be advanced by the inclusion of nonprofits with more than 500 employees. While we are aware that some networks, like YMCAs, have been hit profoundly hard, in that they depend upon sites where people congregate, employ more part-time workers, and have laid off sometimes thousands within weeks of this crisis, we would rather see that category addressed more distinctly, excluding those large organizations that do not fit in that category. This is a provision that should be better defined to extend eligibility just to nonprofits on the cusp between the small-employer program and the mid-size employer loans contemplated in the CARES Act.
The entire sector should also be grateful for the quick work of this coalition, which has pushed for new provisions to:
https://nonprofitquarterly.org/cares-act-new-nonprofit-provisions-pushed-for-next-round-of-relief-money/
Ruth McCambridge
April 9, 2020
As many readers know, the Paycheck Protection Program of the Cares Act, which is supposed to relieve serious COVID-19 related financial pressures on small for-profit and nonprofit employers through $349 billion in forgivable loans, got off to a rocky start last Friday, as nonprofits by the thousands flocked to lenders only to get turned away in many cases. It appears the banks were largely unprepared to process applications, in large part because the Small Business Administration did not get either the applications or the guidelines to them before Thursday night.
But for nonprofits, there were even more fundamental problems, often related to tenuous or unformed relationships between lenders and nonprofits. This led to a lot of time wasted by nonprofits stalking bank officers who were giving priority to longstanding and more robust organizations (a problem when you advertise the program as “first come, first served”) or blocked by being unable to fill out some of the application questions that did not quite fit the nonprofit corporate structure.
Many small businesses, nonprofits and for-profits alike, ended up in a kind of limbo, listening to reports about the billions being approved yet having no idea where in the process their own applications were, or even if they were in the system yet. As far as we know, such dynamics also apply to small businesses that may not be frequent users of debt. So, while the country was promised an admittedly inconceivable one-day approval and payout process, a week out, many nonprofits are still wondering whether or not they made it into the queue in time. (We will address these issues tomorrow in a longer piece by Steve Dubb.)
A new set of unemployment figures came out today, documenting that another 6.6 million are unemployed, bringing the total added to the unemployment rolls over the past four weeks to an unfathomable 17 million. Talks have begun for a CARES Act 2.0, otherwise known as Phase 4 of Congress’s response to the coronavirus, and in light of this, national advocates are requesting some extra provisions for this next round of stimulus capital to make sure sufficient money is available to nonprofits. A Nonprofit Community Letter posted on the National Council of Nonprofits website and circulated to Congress yesterday lays out these potential provisions in detail.
Among the changes proposed by the more than 200 national signatories is “expanded nonprofit access to credit.” Funding exclusive to nonprofits would be made available within the two principal loan programs established in the CARES Act. Doing so would ensure that organizations dedicated to addressing immediate pandemic-related problems were included in relief efforts and not excluded or pushed to the back of the line.
In terms of the Paycheck Protection Program, they want the bill to “provide incentives to private lenders to prioritize processing of applications of small nonprofits and expand the eligibility for nonprofits to participate in the Paycheck Protection Program by modifying the current 500-employee cap or by other means.”
We like the first half of that proposition, but if the purpose is to open access to nonprofits unused to borrowing from banks, we are not completely sure how that cause would be advanced by the inclusion of nonprofits with more than 500 employees. While we are aware that some networks, like YMCAs, have been hit profoundly hard, in that they depend upon sites where people congregate, employ more part-time workers, and have laid off sometimes thousands within weeks of this crisis, we would rather see that category addressed more distinctly, excluding those large organizations that do not fit in that category. This is a provision that should be better defined to extend eligibility just to nonprofits on the cusp between the small-employer program and the mid-size employer loans contemplated in the CARES Act.
The entire sector should also be grateful for the quick work of this coalition, which has pushed for new provisions to:
- Strengthen Charitable Giving Incentives to encourage all Americans to help their communities through charitable donations during these challenging times by making donations on and after March 13 (date of national emergency declaration) and before July 16 to claim the deductions on their 2019 tax filings (applicable to itemized and above-the-line deductions) and improving the Above-the-Line Deduction in CARES Act Section 2204.
- Treat Self-Funded Nonprofits Fairly by increasing the federal unemployment insurance reimbursement for self-funded nonprofits to 100 percent of costs in CARES Act Section 2103.
- Increase Emergency Funding by appropriating funds for targeted state formula grants and programs that can provide a rapid infusion of cash to nonprofit organizations that are partnering with state and local governments to protect vulnerable families and frontline responders.
https://nonprofitquarterly.org/cares-act-new-nonprofit-provisions-pushed-for-next-round-of-relief-money/
For very small businesses that can't find a bank to help with a CARES Act loan
Very small businesses and not-for-profits without a history of bank lending are having trouble finding banks to make CARES Act Payroll Protection loans. Its a big problem that should be addressed by the SBA.
There are a number of on-line and other sources of pragmatic advice, although all are handicapped by problems of uncertainty and lack of resources in the government programs.
See, for example:
https://www.inc.com/video/what-you-need-to-know-to-get-your-stimulus-loan-faster.html
https://raskin.house.gov/coronavirus/federal-legislation-faqs-fact-sheets
Also, the NYT suggests that some lenders have said they will work with new customers. They include Ready Capital (a nonbank lender that already had approval to make S.B.A. loans) and Kabbage (an online lender that teamed up with a bank).
https://www.nytimes.com/article/small-business-loans-stimulus-grants-freelancers-coronavirus.html
Very small businesses and not-for-profits without a history of bank lending are having trouble finding banks to make CARES Act Payroll Protection loans. Its a big problem that should be addressed by the SBA.
There are a number of on-line and other sources of pragmatic advice, although all are handicapped by problems of uncertainty and lack of resources in the government programs.
See, for example:
https://www.inc.com/video/what-you-need-to-know-to-get-your-stimulus-loan-faster.html
https://raskin.house.gov/coronavirus/federal-legislation-faqs-fact-sheets
Also, the NYT suggests that some lenders have said they will work with new customers. They include Ready Capital (a nonbank lender that already had approval to make S.B.A. loans) and Kabbage (an online lender that teamed up with a bank).
https://www.nytimes.com/article/small-business-loans-stimulus-grants-freelancers-coronavirus.html
Rachel Carson Council: COVID and food insecurity
What COVID-19 is revealing is what some of us already knew — 40 million Americans were food insecure before the pandemic; now the numbers are rapidly rising. The people that were most vulnerable to food insecurity in this country are more vulnerable than ever before. With the economy getting worse and people unable to work, we need to call on our policy makers and legislators to ensure safety and security for our most at-risk populations. Just a few months before COVID-19, President Trump was creating new, restrictive SNAP eligibility requirements that were scheduled to go into effect on April 1st, excluding 700,000 people from the program. The pandemic has at least shown that SNAP is a basic necessity for many Americans. With public pressure, the newly-passed $2 trillion-dollar COVID-19 bill includes extra funding for federal food distribution and blocks any new SNAP requirements. And, most importantly, the Senate’s stimulus bill now includes $16 billion dollars’ worth of SNAP food assistance (Lisa Held, 2020).
Excerpt from https://rachelcarsoncouncil.org/covid-19-revealing-americas-food-insecurity/?eType=EmailBlastContent&eId=4bb8a44a-523a-4cc1-b610-1f069a663701
From JAMA Viewpoint
March 27, 2020
The Importance of Addressing Advance Care Planning and Decisions About Do-Not-Resuscitate Orders During Novel Coronavirus 2019 (COVID-19)
J. Randall Curtis, MD, MPH1,2; Erin K. Kross, MD1,2; Renee D. Stapleton, MD, PhD3
Published online March 27, 2020. doi:10.1001/jama.2020.4894
EXCERPT:
The novel coronavirus disease 2019 (COVID-19) pandemic is challenging health care systems worldwide and raising important ethical issues, especially regarding the potential need for rationing health care in the context of scarce resources and crisis capacity. Even if capacity to provide care is sufficient, one priority should be addressing goals of care in the setting of acute life-threatening illness, especially for patients with chronic, life-limiting disease.
Clinicians should ensure patients receive the care they want, aligning the care that is delivered with patients’ values and goals. The importance of goal-concordant care is not new or even substantially different in the context of this pandemic, but the importance of providing goal-concordant care is now heightened in several ways. Patients most likely to develop severe illness will be older and have greater burden of chronic illness—exactly those who may wish to forgo prolonged life support and who may find their quality of life unacceptable after prolonged life support.1 In addition, recent reports suggest that survival may be substantially lower when acute respiratory distress syndrome is associated with COVID-19 vs when it is associated with other etiologies.2,3
In this context, advance care planning prior to serious acute illness and discussions about goals of care at the onset of serious acute illness should be a high priority for 3 reasons.
First, clinicians should always strive to avoid intensive life-sustaining treatments when unwanted by patients.
Second, avoiding nonbeneficial or unwanted high-intensity care becomes especially important in times of stress on health care capacity.
Third, provision of nonbeneficial or unwanted high-intensity care may put other patients, family members, and health care workers at higher risk of transmission of severe acute respiratory syndrome coronavirus.
Now is the time to implement advance care planning to ensure patients do not receive care they would not want if they become too severely ill to make their own decisions. As eloquently pointed out by an intensivist, “If you do not talk with [your family] about this now, you may have to have a much more difficult conversation with me later.”4
Several online resources can guide these advance care planning discussions.5-7
Full article: https://jamanetwork.com/journals/jama/fullarticle/2763952?guestAccessKey=9207f0d4-7bcd-477b-9957-2e3c074d13a3&utm_content=weekly_highlights&utm_term=040420&utm_source=silverchair&utm_campaign=jama_network&cmp=1&utm_medium=email
March 27, 2020
The Importance of Addressing Advance Care Planning and Decisions About Do-Not-Resuscitate Orders During Novel Coronavirus 2019 (COVID-19)
J. Randall Curtis, MD, MPH1,2; Erin K. Kross, MD1,2; Renee D. Stapleton, MD, PhD3
Published online March 27, 2020. doi:10.1001/jama.2020.4894
EXCERPT:
The novel coronavirus disease 2019 (COVID-19) pandemic is challenging health care systems worldwide and raising important ethical issues, especially regarding the potential need for rationing health care in the context of scarce resources and crisis capacity. Even if capacity to provide care is sufficient, one priority should be addressing goals of care in the setting of acute life-threatening illness, especially for patients with chronic, life-limiting disease.
Clinicians should ensure patients receive the care they want, aligning the care that is delivered with patients’ values and goals. The importance of goal-concordant care is not new or even substantially different in the context of this pandemic, but the importance of providing goal-concordant care is now heightened in several ways. Patients most likely to develop severe illness will be older and have greater burden of chronic illness—exactly those who may wish to forgo prolonged life support and who may find their quality of life unacceptable after prolonged life support.1 In addition, recent reports suggest that survival may be substantially lower when acute respiratory distress syndrome is associated with COVID-19 vs when it is associated with other etiologies.2,3
In this context, advance care planning prior to serious acute illness and discussions about goals of care at the onset of serious acute illness should be a high priority for 3 reasons.
First, clinicians should always strive to avoid intensive life-sustaining treatments when unwanted by patients.
Second, avoiding nonbeneficial or unwanted high-intensity care becomes especially important in times of stress on health care capacity.
Third, provision of nonbeneficial or unwanted high-intensity care may put other patients, family members, and health care workers at higher risk of transmission of severe acute respiratory syndrome coronavirus.
Now is the time to implement advance care planning to ensure patients do not receive care they would not want if they become too severely ill to make their own decisions. As eloquently pointed out by an intensivist, “If you do not talk with [your family] about this now, you may have to have a much more difficult conversation with me later.”4
Several online resources can guide these advance care planning discussions.5-7
Full article: https://jamanetwork.com/journals/jama/fullarticle/2763952?guestAccessKey=9207f0d4-7bcd-477b-9957-2e3c074d13a3&utm_content=weekly_highlights&utm_term=040420&utm_source=silverchair&utm_campaign=jama_network&cmp=1&utm_medium=email
Strategy For Small Business Owners Frustrated With Troubled Paycheck Protection Program Launch
by Ryan Guina, Forbes Contributor
DAR editorial comment: I like the Guina piece excerpted below because it moves beyond complaining about the serious deficiencies to the Government's roleout of small business assistance to suggesting possible small business strategies.
The recently passed the Coronavirus Aid, Relief and Economic Security (CARES) Act included a potential lifeline for small businesses, a $349 billion loan program called the Paycheck Protection Program (PPP). The PPP Loan is designed to help small businesses keep their doors open during a time of social distancing and mandatory business closures.
Unfortunately, the program was rushed through the implementation process and was pushed live before banks had the ability to create stable processes for accepting and funding these loan applications.
The CARES Act was signed into law on Friday, March 27, 2020. The Small Business Administration (SBA) and Treasury announced that the first day banks would accept PPP Loan applications would be Friday, April 3, 2020, just one week after the Act was passed. The Interim Final Rule, which provides guidelines for how the program will be run, was released the evening of Thursday, April 2, 2020, only hours before the deadline banks were given to begin accepting loans.
Many Banks Simply Weren’t Ready to Handle This Program
While some smaller banks began accepting PPP Loan applications right away, many of the larger commercial banks informed their customers they were not currently accepting applications. Many other banks were limiting applications to current customers only.
Some banks even went so far as to limit applications to customers that had both an established bank account, and an existing loan product, such as a small business loan, business credit card or business line of credit.
This latter limitation is especially frustrating for small business owners.
* * *
Where Can Small Business Turn if Their Bank Isn’t Accepting PPP Loan Applications?
The SBA has announced that business owners can apply at any participating SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, or Farm Credit System institution.
However, many banks are currently limiting PP Loan applications to current customers.
If this describes your bank, then you have several choices:
There are pros and cons to each of these options.
Should Small Business Owners Wait Until Their Bank Begins Accepting Applications?
While the program is open through June 30, 2020, funds are limited. The CARES Act included $349 billion toward helping small businesses. Midway through the first day, Steven Mnuchin, the Secretary of the Treasury, tweeted that over $1.8 billion in PPP Loans had already been processed, primarily from community banks. Some big banks had already taken in large amounts as well, but were not included in those numbers.
Waiting is an option, but it is not without risk. The SBA expects this program to be oversubscribed and funds may run out in the next few weeks.
Should Small Business Owners Open an Account Elsewhere?
With many banks limiting access to current customers, opening a new business bank account is an option. However, this can take time, as opening a business bank account can take more time than opening a personal account, which can be opened online in just a few minutes.
In addition, some banks are limiting loan applications to clients that were already customers prior to the loan being announced. If you decide to open a new bank account, be sure to clarify whether or not you will be able to apply for the PPP loan.
Finding Another Participating SBA 7(a) Lender is Another Option
The SBA isn’t limiting the PPP Loan funding to banks. You can try finding another lender that will fund these loans. The SBA website has a list of the top 100 most active SBA 7(a) lenders.
At this point, it may be worth working through that list to see which lenders are accepting applications at this time.
Will The PPP Loan Program Run Out of Funds?
At this point, it is almost a given that the funds will run out. The question is when? And right now, no one knows when that will happen.
In addition to the numbers tweeted by Steven Mnuchin, Bank of America tweeted they processed over $6 billion in PPP loans in just the first day of the program.
* * *
Full article: https://www.forbes.com/sites/ryanguina/2020/04/04/small-business-owners-frustrated-with-failed-paycheck-protection-program-launch/#5bd4c3546500
by Ryan Guina, Forbes Contributor
DAR editorial comment: I like the Guina piece excerpted below because it moves beyond complaining about the serious deficiencies to the Government's roleout of small business assistance to suggesting possible small business strategies.
The recently passed the Coronavirus Aid, Relief and Economic Security (CARES) Act included a potential lifeline for small businesses, a $349 billion loan program called the Paycheck Protection Program (PPP). The PPP Loan is designed to help small businesses keep their doors open during a time of social distancing and mandatory business closures.
Unfortunately, the program was rushed through the implementation process and was pushed live before banks had the ability to create stable processes for accepting and funding these loan applications.
The CARES Act was signed into law on Friday, March 27, 2020. The Small Business Administration (SBA) and Treasury announced that the first day banks would accept PPP Loan applications would be Friday, April 3, 2020, just one week after the Act was passed. The Interim Final Rule, which provides guidelines for how the program will be run, was released the evening of Thursday, April 2, 2020, only hours before the deadline banks were given to begin accepting loans.
Many Banks Simply Weren’t Ready to Handle This Program
While some smaller banks began accepting PPP Loan applications right away, many of the larger commercial banks informed their customers they were not currently accepting applications. Many other banks were limiting applications to current customers only.
Some banks even went so far as to limit applications to customers that had both an established bank account, and an existing loan product, such as a small business loan, business credit card or business line of credit.
This latter limitation is especially frustrating for small business owners.
* * *
Where Can Small Business Turn if Their Bank Isn’t Accepting PPP Loan Applications?
The SBA has announced that business owners can apply at any participating SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, or Farm Credit System institution.
However, many banks are currently limiting PP Loan applications to current customers.
If this describes your bank, then you have several choices:
- You can wait until your bank starts accepting PPP Loan applications;
- You can try to open a new bank account elsewhere;
- or you can apply through another participating SBA 7(a) lender. There are some companies that specialize in small business loans that have already streamlined the application process for this program.
There are pros and cons to each of these options.
Should Small Business Owners Wait Until Their Bank Begins Accepting Applications?
While the program is open through June 30, 2020, funds are limited. The CARES Act included $349 billion toward helping small businesses. Midway through the first day, Steven Mnuchin, the Secretary of the Treasury, tweeted that over $1.8 billion in PPP Loans had already been processed, primarily from community banks. Some big banks had already taken in large amounts as well, but were not included in those numbers.
Waiting is an option, but it is not without risk. The SBA expects this program to be oversubscribed and funds may run out in the next few weeks.
Should Small Business Owners Open an Account Elsewhere?
With many banks limiting access to current customers, opening a new business bank account is an option. However, this can take time, as opening a business bank account can take more time than opening a personal account, which can be opened online in just a few minutes.
In addition, some banks are limiting loan applications to clients that were already customers prior to the loan being announced. If you decide to open a new bank account, be sure to clarify whether or not you will be able to apply for the PPP loan.
Finding Another Participating SBA 7(a) Lender is Another Option
The SBA isn’t limiting the PPP Loan funding to banks. You can try finding another lender that will fund these loans. The SBA website has a list of the top 100 most active SBA 7(a) lenders.
At this point, it may be worth working through that list to see which lenders are accepting applications at this time.
Will The PPP Loan Program Run Out of Funds?
At this point, it is almost a given that the funds will run out. The question is when? And right now, no one knows when that will happen.
In addition to the numbers tweeted by Steven Mnuchin, Bank of America tweeted they processed over $6 billion in PPP loans in just the first day of the program.
* * *
Full article: https://www.forbes.com/sites/ryanguina/2020/04/04/small-business-owners-frustrated-with-failed-paycheck-protection-program-launch/#5bd4c3546500
Trump Administration Plans to Pay Hospitals to Treat Uninsured Coronavirus Patients--Update
By Stephanie Armour
The Trump administration is expected to use a federal stimulus package to pay hospitals that treat uninsured people with the new coronavirus as long as they agree not to bill the patients or issue unexpected charges, according to two people familiar with the planning.
The plan, which could be released Friday, comes as the White House faces mounting criticism for not launching a special enrollment period for people seeking coverage under the Affordable Care Act. Congressional Democrats also are pressuring the administration and insurers to waive treatment costs for the growing number of Americans who are losing employer-provided health coverage as job losses mount.
Hospitals treating the uninsured often bill patients for the difference between the amount they get from the government and the cost of care. The uninsured also may get bills for care provided by doctors who aren't directly employed by the hospital. Both would be barred under the administration proposal, and hospitals would likely be reimbursed at current Medicare rates, people familiar with the planning said.
Hospitals are eager to get funding and administration officials are working now to determine how the money will be divided, according to one of the people familiar with the planning. It will go toward revenue assistance, covering the costs of the uninsured, and the needs of hospitals. For example, needs may be higher for hospitals in hotspots hard-hit by the pandemic.
Hospitals, which typically bear the brunt of costs for uncompensated care, have been bracing for an influx of patients. Hospitals of all types provided more than $38 billion in uncompensated care in 2017, according to the American Hospital Association.
Full article: https://ih.advfn.com/stock-market/stock-news/82165041/trump-administration-plans-to-pay-hospitals-to-tre
By Stephanie Armour
The Trump administration is expected to use a federal stimulus package to pay hospitals that treat uninsured people with the new coronavirus as long as they agree not to bill the patients or issue unexpected charges, according to two people familiar with the planning.
The plan, which could be released Friday, comes as the White House faces mounting criticism for not launching a special enrollment period for people seeking coverage under the Affordable Care Act. Congressional Democrats also are pressuring the administration and insurers to waive treatment costs for the growing number of Americans who are losing employer-provided health coverage as job losses mount.
Hospitals treating the uninsured often bill patients for the difference between the amount they get from the government and the cost of care. The uninsured also may get bills for care provided by doctors who aren't directly employed by the hospital. Both would be barred under the administration proposal, and hospitals would likely be reimbursed at current Medicare rates, people familiar with the planning said.
Hospitals are eager to get funding and administration officials are working now to determine how the money will be divided, according to one of the people familiar with the planning. It will go toward revenue assistance, covering the costs of the uninsured, and the needs of hospitals. For example, needs may be higher for hospitals in hotspots hard-hit by the pandemic.
Hospitals, which typically bear the brunt of costs for uncompensated care, have been bracing for an influx of patients. Hospitals of all types provided more than $38 billion in uncompensated care in 2017, according to the American Hospital Association.
Full article: https://ih.advfn.com/stock-market/stock-news/82165041/trump-administration-plans-to-pay-hospitals-to-tre
Open Technology Institute
Easing the Home Connectivity Crunch
Wi-Fi's Role in the 5G Wireless Ecosystem
RSVP
The widespread work and school closures that are disrupting daily life and the economy have highlighted how critical it is to have affordable, high-capacity internet connectivity throughout every home. Stay-at-home orders are turning homes into classrooms and offices, with parents and kids sharing available bandwidth on multiple laptops, tablets, and smartphones.
Even homes with gigabit-capable fiber or cable service are discovering that today’s Wi-Fi is constrained in supporting multiple users engaged in video conferencing, streaming video, and other high-bandwidth applications.
Beyond the current crisis, future 5G applications, such as virtual and augmented reality, will require more and more bandwidth. Smart homes and enterprises need affordable bandwidth to connect the emerging Internet of Things (IoT). In rural and small town areas, more unlicensed spectrum will allow wireless internet service providers (WISPs) to provide higher-capacity service. And in lower-income areas, enhanced Wi-Fi can help narrow the digital divide.
FCC Chairman Ajit Pai will join us to discuss the importance of Next Generation Wi-Fi (Wi-Fi 6) as a complement to 5G mobile networks and as a pillar of a world-leading 5G wireless ecosystem.
The FCC is considering two proposals to open more than 1200 megahertz of unlicensed spectrum in the 5 and 6 GHz bands capable of supporting the very wide channels of spectrum for Wi-Fi 6 and Wi-Fi 7 (160 megahertz and beyond) and paving the way for a new era of wireless innovation.
Responding to the Chairman’s remarks, a panel discussion featuring experts with a variety of perspectives on future use cases for Wi-Fi and wireless connectivity will join us.
Keynote Discussion:
Chairman Ajit Pai, Federal Communications Commission, @AjitPaiFCC
Discussion Panel:
Ross Marchand, @RossAMarchand
Policy Director, Taxpayer Protection Alliance
Christina Mason, @WISPAnews
Vice President for Legislative Affairs, Wireless Internet Service Providers Association (WISPA)
John Windhausen, @shlbcoalition
Executive Director, Schools, Health & Libraries Broadband (SHLB) Coalition
Audrey Connors, @CharterGOV
Vice President, Government Affairs, Charter Communications
Chris Szymanski, @C_Szymanski
Director, Product Marketing & Global Government Affairs, Broadcom Inc.
Michael Calabrese, @MCalabreseNAF (Moderator)
Director, Wireless Future Project, New America’s Open Technology Institute
Please note that this event will be online only.
You can register for the event via Zoom by clicking here.
If you have any questions about accessing the webcast, please reach out to events@newamerica.org.
This event is co-sponsored by the Taxpayers Protection Alliance.
Easing the Home Connectivity Crunch: Wi-Fi’s Role in the 5G Wireless Ecosystem
Monday, April 6, 2020
1:00 PM – 2:15 PM ET
ONLINE
RSVP
Tweet about mergers and ventilators by Michael Carrier -- Rutgers Law School
https://www.linkedin.com/in/michael-carrier-7029b81?miniProfileUrn=urn%3Ali%3Afs_miniProfile%3AACoAAABTcPIBXTA3LBC9u5ZoPTkDJWFXxmKxY20
We don’t have enough ventilators. A decade ago, the gov’t chose small company Newport to supply it with inexpensive versions. But Newport was swallowed up by Covidien to protect its existing ventilator business. Textbook example of consolidation harms, Innovator’s Dilemma (company protects its business), killer acquisitions (acquire/quash rival to maintain existing model).
* * *
The Carrier tweet refers to this NYT article
The U.S. Tried to Build a New Fleet of Ventilators. The Mission Failed. nytimes.com https://www.nytimes.com/2020/03/29/business/coronavirus-us-ventilator-shortage.html?referringSource=articleShare
The Federal Government's clouded crystal ball revisited
“I don’t think corona is as big a threat as people make it out to be,” the acting chairman of the Council of Economic Advisers, Tomas Philipson, told reporters during a Feb. 18 briefing
"I have all this data about I.C.U. capacity . . . . "I'm doing my own projections, and I've gotten a lot smarter about this. New York doesn't need all the ventilators." Jared Kushner
Posting by DAR
“I don’t think corona is as big a threat as people make it out to be,” the acting chairman of the Council of Economic Advisers, Tomas Philipson, told reporters during a Feb. 18 briefing
"I have all this data about I.C.U. capacity . . . . "I'm doing my own projections, and I've gotten a lot smarter about this. New York doesn't need all the ventilators." Jared Kushner
Posting by DAR
Advice for small businesses and not-for-profits seeking CARES Act loan help
With $2 trillion allocated for businesses, not-for-profits, individuals, federal agencies, and state and local governments, the CARES Act has been designed to distribute capital broadly. There are a number of provisions that impact small businesses and not-for-profits. It’s early to expect regulations and procedural advice from the federal Small Business Administration or banks that will help administer the CARES Act. But we have found some information that may help with early planning.
There is useful information in the U.S. Chamber of Commerce Guide to the recently passed Coronavirus Aid, Relief, and Economic Security Act (https://www.uschamber.com/co/start/strategy/cares-act-small-business-guide ) (see the statute at https://www.govinfo.gov/content/pkg/CREC-2020-03-27/pdf/CREC-2020-03-27.pdf)
The Chamber’s Guide to the CARES Act explains that currently, the SBA guarantees small business loans that are given out by a network of more than 800 lenders across the U.S. The new CARES Paycheck Protection Program creates a type of emergency loan that can be forgiven when used to maintain payroll through June and expands the network beyond SBA so that more banks, credit unions and lenders can issue those loans. The basic purpose is to incentivize small businesses to not lay off workers and to rehire laid-off workers that lost jobs due to COVID-19 disruptions.
The Guide explains that the Paycheck Protection Program, one of the largest sections of the CARES Act, is the most important provision in the new stimulus bill for most small businesses. This new program sets aside $350 billion in government-backed loans, and it is modeled after the existing SBA 7(a) loan program (see https://www.uschamber.com/co/run/business-financing/guide-to-sba-loans)
The Paycheck Protection Program offers loans for small businesses with fewer than 500 employees, select types of businesses with fewer than 1,500 employees, 501(c)(3) non-profits with fewer than 500 workers and some 501(c)(19) veteran organizations. Additionally, the self-employed, sole proprietors, and freelance and gig economy workers are also eligible to apply. Businesses, even without a personal guarantee or collateral, can get a loan as long as they were operational on February 15, 2020.
The maximum loan amount under the Paycheck Protection Act is $10 million, with an interest rate no higher than 4%. No personal guarantee or collateral is required for the loan. The lenders, including banks that will work in cooperation with the federal government, are expected to defer fees, principal and interest for no less than six months and no more than one year.
Small businesses that take out these loans can get some or all of their loans forgiven. The Guide explains that, generally speaking, as long as employers continue paying employees at normal levels during the eight weeks following the origination of the loan, then the amount they spent on payroll costs (excluding costs for any compensation above $100,000 annually), mortgage interest, rent payments and utility payments can be combined and that portion of the loan will be forgiven.
The Chamber Guide points out that another important aspect of the CARES Act for small businesses is that it expands eligibility for the SBA’s Economic Injury Disaster Loans (EIDLs). [See https://www.uschamber.com/co/start/strategy/applying-for-sba-disaster-relief-loan] In early March, prior to passage of the CARES Act, the SBA’s disaster loan program was extended to all small businesses affected by COVID-19, but the CARES Act opens this program up further and makes it easier to apply.
The Guide points out the following changes worked by the CARES Act concerning the the SBA’s Economic Injury Disaster Loans (EIDLs):
In the meanwhile, there is some additional pragmatic advice available, including advice from Peter Reilly at https://www.forbes.com/sites/peterjreilly/2020/03/28/paycheck-protection-programdevilish-detailssome-uncertainty/#5ba2051f652f).
Reilly emphasizes that the new CARES Act Paycheck Protection Program is an extension of the Small Business Administration 7(a) program. Reilly further points out that the SBA needs to make up the exact rules and then the rules have to be implemented by the 1,800 banks that are part of the program. Reilly recommends that “to participate you need to contact a bank.” Reilly helpfully advises that “US Bank has a pre-application you can do on-line and they will get back to you.” [https://apply.usbank.com/applications/business/InquiryForm] Reilly says that he did not get anywhere with the other large banks he contacted. He says that “If you have an existing banking relationship, you should contact that bank first thing.”
Reilly offers useful advice on what borrowers will need to demonstrate to lenders. Besides promising that you are only going to take out one loan under the Payroll Protection Program, you have to certify two things. One is that you intend to use the money to retain workers, maintain payroll or make mortgage lease or utility payments. The other thing you have to certify is that “uncertainty of current economic conditions makes necessary the loan request” to support your ongoing operations.
Another point emphasized by Reilly is that no collateral or personal guaranty is required. Interest is no more than 4% and repayment, if required, can be over a period as long as ten years. You don’t have to show that you can’t borrow the money elsewhere.
Finally, here is an excerpt from the Reilly/Forbes article that includes useful comment on aspects of the CARES Act that will require further clarification:
There are three important things that people want to know about this program. How much can you borrow? How are you supposed to spend the money? And how much of the loan will be forgiven?
It can be somewhat confusing because each set of rules uses some of the same elements, but they are different in how they are combined.
“Payroll costs” is the most important concept and thankfully is defined the same way throughout.
“Payroll costs” is defined very broadly and includes salary, wage, commission, or similar compensation, payment of cash tip or equivalent, payment for vacation, parental, family, medical, or sick leave, allowance for dismissal or separation, payment required for the provisions of group health care benefits, including insurance premiums, payment of any retirement benefit, and payment of State or local tax assessed on the compensation of employees.
And there is one more thing included in payroll costs that I find pretty puzzling:
“the sum of payments of any compensation to or income of a sole proprietor or independent contractor that is a wage, commission, income, net earnings from self-employment, or similar compensation and that is in an amount that is not more than $100,000 in 1 year, as prorated for the covered period”
Now I am not sure exactly what that last item means. I read it to mean that you also include the people you are paying as independent contractors and if you are a sole proprietor whatever your schedule C profit was (up to $100,000) and something similar for partnerships.
Including your Schedule C profit would put you in a similar position (slightly better maybe) as an S corporation owner who paid himself a reasonable salary. An S corporation owner that did not pay himself salary might be worse off.
Excluded from payroll costs are amounts attributable to payroll over $100,000 and amounts for which you are getting credit under the Families First Coronavirus Response Act.
How Much Can You Borrow?
This is a little confusing. There are things that you can use the loan for besides “payroll costs”, but the maximum loan computation is based solely on “payroll costs”. It is 2.5 times the average monthly amount from “ the 1-year period before the date on which the loan is made” unless the Administrator, whoever that is, says that you are seasonal. If you are seasonal it is the amount you paid in 2019 for the 12 week period beginning February 15, 2019 or at your election March 1 to June 30.
And there is a $10,000,000 limit, but if your payroll is that large, you should have staff figuring this out for you.
“The 1-year period before the date on which the loan is made” strikes me as something of a moving target.
What Can You Use The Loan For?
Besides payroll costs you can use the loan funds for:
“(II) costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums;
“(III) employee salaries, commissions, or similar compensations;
“(IV) payments of interest on any mortgage obligation (which shall not include any prepayment of or payment of principal on a mortgage obligation);
“(V) rent (including rent under a lease agreement);
“(VI) utilities; and
“(VII) interest on any other debt obligations that were incurred before the covered period.
There does seem to be some redundancy there.
I would recommend that you seriously consider opening an account where you deposit the loan proceeds and using that account to pay permitted expenses. That would give you a very easy audit trail.
How Much Can Be Forgiven?
This gets very tricky, because the forgiveness section uses the term “covered period”, but defines it differently than the loan amount section. It is the eight-week period beginning with the origination of the loan.
Here is the actual language:
“Forgiveness.—An eligible recipient shall be eligible for forgiveness of indebtedness on a covered loan in an amount equal to the sum of the following costs incurred and payments made during the covered period:
(1) Payroll costs.
(2) Any payment of interest on any covered mortgage obligation (which shall not include any prepayment of or payment of principal on a covered mortgage obligation).
(3) Any payment on any covered rent obligation.
(4) Any covered utility payment.”
It would seem that you are on a kind of hybrid accounting method in measuring the forgiveness amount. Things that you paid during the covered period that you incurred before and things that you incur during the period that you pay after seem to count. I wouldn’t plan on that being the right interpretation, but keep it in mind.
But then there is a reduction in the forgiveness amount based on a headcount fraction.
“ (A) IN GENERAL.—The amount of loan forgiveness under this section shall be reduced, but not increased, by multiplying the amount described in subsection (b) by the quotient obtained by dividing--
(i) the average number of full-time equivalent employees per month employed by the eligible recipient during the covered period; by
(ii) (I) at the election of the borrower--
(aa) the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on February 15, 2019 and ending on June 30, 2019; or
(bb) the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on January 1, 2020 and ending on February 29, 2020; or
(II) in the case of an eligible recipient that is seasonal employer, as determined by the Administrator, the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on February 15, 2019 and ending on June 30, 2019.
(B) CALCULATION OF AVERAGE NUMBER OF EMPLOYEES.—For purposes of subparagraph (A), the average number of full-time equivalent employees shall be determined by calculating the average number of full-time equivalent employees for each pay period falling within a month.”
There is also a carve-back in the forgiveness amount if there is a reduction in pay of more than 25% of any individual full-time employee.
These reductions, however, are not implemented if you are fully staffed up by June 30.
All Might Not Be Forgiven
Even if you spend all the money on permitted expenses, the difference in the definition of “covered period” might mean that you won’t have the full amount forgiven. And then there is that headcount problem.
[end of the Reilly excerpt from Forbes]
This posting is by Don Allen Resnikoff
With $2 trillion allocated for businesses, not-for-profits, individuals, federal agencies, and state and local governments, the CARES Act has been designed to distribute capital broadly. There are a number of provisions that impact small businesses and not-for-profits. It’s early to expect regulations and procedural advice from the federal Small Business Administration or banks that will help administer the CARES Act. But we have found some information that may help with early planning.
There is useful information in the U.S. Chamber of Commerce Guide to the recently passed Coronavirus Aid, Relief, and Economic Security Act (https://www.uschamber.com/co/start/strategy/cares-act-small-business-guide ) (see the statute at https://www.govinfo.gov/content/pkg/CREC-2020-03-27/pdf/CREC-2020-03-27.pdf)
The Chamber’s Guide to the CARES Act explains that currently, the SBA guarantees small business loans that are given out by a network of more than 800 lenders across the U.S. The new CARES Paycheck Protection Program creates a type of emergency loan that can be forgiven when used to maintain payroll through June and expands the network beyond SBA so that more banks, credit unions and lenders can issue those loans. The basic purpose is to incentivize small businesses to not lay off workers and to rehire laid-off workers that lost jobs due to COVID-19 disruptions.
The Guide explains that the Paycheck Protection Program, one of the largest sections of the CARES Act, is the most important provision in the new stimulus bill for most small businesses. This new program sets aside $350 billion in government-backed loans, and it is modeled after the existing SBA 7(a) loan program (see https://www.uschamber.com/co/run/business-financing/guide-to-sba-loans)
The Paycheck Protection Program offers loans for small businesses with fewer than 500 employees, select types of businesses with fewer than 1,500 employees, 501(c)(3) non-profits with fewer than 500 workers and some 501(c)(19) veteran organizations. Additionally, the self-employed, sole proprietors, and freelance and gig economy workers are also eligible to apply. Businesses, even without a personal guarantee or collateral, can get a loan as long as they were operational on February 15, 2020.
The maximum loan amount under the Paycheck Protection Act is $10 million, with an interest rate no higher than 4%. No personal guarantee or collateral is required for the loan. The lenders, including banks that will work in cooperation with the federal government, are expected to defer fees, principal and interest for no less than six months and no more than one year.
Small businesses that take out these loans can get some or all of their loans forgiven. The Guide explains that, generally speaking, as long as employers continue paying employees at normal levels during the eight weeks following the origination of the loan, then the amount they spent on payroll costs (excluding costs for any compensation above $100,000 annually), mortgage interest, rent payments and utility payments can be combined and that portion of the loan will be forgiven.
The Chamber Guide points out that another important aspect of the CARES Act for small businesses is that it expands eligibility for the SBA’s Economic Injury Disaster Loans (EIDLs). [See https://www.uschamber.com/co/start/strategy/applying-for-sba-disaster-relief-loan] In early March, prior to passage of the CARES Act, the SBA’s disaster loan program was extended to all small businesses affected by COVID-19, but the CARES Act opens this program up further and makes it easier to apply.
The Guide points out the following changes worked by the CARES Act concerning the the SBA’s Economic Injury Disaster Loans (EIDLs):
- EIDLs are now also available to ESOPs with fewer than 500 employees. (An employee stock ownership plan (ESOP) is an employee benefit plan that gives workers ownership interest in the company.) They are also available to all non-profit organizations, including 501(c)(6)s, and to individuals operating as sole proprietors or independent contractors.
- EIDLs can be approved by the SBA based solely on an applicant’s credit score.
- EIDLs that are smaller than $200,000 can be approved without a personal guarantee.
- Borrowers can receive a $10,000 emergency grant cash advance that can be forgiven if spent on paid leave, maintaining payroll, increased costs due to supply chain disruption, mortgage or lease payments or repaying obligations that cannot be met due to revenue losses.
In the meanwhile, there is some additional pragmatic advice available, including advice from Peter Reilly at https://www.forbes.com/sites/peterjreilly/2020/03/28/paycheck-protection-programdevilish-detailssome-uncertainty/#5ba2051f652f).
Reilly emphasizes that the new CARES Act Paycheck Protection Program is an extension of the Small Business Administration 7(a) program. Reilly further points out that the SBA needs to make up the exact rules and then the rules have to be implemented by the 1,800 banks that are part of the program. Reilly recommends that “to participate you need to contact a bank.” Reilly helpfully advises that “US Bank has a pre-application you can do on-line and they will get back to you.” [https://apply.usbank.com/applications/business/InquiryForm] Reilly says that he did not get anywhere with the other large banks he contacted. He says that “If you have an existing banking relationship, you should contact that bank first thing.”
Reilly offers useful advice on what borrowers will need to demonstrate to lenders. Besides promising that you are only going to take out one loan under the Payroll Protection Program, you have to certify two things. One is that you intend to use the money to retain workers, maintain payroll or make mortgage lease or utility payments. The other thing you have to certify is that “uncertainty of current economic conditions makes necessary the loan request” to support your ongoing operations.
Another point emphasized by Reilly is that no collateral or personal guaranty is required. Interest is no more than 4% and repayment, if required, can be over a period as long as ten years. You don’t have to show that you can’t borrow the money elsewhere.
Finally, here is an excerpt from the Reilly/Forbes article that includes useful comment on aspects of the CARES Act that will require further clarification:
There are three important things that people want to know about this program. How much can you borrow? How are you supposed to spend the money? And how much of the loan will be forgiven?
It can be somewhat confusing because each set of rules uses some of the same elements, but they are different in how they are combined.
“Payroll costs” is the most important concept and thankfully is defined the same way throughout.
“Payroll costs” is defined very broadly and includes salary, wage, commission, or similar compensation, payment of cash tip or equivalent, payment for vacation, parental, family, medical, or sick leave, allowance for dismissal or separation, payment required for the provisions of group health care benefits, including insurance premiums, payment of any retirement benefit, and payment of State or local tax assessed on the compensation of employees.
And there is one more thing included in payroll costs that I find pretty puzzling:
“the sum of payments of any compensation to or income of a sole proprietor or independent contractor that is a wage, commission, income, net earnings from self-employment, or similar compensation and that is in an amount that is not more than $100,000 in 1 year, as prorated for the covered period”
Now I am not sure exactly what that last item means. I read it to mean that you also include the people you are paying as independent contractors and if you are a sole proprietor whatever your schedule C profit was (up to $100,000) and something similar for partnerships.
Including your Schedule C profit would put you in a similar position (slightly better maybe) as an S corporation owner who paid himself a reasonable salary. An S corporation owner that did not pay himself salary might be worse off.
Excluded from payroll costs are amounts attributable to payroll over $100,000 and amounts for which you are getting credit under the Families First Coronavirus Response Act.
How Much Can You Borrow?
This is a little confusing. There are things that you can use the loan for besides “payroll costs”, but the maximum loan computation is based solely on “payroll costs”. It is 2.5 times the average monthly amount from “ the 1-year period before the date on which the loan is made” unless the Administrator, whoever that is, says that you are seasonal. If you are seasonal it is the amount you paid in 2019 for the 12 week period beginning February 15, 2019 or at your election March 1 to June 30.
And there is a $10,000,000 limit, but if your payroll is that large, you should have staff figuring this out for you.
“The 1-year period before the date on which the loan is made” strikes me as something of a moving target.
What Can You Use The Loan For?
Besides payroll costs you can use the loan funds for:
“(II) costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums;
“(III) employee salaries, commissions, or similar compensations;
“(IV) payments of interest on any mortgage obligation (which shall not include any prepayment of or payment of principal on a mortgage obligation);
“(V) rent (including rent under a lease agreement);
“(VI) utilities; and
“(VII) interest on any other debt obligations that were incurred before the covered period.
There does seem to be some redundancy there.
I would recommend that you seriously consider opening an account where you deposit the loan proceeds and using that account to pay permitted expenses. That would give you a very easy audit trail.
How Much Can Be Forgiven?
This gets very tricky, because the forgiveness section uses the term “covered period”, but defines it differently than the loan amount section. It is the eight-week period beginning with the origination of the loan.
Here is the actual language:
“Forgiveness.—An eligible recipient shall be eligible for forgiveness of indebtedness on a covered loan in an amount equal to the sum of the following costs incurred and payments made during the covered period:
(1) Payroll costs.
(2) Any payment of interest on any covered mortgage obligation (which shall not include any prepayment of or payment of principal on a covered mortgage obligation).
(3) Any payment on any covered rent obligation.
(4) Any covered utility payment.”
It would seem that you are on a kind of hybrid accounting method in measuring the forgiveness amount. Things that you paid during the covered period that you incurred before and things that you incur during the period that you pay after seem to count. I wouldn’t plan on that being the right interpretation, but keep it in mind.
But then there is a reduction in the forgiveness amount based on a headcount fraction.
“ (A) IN GENERAL.—The amount of loan forgiveness under this section shall be reduced, but not increased, by multiplying the amount described in subsection (b) by the quotient obtained by dividing--
(i) the average number of full-time equivalent employees per month employed by the eligible recipient during the covered period; by
(ii) (I) at the election of the borrower--
(aa) the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on February 15, 2019 and ending on June 30, 2019; or
(bb) the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on January 1, 2020 and ending on February 29, 2020; or
(II) in the case of an eligible recipient that is seasonal employer, as determined by the Administrator, the average number of full-time equivalent employees per month employed by the eligible recipient during the period beginning on February 15, 2019 and ending on June 30, 2019.
(B) CALCULATION OF AVERAGE NUMBER OF EMPLOYEES.—For purposes of subparagraph (A), the average number of full-time equivalent employees shall be determined by calculating the average number of full-time equivalent employees for each pay period falling within a month.”
There is also a carve-back in the forgiveness amount if there is a reduction in pay of more than 25% of any individual full-time employee.
These reductions, however, are not implemented if you are fully staffed up by June 30.
All Might Not Be Forgiven
Even if you spend all the money on permitted expenses, the difference in the definition of “covered period” might mean that you won’t have the full amount forgiven. And then there is that headcount problem.
[end of the Reilly excerpt from Forbes]
This posting is by Don Allen Resnikoff
Coronavirus stimulus bill designates D.C. as a territory
The $2 trillion coronavirus stimulus legislation designates Washington, D.C., as a territory, meaning the District is poised to get $500 million while states will receive at least $1.25 billion apiece. Mayor Muriel Bowser said the funding level is "unconscionable ... especially given the unique challenges we take on as the seat of the federal government," and Sen. Chris Van Hollen, D-Md., said he aims to provide the additional money to the District retroactively.
Full Story: The Washington Post (tiered subscription model) (3/26), CNN (3/26)
The $2 trillion coronavirus stimulus legislation designates Washington, D.C., as a territory, meaning the District is poised to get $500 million while states will receive at least $1.25 billion apiece. Mayor Muriel Bowser said the funding level is "unconscionable ... especially given the unique challenges we take on as the seat of the federal government," and Sen. Chris Van Hollen, D-Md., said he aims to provide the additional money to the District retroactively.
Full Story: The Washington Post (tiered subscription model) (3/26), CNN (3/26)
The DC attorney general's office has sent out five cease-and-desist letters warning area stores and an online seller to stop price gouging,
news release at https://thedcline.org/2020/03/26/press-release-ag-racine-sends-cease-and-desist-letters-to-stop-price-gouging-by-district-stores-and-online-sellers/
One Southeast store reportedly upped the price for an eight-ounce bottle of hand sanitizer to $15; another charged $19.99 for a container of Lysol. "D.C. residents who are seeking scarce and essential goods to protect their health should not have to worry about paying illegally inflated prices," said AG Karl Racine.
news release at https://thedcline.org/2020/03/26/press-release-ag-racine-sends-cease-and-desist-letters-to-stop-price-gouging-by-district-stores-and-online-sellers/
One Southeast store reportedly upped the price for an eight-ounce bottle of hand sanitizer to $15; another charged $19.99 for a container of Lysol. "D.C. residents who are seeking scarce and essential goods to protect their health should not have to worry about paying illegally inflated prices," said AG Karl Racine.
Politics and the virus: Ohio and Texas have moved to make abortion inaccessible under directives seeking to free up hospital beds by postponing “elective” and “nonessential” procedures.
The American College of Obstetricians and Gynecologists and the American Board of Obstetrics and Gynecology issued a statement saying that abortion should not fall into the category of procedures that can be delayed during the coronavirus outbreak, calling it “an essential component of comprehensive health care. The statement is at https://www.acog.org/news/news-releases/2020/03/joint-statement-on-abortion-access-during-the-covid-19-outbreak
State AGs Ask Amazon, Facebook & Others To Help With COVID-19 Price Gouging
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A group of 33 attorneys general from U.S. states and territories called on Amazon, eBay, Facebook, Walmart and Craigslist to prevent price gouging on coronavirus-related products.
The coalition, led by Pennsylvania’s Democratic Attorney General Josh Shapiro, sent a letter to the companies saying they “have an ethical obligation and patriotic duty to help your fellow citizens in this time of need by doing everything in your power to stop price gouging in real-time.” Attorneys general from California, Colorado and the District of Columbia were among those involved in the effort.
https://www.cnbc.com/2020/03/25/state-ags-call-on-amazon-and-others-to-prevent-coronavirus-price-gouging.html
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A group of 33 attorneys general from U.S. states and territories called on Amazon, eBay, Facebook, Walmart and Craigslist to prevent price gouging on coronavirus-related products.
The coalition, led by Pennsylvania’s Democratic Attorney General Josh Shapiro, sent a letter to the companies saying they “have an ethical obligation and patriotic duty to help your fellow citizens in this time of need by doing everything in your power to stop price gouging in real-time.” Attorneys general from California, Colorado and the District of Columbia were among those involved in the effort.
https://www.cnbc.com/2020/03/25/state-ags-call-on-amazon-and-others-to-prevent-coronavirus-price-gouging.html
Drivers Say Uber and Lyft Are Blocking Unemployment Pay
States like New York and California have made gig workers eligible for jobless benefits and sick days. But the companies have resisted complying.
See https://www.nytimes.com/2020/03/24/business/economy/coronavirus-uber-lyft-drivers-unemployment.html
States like New York and California have made gig workers eligible for jobless benefits and sick days. But the companies have resisted complying.
See https://www.nytimes.com/2020/03/24/business/economy/coronavirus-uber-lyft-drivers-unemployment.html
From DMN: Spinrilla Sues the RIAA for Issuing False Takedown Notices
Independent hip-hop discovery app Spinrilla is suing the Recording Industry Association of America (RIAA) for allegedly issuing false DMCA takedown notices.
The story continues here.https://www.digitalmusicnews.com/2020/03/23/spinrilla-sues-riaa-for-false-takedown-notices/
Independent hip-hop discovery app Spinrilla is suing the Recording Industry Association of America (RIAA) for allegedly issuing false DMCA takedown notices.
The story continues here.https://www.digitalmusicnews.com/2020/03/23/spinrilla-sues-riaa-for-false-takedown-notices/
DOJ moves against ‘despicable scammers’ operating fake Covid-19 vaccine website
In the first federal action against fraud involving the coronavirus outbreak, the DOJ obtained a temporary restraining order against a website selling a bogus vaccine.
The DOJ said Sunday that operators of the website “coronavirusmedicalkit.com” were engaging in an alleged wire fraud scheme to profit from the confusion and fear surrounding Covid-19.
Full article:https://fcpablog.com/2020/03/23/doj-moves-against-dispicable-scammers-operating-fake-covid-19-vaccine-website/
In the first federal action against fraud involving the coronavirus outbreak, the DOJ obtained a temporary restraining order against a website selling a bogus vaccine.
The DOJ said Sunday that operators of the website “coronavirusmedicalkit.com” were engaging in an alleged wire fraud scheme to profit from the confusion and fear surrounding Covid-19.
Full article:https://fcpablog.com/2020/03/23/doj-moves-against-dispicable-scammers-operating-fake-covid-19-vaccine-website/
Amazon Accused of Monopolization, Massive Price-Fixing Scheme
Amazon.com Inc. was hit with antitrust claims in Seattle federal court over an alleged “pricing scheme that broadly and anti-competitively impacts virtually all products offered for sale in the U.S. retail e-commerce market.”
“Amazon’s horizontal price-fixing agreement with its two million sellers is a per se violation of antitrust law,” the lawsuit says.
The proposed consumer class action targeting the e-commerce giant, which is responsible for 49% of U.S. online retail sales, was filed late Thursday in the U.S. District Court for the Western District of Washington.
The suit accuses Amazon of continuing to enforce de facto “most favored nation” pricing terms against 2 million third-party sellers offering 600 million products, despite promising the Federal Trade Commission last year that it would stop.
When the mega-retailer abandoned that policy, it was supposed to begin permitting merchants to offer lower prices through cheaper competing platforms, like eBay or their own websites, according to the complaint.
From https://news.bloomberglaw.com/mergers-and-antitrust/amazon-accused-of-monopolization-massive-price-fixing-scheme
Amazon.com Inc. was hit with antitrust claims in Seattle federal court over an alleged “pricing scheme that broadly and anti-competitively impacts virtually all products offered for sale in the U.S. retail e-commerce market.”
“Amazon’s horizontal price-fixing agreement with its two million sellers is a per se violation of antitrust law,” the lawsuit says.
The proposed consumer class action targeting the e-commerce giant, which is responsible for 49% of U.S. online retail sales, was filed late Thursday in the U.S. District Court for the Western District of Washington.
The suit accuses Amazon of continuing to enforce de facto “most favored nation” pricing terms against 2 million third-party sellers offering 600 million products, despite promising the Federal Trade Commission last year that it would stop.
When the mega-retailer abandoned that policy, it was supposed to begin permitting merchants to offer lower prices through cheaper competing platforms, like eBay or their own websites, according to the complaint.
From https://news.bloomberglaw.com/mergers-and-antitrust/amazon-accused-of-monopolization-massive-price-fixing-scheme
DNEW YORK/WASHINGTON (Reuters) - https://www.reuters.com/article/us-health-coronavirus-usa-amazon-com/amazon-asks-shoppers-to-cooperate-with-u-s-probe-of-coronavirus-price-gouging-idUSKBN21636U
Amazon.com Inc notified a customer about a Department of Justice criminal investigation of price-gouging by third-party sellers on its e-commerce marketplace.
The email was sent by Joell Parks, a senior law enforcement response specialist at Amazon to a Reuters editor, who is also an Amazon customer.
“We wanted to notify you directly about this matter in the event that you are contacted by the Department of Justice in connection with its investigation,” Parks said in his email.
The company has come under pressure from lawmakers to nab sellers engaged in price-gouging amid the coronavirus outbreak.
DC OAG issues price gouging alert
OFFICE OF THE ATTORNEY GENERAL:
REPORT PRICE GOUGING: Submit a complaint: OAG has established a rapid-response team to investigate consumer complaints about price gouging. If you believe you have been overcharged, you can report price gouging to OAG by calling(202) 442-9828, emailingConsumer.Protection@dc.gov, submitting a complaint online at oag.dc.gov/ConsumerComplaint. Scammers may attempt to defraud consumers by selling products that are ineffective at preventing the disease and spreading misinformation through social media and other channels. Other scammers may pretend to solicit donations to help coronavirus victims, but instead are stealing consumers’ money and personal information. Here are some tips to protect yourself from these scams: The District's price gouging consumer protection law is now in effect during the state of emergency. District law prevents any individual or company from overcharging for similar goods or services that were sold in the 90 days before the Mayor’s emergency declaration (e.g., overcharging for products such as sanitizer, tissue paper, cleaning and disinfecting products, among others). Individuals and companies that break the law are subject to $5,000 fines per violation and the revocation of licenses and permits.
PROTECT YOURSELF FROM SCAMS AND FRAUD Coronavirus (COVID-19):Know Your Rights The Office of the Attorney General (OAG) is closely monitoring the Coronavirus (COVID-19) public health situation and following the Mayor’s emergency declaration. To ensure that District residents know their rights, here are some important tips for consumers about scams, frauds, and price gouging; tips for workers about paid sick leave; and free health resources about Coronavirus (COVID-19). For the latest information, visitoag.dc.gov/coronavirus.
Beware of emails claiming to be from the CDC or experts saying that they have information about the virus. For the most up-to-date information about the Coronavirus and prevention tips, visit the Centers for DiseaseControl and Prevention (CDC) and the World Health Organization (WHO).
Consult a medical professional for questions about prevention and treatment. Ignore offers for vaccinations and be wary of advertisements for cures or treatments for the disease. While the best way to prevent this illness is to avoid exposure to the virus, the CDC and the DC Department of Health have tips to prevent the spread of respiratory illnesses.
Do your own research before donating to a charity. Remember that an organization may not be authentic just because it uses words like “CDC” or “government” in its name or has reputable looking seals or logos on its materials. There are a number of independent online sources you can use to verify that a charity is legitimate.
Use OAG’s free resource to learn more tips on how to avoid falling victim to charity scams. Report scams to the Office of the Attorney General (OAG): If you believe you have been the victim of a scam, contact OAG by calling 202-442-9828, emailing consumer.protection@dc.gov, or submitting a complaint online atoag.dc.gov/ConsumerComplaint.
Amazon.com Inc notified a customer about a Department of Justice criminal investigation of price-gouging by third-party sellers on its e-commerce marketplace.
The email was sent by Joell Parks, a senior law enforcement response specialist at Amazon to a Reuters editor, who is also an Amazon customer.
“We wanted to notify you directly about this matter in the event that you are contacted by the Department of Justice in connection with its investigation,” Parks said in his email.
The company has come under pressure from lawmakers to nab sellers engaged in price-gouging amid the coronavirus outbreak.
DC OAG issues price gouging alert
OFFICE OF THE ATTORNEY GENERAL:
REPORT PRICE GOUGING: Submit a complaint: OAG has established a rapid-response team to investigate consumer complaints about price gouging. If you believe you have been overcharged, you can report price gouging to OAG by calling(202) 442-9828, emailingConsumer.Protection@dc.gov, submitting a complaint online at oag.dc.gov/ConsumerComplaint. Scammers may attempt to defraud consumers by selling products that are ineffective at preventing the disease and spreading misinformation through social media and other channels. Other scammers may pretend to solicit donations to help coronavirus victims, but instead are stealing consumers’ money and personal information. Here are some tips to protect yourself from these scams: The District's price gouging consumer protection law is now in effect during the state of emergency. District law prevents any individual or company from overcharging for similar goods or services that were sold in the 90 days before the Mayor’s emergency declaration (e.g., overcharging for products such as sanitizer, tissue paper, cleaning and disinfecting products, among others). Individuals and companies that break the law are subject to $5,000 fines per violation and the revocation of licenses and permits.
PROTECT YOURSELF FROM SCAMS AND FRAUD Coronavirus (COVID-19):Know Your Rights The Office of the Attorney General (OAG) is closely monitoring the Coronavirus (COVID-19) public health situation and following the Mayor’s emergency declaration. To ensure that District residents know their rights, here are some important tips for consumers about scams, frauds, and price gouging; tips for workers about paid sick leave; and free health resources about Coronavirus (COVID-19). For the latest information, visitoag.dc.gov/coronavirus.
Beware of emails claiming to be from the CDC or experts saying that they have information about the virus. For the most up-to-date information about the Coronavirus and prevention tips, visit the Centers for DiseaseControl and Prevention (CDC) and the World Health Organization (WHO).
Consult a medical professional for questions about prevention and treatment. Ignore offers for vaccinations and be wary of advertisements for cures or treatments for the disease. While the best way to prevent this illness is to avoid exposure to the virus, the CDC and the DC Department of Health have tips to prevent the spread of respiratory illnesses.
Do your own research before donating to a charity. Remember that an organization may not be authentic just because it uses words like “CDC” or “government” in its name or has reputable looking seals or logos on its materials. There are a number of independent online sources you can use to verify that a charity is legitimate.
Use OAG’s free resource to learn more tips on how to avoid falling victim to charity scams. Report scams to the Office of the Attorney General (OAG): If you believe you have been the victim of a scam, contact OAG by calling 202-442-9828, emailing consumer.protection@dc.gov, or submitting a complaint online atoag.dc.gov/ConsumerComplaint.
Open Markets Calls for Ban on Takeovers by Large Corporation and Funds for Duration of Crisis
As Congress continues to debate its response to the COVID-19 outbreak, Open Markets Institute released the statement below, calling for an immediate ban on all mergers and acquisitions by any corporation with more than $100 million in annual revenue.
The Open Markets Institute calls on Congress, the Trump administration, and federal and state law enforcement agencies to use their various powers to impose an immediate ban on all mergers and acquisitions by any corporation with more than $100 million in annual revenue, and by any financial institution or equity fund with more than $100 million in capitalization. The ban should remain in place for the duration of the present crisis.
The immediate reason for this ban is the present inability of the Antitrust Division of the Department of Justice (DOJ), the Federal Trade Commission (FTC), and other competition law enforcement agencies to effectively evaluate mergers, given the semi-closure of government due to the present crisis. According to Politico, the DOJ has already asked for more time to review existing proposals for mergers, even in advance of any potential surge in deals.
More fundamentally, the ban is needed to prevent a wholesale concentration of additional power by corporations that already dominate or largely dominate their industries, especially in ways that may significantly worsen the crisis that now threatens America’s health, social, and economic systems. The history of the Panic of 2008 and the subsequent Great Recession instructs us that such a massive, uncontrolled consolidation will result in the unnecessary firing of millions of employees, the unnecessary bankrupting of innumerable independent businesses, a dramatic slowing of innovation in vital industries such as pharmaceuticals, and a further concentration of power and control dangerous both to our democracy and our open commercial systems. [1]
Excerpt from posting at https://openmarketsinstitute.org/
As Congress continues to debate its response to the COVID-19 outbreak, Open Markets Institute released the statement below, calling for an immediate ban on all mergers and acquisitions by any corporation with more than $100 million in annual revenue.
The Open Markets Institute calls on Congress, the Trump administration, and federal and state law enforcement agencies to use their various powers to impose an immediate ban on all mergers and acquisitions by any corporation with more than $100 million in annual revenue, and by any financial institution or equity fund with more than $100 million in capitalization. The ban should remain in place for the duration of the present crisis.
The immediate reason for this ban is the present inability of the Antitrust Division of the Department of Justice (DOJ), the Federal Trade Commission (FTC), and other competition law enforcement agencies to effectively evaluate mergers, given the semi-closure of government due to the present crisis. According to Politico, the DOJ has already asked for more time to review existing proposals for mergers, even in advance of any potential surge in deals.
More fundamentally, the ban is needed to prevent a wholesale concentration of additional power by corporations that already dominate or largely dominate their industries, especially in ways that may significantly worsen the crisis that now threatens America’s health, social, and economic systems. The history of the Panic of 2008 and the subsequent Great Recession instructs us that such a massive, uncontrolled consolidation will result in the unnecessary firing of millions of employees, the unnecessary bankrupting of innumerable independent businesses, a dramatic slowing of innovation in vital industries such as pharmaceuticals, and a further concentration of power and control dangerous both to our democracy and our open commercial systems. [1]
Excerpt from posting at https://openmarketsinstitute.org/
From Open Markets: Coronavirus and the Fragility of Industrial and Financial Systems - An Open Markets Primer
In recent weeks, people around the world have watched in horror as key supply systems have failed or come close to failing, in ways that have greatly exacerbated both the health and economic threats posed by the coronavirus pandemic. Problems include a severe shortage of masks and respirators to protect front-line medical workers and the public at large, and a likely shortage of ventilators for people suffering from the disease. Problems also include the cascading shutdown of many large-scale production systems, such as automobile manufacturing, because of the shutdown of highly concentrated parts production systems, with tens of thousands of manufacturing workers joining the ranks of the unemployed.
These are issues that the Open Markets team knows a lot about. Indeed, our work grew out of a book that Barry Lynn published in 2005, called End of the Line: The Rise and Coming Fall of the Global Corporation (Doubleday), which in turn was based on a 2002 article in Harper’s Magazine, “Unmade in America.” In those works, Lynn provided pioneering research and reporting on how how concentration of capacity made vital production systems subject to cascading and potentially catastrophic collapse because of any of a variety of shocks, including pandemics.
In the years since, the Open Markets team has covered this topic in greater depth than any other group of researchers and thinkers, whether in academia, government, or the private sector, with the partial exception of Yossi Sheffi at MIT and the University of Minnesota epidemiologist Michael Osterholm. This includes pioneering analyses of the effects on international supply systems of the 2008 Lehman Brothers crash, of the 2011 Tohoku disaster in Japan, and of Superstorm Sandy in 2012. It also includes extensive discussions of the complicated and highly dangerous political dimensions of such extreme industrial interdependence.
At Open Markets, we understand that Americans are still in the very early stages of making sense of the threats posed by the coronavirus pandemic and the resulting crash of stock markets around the world. But for those who seek to understand why these events have proven to be so disruptive, and what we can do to prevent a repetition in the future, we have created a new primer on our website, here, which includes links to a number of pioneering articles and papers on these issues.
And read a recent interview of Lynn by David Dayen of The American Prospect here. https://prospect.org/economy/the-man-who-knew/
In recent weeks, people around the world have watched in horror as key supply systems have failed or come close to failing, in ways that have greatly exacerbated both the health and economic threats posed by the coronavirus pandemic. Problems include a severe shortage of masks and respirators to protect front-line medical workers and the public at large, and a likely shortage of ventilators for people suffering from the disease. Problems also include the cascading shutdown of many large-scale production systems, such as automobile manufacturing, because of the shutdown of highly concentrated parts production systems, with tens of thousands of manufacturing workers joining the ranks of the unemployed.
These are issues that the Open Markets team knows a lot about. Indeed, our work grew out of a book that Barry Lynn published in 2005, called End of the Line: The Rise and Coming Fall of the Global Corporation (Doubleday), which in turn was based on a 2002 article in Harper’s Magazine, “Unmade in America.” In those works, Lynn provided pioneering research and reporting on how how concentration of capacity made vital production systems subject to cascading and potentially catastrophic collapse because of any of a variety of shocks, including pandemics.
In the years since, the Open Markets team has covered this topic in greater depth than any other group of researchers and thinkers, whether in academia, government, or the private sector, with the partial exception of Yossi Sheffi at MIT and the University of Minnesota epidemiologist Michael Osterholm. This includes pioneering analyses of the effects on international supply systems of the 2008 Lehman Brothers crash, of the 2011 Tohoku disaster in Japan, and of Superstorm Sandy in 2012. It also includes extensive discussions of the complicated and highly dangerous political dimensions of such extreme industrial interdependence.
At Open Markets, we understand that Americans are still in the very early stages of making sense of the threats posed by the coronavirus pandemic and the resulting crash of stock markets around the world. But for those who seek to understand why these events have proven to be so disruptive, and what we can do to prevent a repetition in the future, we have created a new primer on our website, here, which includes links to a number of pioneering articles and papers on these issues.
And read a recent interview of Lynn by David Dayen of The American Prospect here. https://prospect.org/economy/the-man-who-knew/
March 21, 2020 01:42 PM
Providers warn Senate GOP coronavirus funding proposal will not be enough
Hospitals, physicians, nurses and community health centers are warning that funding proposed by Senate Republicans for a third coronavirus response package will not be enough to prepare for an onslaught of COVID-19 patients and critical shortage of medical supplies.
Senate Republicans included a Medicare payment bump and a hospital add-on payment in their first draft of an economic stimulus package. But comments by Senate leaders indicate direct funding for hospitals, money to purchase more medical supplies and increase testing capacity could be left for later.
It's unclear when Congress would get to major legislation after it passes this third response package. Providers are saying they can't wait.
"This is very urgent and I don't know that we can wait for a fourth package," American Hospital Association President and CEO Rick Pollack told reporters Saturday. "We need to make sure that it is in this package."
The AHA, American Medical Association and American Nurses Association asked Congress for a $100 billion to provide an emergency fund for hospitals' COVID-19 costs, childcare for frontline healthcare workers and money to bolster surge capacity.
AHA also suggested ensuring that hospitals were eligible for low-cost loans, as many small and mid-sized hospitals have faced cashflow concerns. Most hospitals would not be eligible for the small business loan assistance outlined in the Senate GOP proposal, the AHA said.
Washington Gov. Jay Inslee (D) on Thursday called for a halt to elective surgeries and dental services. That followed a March 18 guidance from the CMS recommending that hospitals postpone all non-essential medical and surgical procedures until the pandemic subsides. J. Scott Graham, the CEO of Three Rivers and North Valley rural hospitals in Brewster, Wash.,, said he fears having to close if he can't make payroll or pay suppliers for protective equipment.
"In terms of planning, we know we need to ramp up, but we are concerned that we will not be able to be around by the time the surge hits," Graham said Saturday.
AHA Executive Vice President Tom Nickels said he expects the Senate GOP's opening offer will be "massaged and improved," and believes more funding for providers will be added during negotiations.
The Federation of American Hospitals on Friday hiked its funding request for hospital aid to $225 billion, including $90 billion for bi-weekly supplemental payments to help with hospitals' cashflow, and $100 billion loan backstop program.
"The truth is the care will not be there without Congress ensuring hospitals are properly funded. It's never been more important that policymakers take bold action now to assure care and save lives," said FAH President and CEO Chip Kahn.
Community health centers were set to receive $1.3 billion in new payments under Senate Republicans' initial offer, but the National Association of Community Health Centers ripped the funding as inadequate. Ongoing federal funding for the centers will expire May 22, and the group has agitated for $3 billion in emergency funds and a longer longer-term funding guarantee.
"The COVID-19 crisis demands health centers stay on the front lines, but their mandatory funding runs out on May 22 and not a single dollar of emergency funds has reached them yet," NACHC President and CEO Tom Van Coverden.
Physician groups, including the AMA, American College of Physicians, American Academy of Family Physicians, American College of Surgeons, and Medical Group Management Association, called for tax relief, no-interest loans, and additional steps to accelerate telehealth services.
The draft text would allow the HHS secretary to develop and implement a new payment rule for federally qualified health centers and rural health clinics that provide telehealth services to eligible patients. Payment rates would be based on payment that currently applies to comparable telehealth services under the physician fee schedule, according to the text.
It's a continuation of recent efforts from lawmakers and the Trump administration to reduce telehealth restrictions in the wake of the COVID-19 outbreak.
AMA also asked Congress for additional medical supplies and workforce support to expand paid family, medical and sick leave. Healthcare workers could be exempted from paid leave provided in Congress' second aid package.
AMA President Dr. Patrice Harris, who participated in a virtual meeting with President Donald Trump and Vice President Mike Pence on March 18, said she told them that alleviating personal protective equipment shortages and testing shortages are the group's top priorities. A March 19 MGMA survey found that 89% of physician practices surveyed reported experiencing shortages of critical PPE.
"The funding that Congress has already approved must be increased, and all possible actions must be taken to increase the capacity to manufacture, acquire, and distribute PPE," AMA Executive Vice President and CEO Dr. James Madara wrote in a letter to congressional leaders.
https://www.modernhealthcare.com/politics-policy/providers-warn-senate-gop-coronavirus-funding-proposal-will-not-be-enough
COVID-19 poses long-term impact to not-for-profit hospitals
A myriad of factors will buffet hospitals as they scramble to deal with COVID-19, Moody's Investors Service analysts project as they adjust not-for-profits' outlook from stable to negative.
Read More https://www.modernhealthcare.com/providers/covid-19-poses-long-term-impact-not-profit-hospitals?utm_source=modern-healthcare-covid-19-coverage&utm_medium=email&utm_campaign=20200320&utm_content=article1-readmore
A myriad of factors will buffet hospitals as they scramble to deal with COVID-19, Moody's Investors Service analysts project as they adjust not-for-profits' outlook from stable to negative.
Read More https://www.modernhealthcare.com/providers/covid-19-poses-long-term-impact-not-profit-hospitals?utm_source=modern-healthcare-covid-19-coverage&utm_medium=email&utm_campaign=20200320&utm_content=article1-readmore
Hospital beds in short supply
from https://thehill.com/homenews/state-watch/487869-maryland-ny-move-to-boost-hospital-capacity-ahead-of-coronavirus-wave
In separate announcements, Maryland Gov. Larry Hogan (R) and New York Gov. Andrew Cuomo (D) said they had ordered state health officials to reopen closed hospitals and to convert other facilities in order to accommodate patients.
In an interview, Hogan said the projected number of cases he has seen in scenarios developed by the state's health experts show the need to bolster capacity. Maryland has about 8,000 hospital beds, and Hogan's order will boost capacity by an additional 6,000.
"We don't have exact numbers, but it goes from really bad to terrible," Hogan said of the projections he has seen. "None of [the projections] look good. What we're really all working on, we're all trying to bend the curve down. If we can stretch this out and slow it down by social distancing and all these unprecedented actions we're taking, then it looks a lot different."
In New York, Cuomo's order will add an additional 9,000 beds to the 53,000 beds already available around the state.
"I need, first and foremost, to find available facilities that can be converted. I'm asking local governments, especially in the most dense area, to immediately identify a number of beds in facilities that are available," Cuomo said Monday. "This is very expensive and I don't want to pay money for acquisition of property and real estate. But we need the communities that are most effected to begin finding available beds."
Cuomo said New York City would need an estimated 5,000 additional beds by itself. Nassau and Suffolk counties likely need another 1,000 beds each, and Westchester County — at the heart of the state's outbreak in New Rochelle — needs 2,000 new beds.
Since the beginning of the outbreak in late January, health officials and elected officials have worried about overwhelming the existing health care system. The nation has about 924,000 hospital beds, according to the American Hospital Association, including just under 100,000 that can serve people in intensive care.
Without action, Cuomo said at a Monday news conference, "you overwhelm the hospitals. You have people on gurneys in hallways. That is what is going to happen now if we do nothing. That is what is going to happen now if we do nothing. And that, my friends, will be a tragedy."
from https://thehill.com/homenews/state-watch/487869-maryland-ny-move-to-boost-hospital-capacity-ahead-of-coronavirus-wave
In separate announcements, Maryland Gov. Larry Hogan (R) and New York Gov. Andrew Cuomo (D) said they had ordered state health officials to reopen closed hospitals and to convert other facilities in order to accommodate patients.
In an interview, Hogan said the projected number of cases he has seen in scenarios developed by the state's health experts show the need to bolster capacity. Maryland has about 8,000 hospital beds, and Hogan's order will boost capacity by an additional 6,000.
"We don't have exact numbers, but it goes from really bad to terrible," Hogan said of the projections he has seen. "None of [the projections] look good. What we're really all working on, we're all trying to bend the curve down. If we can stretch this out and slow it down by social distancing and all these unprecedented actions we're taking, then it looks a lot different."
In New York, Cuomo's order will add an additional 9,000 beds to the 53,000 beds already available around the state.
"I need, first and foremost, to find available facilities that can be converted. I'm asking local governments, especially in the most dense area, to immediately identify a number of beds in facilities that are available," Cuomo said Monday. "This is very expensive and I don't want to pay money for acquisition of property and real estate. But we need the communities that are most effected to begin finding available beds."
Cuomo said New York City would need an estimated 5,000 additional beds by itself. Nassau and Suffolk counties likely need another 1,000 beds each, and Westchester County — at the heart of the state's outbreak in New Rochelle — needs 2,000 new beds.
Since the beginning of the outbreak in late January, health officials and elected officials have worried about overwhelming the existing health care system. The nation has about 924,000 hospital beds, according to the American Hospital Association, including just under 100,000 that can serve people in intensive care.
Without action, Cuomo said at a Monday news conference, "you overwhelm the hospitals. You have people on gurneys in hallways. That is what is going to happen now if we do nothing. That is what is going to happen now if we do nothing. And that, my friends, will be a tragedy."
A pre-Covid-19 warning from 2018:
Safety-Net Health Systems At Risk: Who Bears The Burden Of Uncompensated Care?
May 10, 2018 10.1377/hblog20180503.138516 Safety-net health systems play an essential role in the US health care system by providing care to low-income and vulnerable populations, including the uninsured and individuals with Medicaid. Even after coverage expansions under the Affordable Care Act (ACA), about 27 million Americans remain uninsured and millions more underinsured, for whom safety-net health systems play a major role in providing inpatient, emergency, and ambulatory services.
The financial viability of safety-net health systems may be increasingly in peril given the recent elimination of the individual mandate penalty—which the Congressional Budget Office estimates may lead to 13 million additional uninsured people by 2027—and cuts to disproportionate-share hospital (DSH) payments. DSH payments offset the cost of caring for low-income patients. Although the Centers for Medicare and Medicaid Services (CMS) did recently signal a year-on-year increase of $1.6 billion in Medicare DSH payments, anticipating an increase in uninsured patients, overall DSH funding is set to fall by $44 billion in the coming decade. Many of the most affected hospitals are in weak financial condition. The recently passed budget bill delays cuts until 2020 but increases the annual reduction thereafter: $4 billion in 2020, followed by $8 billion per year through 2025.
Growing financial challenges faced by safety-net health systems should concern not just system administrators and low-income patients but also neighboring hospitals and state governments, for which safety-net systems help defray the costs of uncompensated and undercompensated care. When uninsured patients receive care, health systems often bear the cost: In 2016, hospitals alone provided $38.3 billion in uncompensated care, and by some estimates, government funding offsets only 65 percent of such costs. While policy debates focus on overall insurance coverage, less attention is paid to heterogeneous effects of coverage changes when considering the varying payer mix across providers. Hospital margins on average have risen to 30-year highs, driven by commercial prices, but hospitals with fewer commercially insured patients face a different reality.
Effects Of Safety-Net Hospital Closures
Recent years have brought a wave of hospital closures, especially in rural and suburban areas where hospitals are struggling financially. What happens when a safety-net health system closes? Evidence suggests that the total demand for uncompensated care in a health care market does not change and that there is nearly complete spillover of uncompensated care to remaining hospitals. Each newly uninsured individual is associated with a $900 increase in uncompensated care annually, and some recent Medicaid disenrollment has likely resulted in even larger per capita uncompensated cost growth. While it is widely believed that commercial insurers subsidize care for Medicaid and uninsured patients, research suggests that hospitals cannot fully shift increased costs onto commercially insured patients. Medicaid expansion appears to have helped hospitals; reductions in uncompensated care through state Medicaid expansions were associated with substantially lower likelihood of hospital closures, especially in rural areas and in those with large numbers of uninsured patients.
Historical examples of safety-net hospital closures or privatization are telling. In the 1990s, Milwaukee, Wisconsin, Boston, Massachusetts, and Tampa, Florida, all experienced restructuring or mergers of their major safety-net hospitals amid fiscal pressures. In each case, local uncompensated care cost growth exceeded public funding. The situation in Milwaukee was particularly stark: The percentage of countywide uncompensated care delivered at the safety-net hospital post-merger declined from 45 percent to 19 percent, while the share delivered at the next two largest area hospitals increased from 19 percent to 40 percent.
Safety-net health systems thus provide financial protection not only to the patients they serve but also to neighboring hospitals that would otherwise be required to take on an increased uncompensated care burden. Federal law requires that hospitals treat patients regardless of their ability to pay—even though the federal government does not ensure that all individuals have insurance. Programs such as Emergency Medicaid provide some payment for lifesaving treatments and limited recovery services, but longer-term care—including negative-margin services such as psychiatric care—is also disproportionately delivered by safety-net health systems.
Steps To Protect The Safety Net
What can be done to protect the viability of safety-net health systems and the health of the populations they serve?
First, Congress should revisit whether DSH cuts should not just be delayed but also curtailed. The ACA’s DSH payment reductions were designed to be offset by insurance expansions. However, the decline in uncompensated care has not been proportionate with proposed DSH reductions in part because many states have chosen not to expand Medicaid. States that expanded Medicaid have experienced a greater decline in uncompensated care costs compared to non-expansion states, but they too struggle to provide care to low-income populations. These challenges may be exacerbated by elimination of the individual mandate penalty and the expected rise in the uninsured population. Neighboring providers should also organize against DSH cuts because they will likely shoulder a larger burden of uncompensated care if safety-net health systems are no longer able to do so.
Second, states should consider more targeted distribution of DSH funding. Currently, states have wide latitude in how they can distribute DSH funding. They are required to make payments to “deemed-DSH” hospitals—those with a Medicaid utilization rate one standard deviation above the mean or with a low-income inpatient utilization rate higher than 25 percent—but may distribute funding much more broadly if they choose. While only a few hospitals in some states receive DSH funding, other states disburse this funding to nearly all hospitals, and those with the greatest need may receive a small fraction of the funding. The consequences of DSH cuts may be most salient in states such as Texas and Georgia that did not expand Medicaid and that distribute DSH funding across a relatively large group of hospitals.
Third, nonprofit hospitals’ community benefit obligations could be leveraged to decrease the burden on safety net health systems. While all nonprofit health systems enjoy tax-exempt status if they engage in activities that benefit their communities, there is broad variation in what constitutes “community benefit” and how much health systems spend on such activities. As one suggestion, nonprofit hospitals that are not safety-net systems could be expected to assume longer-term responsibility for patients they care for in emergency and inpatient settings as part of their community benefit requirements. Currently, many uninsured patients stabilized at non-safety-net hospitals are referred to safety-net hospitals for follow-up care. Requiring non-safety-net health systems to make accommodations for ongoing management after acute episodes would help ease this burden on safety-net health systems.
Finally, for the sake of their constituent providers and low-income populations, state Medicaid agencies and CMS should re-evaluate Section 1115 waivers that impose work requirements and other strategies to restrict Medicaid eligibility. Kentucky’s recently approved waiver, for example, may result in a 15 percent decrease in Medicaid enrollment by its fifth year, which may negatively affect the financial stability of safety-net providers and have underappreciated spillover effects on non-safety-net providers. Kentucky’s waiver—similar to those proposed in Indiana, Arkansas, and several other states—also terminates retroactive Medicaid coverage, which allows providers to receive payment for care delivered to patients who were eligible for, but not enrolled in, Medicaid at the time of care. Retroactive coverage helps increase financial stability for safety-net providers and, importantly, protects other providers from bearing these costs.
Policies that threaten the viability of safety-net health systems may harm vulnerable populations and have underappreciated spillover effects for neighboring hospitals and state governments. When patients are uninsured or underinsured, safety-net health systems often bear the cost—and their closure or downscaling may have downstream consequences for the payer mix and financial stability of other area providers, and the health of both privately and publicly insured patients.
https://www.healthaffairs.org/do/10.1377/hblog20180503.138516/full/
- The Coming Bailout Is a Moral Failure
- Congress has leverage to rebalance the economy, but so far, it isn’t using it.
Franklin Foer
From The Atlantic
This is the story of an unnatural disaster.
In the meantime, the lobbyists are set to plunder. This morning I heard Nicholas Calio on the radio. During George W. Bush’s administration, he was the White House’s smooth operator on the Hill, a kibitzer and arm-twister who advanced its legislative agenda. Now he works for the airline industry, and he was pleading on its behalf. Of course, there’s every reason to keep vital industries afloat. A vibrant economy needs a transit system. But the injustice of spending $50 billion on the airlines should drive the public to apoplexy. The companies that used their fat profits to buy back stocks as they constricted the distance between seats, that only managed to innovate by charging new fees, will be the ones the government chooses to salvage.
The coming bailout is a familiar moral catastrophe. During the financial crisis, the government saved the banking industry’s bacon, while asking exceedingly little of the culprits. When the government spends billions of dollars to save industries, it has enormous leverage. This is the moment when Congress can shape an economy. It should demand, for instance, that the airlines keep their workers in their jobs; it should place hard caps on executive pay and prohibit stock buybacks; it can demand that airlines take steps to reduce their Sasquatch-size carbon footprint. (And, damnit, Congress should require that their seats actually recline!) If the industry wants the public’s money, it will have to deal with it.
In a crisis, the government can’t save everything. Just as hospitals must ration ventilators, the government must make choices. These choices are excruciating because every industry that perishes will take down workers and investors with it. But just because choices are excruciating doesn’t mean that they shouldn’t be made. Rather, if the public doesn’t make moral demands of its politicians, then the politicians will protect the well connected; they will siphon money to cronies: The Trump administration is considering billions in aid to casino magnates like Steve Wynn and Sheldon Adelson. While casinos are important employers, they also preside over a gambling industry that addicts and abuses citizens—why should they get pulled from the fire while independent booksellers and local florists wither and die?
Mitt Romney had the best idea for how to stimulate the economy and get through the next few months: The government should pay $1,000 to every household in America. (Or even more than that, as Michael Bennet, Cory Booker, and Sherrod Brown have proposed.) That’s a stimulus with immediate impact. Some vital parts of the American economy, like the airlines, might need help bridging the gap until demand returns, since their failure carries systemic risks. But the reconstruction of the American economy isn’t something that should happen in a back room, as the rest of the country fears for its life. Lobbyists shouldn’t be rewarded at a moment like this one, when protesting their greed in the streets would carry mortal risk. Even before this crisis, American capitalism desperately needed rebalancing. What emerges from this economic collapse should be shaped by political choices and moral thinking, not by crony capitalists seeking to jam a sick nation.
Franklin Foer is a staff writer for The Atlantic. He is the author of World Without Mind and How Soccer Explains the World: An Unlikely Theory of Globalization.
COMPETITION POLICY IN TROUBLED TIMES
By John Fingleton[59]
CEO, Office of Fair Trading
20 January 2009
SUMMARY
While recent years have witnessed growing public confidence in the ability of competitive markets to deliver positive outcomes, the credit crunch and the recession have shocked markets, policy-makers and the general public and risk damaging that confidence.
Recession is potentially hostile towards competition policy: the less visible and less immediate costs of restricting competition can look more attractive to policy-makers faced with a range of unpalatable options. Policies to relax competition in the US in the 1930s and in Japan in the 1990s arguably added to the duration of recession in both countries. Learning from history and the robust economic evidence linking competition to productivity growth, we need to ensure that today's solutions do not inadvertently become tomorrow's problems.
It is essential that the causes of the credit crunch are properly diagnosed so that the policy response is targeted "micro-surgery" rather than drastic amputation. If we mistake regulatory failure for market failure, we risk undermining the source of much of the wealth creation that came from the opening of markets to competition.
Intervention to rescue the financial system from systemic collapse in exceptional circumstances can be crucial, but should not be seen as a reason to suspend the importance of competition in other sectors, either via State aid, anti-competitive mergers or cartels.
Subsidies are rarely ideal: they are costly for the taxpayer, can prop-up less efficient firms, create dependency, and ultimately damage competitive incentives. Restrictions on competition are worse. In addition to higher consumer prices and the inefficiency, they are less transparent and can result in permanent changes to market structure. Ad hoc changes to the competition rules can also remove consistency and predictability for business, with additional harm to efficiency. Naturally, incumbent business will rarely object to subsidies or restrictions on competition.
The OFT—and other competition agencies—need to be able to respond quickly to changing priorities, and display a degree of pragmatism in recognising times when other policy interests may over-ride competition policy. At the same time, our role as advocates of competition, within government, with fair-dealing businesses and beyond has never been more important; supporting governments in tackling powerful private vested interests whose solutions would cost us dearly well into the future.
The full article is at https://publications.parliament.uk/pa/cm200809/cmselect/cmdereg/329/329we12.htm
Frequent Uber and Lyft Foe Says Misclassification of Drivers Is Worsening the Global Health Crisis
In a pair of emergency motions for preliminary injunction, lawyers from Lichten & Liss Riordan who represent classes of Uber and Lyft employees are asking the U.S. District Court for the Northern District of California to find that they should be classified as employees, so that they can take advantage of state-mandated sick leave.
https://www.law.com/therecorder/2020/03/20/frequent-uber-and-lyft-foe-says-miclassification-of-drivers-is-worsening-the-global-health-crisis/?kw=Frequent%20Uber%20and%20Lyft%20Foe%20Says%20Misclassification%20of%20Drivers%20is%20Worsening%20the%20Global%20Health%20Crisis&utm_source=email&utm_medium=enl&utm_campaign=newsroomupdate&utm_content=20200320&utm_term=ca
In a pair of emergency motions for preliminary injunction, lawyers from Lichten & Liss Riordan who represent classes of Uber and Lyft employees are asking the U.S. District Court for the Northern District of California to find that they should be classified as employees, so that they can take advantage of state-mandated sick leave.
https://www.law.com/therecorder/2020/03/20/frequent-uber-and-lyft-foe-says-miclassification-of-drivers-is-worsening-the-global-health-crisis/?kw=Frequent%20Uber%20and%20Lyft%20Foe%20Says%20Misclassification%20of%20Drivers%20is%20Worsening%20the%20Global%20Health%20Crisis&utm_source=email&utm_medium=enl&utm_campaign=newsroomupdate&utm_content=20200320&utm_term=ca
Steve Pearlstein on the novel virus and political cynicism
Steve Pearlstein, the contrarian Washington Post commenter on economic and political issues, is willing to say the obvious, and say it plainly: politicians’ response to the corona virus tends to the cynical. Cynical in this context means self-serving as opposed to serving the public.
What may be open to debate is the detail of particular political actions that may be viewed as cynical. Pearlstein finds it to be cynical that both Republican and Democrat Congressional leaders are ready to send out large checks, including large numbers of recipients who do not need it, such as people who have not been laid off their jobs, and pensioners. He writes: “It is yet another sign of our political dysfunction that a government that dithered for weeks before getting serious about fighting a global pandemic now can’t take a few days for thoughtful debate about how to spend a trillion dollars to deal with the economic fallout.”
Government dithering has led to other cynical political behavior that Pearlstein does not talk about, but that is discussed elsewhere in the same newspaper. The hard news is that “Health officials in New York, California and other hard-hit parts of the country are restricting coronavirus testing to health care workers and the severely ill, saying the battle to contain the virus is lost and the country is moving into a new phase of the pandemic response. As cases spike sharply in those places, they are bracing for an onslaught and directing scarce resources where they are needed most to save people’s lives. Instead of encouraging broad testing of the public, they’re focused on conserving masks, ventilators and intensive care beds — and on getting still-limited tests to health-care workers and the most vulnerable. The shift is further evidence that rising levels of infection and illness have begun to overwhelm the health care system.”
Politicians put a political spin on the bad news that the U.S. health care system has been allowed to wither over recent decades, to the extent that it is easily overwhelmed, and that dithering has caused failure in the effort to contain the novel corona virus. Our political leaders do not present themselves as Monty Python characters leading a frantic retreat in a battle they failed to engage at an early point when disease containment was possible. No, they say they are courageous and far sighted war-time leaders, boldly directing business closures and stay-at-home rules. Necessary perhaps; heroic no.
The words of Vice-president Pence: “Thank you, Mr. President. It is . . .an inspiration to every American, because thanks to your leadership from early on, not only are we bringing a whole-of-government approach to confronting the coronavirus, we’re bringing and all-of-America approach. Mr. President, from early on, you took decisive action.”
Posting by Don Allen Resnikoff, who takes full responsibility for the content
Steve Pearlstein, the contrarian Washington Post commenter on economic and political issues, is willing to say the obvious, and say it plainly: politicians’ response to the corona virus tends to the cynical. Cynical in this context means self-serving as opposed to serving the public.
What may be open to debate is the detail of particular political actions that may be viewed as cynical. Pearlstein finds it to be cynical that both Republican and Democrat Congressional leaders are ready to send out large checks, including large numbers of recipients who do not need it, such as people who have not been laid off their jobs, and pensioners. He writes: “It is yet another sign of our political dysfunction that a government that dithered for weeks before getting serious about fighting a global pandemic now can’t take a few days for thoughtful debate about how to spend a trillion dollars to deal with the economic fallout.”
Government dithering has led to other cynical political behavior that Pearlstein does not talk about, but that is discussed elsewhere in the same newspaper. The hard news is that “Health officials in New York, California and other hard-hit parts of the country are restricting coronavirus testing to health care workers and the severely ill, saying the battle to contain the virus is lost and the country is moving into a new phase of the pandemic response. As cases spike sharply in those places, they are bracing for an onslaught and directing scarce resources where they are needed most to save people’s lives. Instead of encouraging broad testing of the public, they’re focused on conserving masks, ventilators and intensive care beds — and on getting still-limited tests to health-care workers and the most vulnerable. The shift is further evidence that rising levels of infection and illness have begun to overwhelm the health care system.”
Politicians put a political spin on the bad news that the U.S. health care system has been allowed to wither over recent decades, to the extent that it is easily overwhelmed, and that dithering has caused failure in the effort to contain the novel corona virus. Our political leaders do not present themselves as Monty Python characters leading a frantic retreat in a battle they failed to engage at an early point when disease containment was possible. No, they say they are courageous and far sighted war-time leaders, boldly directing business closures and stay-at-home rules. Necessary perhaps; heroic no.
The words of Vice-president Pence: “Thank you, Mr. President. It is . . .an inspiration to every American, because thanks to your leadership from early on, not only are we bringing a whole-of-government approach to confronting the coronavirus, we’re bringing and all-of-America approach. Mr. President, from early on, you took decisive action.”
Posting by Don Allen Resnikoff, who takes full responsibility for the content
On the destruction of trees when developers tear down small suburban houses and replace them with mini-mansions
Posting by Don Allen Resnikoff
Recently a neighbor in my suburban Bethesda, MD neighborhood wrote to say she had a heavy heart because of the recent removal of two gorgeous, healthy, “specimen” trees in our neighborhood. The removal was incidental to teardown of a small residence to make room for a larger one that would occupy more of the building lot. “The one at the very corner edge of the property was a splendid sweet gum tree whose gorgeous fall foliage and fruit in spring feed birds and wildlife and whose comforting shade is critical in the midst of a climate crisis. The other, a tulip poplar with a diameter of more than 7 feet, is one of the most important pollinating trees and is the sequoia of the east coast.”
It is easy to share my neighbor’s regrets, but it seems very likely that the property developer is in compliance with the relevant law. Local law provides for “mitigation” when a residential developer destroys trees, but the penalties for non-compliance are minimal. That makes it a law that expresses a conservationist’s goals, but is ineffective. The law requires reform if it is to accomplish its stated goal of mitigation.
Specifically, Montgomery County, Maryland has a Tree Canopy Law that requires mitigation for the area disturbed during development activity. Mitigation for felled trees is required in the form of shade trees planted on the same property where the disturbance occurred. Alternatively, applicants for sediment control permits can choose, for any reason, to pay a fee into the Tree Canopy Conservation Account. The Tree Canopy Law sets the fee at $250.
It is hard to imagine that a $250 fine for cutting down a tree is much of a deterrent on projects involving a property worth a million dollars or more. Advocating for the mitigation law to be more rigorous and costly to the developer might be something for Bethesda suburbanites to consider.
See https://www.montgomerycountymd.gov/DEP/Resources/Files/ReportsandPublications/Trees%20%26%20Air/Trees/County%20Reports/2017-Annual-Report.pdf
Posting by Don Allen Resnikoff
Recently a neighbor in my suburban Bethesda, MD neighborhood wrote to say she had a heavy heart because of the recent removal of two gorgeous, healthy, “specimen” trees in our neighborhood. The removal was incidental to teardown of a small residence to make room for a larger one that would occupy more of the building lot. “The one at the very corner edge of the property was a splendid sweet gum tree whose gorgeous fall foliage and fruit in spring feed birds and wildlife and whose comforting shade is critical in the midst of a climate crisis. The other, a tulip poplar with a diameter of more than 7 feet, is one of the most important pollinating trees and is the sequoia of the east coast.”
It is easy to share my neighbor’s regrets, but it seems very likely that the property developer is in compliance with the relevant law. Local law provides for “mitigation” when a residential developer destroys trees, but the penalties for non-compliance are minimal. That makes it a law that expresses a conservationist’s goals, but is ineffective. The law requires reform if it is to accomplish its stated goal of mitigation.
Specifically, Montgomery County, Maryland has a Tree Canopy Law that requires mitigation for the area disturbed during development activity. Mitigation for felled trees is required in the form of shade trees planted on the same property where the disturbance occurred. Alternatively, applicants for sediment control permits can choose, for any reason, to pay a fee into the Tree Canopy Conservation Account. The Tree Canopy Law sets the fee at $250.
It is hard to imagine that a $250 fine for cutting down a tree is much of a deterrent on projects involving a property worth a million dollars or more. Advocating for the mitigation law to be more rigorous and costly to the developer might be something for Bethesda suburbanites to consider.
See https://www.montgomerycountymd.gov/DEP/Resources/Files/ReportsandPublications/Trees%20%26%20Air/Trees/County%20Reports/2017-Annual-Report.pdf
Trump Administration Is Relaxing Oversight of Nursing Homes
A proposal would loosen federal rules meant to control infections, just as the coronavirus rips through nursing homes.
https://www.nytimes.com/2020/03/14/business/trump-administration-nursing-homes.html
A proposal would loosen federal rules meant to control infections, just as the coronavirus rips through nursing homes.
https://www.nytimes.com/2020/03/14/business/trump-administration-nursing-homes.html
Former U.S. Treasury Secretary Larry Summers warns of US economic stagnation threat
Former U.S. Treasury Secretary Larry Summers said the world’s largest economy now confronts a stagnation like Japan’s as government bond yields plunge to ultra-low levels.
“We’re essentially at the Japanese place,” Summers said in a Bloomberg Television interview Thursday. “That’s a place that’s very hard to get out of, as the Japanese experience suggests, and increasingly the European experience suggests.”
The spreading pandemic demands more aggressive action to avoid repeating the mistake of not injecting sufficient fiscal stimulus into the economy after Lehman Brothers failed.
https://www.bing.com/videos/search?q=larry+sommers+&view=detail&mid=52EE5C9825A76EF0BC5952EE5C9825A76EF0BC59&FORM=VIRE
Former U.S. Treasury Secretary Larry Summers said the world’s largest economy now confronts a stagnation like Japan’s as government bond yields plunge to ultra-low levels.
“We’re essentially at the Japanese place,” Summers said in a Bloomberg Television interview Thursday. “That’s a place that’s very hard to get out of, as the Japanese experience suggests, and increasingly the European experience suggests.”
The spreading pandemic demands more aggressive action to avoid repeating the mistake of not injecting sufficient fiscal stimulus into the economy after Lehman Brothers failed.
https://www.bing.com/videos/search?q=larry+sommers+&view=detail&mid=52EE5C9825A76EF0BC5952EE5C9825A76EF0BC59&FORM=VIRE
Klobuchar Presents New Antitrust Bill
Sen. Amy Klobuchar, ranking member of the Judiciary Committee, has introduced a bill that could give antitrust authorities more tools to pursue potentially anticompetitive edge giants, including by fining them up to 15% of revenues for violations.
The bill focuses on various forms of exclusionary behavior, and seeks to modify permissive standards often applied by courts. The text of the bill is at https://www.klobuchar.senate.gov/public/_cache/files/f/8/f81f969e-1c81-4d10-90aa-178a6cb4f159/3A75B8609ADDE8D20C57297DA5B687D7.aecpa.pdf
US Lawmakers Concern About College Textbook Merger
Two US lawmakers expressed serious concern on Tuesday about the effect of a planned merger of college textbook publishers Cengage Learning Holdings and McGraw-Hill Education, saying the deal would create a new industry leader with nearly half the market.
According to Reuters, [https://www.reuters.com/article/us-mcgrawhill-m-a-cengage/college-textbook-merger-raises-serious-concern-among-u-s-lawmakers-idUSKBN20X31R] Representatives David Cicilline, chair of the House Judiciary Committee’s antitrust panel, and Jan Schakowsky, chair of an Energy and Commerce consumer protection panel, urged the Justice Department to scrutinize the merger to ensure it is legal under antitrust law.
In a letter, Cicilline and Schakowsky noted how few college textbook makers were left in the market and that prices had risen 184% since 1998.
“It has also been reported that the merging companies are working to convert the market to all-digital course materials through an ‘inclusive access’ model, in which students are automatically billed for subscription access to textbooks,” the lawmakers wrote.
They said an all-digital model would prevent students from shopping around to get cheaper prices, and “destroy” the used book market.
California AG Drops Challenge To T-Mobile Sprint Merger
T-Mobile’s proposed $26 billion acquisition of Sprint inched closer Wednesday, when California’s Attorney General Xavier Becerra dropped his opposition to the deal in exchange for concessions from the telecoms.
From the AG's press release:
California Attorney General Xavier Becerra today announced a settlement with T-Mobile, resolving the state's challenge to the company's merger with Sprint. The settlement includes terms to protect low-income subscribers, extend access to underserved communities, protect current T-Mobile and Sprint employees, and create jobs in California. T-Mobile will reimburse California for the costs and fees of its investigation and its litigation challenging the merger. This settlement ends the legal challenge brought by Attorney General Becerra leading a multistate coalition, which alleged that the merger was unlawful and would lead to reduced competition and increased prices for consumers.
Our coalition vigorously challenged the T-Mobile/Sprint telecom merger over concerns that it would thwart competition and leave consumers with higher prices,said Attorney General Becerra. We took our case to court to ensure that, no matter its outcome, we'd protect innovation and fair prices. Though the district court approved the merger, its decision also made clear to companies that local markets matter in assessing the competitive impact of a merger and that no one should underestimate the role of state enforcers. Most importantly, today's settlement locks in new jobs and protections for vulnerable consumers, and it extends access to telecom services for our most underserved and rural communities."
As required by the settlement, the merged company is required to:
Sen. Amy Klobuchar, ranking member of the Judiciary Committee, has introduced a bill that could give antitrust authorities more tools to pursue potentially anticompetitive edge giants, including by fining them up to 15% of revenues for violations.
The bill focuses on various forms of exclusionary behavior, and seeks to modify permissive standards often applied by courts. The text of the bill is at https://www.klobuchar.senate.gov/public/_cache/files/f/8/f81f969e-1c81-4d10-90aa-178a6cb4f159/3A75B8609ADDE8D20C57297DA5B687D7.aecpa.pdf
US Lawmakers Concern About College Textbook Merger
Two US lawmakers expressed serious concern on Tuesday about the effect of a planned merger of college textbook publishers Cengage Learning Holdings and McGraw-Hill Education, saying the deal would create a new industry leader with nearly half the market.
According to Reuters, [https://www.reuters.com/article/us-mcgrawhill-m-a-cengage/college-textbook-merger-raises-serious-concern-among-u-s-lawmakers-idUSKBN20X31R] Representatives David Cicilline, chair of the House Judiciary Committee’s antitrust panel, and Jan Schakowsky, chair of an Energy and Commerce consumer protection panel, urged the Justice Department to scrutinize the merger to ensure it is legal under antitrust law.
In a letter, Cicilline and Schakowsky noted how few college textbook makers were left in the market and that prices had risen 184% since 1998.
“It has also been reported that the merging companies are working to convert the market to all-digital course materials through an ‘inclusive access’ model, in which students are automatically billed for subscription access to textbooks,” the lawmakers wrote.
They said an all-digital model would prevent students from shopping around to get cheaper prices, and “destroy” the used book market.
California AG Drops Challenge To T-Mobile Sprint Merger
T-Mobile’s proposed $26 billion acquisition of Sprint inched closer Wednesday, when California’s Attorney General Xavier Becerra dropped his opposition to the deal in exchange for concessions from the telecoms.
From the AG's press release:
California Attorney General Xavier Becerra today announced a settlement with T-Mobile, resolving the state's challenge to the company's merger with Sprint. The settlement includes terms to protect low-income subscribers, extend access to underserved communities, protect current T-Mobile and Sprint employees, and create jobs in California. T-Mobile will reimburse California for the costs and fees of its investigation and its litigation challenging the merger. This settlement ends the legal challenge brought by Attorney General Becerra leading a multistate coalition, which alleged that the merger was unlawful and would lead to reduced competition and increased prices for consumers.
Our coalition vigorously challenged the T-Mobile/Sprint telecom merger over concerns that it would thwart competition and leave consumers with higher prices,said Attorney General Becerra. We took our case to court to ensure that, no matter its outcome, we'd protect innovation and fair prices. Though the district court approved the merger, its decision also made clear to companies that local markets matter in assessing the competitive impact of a merger and that no one should underestimate the role of state enforcers. Most importantly, today's settlement locks in new jobs and protections for vulnerable consumers, and it extends access to telecom services for our most underserved and rural communities."
As required by the settlement, the merged company is required to:
- Make low-cost plans available in California for at least 5 years, including a plan offering 2 GB of high-speed data at $15 per month and 5 GB of high speed data at $25 per month;
- Extend for at least an additional two years the rate plans offered by T-Mobile pursuant to its earlier FCC commitment, ensuring Californians can retain T-Mobile plans held in February 2019 for a total of five years;
- Offer 100 GB of no-cost broadband internet service per year for five years and a free mobile Wi-Fi hotspot device to 10 million qualifying low-income households not currently connected to broadband nationwide, as well as the option to purchase select Wi-Fi enabled tablets at the company’s cost for each qualifying household;
- Protect California jobs by offering all California T-Mobile and Sprint retail employees in good standing an offer of substantially similar employment. T-Mobile also commits that three years after the closing date, the total number of new T-Mobile employees will be equal to or greater than the total number of employees of the unmerged Sprint and T-Mobile companies;
- Create approximately 1,000 new jobs in California with a customer service center in Kingsburg;
- Increase diversity by increasing the participation rate in its employee Diversity and Inclusion program to 60 percent participation within three years; and
- Reimburse California and other coalition states up to $15 million for the costs of the investigation and litigation challenging the merger.
The US Soccer Federation faced a barrage of public criticism after its lawyers wrote in a legal brief that players on the U.S. Women's National Team "do not perform equal work requiring equal skill, effort, and responsibility under similar working conditions."
Here is what the lawyers wrote (see https://www.courtlistener.com/recap/gov.uscourts.cacd.739234/gov.uscourts.cacd.739234.186.0.pdf):
C. WNT and MNT Players Do Not Perform Equal Work Requiring Equal Skill, Effort, and Responsibility Under Similar Working Conditions.
Even Plaintiffs acknowledge that the level of “skill” required for each job in question (WNT player and MNT player) must be “measured by the experience, ability, education, and training required to perform a job.” (Dkt. 170 at 15 (emphasis added), citing 29 C.F.R. § 1620.15.) The overall soccer-playing ability required to compete at the senior men’s national team level is materially influenced by the level of certain physical attributes, such as speed and strength, required for the job. (Morgan Dep. 212-13; Ellis Dep. 291-92.) As Plaintiff Carli Lloyd’s testimony admits, the WNT could not compete successfully against senior men’s national teams because competing against 16- or 17year-old boys “is about as old as [the WNT] can go.” (Lloyd Dep. 103-04, 106-07; Lloyd Dep. Ex. 15.) Plaintiffs ask the Court to conclude that the ability required of an WNT player is equal to the ability required of an MNT player, as a relative matter, by ignoring the materially higher level of speed and strength required to perform the job of an MNT player. The EPA does not allow this. Sims-Fingers v. City of Indianapolis, 493 F.3d 768, 771 (7th Cir. 2007) (EPA does not ensure equal pay for jobs requiring “proportional” skill level). Nor is it a “sexist stereotype” to recognize the different levels of speed and strength required for the two jobs, as Plaintiffs’ counsel contend. On the contrary, it is indisputable “science,” as even Plaintiff Lloyd described it in her testimony. (Lloyd Dep. 103-05.) See also Doraine Lambert Coleman, Sex in Sport,80LAW AND CONTEMPORARY PROBLEMS 63-126(2017)(available at: https://scholarship.law.duke.edu/lcp/vol80/iss4/5) (describing the scientific basis for “the average 10-12% performance gap between elite male and elite female athletes,” which includes differences between males and females in “skeletal structure, muscle composition, heart and lung capacity including VO2 max, red blood cell count, body fat, and the absolute ability to process carbohydrates,” and noting, by way of example, that “no matter how great the great Katie Ledecky gets . . . she will never beat Michael Phelps or his endurance counterparts in the pool”).
Here is what the lawyers wrote (see https://www.courtlistener.com/recap/gov.uscourts.cacd.739234/gov.uscourts.cacd.739234.186.0.pdf):
C. WNT and MNT Players Do Not Perform Equal Work Requiring Equal Skill, Effort, and Responsibility Under Similar Working Conditions.
Even Plaintiffs acknowledge that the level of “skill” required for each job in question (WNT player and MNT player) must be “measured by the experience, ability, education, and training required to perform a job.” (Dkt. 170 at 15 (emphasis added), citing 29 C.F.R. § 1620.15.) The overall soccer-playing ability required to compete at the senior men’s national team level is materially influenced by the level of certain physical attributes, such as speed and strength, required for the job. (Morgan Dep. 212-13; Ellis Dep. 291-92.) As Plaintiff Carli Lloyd’s testimony admits, the WNT could not compete successfully against senior men’s national teams because competing against 16- or 17year-old boys “is about as old as [the WNT] can go.” (Lloyd Dep. 103-04, 106-07; Lloyd Dep. Ex. 15.) Plaintiffs ask the Court to conclude that the ability required of an WNT player is equal to the ability required of an MNT player, as a relative matter, by ignoring the materially higher level of speed and strength required to perform the job of an MNT player. The EPA does not allow this. Sims-Fingers v. City of Indianapolis, 493 F.3d 768, 771 (7th Cir. 2007) (EPA does not ensure equal pay for jobs requiring “proportional” skill level). Nor is it a “sexist stereotype” to recognize the different levels of speed and strength required for the two jobs, as Plaintiffs’ counsel contend. On the contrary, it is indisputable “science,” as even Plaintiff Lloyd described it in her testimony. (Lloyd Dep. 103-05.) See also Doraine Lambert Coleman, Sex in Sport,80LAW AND CONTEMPORARY PROBLEMS 63-126(2017)(available at: https://scholarship.law.duke.edu/lcp/vol80/iss4/5) (describing the scientific basis for “the average 10-12% performance gap between elite male and elite female athletes,” which includes differences between males and females in “skeletal structure, muscle composition, heart and lung capacity including VO2 max, red blood cell count, body fat, and the absolute ability to process carbohydrates,” and noting, by way of example, that “no matter how great the great Katie Ledecky gets . . . she will never beat Michael Phelps or his endurance counterparts in the pool”).
Press Release: AG Racine Announces Victory for the District in LED Digital Sign Lawsuit
Press Release On Mar 10, 2020 Last updated Mar 10, 2020
Court Ruling Resolves 2016 Lawsuit Against Lumen Eight Media Group LLC for Illegal Outdoor LED Digital Signs
WASHINGTON, D.C. – Attorney General Karl A. Racine today issued the following statement announcing that Superior Court Judge Florence Pan has ruled in the District’s favor, granting its motion for summary judgment in a lawsuit against digital sign company Lumen Eight Media Group LLC (formerly known as Digi Media Communications LLC). The District sued the company in August 2016 because it flagrantly violated District law by erecting large Light-Emitting Diode (LED) digital signs without first obtaining the required licenses. Doubling down on its illegal action, the company ignored multiple stop-work orders directing it to cease and desist any further installation of digital LED signs without obtaining the required permits. AG Racine’s statement is below.
“Lumen Eight’s entire business model was based on its flagrant disregard of District law. This ruling is a major victory for the District. Judge Pan’s opinion affirmed that the company intentionally did not seek approval from District government for its signs, mischaracterized the nature of its work to avoid scrutiny, and then ignored DCRA’s stop-work orders altogether.”
“Most companies that conduct business in the District of Columbia follow the law, and achieve business success on the merits of the goods and services that they sell. Lawbreakers, including companies that regularly contribute money to D.C. politicians, are on notice that the Office of the Attorney General will investigate and prosecute, without fear nor favor, companies and individuals who violate the law. I am thankful to the Committee of 100 on the Federal City and industry competitors for bringing this matter to our attention and to our talented OAG attorneys that brought home this win for District residents.”
Image of Lumen Eight’s digital Light-Emitting Diode (LED) signs: https://oag.dc.gov/sites/default/files/2020-03/Sign-1-image.pdf
A copy of the judge’s ruling is at: https://oag.dc.gov/sites/default/files/2020-03/Lumen-Eight-Digi-Media-Opinion.pdf
Press Release On Mar 10, 2020 Last updated Mar 10, 2020
Court Ruling Resolves 2016 Lawsuit Against Lumen Eight Media Group LLC for Illegal Outdoor LED Digital Signs
WASHINGTON, D.C. – Attorney General Karl A. Racine today issued the following statement announcing that Superior Court Judge Florence Pan has ruled in the District’s favor, granting its motion for summary judgment in a lawsuit against digital sign company Lumen Eight Media Group LLC (formerly known as Digi Media Communications LLC). The District sued the company in August 2016 because it flagrantly violated District law by erecting large Light-Emitting Diode (LED) digital signs without first obtaining the required licenses. Doubling down on its illegal action, the company ignored multiple stop-work orders directing it to cease and desist any further installation of digital LED signs without obtaining the required permits. AG Racine’s statement is below.
“Lumen Eight’s entire business model was based on its flagrant disregard of District law. This ruling is a major victory for the District. Judge Pan’s opinion affirmed that the company intentionally did not seek approval from District government for its signs, mischaracterized the nature of its work to avoid scrutiny, and then ignored DCRA’s stop-work orders altogether.”
“Most companies that conduct business in the District of Columbia follow the law, and achieve business success on the merits of the goods and services that they sell. Lawbreakers, including companies that regularly contribute money to D.C. politicians, are on notice that the Office of the Attorney General will investigate and prosecute, without fear nor favor, companies and individuals who violate the law. I am thankful to the Committee of 100 on the Federal City and industry competitors for bringing this matter to our attention and to our talented OAG attorneys that brought home this win for District residents.”
Image of Lumen Eight’s digital Light-Emitting Diode (LED) signs: https://oag.dc.gov/sites/default/files/2020-03/Sign-1-image.pdf
A copy of the judge’s ruling is at: https://oag.dc.gov/sites/default/files/2020-03/Lumen-Eight-Digi-Media-Opinion.pdf
Antitrust Standing after Apple v. Pepper: Application to the Sports Betting Data Market
Ryan M. Rodenberg, FSU describes Antitrust Standing after Apple v. Pepper: Application to the Sports Betting Data Market.
ABSTRACT: In Apple v. Pepper, the U.S. Supreme Court expressed a largely permissive view about whether certain potential plaintiffs have legal standing to pursue antitrust lawsuits in federal court. The Apple v. Pepper ruling provided important clarity about the scope of the so-called indirect purchaser rule set forth forty-plus years earlier in Illinois Brick. This paper first summarizes the key takeaways from the Apple v. Pepper decision released on May 13, 2019, positioning the ruling vis-à-vis other standing-related cases that have sometimes closed the courtroom doors to plaintiffs alleging anticompetitive conduct under the Sherman Act and Clayton Act. This paper then applies the lessons from Apple v. Pepper to sports betting data, an emerging tech-focused market. This paper concludes by outlining how—and why—this market will likely be subject to antitrust scrutiny soon.
https://lawprofessors.typepad.com/antitrustprof_blog/2020/03/antitrust-standing-after-apple-v-pepper-application-to-the-sports-betting-data-market.html?
Ryan M. Rodenberg, FSU describes Antitrust Standing after Apple v. Pepper: Application to the Sports Betting Data Market.
ABSTRACT: In Apple v. Pepper, the U.S. Supreme Court expressed a largely permissive view about whether certain potential plaintiffs have legal standing to pursue antitrust lawsuits in federal court. The Apple v. Pepper ruling provided important clarity about the scope of the so-called indirect purchaser rule set forth forty-plus years earlier in Illinois Brick. This paper first summarizes the key takeaways from the Apple v. Pepper decision released on May 13, 2019, positioning the ruling vis-à-vis other standing-related cases that have sometimes closed the courtroom doors to plaintiffs alleging anticompetitive conduct under the Sherman Act and Clayton Act. This paper then applies the lessons from Apple v. Pepper to sports betting data, an emerging tech-focused market. This paper concludes by outlining how—and why—this market will likely be subject to antitrust scrutiny soon.
https://lawprofessors.typepad.com/antitrustprof_blog/2020/03/antitrust-standing-after-apple-v-pepper-application-to-the-sports-betting-data-market.html?
Yelp Tells Senators Why Google Needs To Be Broken Up
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March 10, 2020
Yelp, one of Google’s most enduring critics, got to share its grievances with senators on the Antitrust Subcommittee on Tuesday, reported CNBC. https://www.cnbc.com/2020/03/10/yelp-testifies-against-google-in-antitrust-senate-hearing.html
At a hearing dedicated to “Examining Self-Preferencing by Digital Platforms,” Luther Lowe, Yelp’s senior vice president of public policy, laid out the company’s long-standing claims against Google. Yelp, which delivers local search results for consumers looking for restaurants or other businesses, has persistently complained that Google favors its own products and services in search, often at the expense to consumers in terms of quality.
Now, Yelp isn’t the only one paying attention. Regulators and lawmakers across the political spectrum are raising concerns about the power Big Tech companies wield over competitors who also rely on their services. Tuesday’s hearing was another demonstration that Yelp’s complaints are finally resonating in the U.S. as lawmakers introduce new policies and ramp up oversight.
Google didn’t always try to stifle competition, according to Lowe, who acknowledged co-founder Larry Page’s 2004 claimthat, “We want to get you out of Google and to the right place as fast as possible.” But Lowe said Google’s approach later shifted from this model around 2007 when it added answer boxes or “OneBoxes” that surfaced what Google seemed to determine would be the most relevant result for a user.
Because Google displayed the answer boxes at the top of search results, Lowe argued in his prepared testimony, “it had conditioned consumers to expect for the best or most relevant results from around the web — even though they no longer were. By doing so, Google physically demoted non-Google results even if they contained information with higher quality scores than the information Google.” Some of those non-Google results included Yelp, which Lowe said gets about 80% of its web traffic from Google.
“We build Google Search for our users,” a Google spokesperson said in an emailed statement. “People want quick access to information and we’re constantly improving Search to help people easily find what they’re looking for, whether it’s information on a web page, directions on a map, products for sale or a translation.”
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March 10, 2020
Yelp, one of Google’s most enduring critics, got to share its grievances with senators on the Antitrust Subcommittee on Tuesday, reported CNBC. https://www.cnbc.com/2020/03/10/yelp-testifies-against-google-in-antitrust-senate-hearing.html
At a hearing dedicated to “Examining Self-Preferencing by Digital Platforms,” Luther Lowe, Yelp’s senior vice president of public policy, laid out the company’s long-standing claims against Google. Yelp, which delivers local search results for consumers looking for restaurants or other businesses, has persistently complained that Google favors its own products and services in search, often at the expense to consumers in terms of quality.
Now, Yelp isn’t the only one paying attention. Regulators and lawmakers across the political spectrum are raising concerns about the power Big Tech companies wield over competitors who also rely on their services. Tuesday’s hearing was another demonstration that Yelp’s complaints are finally resonating in the U.S. as lawmakers introduce new policies and ramp up oversight.
Google didn’t always try to stifle competition, according to Lowe, who acknowledged co-founder Larry Page’s 2004 claimthat, “We want to get you out of Google and to the right place as fast as possible.” But Lowe said Google’s approach later shifted from this model around 2007 when it added answer boxes or “OneBoxes” that surfaced what Google seemed to determine would be the most relevant result for a user.
Because Google displayed the answer boxes at the top of search results, Lowe argued in his prepared testimony, “it had conditioned consumers to expect for the best or most relevant results from around the web — even though they no longer were. By doing so, Google physically demoted non-Google results even if they contained information with higher quality scores than the information Google.” Some of those non-Google results included Yelp, which Lowe said gets about 80% of its web traffic from Google.
“We build Google Search for our users,” a Google spokesperson said in an emailed statement. “People want quick access to information and we’re constantly improving Search to help people easily find what they’re looking for, whether it’s information on a web page, directions on a map, products for sale or a translation.”
Federal rules centralize medical data online
The goal is to help doctors get a fuller picture of patient health and enabling patients to make more informed treatment choices.
One of the rules requires vendors of electronic health records to adopt software — known as application programming interfaces, or A.P.I.s. — to enable providers to send medical record data directly to patient-authorized apps. Another rule similarly requires Medicare and Medicaid plans to adopt A.P.I.s. That software will enable people to use apps to get their insurance claims and benefit information.
Health providers and health record vendors will have two years to comply with the A.P.I. requirements. Electronic health record vendors that impede such data-sharing — a practice called “information blocking” — could be fined up to $1 million per violation. Doctors accused of information blocking could be subject to federal investigation.
More at https://www.nytimes.com/2020/03/09/business/medical-app-patients-data-privacy.html
The goal is to help doctors get a fuller picture of patient health and enabling patients to make more informed treatment choices.
One of the rules requires vendors of electronic health records to adopt software — known as application programming interfaces, or A.P.I.s. — to enable providers to send medical record data directly to patient-authorized apps. Another rule similarly requires Medicare and Medicaid plans to adopt A.P.I.s. That software will enable people to use apps to get their insurance claims and benefit information.
Health providers and health record vendors will have two years to comply with the A.P.I. requirements. Electronic health record vendors that impede such data-sharing — a practice called “information blocking” — could be fined up to $1 million per violation. Doctors accused of information blocking could be subject to federal investigation.
More at https://www.nytimes.com/2020/03/09/business/medical-app-patients-data-privacy.html
Bloomberg News opinion:
Why testing matters
Uncertainty. It's as bad for public health as it is for markets.
Since the U.S.'s top health official announced plans in mid-February for wider testing of the coronavirus, there's been report after report of diagnostic kits malfunctioning or being shipped out late, and of symptomatic patients being told they don't fit the criteria to be tested.
That failure has hamstrung the U.S. government's response and doesn't make for good medicine. It's also stoking a deeper sense of unease that's eroding confidence in everything from the stock market to authorities' ability to handle a wider outbreak.
Checking large numbers of people would let the Trump administration back up its claims that it has the outbreak in hand. If more cases are found, health workers can take action to stop the virus from spreading. If only a few are, officials could reassure the public that the risk is less than feared.
Instead, we're left in the dark. At a Monday evening White House press conference, Health and Human Services Secretary Alex Azar couldn't say how many tests had been performed in the U.S. The Trump administration has repeatedly said the risk of Americans remains low, and that may be true.
But without good surveillance, it's still an educated guess.
That uncertainty is as detrimental to an effective public-health response as it is to rational behavior. If you worry about whether your family is safe, you panic-buy toilet paper and canned food, stop booking airline tickets, and quit going out. If you don't know whether an outbreak will cripple the economy, you get out of stocks.
Give people good information—even if it's a little scary—and they'll make better decisions. If you don't, they'll make worse, irrational ones. That goes for investors, government leaders, and the person next to you at the grocery store buying a shelf's worth of bleach. -- Drew Armstrong
Why testing matters
Uncertainty. It's as bad for public health as it is for markets.
Since the U.S.'s top health official announced plans in mid-February for wider testing of the coronavirus, there's been report after report of diagnostic kits malfunctioning or being shipped out late, and of symptomatic patients being told they don't fit the criteria to be tested.
That failure has hamstrung the U.S. government's response and doesn't make for good medicine. It's also stoking a deeper sense of unease that's eroding confidence in everything from the stock market to authorities' ability to handle a wider outbreak.
Checking large numbers of people would let the Trump administration back up its claims that it has the outbreak in hand. If more cases are found, health workers can take action to stop the virus from spreading. If only a few are, officials could reassure the public that the risk is less than feared.
Instead, we're left in the dark. At a Monday evening White House press conference, Health and Human Services Secretary Alex Azar couldn't say how many tests had been performed in the U.S. The Trump administration has repeatedly said the risk of Americans remains low, and that may be true.
But without good surveillance, it's still an educated guess.
That uncertainty is as detrimental to an effective public-health response as it is to rational behavior. If you worry about whether your family is safe, you panic-buy toilet paper and canned food, stop booking airline tickets, and quit going out. If you don't know whether an outbreak will cripple the economy, you get out of stocks.
Give people good information—even if it's a little scary—and they'll make better decisions. If you don't, they'll make worse, irrational ones. That goes for investors, government leaders, and the person next to you at the grocery store buying a shelf's worth of bleach. -- Drew Armstrong
“Sewer-service” in the District of Columbia’s Landlord-Tenant Court means that defendants do not appear for court because they do not know about their case
– blog entry by Don Allen Resnikoff
A few years ago, Adrian Gottshall wrote: "Years have passed since the first day that I observed ‘roll call’ in the District of Columbia Landlord and Tenant Branch, and I no longer wonder why some tenants in default fail to appear. I unequivocally know that service practices are unreliable and unfair. There are systemic due process violations occurring in the form of improper and ineffective service of process. Most troubling is that many defendants do not appear for court simply because they do not know about their case. Unreliable and unfair service practices are a national problem. They are not unique to the District of Columbia. At least three jurisdictions have recently attempted to address sewer service through litigation, resulting in multimillion dollar settlements for victims."[i]
Recently, litigation was filed alleging sewer service in the District of Columbia Landlord and Tenant Branch. The Complaint was filed in the U.S. District Court in the District of Columbia against Metropolitan Process Services, LLC and service person Stephens.[ii]
The Complaint in the D.C. litigation alleges that Defendant Stephens knowingly submitted false affidavits of service. The false affidavits asserted that he had attempted to serve and actually served process on Plaintiffs when in fact he did not.
The Complaint explains that Defendant Stephens and/or his company, Defendant Metropolitan Process Services, are the process servers of record for the vast majority of eviction cases filed in the Landlord-Tenant Branch of the District of Columbia Superior Court. “[F]or a significant percentage of the process they are retained to serve, Stephens and Metropolitan resort to “sewer service,” simply completing false affidavits to be used in L&T Court in which Defendants allege attempts at service that did not actually occur.”
The Plaintiffs’ allegations depend on looking at more than one affidavit of service in isolation: “Each of the affidavits of service submitted by Defendants, standing alone and viewed in the context of a single case, appears to be in order. However, when these affidavits of
service are reviewed together, obvious irregularities appear. For example: In most cases, Stephens did not even individually sign and swear to the affidavits. Hundreds of his affidavits, purportedly completed months apart, have the exact same signature in the exact same spot on the signature line, with the exact same notary seal, with the exact same smudge in the exact same
place on the seal, and in many cases with the exact same purported notary
signature.”
The Complaint promises statistical and other evidence of wrongdoing, such as Stephens’ filing affidavits in cases showing him to be in two distant places at the same time: “Examples abound of Stephens signing affidavits placing him in two different places at the same time. Indeed, on information and belief, Stephens submitted affidavits of service swearing to attempts at personal service on D.C. tenants at their residences at a time when he was physically present in Maryland state court for a hearing related to his arrest for drunk driving.”
The Plaintiffs in the U.S. District Court case allege that they are victims of Defendants’ sewer service, because Defendants falsified affidavits of service in connection with Plaintiffs’ eviction cases to falsely allege that Defendants had posted papers on Plaintiffs’ doors, when in fact there was no attempt at service at all.
Of course, the allegations of false affidavits and sewer service in the D.C. Landlord-Tenant Branch made in the U.S. District Court litigation are also a source of concern for the D.C. Superior Court, the D.C. Bar, and other groups interested in procedural fairness in the courts.
DAR
[i] January 2018 Solving Sewer Service: Fighting Fraud with Technology Adrian Gottshall University of the District of Columbia , https://scholarworks.uark.edu/cgi/viewcontent.cgi?article=1034&context=alr
[ii] Whitlock, et al, v. Metropolitan Process Services, LLC, et al., Case 1:20-cv-00339, assigned to Judge Leon
– blog entry by Don Allen Resnikoff
A few years ago, Adrian Gottshall wrote: "Years have passed since the first day that I observed ‘roll call’ in the District of Columbia Landlord and Tenant Branch, and I no longer wonder why some tenants in default fail to appear. I unequivocally know that service practices are unreliable and unfair. There are systemic due process violations occurring in the form of improper and ineffective service of process. Most troubling is that many defendants do not appear for court simply because they do not know about their case. Unreliable and unfair service practices are a national problem. They are not unique to the District of Columbia. At least three jurisdictions have recently attempted to address sewer service through litigation, resulting in multimillion dollar settlements for victims."[i]
Recently, litigation was filed alleging sewer service in the District of Columbia Landlord and Tenant Branch. The Complaint was filed in the U.S. District Court in the District of Columbia against Metropolitan Process Services, LLC and service person Stephens.[ii]
The Complaint in the D.C. litigation alleges that Defendant Stephens knowingly submitted false affidavits of service. The false affidavits asserted that he had attempted to serve and actually served process on Plaintiffs when in fact he did not.
The Complaint explains that Defendant Stephens and/or his company, Defendant Metropolitan Process Services, are the process servers of record for the vast majority of eviction cases filed in the Landlord-Tenant Branch of the District of Columbia Superior Court. “[F]or a significant percentage of the process they are retained to serve, Stephens and Metropolitan resort to “sewer service,” simply completing false affidavits to be used in L&T Court in which Defendants allege attempts at service that did not actually occur.”
The Plaintiffs’ allegations depend on looking at more than one affidavit of service in isolation: “Each of the affidavits of service submitted by Defendants, standing alone and viewed in the context of a single case, appears to be in order. However, when these affidavits of
service are reviewed together, obvious irregularities appear. For example: In most cases, Stephens did not even individually sign and swear to the affidavits. Hundreds of his affidavits, purportedly completed months apart, have the exact same signature in the exact same spot on the signature line, with the exact same notary seal, with the exact same smudge in the exact same
place on the seal, and in many cases with the exact same purported notary
signature.”
The Complaint promises statistical and other evidence of wrongdoing, such as Stephens’ filing affidavits in cases showing him to be in two distant places at the same time: “Examples abound of Stephens signing affidavits placing him in two different places at the same time. Indeed, on information and belief, Stephens submitted affidavits of service swearing to attempts at personal service on D.C. tenants at their residences at a time when he was physically present in Maryland state court for a hearing related to his arrest for drunk driving.”
The Plaintiffs in the U.S. District Court case allege that they are victims of Defendants’ sewer service, because Defendants falsified affidavits of service in connection with Plaintiffs’ eviction cases to falsely allege that Defendants had posted papers on Plaintiffs’ doors, when in fact there was no attempt at service at all.
Of course, the allegations of false affidavits and sewer service in the D.C. Landlord-Tenant Branch made in the U.S. District Court litigation are also a source of concern for the D.C. Superior Court, the D.C. Bar, and other groups interested in procedural fairness in the courts.
DAR
[i] January 2018 Solving Sewer Service: Fighting Fraud with Technology Adrian Gottshall University of the District of Columbia , https://scholarworks.uark.edu/cgi/viewcontent.cgi?article=1034&context=alr
[ii] Whitlock, et al, v. Metropolitan Process Services, LLC, et al., Case 1:20-cv-00339, assigned to Judge Leon
Local government needs more Coronavirus test kits
https://techcrunch.com/2020/03/08/u-s-response-to-the-covid-19-coronavirus-moves-from-containment-to-mitigation/
https://techcrunch.com/2020/03/08/u-s-response-to-the-covid-19-coronavirus-moves-from-containment-to-mitigation/
The Economist on politics and Coronavirus in China:
The virus outbreak could end swiftly, amid worldwide praise for the bravery of China’s doctors and nurses, the self-discipline of the public and the resolve of Chinese leaders, albeit after a slow start. If the crisis does not end well, scapegoats will be found, and underlings punished. That alone would not have to shake Mr Xi’s authority, which can always be shored up with repression, still greater ideological discipline and nationalist propaganda. But a botched response to the virus would lay bare tensions inherent in the party’s hybrid claims to legitimacy.
Mr Xi’s China is two things at once. It is a secretive, techno-authoritarian one-party state, ruled by grey men in unaccountable councils and secretive committees. It also claims to be a nation-sized family headed by a patriarch of unique wisdom and virtue, in a secular, 21st-century version of the mandate of Heaven. If forced to choose between those competing models, bet on cold, bureaucratic control to win out.
From https://www.economist.com/china/2020/01/30/xi-jinping-wants-to-be-both-feared-and-loved-by-chinas-people?cid1=cust/ednew/n/bl/n/2020/02/29n/owned/n/n/nwl/n/n/NA/415278/n
Posting by Don Resnikoff
The virus outbreak could end swiftly, amid worldwide praise for the bravery of China’s doctors and nurses, the self-discipline of the public and the resolve of Chinese leaders, albeit after a slow start. If the crisis does not end well, scapegoats will be found, and underlings punished. That alone would not have to shake Mr Xi’s authority, which can always be shored up with repression, still greater ideological discipline and nationalist propaganda. But a botched response to the virus would lay bare tensions inherent in the party’s hybrid claims to legitimacy.
Mr Xi’s China is two things at once. It is a secretive, techno-authoritarian one-party state, ruled by grey men in unaccountable councils and secretive committees. It also claims to be a nation-sized family headed by a patriarch of unique wisdom and virtue, in a secular, 21st-century version of the mandate of Heaven. If forced to choose between those competing models, bet on cold, bureaucratic control to win out.
From https://www.economist.com/china/2020/01/30/xi-jinping-wants-to-be-both-feared-and-loved-by-chinas-people?cid1=cust/ednew/n/bl/n/2020/02/29n/owned/n/n/nwl/n/n/NA/415278/n
Posting by Don Resnikoff
Are China’s Coronavirus Figures Reliable? China reports that new virus cases are declining, but the data may be tied to party politics.
BY JAMES PALMER
| FEBRUARY 19, 2020, 3:18 PM
In China, the death toll from the coronavirus has now topped 2,000, with over 70,000 cases confirmed. But if you follow Chinese state media, the tone is increasingly optimistic: Victory in the people’s war against the virus, led by President Xi Jinping, is coming! The official figures seem to bear this out: New infections outside of Hubei province, the virus epicenter, have dropped for more than 10 days straight, and the number of new cases inside Hubei has slowed to under 2,000 per day.
* * *
Party politics. One suspicious element is how consistent the drop in new virus cases has been. While there was a jump in numbers last Thursday, it was the result of changes in testing standards in Hubei—moving nearly 15,000 cases from “suspected” to “confirmed.” The announcement came as Hubei’s top officials were removed from their jobs—and Xi’s close ally Ying Yong, the former mayor of Shanghai, installed as the province’s party boss. As often happens, it seems the new boss wanted to blame the bad news on the old one.
* * *
Downward trend. The straight decline in new cases of the virus could be good news, or it could be statistical manipulation. Outside of Hubei, diagnostic test kits are in short supply, and other provinces haven’t switched to using the symptomatic diagnosis now accepted in Hubei. The kits are only being used to test people who came from Hubei and not for cases of transmission, so it’s unsurprising the numbers are dropping. Chinese doctors report that dozens of other hospital patients are being quarantined and treated but not officially diagnosed.
https://foreignpolicy.com/2020/02/19/china-coronavirus-figures-reliable-communist-party-politics-xi-jinping-quarantine-hubei/
Posting by Don Resnikoff
BY JAMES PALMER
| FEBRUARY 19, 2020, 3:18 PM
In China, the death toll from the coronavirus has now topped 2,000, with over 70,000 cases confirmed. But if you follow Chinese state media, the tone is increasingly optimistic: Victory in the people’s war against the virus, led by President Xi Jinping, is coming! The official figures seem to bear this out: New infections outside of Hubei province, the virus epicenter, have dropped for more than 10 days straight, and the number of new cases inside Hubei has slowed to under 2,000 per day.
* * *
Party politics. One suspicious element is how consistent the drop in new virus cases has been. While there was a jump in numbers last Thursday, it was the result of changes in testing standards in Hubei—moving nearly 15,000 cases from “suspected” to “confirmed.” The announcement came as Hubei’s top officials were removed from their jobs—and Xi’s close ally Ying Yong, the former mayor of Shanghai, installed as the province’s party boss. As often happens, it seems the new boss wanted to blame the bad news on the old one.
* * *
Downward trend. The straight decline in new cases of the virus could be good news, or it could be statistical manipulation. Outside of Hubei, diagnostic test kits are in short supply, and other provinces haven’t switched to using the symptomatic diagnosis now accepted in Hubei. The kits are only being used to test people who came from Hubei and not for cases of transmission, so it’s unsurprising the numbers are dropping. Chinese doctors report that dozens of other hospital patients are being quarantined and treated but not officially diagnosed.
https://foreignpolicy.com/2020/02/19/china-coronavirus-figures-reliable-communist-party-politics-xi-jinping-quarantine-hubei/
Posting by Don Resnikoff
Ride-Hailing Isn’t Really GreenThe Union of Concerned Scientists estimates that the environmental impact of Uber and Lyft rides is 69% worse than the transportation modes they replace.
Uber and Lyft have consumed a vast amount of attention since they arrived a decade ago. But in many ways, we’re just beginning to understand what ride-hailing is doing. A growing cache of research by academics and policymakers points to a host of negative impacts associated with the explosive popularity of on-demand rides, including increased traffic congestion, declines in public transit ridership and upticks in traffic fatalities.
A new report by the Union of Concerned Scientists evaluates another, less-examined ramification of the ride-hailing sector: its environmental toll. Read more at Citylab
Uber and Lyft have consumed a vast amount of attention since they arrived a decade ago. But in many ways, we’re just beginning to understand what ride-hailing is doing. A growing cache of research by academics and policymakers points to a host of negative impacts associated with the explosive popularity of on-demand rides, including increased traffic congestion, declines in public transit ridership and upticks in traffic fatalities.
A new report by the Union of Concerned Scientists evaluates another, less-examined ramification of the ride-hailing sector: its environmental toll. Read more at Citylab
Researchers who have examined the genomes of two coronavirus infections in Washington State say the similarities between the cases suggest that the virus may have been spreading in the state for weeks.
* * *
State and local health officials have been hamstrung in their ability to test widely for the coronavirus. Until very recently, the C.D.C. had insisted that only its test could be used, and only on patients who met specific criteria — those who had traveled to China within 14 days of developing symptoms or had contact with a known coronavirus case.
from: https://www.nytimes.com/2020/03/01/health/coronavirus-washington-spread.html
Posting by Don Resnikoff
* * *
State and local health officials have been hamstrung in their ability to test widely for the coronavirus. Until very recently, the C.D.C. had insisted that only its test could be used, and only on patients who met specific criteria — those who had traveled to China within 14 days of developing symptoms or had contact with a known coronavirus case.
from: https://www.nytimes.com/2020/03/01/health/coronavirus-washington-spread.html
Posting by Don Resnikoff
NYT Opinion: We Don’t Really Know How Many People Have Coronavirus. In an era when we get flash-flood warnings on phones, why is data on the new coronavirus so limited?
By Elisabeth Rosenthal
Ms. Rosenthal, a journalist and physician, is a contributing opinion writer.
In recent weeks, a smattering of scientific papers and government statements have begun to sketch the outlines of the epidemic. The Chinese national health commission has reported that more than 1,700 medical workers in the country had contracted the virus as of Feb 14. (That’s alarming). The Chinese Center for Disease Control and Prevention estimates that some 80 percent of those infected have a mild illness. (That’s comforting). Earlier this week, a joint W.H.O.-China mission announced that the death rate in Wuhan was 2 to 4 percent, but only .7 percent in the rest of China — a difference that makes little scientific sense.
In recent days the W.H.O. has complained that China has not been sharing data on infections in health care workers. Earlier this month, the editors of the journal Nature called on researchers to “ensure that their work on this outbreak is shared rapidly and openly.”
Much more could be known and, in all likelihood, some scientists out there have good, if not definitive, answers. And yet, the lack of consistent, reliable and regularly updated information on the key measures of this outbreak is startling. In an era when we get flash-flood warnings on phones and weekly influenza statistics from every state, why is data on the new coronavirus so limited?
Science, politics and pride have all, in various ways, conspired to keep potentially vital, lifesaving knowledge under wraps. That is problematic at a time when more information is needed to be strategic about preparedness.
It began early in the course of the epidemic. On Dec. 30, a Chinese doctor, Li Wenliang posted about a small number of people with an unusual pneumonia on social media. Though scientists in labs were already sequencing the virus, he was “warned and reprimanded” by local officials for rumor-mongering and the “illegal activity of publishing false information online.” (Dr. Li later died of the illness.)
There is a tradition in China (and likely much of the world) for local authorities not to report bad news to their superiors. During the Great Leap Forward, local officials reported exaggerated harvest yields even as millions were starving. More recently, officials in Henan Province denied there was an epidemic of AIDS spread through unsanitary blood collection practices.
Indeed, even when Beijing urges greater attention to scientific reality, compliance is mixed. On Feb. 13, the Communist Party secretaries of Wuhan and Hubei Province lost their jobs over their botched initial handling of the crisis. But damage had been done. As the virus was taking hold, doctors were not wearing proper protective equipment. Sick people, thinking they just had a cold, didn’t seek medical attention. And travelers continued to board cruise ships spreading a new pathogen.
“Early on, management was less than optimal in Hubei and they’re paying for that now,” Dr. Ian Lipkin, a professor of epidemiology at Columbia’s Mailman School of Public Health who has been working in China and advising the Chinese government since the SARS outbreak, told me.
There were, of course, some genuine barriers to understanding what exactly was happening in Wuhan: Pneumonias are not unusual in winter, and there was no way to know that there was a novel virus. (Dr. Lipkin’s group is working on building a new test that distinguishes between different cause of viral pneumonias, with a researcher headed to China next week for testing.)
Lest Americans feel that it could never happen here, Dr. Lipkin points out that it took many months for health officials in the United States to acknowledge and recognize H.I.V. as a new virus, despite the fact that gay men were turning up at alarming rates with unusual pneumonias and skin cancers.
Scientific competition has also slowed reaction and response, experts fear — leading to the extraordinary editors’ plea in Nature. For a young researcher, a paper in Nature or the New England Journal of Medicine is gold in career currency. Scientific prestige may encourage perfecting data for peer review, but preparedness requires rapid dissemination of information.
While federal officials in the United States warn Americans to be ready for the virus, there are some important aspects of its spread about which we have little information — even though they have likely already been studied by scientists and officials, in China, in Japan and elsewhere.
Scientists in various countries are presumably gathering large amounts of data day by day and the world deserves to see more of it.
“Were there patterns around infections, places, procedures? Maybe that is being collected and readied for the medical literature. But it would be hugely important to know,” said Dr. Tom Inglesby, director of the Center for Health Security of the Johns Hopkins Bloomberg School of Public Health, which studies epidemics.
For example: Of the more than 1,700 health workers who were infected in China, did those infections occur before they knew to wear protective equipment? Were they doing procedures that might lead to exposure? Those answers would quell fears about how the virus spreads and how to protect front line workers.
Likewise, there were hundreds of people who tested positive aboard the Diamond Princess cruise ship and were transferred to the hospital. But there has been little public information released about what shape they were in. How many in the cohort were really sick, how many just had minor symptoms and how many just needed isolation? Does the pattern of infection suggest a role for transmission via plumbing on the ship?
Finally, the world’s public health researchers need much more transparency about how officials are monitoring this epidemic. What exactly is
China’s surveillance strategy among the general population? To gauge the actual death rate of Covid-19, researchers would need to know how
many people actually have it, even if they have only mild symptoms. In-country surveillance may reveal a very large pool of people with mild or no symptoms at all.
Dr. Lipkin noted that because cases noted early in an epidemic are the most severe, early mortality estimates tend to be high. As more information comes out, the death rates are likely to fall. “We’re probably six months out from having a good picture and when we do I’d guess the mortality will drop dramatically,” he said.
Compared with the situation in 2003, when it took about five months for the Chinese central government to publicly acknowledge a deadly crisis associated with SARS, the flow of information has clearly improved. But since then, travel and commerce between China and the rest of the world has increased manifold. The spread of information about emerging infectious diseases needs to keep up with that new reality.
From: https://www.nytimes.com/2020/02/28/opinion/coronavirus-death-rate.html?action=click&module=Opinion&pgtype=Homepage
Elisabeth Rosenthal worked as an emergency room physician before becoming a journalist. A former New York Times correspondent, she is the author of “An American Sickness: How Healthcare Became Big Business and How You Can Take It Back” and editor-in-chief of Kaiser Health News. @RosenthalHealth
By Elisabeth Rosenthal
Ms. Rosenthal, a journalist and physician, is a contributing opinion writer.
- Feb. 28, 2020
In recent weeks, a smattering of scientific papers and government statements have begun to sketch the outlines of the epidemic. The Chinese national health commission has reported that more than 1,700 medical workers in the country had contracted the virus as of Feb 14. (That’s alarming). The Chinese Center for Disease Control and Prevention estimates that some 80 percent of those infected have a mild illness. (That’s comforting). Earlier this week, a joint W.H.O.-China mission announced that the death rate in Wuhan was 2 to 4 percent, but only .7 percent in the rest of China — a difference that makes little scientific sense.
In recent days the W.H.O. has complained that China has not been sharing data on infections in health care workers. Earlier this month, the editors of the journal Nature called on researchers to “ensure that their work on this outbreak is shared rapidly and openly.”
Much more could be known and, in all likelihood, some scientists out there have good, if not definitive, answers. And yet, the lack of consistent, reliable and regularly updated information on the key measures of this outbreak is startling. In an era when we get flash-flood warnings on phones and weekly influenza statistics from every state, why is data on the new coronavirus so limited?
Science, politics and pride have all, in various ways, conspired to keep potentially vital, lifesaving knowledge under wraps. That is problematic at a time when more information is needed to be strategic about preparedness.
It began early in the course of the epidemic. On Dec. 30, a Chinese doctor, Li Wenliang posted about a small number of people with an unusual pneumonia on social media. Though scientists in labs were already sequencing the virus, he was “warned and reprimanded” by local officials for rumor-mongering and the “illegal activity of publishing false information online.” (Dr. Li later died of the illness.)
There is a tradition in China (and likely much of the world) for local authorities not to report bad news to their superiors. During the Great Leap Forward, local officials reported exaggerated harvest yields even as millions were starving. More recently, officials in Henan Province denied there was an epidemic of AIDS spread through unsanitary blood collection practices.
Indeed, even when Beijing urges greater attention to scientific reality, compliance is mixed. On Feb. 13, the Communist Party secretaries of Wuhan and Hubei Province lost their jobs over their botched initial handling of the crisis. But damage had been done. As the virus was taking hold, doctors were not wearing proper protective equipment. Sick people, thinking they just had a cold, didn’t seek medical attention. And travelers continued to board cruise ships spreading a new pathogen.
“Early on, management was less than optimal in Hubei and they’re paying for that now,” Dr. Ian Lipkin, a professor of epidemiology at Columbia’s Mailman School of Public Health who has been working in China and advising the Chinese government since the SARS outbreak, told me.
There were, of course, some genuine barriers to understanding what exactly was happening in Wuhan: Pneumonias are not unusual in winter, and there was no way to know that there was a novel virus. (Dr. Lipkin’s group is working on building a new test that distinguishes between different cause of viral pneumonias, with a researcher headed to China next week for testing.)
Lest Americans feel that it could never happen here, Dr. Lipkin points out that it took many months for health officials in the United States to acknowledge and recognize H.I.V. as a new virus, despite the fact that gay men were turning up at alarming rates with unusual pneumonias and skin cancers.
Scientific competition has also slowed reaction and response, experts fear — leading to the extraordinary editors’ plea in Nature. For a young researcher, a paper in Nature or the New England Journal of Medicine is gold in career currency. Scientific prestige may encourage perfecting data for peer review, but preparedness requires rapid dissemination of information.
While federal officials in the United States warn Americans to be ready for the virus, there are some important aspects of its spread about which we have little information — even though they have likely already been studied by scientists and officials, in China, in Japan and elsewhere.
Scientists in various countries are presumably gathering large amounts of data day by day and the world deserves to see more of it.
“Were there patterns around infections, places, procedures? Maybe that is being collected and readied for the medical literature. But it would be hugely important to know,” said Dr. Tom Inglesby, director of the Center for Health Security of the Johns Hopkins Bloomberg School of Public Health, which studies epidemics.
For example: Of the more than 1,700 health workers who were infected in China, did those infections occur before they knew to wear protective equipment? Were they doing procedures that might lead to exposure? Those answers would quell fears about how the virus spreads and how to protect front line workers.
Likewise, there were hundreds of people who tested positive aboard the Diamond Princess cruise ship and were transferred to the hospital. But there has been little public information released about what shape they were in. How many in the cohort were really sick, how many just had minor symptoms and how many just needed isolation? Does the pattern of infection suggest a role for transmission via plumbing on the ship?
Finally, the world’s public health researchers need much more transparency about how officials are monitoring this epidemic. What exactly is
China’s surveillance strategy among the general population? To gauge the actual death rate of Covid-19, researchers would need to know how
many people actually have it, even if they have only mild symptoms. In-country surveillance may reveal a very large pool of people with mild or no symptoms at all.
Dr. Lipkin noted that because cases noted early in an epidemic are the most severe, early mortality estimates tend to be high. As more information comes out, the death rates are likely to fall. “We’re probably six months out from having a good picture and when we do I’d guess the mortality will drop dramatically,” he said.
Compared with the situation in 2003, when it took about five months for the Chinese central government to publicly acknowledge a deadly crisis associated with SARS, the flow of information has clearly improved. But since then, travel and commerce between China and the rest of the world has increased manifold. The spread of information about emerging infectious diseases needs to keep up with that new reality.
From: https://www.nytimes.com/2020/02/28/opinion/coronavirus-death-rate.html?action=click&module=Opinion&pgtype=Homepage
Elisabeth Rosenthal worked as an emergency room physician before becoming a journalist. A former New York Times correspondent, she is the author of “An American Sickness: How Healthcare Became Big Business and How You Can Take It Back” and editor-in-chief of Kaiser Health News. @RosenthalHealth
NYT:New York City May Crack Down on Grubhub and Other Food Delivery Apps
The City Council will consider a package of bills aimed at limiting how much food delivery apps can charge restaurants.
Legislation to regulate food delivery apps in New York is expected to be broadly supported in the City Council. Credit...Jeenah Moon for The New York TimesBy Jeffery C. Mays and David Yaffe-Bellany
For almost a year, the City Council has warned major food delivery apps like Grubhub and Uber Eats that their business practices were hurting local restaurants in New York, and that legislation to regulate the industry might be in order.
Restaurants were being charged commissions ranging from 15 to 30 percent, and Grubhub was routinely billing restaurants for calls that did not result in orders.
Grubhub, facing scrutiny from its investors, responded by revising its phone ordering system to reduce errant charges, and ending its practice of creating competing websites for restaurants that used its service.
The changes were not enough.
The City Council will soon consider a package of bills that is believed to be the first local effort to regulate commissions, phone fees or some
other aspect of the on-demand food delivery economy.
From
The City Council will consider a package of bills aimed at limiting how much food delivery apps can charge restaurants.
Legislation to regulate food delivery apps in New York is expected to be broadly supported in the City Council. Credit...Jeenah Moon for The New York TimesBy Jeffery C. Mays and David Yaffe-Bellany
For almost a year, the City Council has warned major food delivery apps like Grubhub and Uber Eats that their business practices were hurting local restaurants in New York, and that legislation to regulate the industry might be in order.
Restaurants were being charged commissions ranging from 15 to 30 percent, and Grubhub was routinely billing restaurants for calls that did not result in orders.
Grubhub, facing scrutiny from its investors, responded by revising its phone ordering system to reduce errant charges, and ending its practice of creating competing websites for restaurants that used its service.
The changes were not enough.
The City Council will soon consider a package of bills that is believed to be the first local effort to regulate commissions, phone fees or some
other aspect of the on-demand food delivery economy.
From
U.S. consumer watchdog agrees to implement minority-lending protections after lawsuit
Katanga Johnson
WASHINGTON (Reuters) - The U.S. Consumer Financial Protection Bureau (CFPB) has agreed to enforce data-collection requirements that aim to guard against discriminatory lending practices after being sued by a Washington-based advocacy group, the group said on Wednesday.
Democracy Forward sued the agency in May 2019 alleging it had flouted laws introduced following the 2007-2009 financial crisis that require it to collect and disclose data on lending to women-owned, minority-owned and small businesses.Excerpt from
Under the settlement filed in the U.S. District Court in the Northern District of California, the CFPB agreed by September to outline a proposed rule for collecting the data and to create a panel of small-business advocates to feed in to the process.
Excerpt from https://www.reuters.com/article/us-usa-cfpb-minoritybusinesses/u-s-consumer-watchdog-agrees-to-implement-minority-lending-protections-after-lawsuit-idUSKCN20K2OF
Katanga Johnson
WASHINGTON (Reuters) - The U.S. Consumer Financial Protection Bureau (CFPB) has agreed to enforce data-collection requirements that aim to guard against discriminatory lending practices after being sued by a Washington-based advocacy group, the group said on Wednesday.
Democracy Forward sued the agency in May 2019 alleging it had flouted laws introduced following the 2007-2009 financial crisis that require it to collect and disclose data on lending to women-owned, minority-owned and small businesses.Excerpt from
Under the settlement filed in the U.S. District Court in the Northern District of California, the CFPB agreed by September to outline a proposed rule for collecting the data and to create a panel of small-business advocates to feed in to the process.
Excerpt from https://www.reuters.com/article/us-usa-cfpb-minoritybusinesses/u-s-consumer-watchdog-agrees-to-implement-minority-lending-protections-after-lawsuit-idUSKCN20K2OF
Garrett speaks on lack of US coronavirus preparation
https://www.msnbc.com/rachel-maddow/watch/u-s-unready-to-deal-with-potential-coronavirus-spread-79446085581
https://www.msnbc.com/rachel-maddow/watch/u-s-unready-to-deal-with-potential-coronavirus-spread-79446085581
From Consumer Law & Policy Blog
Libel tourism in Virginia again used to seek to identify anonymous Twitter users
Posted: 24 Feb 2020 03:03 PM PST
Late last year, I wrote about an abusive subpoena that California Congressman Devin Nunes was pursuing in Virginia state court, seeking to identify the owner of a satirical Twitter account that makes fun of Nunes, referring to his family history in dairy farming, by using the Twitter handle “@Devin Cow” and including various puns referring to cow body parts, cow noises, and cowboys. We filed an amicus brief urging the state court judge to use the Dendrite standard to decide whether to compel Twitter to identify Nunes’ online detractor, and arguing that there was no basis for overcoming the Cow’s right to parody anonymously. The motion to quash that subpoena is still pending.
Nunes’ lawyer, Steven Biss, has recently tried another route to achieve the same objective. He is representing a communications specialist based in North Carolina named Trevor Fitzgibbon, who has been engaged in a protracted dispute with a Washington, D.C. lawyer named Jesselyn Radack who is, in turn, one of several women who have accused Fitzgibbon of untoward sexual conduct. Their first round of litigation, filed in the Eastern District of Virginia even though neither side lives there, ended in a harsh settlement that included a six-figure payment by Radack to Fitzgibbon as well as a clause forbidding each to talk about the other publicly. Fitzgibbon has again sued Radack in the Eastern District of Virginia, accusing her of breaching the settlement agreement, of fraudulently inducing him to sign that agreement in the first place, and of defamation. The complaint charges Radack with conspiring with various other people to defame Fitzgibbon, but only Radack is named as a defendant. Radack has counterclaimed against Fitzgibbon, making much the same accusations of breach of contract, fraudulent inducement, and defamation.
Although Fitzgibbon and Radack are entitled to their mutual antagonism, and to slug it out in federal court if they must, it is the abuse of the subpoena power that engages our attention. Supposedly for the purpose of pursuing his claims against Radack, Biss has served yet another subpoena on Twitter, claiming the right to be provided with identifying information about the owners of some twenty-two Twitter accounts.
Most of these accounts have been used to take part in the online discussion of the Fitzgibbon/Radack charges and countercharges, but the Twitter account holders are not named as defendants in the litigation. Fitzgibbon’s papers strongly suggest that he resents the participation of these Twitter users, and that he believes that some tweets have wrongly taken Radack’s side against him. However, but the asserted purpose of the subpoena is not to bring them into the litigation as defendants but only to ascertain whether they have information that he can use to establish Radack’s liability or to increase the level of damages he can seek.
The 2theMart Standard
Given that stated purpose, his subpoena is not subject to the Dendrite standard, but rather to a somewhat older, but less used standard, first adopted in a federal court decision from Seattle called Doe v. 2theMart, that governs subpoenas seeking to identify anonymous online speakers so that they may be asked to provide evidence in cases in which they have not, themselves, been accused of wrongdoing. The question presented by this new subpoena is whether a party to an online controversy can, simply by suing one detractor whose online statements are strongest and, perhaps, most susceptible to litigation, successfully sweep into the maw of the litigation everyone else who discusses the controversy online, just by saying that they are potential witnesses who must be interrogated about how they came to form their online opinions and whether they ever have communicated with each other privately. Needless to say, if that were enough reason to compel the identification of online speakers, the result could be a significant level of deterrence against participation in online discussions. An exhibit to our filing is an affidavit from one the Twitter account holders sought by the subpoena, explaining why she is afraid of having her information revealed.
Yet another one of subpoena targets, though, is @DevinCow, who has never said anything about Fitzgibbon, at least so far as we could see from Fitzgibbon’s brief. That Twitter user’s only involvement with the controversy appears to be Radack’s having expressed appreciation for something that @DevinCow said in a tweet; Radack's having listed the lawsuit against @DevinCow as one of a large number of lawsuits filed by Steven Biss that she considers abusive; and Radack’s speculation that a conservative Silicon Valley investor may be financing all of Biss’s litigation campaign. Considering the limited basis for identifying @DevinCow as a witness in the Fitzgibbon/Radack litigation, there is a good reason to infer that Biss maybe abusing his ready access to the federal court discovery process to attempt an end run around the roadblocks he has encountered to identifying @DevinCow in the state court litigation. And the 2theMart standard, unlike Dendrite, calls for explicit consideration of whether the subpoena has been served in good faith.
We have now filed an amicus brief urging that the very fact that Fitzgibbon’s attorney has included a demand for identification of @Devin Cow who seems to have little bearing on the Fitzgibbon / Radack quarrel, but who is a defendant in another lawsuit entirely, could be reason enough to condemn the subpoena as a product of bad faith. We also explain why the trial court should adopt the 2theMart standard and explain how it should be applied in this case even apart from the highly suspicious aspect of the subpoena aimed at @DevinCow.
As with our previous amicus brief in the Nnnes litigation itself, I am grateful to Matt Kelley of Ballard Spahr for participating as Virginia co-counsel on the amicus brief.
Read NCLC's critique of the CFPB's proposed debt-collection rule
Posted: 24 Feb 2020 09:30 AM PST
The National Consumer Law Center has issued this press release, entitled "CFPB Fails to Protect Consumers From Abusive Collection of Time-Barred Debts (Again)," which, among other things, castigates the CFPB for failing to flat-out "ban collection of time-barred debt in and out of court."
Libel tourism in Virginia again used to seek to identify anonymous Twitter users
Posted: 24 Feb 2020 03:03 PM PST
Late last year, I wrote about an abusive subpoena that California Congressman Devin Nunes was pursuing in Virginia state court, seeking to identify the owner of a satirical Twitter account that makes fun of Nunes, referring to his family history in dairy farming, by using the Twitter handle “@Devin Cow” and including various puns referring to cow body parts, cow noises, and cowboys. We filed an amicus brief urging the state court judge to use the Dendrite standard to decide whether to compel Twitter to identify Nunes’ online detractor, and arguing that there was no basis for overcoming the Cow’s right to parody anonymously. The motion to quash that subpoena is still pending.
Nunes’ lawyer, Steven Biss, has recently tried another route to achieve the same objective. He is representing a communications specialist based in North Carolina named Trevor Fitzgibbon, who has been engaged in a protracted dispute with a Washington, D.C. lawyer named Jesselyn Radack who is, in turn, one of several women who have accused Fitzgibbon of untoward sexual conduct. Their first round of litigation, filed in the Eastern District of Virginia even though neither side lives there, ended in a harsh settlement that included a six-figure payment by Radack to Fitzgibbon as well as a clause forbidding each to talk about the other publicly. Fitzgibbon has again sued Radack in the Eastern District of Virginia, accusing her of breaching the settlement agreement, of fraudulently inducing him to sign that agreement in the first place, and of defamation. The complaint charges Radack with conspiring with various other people to defame Fitzgibbon, but only Radack is named as a defendant. Radack has counterclaimed against Fitzgibbon, making much the same accusations of breach of contract, fraudulent inducement, and defamation.
Although Fitzgibbon and Radack are entitled to their mutual antagonism, and to slug it out in federal court if they must, it is the abuse of the subpoena power that engages our attention. Supposedly for the purpose of pursuing his claims against Radack, Biss has served yet another subpoena on Twitter, claiming the right to be provided with identifying information about the owners of some twenty-two Twitter accounts.
Most of these accounts have been used to take part in the online discussion of the Fitzgibbon/Radack charges and countercharges, but the Twitter account holders are not named as defendants in the litigation. Fitzgibbon’s papers strongly suggest that he resents the participation of these Twitter users, and that he believes that some tweets have wrongly taken Radack’s side against him. However, but the asserted purpose of the subpoena is not to bring them into the litigation as defendants but only to ascertain whether they have information that he can use to establish Radack’s liability or to increase the level of damages he can seek.
The 2theMart Standard
Given that stated purpose, his subpoena is not subject to the Dendrite standard, but rather to a somewhat older, but less used standard, first adopted in a federal court decision from Seattle called Doe v. 2theMart, that governs subpoenas seeking to identify anonymous online speakers so that they may be asked to provide evidence in cases in which they have not, themselves, been accused of wrongdoing. The question presented by this new subpoena is whether a party to an online controversy can, simply by suing one detractor whose online statements are strongest and, perhaps, most susceptible to litigation, successfully sweep into the maw of the litigation everyone else who discusses the controversy online, just by saying that they are potential witnesses who must be interrogated about how they came to form their online opinions and whether they ever have communicated with each other privately. Needless to say, if that were enough reason to compel the identification of online speakers, the result could be a significant level of deterrence against participation in online discussions. An exhibit to our filing is an affidavit from one the Twitter account holders sought by the subpoena, explaining why she is afraid of having her information revealed.
Yet another one of subpoena targets, though, is @DevinCow, who has never said anything about Fitzgibbon, at least so far as we could see from Fitzgibbon’s brief. That Twitter user’s only involvement with the controversy appears to be Radack’s having expressed appreciation for something that @DevinCow said in a tweet; Radack's having listed the lawsuit against @DevinCow as one of a large number of lawsuits filed by Steven Biss that she considers abusive; and Radack’s speculation that a conservative Silicon Valley investor may be financing all of Biss’s litigation campaign. Considering the limited basis for identifying @DevinCow as a witness in the Fitzgibbon/Radack litigation, there is a good reason to infer that Biss maybe abusing his ready access to the federal court discovery process to attempt an end run around the roadblocks he has encountered to identifying @DevinCow in the state court litigation. And the 2theMart standard, unlike Dendrite, calls for explicit consideration of whether the subpoena has been served in good faith.
We have now filed an amicus brief urging that the very fact that Fitzgibbon’s attorney has included a demand for identification of @Devin Cow who seems to have little bearing on the Fitzgibbon / Radack quarrel, but who is a defendant in another lawsuit entirely, could be reason enough to condemn the subpoena as a product of bad faith. We also explain why the trial court should adopt the 2theMart standard and explain how it should be applied in this case even apart from the highly suspicious aspect of the subpoena aimed at @DevinCow.
As with our previous amicus brief in the Nnnes litigation itself, I am grateful to Matt Kelley of Ballard Spahr for participating as Virginia co-counsel on the amicus brief.
Read NCLC's critique of the CFPB's proposed debt-collection rule
Posted: 24 Feb 2020 09:30 AM PST
The National Consumer Law Center has issued this press release, entitled "CFPB Fails to Protect Consumers From Abusive Collection of Time-Barred Debts (Again)," which, among other things, castigates the CFPB for failing to flat-out "ban collection of time-barred debt in and out of court."
AG voids hundreds of predatory loans, orders $2.2M in restitution
By: Heather Cobun Daily Record Legal Affairs Writer February 21, 2020
A loan business was ordered recently to pay $2.2 million to consumers for making unlicensed and predatory title loans.
Cash-N-Go Inc. and its owner, Brent M. Jackson, were charged by the Maryland Office of the Attorney General last year with violations of the Maryland Consumer Protection Act. The office announced Friday that it had issued a final order against Jackson and his businesses making all Cash-N-Go loans void and unenforceable.
“The Cash-N-Go companies and their owner, Brent Jackson, preyed on Maryland consumers in financial distress,” Attorney General Brian E. Frosh said in a statement. “Jackson victimized vulnerable people for his personal financial benefit.”
The final order requires Cash-N-Go to pay more than $2.2 million in restitution to consumers and a $1.2 million penalty to the state.
The defendants were represented by Douglas Gansler, partner at Cadwalader, Wickersham & Taft LLP in Washington. Gansler, the Maryland Attorney General from 2007 to 2015, did not respond to a call seeking comment Friday.
The various Cash-N-Go businesses offered short-term, high-interest loans secured by a customer’s vehicle, purporting to be a pawn transaction, according to the release. Cash-N-Go kept the title and the vehicle would be repossessed if a customer failed to make a payment.
So-called title loans or title pawns are consumer loans under Maryland law and are subject to loan licensing requirements and interest rate caps, but Jackson’s companies were never licensed and charged more than 10 times the maximum legal rate of interest, which is 33%, according to the release.
Under the final order, Cash-N-Go is prohibited from collecting any money related to the loans or repossessing vehicles, according to the release. The companies must also return any previously repossessed vehicles to their owners. They can continue operating as a check cashing businesses and pawn brokers, according to the release.
The businesses allegedly made more than 1,700 title loans to Maryland consumers between 2007 and 2016 for amounts ranging from several hundred dollars to $6,000, according to the charges, filed in April 2019. They collected more than $2.2 million from consumers in repayment and tens of thousands of dollars from sales of repossessed vehicles.
AG Racine Announces Real Estate Company to Pay $900K for Discriminating Against Low-Income District Renters
OAG press release: Largest OAG Civil Rights Settlement Resolves Lawsuit Against Curtis Investment Group for Refusing to Rent to Housing Voucher Recipients
https://oag.dc.gov/release/ag-racine-announces-real-estate-company-pay-900k
OAG press release: Largest OAG Civil Rights Settlement Resolves Lawsuit Against Curtis Investment Group for Refusing to Rent to Housing Voucher Recipients
https://oag.dc.gov/release/ag-racine-announces-real-estate-company-pay-900k
Delrahim: T-Mobile/Sprint Ruling Will Make It Harder For States To Challenge Mergers
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February 19, 2020The court ruling in favor of the T-Mobile/Sprint merger last week sets a high bar for state challenges and prevents highly decentralized antitrust enforcement, said Makan Delrahim, assistant attorney general of the Department of Justice’s (DOJ) Antitrust Division, reported CNBC.
“Had that gone the other way, you would have had 53 antitrust agencies,” Delrahim said in an interview Wednesday on CNBC’s “Squawk Box,” adding that it would have allowed every state to have “whacks of the pinata.”
Attorneys general from 13 states and the District of Columbia sued to block the US$26 billion telecom merger after the DOJ and Federal Communications Commission cleared the deal with certain remedies. The states argued that combining the No. 3 and No. 4 US carriers would result in higher prices for consumers due to limited competition. The companies countered that the merger would enable them to effectively compete against top players AT&Tand Verizon.
In his decision, Judge Victor Marrero wrote, “The resulting stalemate leaves the Court lacking sufficiently impartial and objective ground on which to rely in basing a sound forecast of the likely competitive effects of a merger.”
The ruling could open the door for future mergers in the industry and has also raised fears of a chilling effect on state actions. New York Attorney General Letitia James, who helped lead the states’ effort, said Sunday, February 16, that she would not move forward with an appeal.
Full Content: CNBC
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February 19, 2020The court ruling in favor of the T-Mobile/Sprint merger last week sets a high bar for state challenges and prevents highly decentralized antitrust enforcement, said Makan Delrahim, assistant attorney general of the Department of Justice’s (DOJ) Antitrust Division, reported CNBC.
“Had that gone the other way, you would have had 53 antitrust agencies,” Delrahim said in an interview Wednesday on CNBC’s “Squawk Box,” adding that it would have allowed every state to have “whacks of the pinata.”
Attorneys general from 13 states and the District of Columbia sued to block the US$26 billion telecom merger after the DOJ and Federal Communications Commission cleared the deal with certain remedies. The states argued that combining the No. 3 and No. 4 US carriers would result in higher prices for consumers due to limited competition. The companies countered that the merger would enable them to effectively compete against top players AT&Tand Verizon.
In his decision, Judge Victor Marrero wrote, “The resulting stalemate leaves the Court lacking sufficiently impartial and objective ground on which to rely in basing a sound forecast of the likely competitive effects of a merger.”
The ruling could open the door for future mergers in the industry and has also raised fears of a chilling effect on state actions. New York Attorney General Letitia James, who helped lead the states’ effort, said Sunday, February 16, that she would not move forward with an appeal.
Full Content: CNBC
Opinion: be mad about your internet bill
In 2019, New York University economist Thomas Philippon did a deep dive into market concentration and monopolies in The Great Reversal: How America Gave Up on Free Markets. And one of his touchpoints for the book is the internet. Looking at the data, he found that the United States has fallen behind other developed economies in broadband penetration and that prices are significantly higher. In 2017, the average monthly cost of broadband in America was $66.17; in France, it was $38.10, in Germany, $35.71, and in South Korea, $29.90. How did this happen? In his view, a lot of it comes down to competition — or, rather, lack thereof.
To a certain extent, telecommunications companies and internet service providers are a sort of natural monopoly, meaning high infrastructure costs and other barriers to entry give early entrants a significant advantage. It costs money to install a cable system because you have to dig up streets, access buildings, etc., and once one company does that, there’s not a ton of incentive to do it all over again. On top of that, telecom companies paid what were often super-low fees -- maybe enough to create a public access studio — to wire up cities and towns in exchange for, essentially, getting a monopoly.
But that’s where the government could come in by regulating the network or forcing the company that built it to lease out parts of it to rivals. As Philippon notes, that’s what happened in France: An incumbent carrier was compelled to lease out the “last mile” of its network — basically, the last bit of cable that gets to your house or apartment building — and therefore let competitors have a chance at also appealing to customers.
IN 2017, THE AVERAGE MONTHLY COST OF BROADBAND IN AMERICA WAS $66.17; IN FRANCE, IT WAS $38.10, AND IN SOUTH KOREA, $29.90In the US, however, just a few big companies, often without overlap, control much of the telecom industry, and the result is high prices and uneven connectivity.
In 2018, Harvard law professor Susan Crawford examined the case of, what do you know, New York City in an article for Wired. The city was supposed to be “a model for big-city high-speed internet,” she explained, after then-Mayor Mike Bloomberg struck a deal with Verizon to install its FiOS fiber service in residential buildings in 2008, ending what was then Time Warner Cable’s local monopoly. In 2015, a quarter of New York City’s residential blocks still didn’t have FiOS, and one in five New Yorkers still don’t have internet access at home.
“New York City could be in a very different position today if those Bloomberg officials had called for a city-overseen fiber network. The creation of a neutral, unlit ‘last mile’ network that reaches every building in the city, like a street grid, would have allowed the city to ensure fiber access to everyone,” Crawford wrote.
Instead, multiple states (though not New York) have put up roadblocks to municipal broadband to keep cities from providing alternatives to and competing with local entities. It’s an example of lobbying at its finest, so that powerful corporations can keep competitors out and charge whatever they want.
Excerpt from article by Emily Stewart at https://www.vox.com/the-goods/2020/2/18/21126347/antitrust-monopolies-internet-telecommunications-cheerleading
DC educators target white racial bias in social studies standards as State Board launches rewrite
By Graham Vyse on Dec 3, 2019 Last updated Dec 12, 2019
Excerpt:
The DC State Board of Education is launching a three-year effort to change how public schools teach social studies, rewriting state academic standards to improve civics learning and promote more culturally relevant instruction for students in the nation’s capital.
The board is partnering with the Office of the State Superintendent of Education (OSSE) on the first update of these standards since 2006, and DC Public Schools (DCPS) hopes the process will address perceptions of white, Western bias in curricula.
“We frequently hear from teachers and students that our standards are not culturally relevant, sustaining or affirming,” Lindsey McCrea, the DCPS manager for social studies content and curriculum, told the State Board at its Nov. 20 monthly meeting. “The dominant narrative of Western European powers and the decisions of white Americans are the primary focus of the standards from kindergarten through 12th grade, while the experiences of marginalized people continue to be marginalized in DC state standards. All of our students deserve to see their own cultural, racial and social backgrounds reflected in the curriculum.”
https://thedcline.org/2019/12/03/dcps-targets-white-racial-bias-in-social-studies-education-standards-as-state-board-launches-rewrite/
By Graham Vyse on Dec 3, 2019 Last updated Dec 12, 2019
Excerpt:
The DC State Board of Education is launching a three-year effort to change how public schools teach social studies, rewriting state academic standards to improve civics learning and promote more culturally relevant instruction for students in the nation’s capital.
The board is partnering with the Office of the State Superintendent of Education (OSSE) on the first update of these standards since 2006, and DC Public Schools (DCPS) hopes the process will address perceptions of white, Western bias in curricula.
“We frequently hear from teachers and students that our standards are not culturally relevant, sustaining or affirming,” Lindsey McCrea, the DCPS manager for social studies content and curriculum, told the State Board at its Nov. 20 monthly meeting. “The dominant narrative of Western European powers and the decisions of white Americans are the primary focus of the standards from kindergarten through 12th grade, while the experiences of marginalized people continue to be marginalized in DC state standards. All of our students deserve to see their own cultural, racial and social backgrounds reflected in the curriculum.”
https://thedcline.org/2019/12/03/dcps-targets-white-racial-bias-in-social-studies-education-standards-as-state-board-launches-rewrite/
On Watergate, Nixon, and USDOJ independence from political interference
After President Richard Nixon resigned, Attorney General Griffin Bell gathered Justice Department lawyers in the department's elaborate Great Hall to address their independence in the post-Watergate world.
"The partisan activities of some attorneys general ... combined with the unfortunate legacy of Watergate, have given rise to the understandable public concern that some decisions at Justice may be the products of favor, or pressure, or politics," he said in the September 6, 1978 address. https://www.justice.gov/sites/default/files/ag/legacy/2011/08/23/09-06-1978b.pdf
Resulting Justice Department rules limited White House involvement with law enforcement decisions. The reforms emerged from Nixon's use of the department to conceal his administration's involvement in the break-in at the Democratic National Committee in the Watergate building.
The regulations that were put into place were intended to insulate the USDoJ from political interference. US attorneys were to be independent.
White House officials and justice department lawyers weren’t supposed to exchange information about ongoing criminal investigations or civil enforcement actions. A 2007 memorandum allowed the department to advise the White House of criminal or civil enforcement matters “only where it is important for the performance of the president’s duties and where appropriate from a law enforcement perspective”.
Recent events, very well reported in the press, create worry about political misuse of the USDOJ. Recently, more than 2000 former USDOJ attorneys publicly expressed their concern, and a national association of federal judges has called an emergency meeting Tuesday to address growing concerns about the intervention of Justice Department officials and President Donald Trump in politically sensitive cases,. https://www.msn.com/en-us/news/politics/federal-judges-association-calls-emergency-meeting-after-doj-intervenes-in-case-of-trump-ally-roger-stone/ar-BB1068Le
Posted by Don Allen Resnikoff, who takes full responsibility for the content
https://www.msn.com/en-us/news/politics/federal-judges-association-calls-emergency-meeting-after-doj-intervenes-in-case-of-trump-ally-roger-stone/ar-BB1068Le
After President Richard Nixon resigned, Attorney General Griffin Bell gathered Justice Department lawyers in the department's elaborate Great Hall to address their independence in the post-Watergate world.
"The partisan activities of some attorneys general ... combined with the unfortunate legacy of Watergate, have given rise to the understandable public concern that some decisions at Justice may be the products of favor, or pressure, or politics," he said in the September 6, 1978 address. https://www.justice.gov/sites/default/files/ag/legacy/2011/08/23/09-06-1978b.pdf
Resulting Justice Department rules limited White House involvement with law enforcement decisions. The reforms emerged from Nixon's use of the department to conceal his administration's involvement in the break-in at the Democratic National Committee in the Watergate building.
The regulations that were put into place were intended to insulate the USDoJ from political interference. US attorneys were to be independent.
White House officials and justice department lawyers weren’t supposed to exchange information about ongoing criminal investigations or civil enforcement actions. A 2007 memorandum allowed the department to advise the White House of criminal or civil enforcement matters “only where it is important for the performance of the president’s duties and where appropriate from a law enforcement perspective”.
Recent events, very well reported in the press, create worry about political misuse of the USDOJ. Recently, more than 2000 former USDOJ attorneys publicly expressed their concern, and a national association of federal judges has called an emergency meeting Tuesday to address growing concerns about the intervention of Justice Department officials and President Donald Trump in politically sensitive cases,. https://www.msn.com/en-us/news/politics/federal-judges-association-calls-emergency-meeting-after-doj-intervenes-in-case-of-trump-ally-roger-stone/ar-BB1068Le
Posted by Don Allen Resnikoff, who takes full responsibility for the content
https://www.msn.com/en-us/news/politics/federal-judges-association-calls-emergency-meeting-after-doj-intervenes-in-case-of-trump-ally-roger-stone/ar-BB1068Le
From AAI:
District Court Opinion in State’s Challenge to Sprint-T-Mobile Marks New Low in Weak Merger Control; Consumers Will Bear the Burden
Today, a U.S. district court in New York issued its opinion rejecting the challenge brought by a coalition of state Attorneys General seeking to block the merger of Sprint and T-Mobile. The decision clears the way for the proposed merger to proceed. Separately, a U.S. district court in Washington, D.C. has yet to decide whether to approve the proposed settlement between the merging parties and the U.S. Department of Justice (DOJ). Approval of the settlement would push the deal toward completion.
“The States deserve enormous credit for bringing this case in the wake of failed federal enforcement,” said American Antitrust Institute (AAI) President Diana Moss. “Consumers will bear the ultimate burden of this disappointing decision through higher prices, lower quality, and diminished innovation in essential wireless telecommunications services,” she added.
AAI expressed alarm that the opinion ignores the basic economic reality that, in a market with only three remaining players, incentives to compete are substantially weakened. AAI’s past analysis of the Sprint-T-Mobile merger highlights the considerable economic evidence demonstrating that four-to-three mergers increase incentives for firms to collude and harm consumers.
Read More
District Court Opinion in State’s Challenge to Sprint-T-Mobile Marks New Low in Weak Merger Control; Consumers Will Bear the Burden
Today, a U.S. district court in New York issued its opinion rejecting the challenge brought by a coalition of state Attorneys General seeking to block the merger of Sprint and T-Mobile. The decision clears the way for the proposed merger to proceed. Separately, a U.S. district court in Washington, D.C. has yet to decide whether to approve the proposed settlement between the merging parties and the U.S. Department of Justice (DOJ). Approval of the settlement would push the deal toward completion.
“The States deserve enormous credit for bringing this case in the wake of failed federal enforcement,” said American Antitrust Institute (AAI) President Diana Moss. “Consumers will bear the ultimate burden of this disappointing decision through higher prices, lower quality, and diminished innovation in essential wireless telecommunications services,” she added.
AAI expressed alarm that the opinion ignores the basic economic reality that, in a market with only three remaining players, incentives to compete are substantially weakened. AAI’s past analysis of the Sprint-T-Mobile merger highlights the considerable economic evidence demonstrating that four-to-three mergers increase incentives for firms to collude and harm consumers.
Read More
DOJ & FTC Argue Opposite Sides Of Qualcomm Suit
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February 9, 2020According to the Financial Times, https://www.ft.com/content/adbca366-49d3-11ea-aeb3-955839e06441 [oaywall] the Trump administration is set for an unusual courtroom showdown on Thursday, February 13, between lawyers of two federal antitrust agencies who will argue opposite sides of a Qualcomm case that could help shape the race to develop 5G technology.
The Department of Justice (DOJ) has taken the US chipmaker’s side as Qualcomm tries to overturn its loss at trial last year in a Federal Trade Commission (FTC) lawsuit filed in the final days of the Obama administration.
Lawyers for the DOJ’s antitrust division, headed by Makan Delrahim, a former Qualcomm lobbyist recused from the case, have argued that US national security is at stake, while FTC attorneys have accused the DOJ of interfering with antitrust enforcement.
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February 9, 2020According to the Financial Times, https://www.ft.com/content/adbca366-49d3-11ea-aeb3-955839e06441 [oaywall] the Trump administration is set for an unusual courtroom showdown on Thursday, February 13, between lawyers of two federal antitrust agencies who will argue opposite sides of a Qualcomm case that could help shape the race to develop 5G technology.
The Department of Justice (DOJ) has taken the US chipmaker’s side as Qualcomm tries to overturn its loss at trial last year in a Federal Trade Commission (FTC) lawsuit filed in the final days of the Obama administration.
Lawyers for the DOJ’s antitrust division, headed by Makan Delrahim, a former Qualcomm lobbyist recused from the case, have argued that US national security is at stake, while FTC attorneys have accused the DOJ of interfering with antitrust enforcement.
From Ars Technica
https://arstechnica.com/information-technology/2020/02/att-lost-1-2b-by-preventing-time-warner-shows-from-airing-on-netflix/
AT&T withholds content to give its own planned service, HBO Max, exclusivity:
"AT&T's actual Q4 2019 revenue was $46.8 billion, but the company said it would have been $48 billion if not for "HBO Max investments in the form of foregone WarnerMedia content licensing revenues."
"An AT&T spokesperson told Ars that the $1.2 billion in lost revenue was primarily caused by the decision "not to sell existing content—mainly Friends, The Big Bang Theory, and Fresh Prince—to third parties such as Netflix." As we've previously reported, AT&T took Time Warner shows off Netflix in order to give the exclusive streaming rights to AT&T's HBO Max, which is scheduled to debut in May 2020 for $14.99 a month."
DAR comment (attention DC and other AGs): A possible candidate for State or Federal enforcement?
https://arstechnica.com/information-technology/2020/02/att-lost-1-2b-by-preventing-time-warner-shows-from-airing-on-netflix/
AT&T withholds content to give its own planned service, HBO Max, exclusivity:
"AT&T's actual Q4 2019 revenue was $46.8 billion, but the company said it would have been $48 billion if not for "HBO Max investments in the form of foregone WarnerMedia content licensing revenues."
"An AT&T spokesperson told Ars that the $1.2 billion in lost revenue was primarily caused by the decision "not to sell existing content—mainly Friends, The Big Bang Theory, and Fresh Prince—to third parties such as Netflix." As we've previously reported, AT&T took Time Warner shows off Netflix in order to give the exclusive streaming rights to AT&T's HBO Max, which is scheduled to debut in May 2020 for $14.99 a month."
DAR comment (attention DC and other AGs): A possible candidate for State or Federal enforcement?
NYT: Bill Barr’s striking plan to counter Huawei
President Trump has made it very clear that he is worried about Huawei’s leading role in 5G wireless technology. Now his attorney general, Bill Barr, has offered a radical solution: having the U.S. invest in the Chinese company’s European counterparts.
The U.S. doesn’t have a homegrown competitor to Huawei, Mr. Barr noted in a speech yesterday. The only viable rivals are Ericsson of Sweden and Nokia of Finland.
“Our economic future is at stake,” Mr. Barr said. “The risk of losing the 5G struggle with China should vastly outweigh other considerations.”
So he has an idea:
• “Some propose that these concerns could be met by the United States aligning itself with Nokia and/or Ericsson through American ownership of a controlling stake, either directly or through a consortium of private American and allied companies.”
• “Putting our large market and financial muscle behind one or both of these firms would make it a more formidable competitor and eliminate concerns over its staying power,” Mr. Barr adds. “We and our closest allies certainly need to be actively considering this approach.”
https://www.nytimes.com/2020/02/07/business/dealbook/bill-barr-huawei-nokia-ericsson.html
Mr. Barr's speech is at https://www.justice.gov/opa/speech/attorney-general-william-p-barr-delivers-keynote-address-department-justices-china
President Trump has made it very clear that he is worried about Huawei’s leading role in 5G wireless technology. Now his attorney general, Bill Barr, has offered a radical solution: having the U.S. invest in the Chinese company’s European counterparts.
The U.S. doesn’t have a homegrown competitor to Huawei, Mr. Barr noted in a speech yesterday. The only viable rivals are Ericsson of Sweden and Nokia of Finland.
“Our economic future is at stake,” Mr. Barr said. “The risk of losing the 5G struggle with China should vastly outweigh other considerations.”
So he has an idea:
• “Some propose that these concerns could be met by the United States aligning itself with Nokia and/or Ericsson through American ownership of a controlling stake, either directly or through a consortium of private American and allied companies.”
• “Putting our large market and financial muscle behind one or both of these firms would make it a more formidable competitor and eliminate concerns over its staying power,” Mr. Barr adds. “We and our closest allies certainly need to be actively considering this approach.”
https://www.nytimes.com/2020/02/07/business/dealbook/bill-barr-huawei-nokia-ericsson.html
Mr. Barr's speech is at https://www.justice.gov/opa/speech/attorney-general-william-p-barr-delivers-keynote-address-department-justices-china
Texas AG Accuses Google Of Delaying Antitrust Investigation
The state attorney general leading a broad antitrust investigation into Google is accusing the tech giant of delaying the case and vowed to see it through to the end.
https://www.cnbc.com/2020/02/05/texas-ag-paxton-says-google-delaying-antitrust-investigation.html
AAI Says DOJ Missed the Opportunity to Bust a Monopoly: Letter Unpacks Government’s Response to Live Nation-Ticketmaster’s Violations of the 2010 Merger Settlement
Today, AAI submitted a letter to the U.S. Department of Justice, Antitrust Division regarding its recent enforcement action in U.S v. Ticketmaster Entertainment, Inc., and Live Nation Entertainment, Inc. The decade-old merger of Live Nation and Ticketmaster melded together artist management, concert promotion, venue operation, and ticketing in a monolithic, multi-level supply chain in the live music business.
Read More https://www.antitrustinstitute.org/work-product/aai-says-doj-missed-the-opportunity-to-bust-a-monopoly-letter-unpacks-governments-response-to-live-nation-ticketmasters-violations-of-the-2010-merger-settlement/
Today, AAI submitted a letter to the U.S. Department of Justice, Antitrust Division regarding its recent enforcement action in U.S v. Ticketmaster Entertainment, Inc., and Live Nation Entertainment, Inc. The decade-old merger of Live Nation and Ticketmaster melded together artist management, concert promotion, venue operation, and ticketing in a monolithic, multi-level supply chain in the live music business.
Read More https://www.antitrustinstitute.org/work-product/aai-says-doj-missed-the-opportunity-to-bust-a-monopoly-letter-unpacks-governments-response-to-live-nation-ticketmasters-violations-of-the-2010-merger-settlement/
Laurie Garrett: Trump Has Sabotaged America’s Coronavirus Response
As it improvises its way through a public health crisis, the United States has never been less prepared for a pandemic.
BY LAURIE GARRETT
| JANUARY 31, 2020, 11:07 AM
When Tedros Adhanom Ghebreyesus, the director-general of the World Health Organization (WHO), declared the Wuhan coronavirus a public health emergency of international concern on Thursday, he praised China for taking “unprecedented” steps to control the deadly virus. “I have never seen for myself this kind of mobilization,” he noted. “China is actually setting a new standard for outbreak response.”
The epidemic control efforts unfolding today in China—including placing some 100 million citizens on lockdown, shutting down a national holiday, building enormous quarantine hospitals in days’ time, and ramping up 24-hour manufacturing of medical equipment—are indeed gargantuan. It’s impossible to watch them without wondering, “What would we do? How would my government respond if this virus spread across my country?”
For the United States, the answers are especially worrying because the government has intentionally rendered itself incapable. In 2018, the Trump administration fired the government’s entire pandemic response chain of command, including the White House management infrastructure. In numerous phone calls and emails with key agencies across the U.S. government, the only consistent response I encountered was distressed confusion. If the United States still has a clear chain of command for pandemic response, the White House urgently needs to clarify what it is
If the United States still has a clear chain of command for pandemic response, the White House urgently needs to clarify what it is
—not just for the public but for the government itself, which largely finds itself in the dark.
When Ebola broke out in West Africa in 2014, President Barack Obama recognized that responding to the outbreak overseas, while also protecting Americans at home, involved multiple U.S. government departments and agencies, none of which were speaking to one another. Basically, the U.S. pandemic infrastructure was an enormous orchestra full of talented, egotistical players, each jockeying for solos and fame, refusing to rehearse, and demanding higher salaries—all without a conductor. To bring order and harmony to the chaos, rein in the agency egos, and create a coherent multiagency response overseas and on the homefront, Obama anointed a former vice presidential staffer, Ronald Klain, as a sort of “epidemic czar” inside the White House, clearly stipulated the roles and budgets of various agencies, and placed incident commanders in charge in each Ebola-hit country and inside the United States. The orchestra may have still had its off-key instruments, but it played the same tune.
Building on the Ebola experience, the Obama administration set up a permanent epidemic monitoring and command group inside the White House National Security Council (NSC) and another in the Department of Homeland Security (DHS)—both of which followed the scientific and public health leads of the National Institutes of Health (NIH) and the Centers for Disease Control and Prevention (CDC) and the diplomatic advice of the State Department.
On the domestic front, the real business of assuring public health and safety is a local matter, executed by state, county, and city departments that operate under a mosaic of laws and regulations that vary jurisdiction by jurisdiction. Some massive cities, such as New York City or Boston, have large budgets, clear regulations, and epidemic experiences that have left deep benches of medical and public health talent. But much of the United States is less fortunate on the local level, struggling with underfunded agencies, understaffing, and no genuine epidemic experience. Large and small, America’s localities rely in times of public health crisis on the federal government.
Bureaucracy matters. Without it, there’s nothing to coherently manage an alphabet soup of agencies housed in departments ranging from Defense to Commerce, Homeland Security to Health and Human Services (HHS).
But that’s all gone now.
In the spring of 2018, the White House pushed Congress to cut funding for Obama-era disease security programs, proposing to eliminate $252 million in previously committed resources for rebuilding health systems in Ebola-ravaged Liberia, Sierra Leone, and Guinea. Under fire from both sides of the aisle, President Donald Trump dropped the proposal to eliminate Ebola funds a month later. But other White House efforts included reducing $15 billion in national health spending and cutting the global disease-fighting operational budgets of the CDC, NSC, DHS, and HHS. And the government’s $30 million Complex Crises Fund was eliminated.
REIn May 2018, Trump ordered the NSC’s entire global health security unit shut down, calling for reassignment of Rear Adm. Timothy Ziemer and dissolution of his team inside the agency. The month before, then-White House National Security Advisor John Bolton pressured Ziemer’s DHS counterpart, Tom Bossert, to resign along with his team. Neither the NSC nor DHS epidemic teams have been replaced. The global health section of the CDC was so drastically cut in 2018 that much of its staff was laid off and the number of countries it was working in was reduced from 49 to merely 10. Meanwhile, throughout 2018, the U.S. Agency for International Development and its director, Mark Green, came repeatedly under fire from both the White House and Secretary of State Mike Pompeo. And though Congress has so far managed to block Trump administration plans to cut the U.S. Public Health Service Commissioned Corps by 40 percent, the disease-fighting cadres have steadily eroded as retiring officers go unreplaced.
Public health advocates have been ringing alarm bells to no avail.
Public health advocates have been ringing alarm bells to no avail.
Klain has been warning for two years that the United States was in grave danger should a pandemic emerge. In 2017 and 2018, the philanthropist billionaire Bill Gates met repeatedly with Bolton and his predecessor, H.R. McMaster, warning that ongoing cuts to the global health disease infrastructure would render the United States vulnerable to, as he put it, the “significant probability of a large and lethal modern-day pandemic occurring in our lifetimes.” And an independent, bipartisan panel formed by the Center for Strategic and International Studies concluded that lack of preparedness was so acute in the Trump administration that the “United States must either pay now and gain protection and security or wait for the next epidemic and pay a much greater price in human and economic costs.”
The next epidemic is now here; we’ll soon know the costs imposed by the Trump administration’s early negligence and present panic. On Jan. 29, Trump announced the creation of the President’s Coronavirus Task Force, an all-male group of a dozen advisors, five from the White House staff. Chaired by Secretary of Health and Human Services Alex Azar, the task force includes men from the CDC, State Department, DHS, the Office of Management and Budget, and the Transportation Department. It’s not clear how this task force will function or when it will even convene.
In the absence of a formal structure, the government has resorted to improvisation. In practical terms, the U.S. government’s public health effort is led by Daniel Jernigan, the incident commander for the Wuhan coronavirus response at the CDC. Jernigan is responsible for convening meetings of the nation’s state health commissioners and briefing CDC Director Robert Redfield and his boss, Azar. Meanwhile, state-level health leaders told me that they have been sharing information with one another and deciding how best to prepare their medical and public health workers without waiting for instructions from federal leadership. The most important federal program for local medical worker and hospital epidemic training, however, will run out of money in May, as Congress has failed to vote on its funding. The HHS Office of the Assistant Secretary for Preparedness and Response (ASPR) is the bulwark between hospitals and health departments versus pandemic threats; last year HHS requested $2.58 billion, but Congress did not act.
On Thursday, the CDC confirmed the first human-to-human spread of the Wuhan coronavirus inside the United States, between a husband and wife in Chicago. While the wife acquired her infection traveling in China, she passed the virus to her husband on return to the United States. Though only six Wuhan coronavirus cases have been confirmed in the United States, with no deaths, Nancy Messonnier of the CDC told reporters on Thursday: “Moving forward, we can expect to see more cases, and more cases mean the potential for more person-to-person spread.”
As the number of coronavirus cases increases, Americans are growing more fearful, which is creating new problems that the government is leaving unaddressed.
As the number of coronavirus cases increases, Americans are growing more fearful, which is creating new problems that the government is leaving unaddressed.
Surveying the largest drug store chains in New York City on Wednesday, I found that all were sold out of medical face masks and latex gloves, as is Amazon. Searching online for protective masks reveals that dozens of products intended for use to block dust and particles far larger than viruses are garnering brisk sales—and none available that can actually prevent viral exposure. The surge in mask and glove sales to worried citizens all over the world needs refereeing. Bona fide anti-viral masks should be prioritized to front-line medical and public health staff, and the populace shouldn’t be misled into purchasing and wearing products that offer no genuine protection.
Countering misinformation, conspiracy theories, rumormongering, and discriminatory behavior against people believed to be disease spreaders requires thoughtful communication from leadership at the highest levels of government. None is in evidence. Instead, Commerce Secretary Wilbur Ross appeared on Fox Business on Thursday to fan the flames of fear for the sake of hypothetical business opportunities. “It does give businesses yet another thing to consider when they go through their review of their supply chain,” Ross said. “It’s another risk factor that people need to take into account. So, I think it will help accelerate the return of jobs to North America, some to the U.S., probably some to Mexico as well.” Meanwhile, Trump, asked at the recent World Economic Forum gathering in Davos, Switzerland how he intended to respond to the epidemic, said the situation was under control and a world away from the United States.
In a statement released this week, Pompeo sought to calm Americans, saying, “People should know that there are enormous efforts underway by the United States government to make sure that we do everything we can to protect the American people and to reduce the risk all around the globe.” But late Thursday night, the secretary—in clear defiance of WHO’s admonishment against restricting travel to and from China--issued an advisory saying, “Those currently in China should consider departing.”
In recent days, a handful of policy leaders have been shifted from government positions focused on weapons of mass destruction and bioterrorism to the slowly emerging epidemic response infrastructure, such as Matthew Pottinger, Philip Ferro, and David Wade on the NSC and the bioterrorism expert Anthony Ruggiero. It’s not at all clear how they would handle an explosion of coronavirus cases, were such a dreadful thing to occur in the United States. “The full weight of the US Government is working on this,” a senior administration official told CNN on Tuesday. “As with any interagency effort of this scale, the National Security Council works closely with the whole of government to ensure a coordinated and unified effort.”
The last time the U.S. government and its many local and state counterparts faced an explosive pandemic on American soil was 2009, with the spread of H1N1, or swine flu. The then-new Obama administration was still filling key positions across the executive branch when the epidemic emerged that spring, and it struggled to set the proper tone in reaction to what turned out to be an exceptionally contagious, but not unusually virulent, form of influenza. The challenge revealed enormous gaps in America’s ability to swiftly manufacture vaccines, stock-outs of face masks and vital hospital supplies, and serious difficulty in keeping ahead of outright lies, conspiracy theories, and rumormongering on cable TV and social media. The much more deadly pandemic test came in 1981, with the arrival of HIV: It did not go well, as history has well established, because homophobia was so pervasive in the country and within government that gay men, rather than the virus killing them, were treated as a national scourge.
Since the great influenza pandemic of 1918, the United States has been spared terrifying epidemics. Americans now are epidemic voyeurs. They watch YouTube videos of China’s struggles. They see the government attack its epidemic by building a 1,000-bed quarantine hospital in a single week, lock down cities larger than New York or Los Angeles, ramp up 24/7 manufacture of face masks and protective gear, deploy its armed forces medical corps to treat ailing citizens, send enormous convoys of food and supplies to anxious citizens of Wuhan, and release terrifying, growing tallies daily of its swelling patient populations. They look in horror at panicked lines of masked people waiting to learn if their fevers are caused by the deadly disease, at bodies lying on cold floors in overcrowded hospitals, and at people crying out from behind their masks for help. And they ask, “What would the United States do? What would the White House do?” The answers are not reassuring.
Laurie Garrett is a former senior fellow for global health at the Council on Foreign Relations and a Pulitzer Prize winning science writer. https://foreignpolicy.com/2020/01/31/coronavirus-china-trump-united-states-public-health-emergency-response/
February 6, 2020
Adventist HealthCare officially takes over Howard University Hospital
.
By Sara Gilgore / Per their new management services agreement, Adventist takes over the D.C. facility later this month, opening the door to potential major changes down the road, including perhaps a relocation.
Read Full Article https://www.bizjournals.com/washington/news/2020/02/06/exclusive-adventist-healthcare-officially-takes.html?
Adventist HealthCare officially takes over Howard University Hospital
.
By Sara Gilgore / Per their new management services agreement, Adventist takes over the D.C. facility later this month, opening the door to potential major changes down the road, including perhaps a relocation.
Read Full Article https://www.bizjournals.com/washington/news/2020/02/06/exclusive-adventist-healthcare-officially-takes.html?
Paige W. Cunningham on Healthcare and the 2020 Election; notes variations in health care policy among States
In the presidential election, healthcare is the number one issue for voters in both parties. Paige Winfield Cunningham is a national reporter at the Washington Post, focusing specifically on healthcare policy. Despite the healthcare wars within the Democratic Party—and between Democrats and the GOP—Cunningham tells Hari that neither party will make major changes.
READ TRANSCRIPT: https://www.pbs.org/wnet/amanpour-and-company/video/paige-w-cunningham-on-healthcare-and-the-2020-election/
WATCH FULL EPISODE https://www.pbs.org/wnet/amanpour-and-company/video/february-3-2020-gdj4hf/
In the presidential election, healthcare is the number one issue for voters in both parties. Paige Winfield Cunningham is a national reporter at the Washington Post, focusing specifically on healthcare policy. Despite the healthcare wars within the Democratic Party—and between Democrats and the GOP—Cunningham tells Hari that neither party will make major changes.
READ TRANSCRIPT: https://www.pbs.org/wnet/amanpour-and-company/video/paige-w-cunningham-on-healthcare-and-the-2020-election/
WATCH FULL EPISODE https://www.pbs.org/wnet/amanpour-and-company/video/february-3-2020-gdj4hf/
NYT recap of U.S. policies on Huawei
“Our economic future is at stake,” Mr. Barr said in a speech delivered during a conference in Washington on threats that China poses to the United States. “The risk of losing the 5G struggle with China should vastly outweigh other considerations.”
Mr. Barr noted that two Chinese telecom giants, Huawei and ZTE, account for about 40 percent of the global 5G infrastructure market, which is expected to serve as the backbone for trillions of dollars’ worth of economic and industrial activity in an increasingly digital global economy. 5G networks promise substantially faster network speeds and prospects for new commercial applications in multiple industries like transportation and health care.
Mr. Barr said it was the first time in history that the United States was not the leader in a major technological sector that will underpin future innovation.
The next generation of telecom networks — and the equipment for them that is currently being built — has emerged as a key fight in the battle between the United States and China for technology supremacy. American intelligence officials also say that equipment made by Chinese telecom companies could pose a threat to national security and have urged allies not to use it in their systems.
The White House and American national security experts have said that companies including Huawei are too closely tied to the Chinese government, and that their equipment could give Chinese officials unlawful access to data and communications if networks across the world decide to use it. The companies have long denied that they are beholden to the government.
“No country poses a greater threat than communist China,” John Brown, the assistant director of the F.B.I.’s counterintelligence division, said during separate remarks at the conference. He said that the world must decide whether its communications will go through China or the United States.
But the Trump administration has taken an inconsistent approach toward Huawei and ZTE and those companies continue to play an essential role in the new, 5G telecom networks being built around the globe.
A proposed rule change that would restrict sales of American computer processing chips to Huawei was placed on hold after Defense Department officials argued that such a move could undermine national security by discouraging the use of American components abroad.
Mr. Trump’s response to the security issues posed by 5G has been mixed. Last summer he said that “Huawei is something that is very dangerous.” But during the same remarks, he raised the prospect of including Huawei in a trade deal with China. “If we made a deal, I can imagine Huawei being included in some form or some part,” he said.
And in 2018, Mr. Trump lifted tough sanctions that the United States had imposed on ZTE, which had violated sanctions on Iran and North Korea and that defense advisers said posed a threat to national security. President Xi Jinping of China had personally asked Mr. Trump to intervene.
Intelligence officials and Republican lawmakers decried the move, saying that ZTE had not only failed to remedy its sanctions issues but had also lied about its efforts.
Nevertheless, the Trump administration has asked allies not to use equipment made by Huawei, in some cases threatening to withhold intelligence from countries that do not ban the company. But that pressure campaign has had limited success. China has threatened to economically retaliate against countries that ban equipment made by its technology companies.
Last month, Britain, one of the United States’ closest allies and part of the so-called Five Eyes intelligence-sharing alliance, decided to allow Huawei on its new 5G wireless network.
The British government said that it would only use Huawei in the parts of its new wireless network that would not compromise its national security. Officials also said it had to use Huawei because — after years of mergers and industry consolidation — there are too few competitors in the network-equipment space. It asked allies to work with the private sector to foster more competition.
Mr. Barr agreed that too few companies were making 5G equipment; Nokia and Ericsson are the only other global competitors. He said that proposals had already been floated to address this problem, including the possibility that a consortium of private American and allied companies could put financial might “behind one or both of those firms” to make them more competitive and guarantee their staying power.
“It’s all very well to tell our friends and allies that they shouldn't install Huawei, but whose infrastructure are they going to install?” Mr. Barr said.
https://www.nytimes.com/2020/02/06/us/politics/barr-5g.html
“Our economic future is at stake,” Mr. Barr said in a speech delivered during a conference in Washington on threats that China poses to the United States. “The risk of losing the 5G struggle with China should vastly outweigh other considerations.”
Mr. Barr noted that two Chinese telecom giants, Huawei and ZTE, account for about 40 percent of the global 5G infrastructure market, which is expected to serve as the backbone for trillions of dollars’ worth of economic and industrial activity in an increasingly digital global economy. 5G networks promise substantially faster network speeds and prospects for new commercial applications in multiple industries like transportation and health care.
Mr. Barr said it was the first time in history that the United States was not the leader in a major technological sector that will underpin future innovation.
The next generation of telecom networks — and the equipment for them that is currently being built — has emerged as a key fight in the battle between the United States and China for technology supremacy. American intelligence officials also say that equipment made by Chinese telecom companies could pose a threat to national security and have urged allies not to use it in their systems.
The White House and American national security experts have said that companies including Huawei are too closely tied to the Chinese government, and that their equipment could give Chinese officials unlawful access to data and communications if networks across the world decide to use it. The companies have long denied that they are beholden to the government.
“No country poses a greater threat than communist China,” John Brown, the assistant director of the F.B.I.’s counterintelligence division, said during separate remarks at the conference. He said that the world must decide whether its communications will go through China or the United States.
But the Trump administration has taken an inconsistent approach toward Huawei and ZTE and those companies continue to play an essential role in the new, 5G telecom networks being built around the globe.
A proposed rule change that would restrict sales of American computer processing chips to Huawei was placed on hold after Defense Department officials argued that such a move could undermine national security by discouraging the use of American components abroad.
Mr. Trump’s response to the security issues posed by 5G has been mixed. Last summer he said that “Huawei is something that is very dangerous.” But during the same remarks, he raised the prospect of including Huawei in a trade deal with China. “If we made a deal, I can imagine Huawei being included in some form or some part,” he said.
And in 2018, Mr. Trump lifted tough sanctions that the United States had imposed on ZTE, which had violated sanctions on Iran and North Korea and that defense advisers said posed a threat to national security. President Xi Jinping of China had personally asked Mr. Trump to intervene.
Intelligence officials and Republican lawmakers decried the move, saying that ZTE had not only failed to remedy its sanctions issues but had also lied about its efforts.
Nevertheless, the Trump administration has asked allies not to use equipment made by Huawei, in some cases threatening to withhold intelligence from countries that do not ban the company. But that pressure campaign has had limited success. China has threatened to economically retaliate against countries that ban equipment made by its technology companies.
Last month, Britain, one of the United States’ closest allies and part of the so-called Five Eyes intelligence-sharing alliance, decided to allow Huawei on its new 5G wireless network.
The British government said that it would only use Huawei in the parts of its new wireless network that would not compromise its national security. Officials also said it had to use Huawei because — after years of mergers and industry consolidation — there are too few competitors in the network-equipment space. It asked allies to work with the private sector to foster more competition.
Mr. Barr agreed that too few companies were making 5G equipment; Nokia and Ericsson are the only other global competitors. He said that proposals had already been floated to address this problem, including the possibility that a consortium of private American and allied companies could put financial might “behind one or both of those firms” to make them more competitive and guarantee their staying power.
“It’s all very well to tell our friends and allies that they shouldn't install Huawei, but whose infrastructure are they going to install?” Mr. Barr said.
https://www.nytimes.com/2020/02/06/us/politics/barr-5g.html
From New York's Street Vendor Project
http://streetvendor.org/
There are as many as 20,000 street vendors in New York City — hot dog vendors, flower vendors, t-shirt vendors, street artists, fancy food trucks, and many others. They are small businesspeople struggling to make ends meet. Most are immigrants and people of color. Some are US military veterans who served their country. They work long hours under harsh conditions, asking for nothing more than a chance to sell their goods on the public sidewalk.
Yet, in recent years, vendors have been victims of New York’s aggressive “quality of life” crackdown. They have been denied access to vending licenses. Many streets have been closed to them at the urging of powerful business groups. They receive exorbitant tickets for minor violations like vending too close to a crosswalk — more than any big businesses are required to pay for similar violations.
The Street Vendor Project is a membership-based project with more than 2,000 vendor members who are working together to create a vendors’ movement for permanent change. We reach out to vendors in the streets and storage garages and teach them about their legal rights and responsibilities. We hold meetings where we plan collective actions for getting our voices heard. We publish reports and file lawsuits to raise public awareness about vendors and the enormous contribution they make to our city.
Finally, we help vendors grow their businesses by linking them with small business training and loans.The Street Vendor Project is part of the Urban Justice Center, a non-profit organization that provides legal representation and advocacy to various marginalized groups of New Yorkers.
http://streetvendor.org/
There are as many as 20,000 street vendors in New York City — hot dog vendors, flower vendors, t-shirt vendors, street artists, fancy food trucks, and many others. They are small businesspeople struggling to make ends meet. Most are immigrants and people of color. Some are US military veterans who served their country. They work long hours under harsh conditions, asking for nothing more than a chance to sell their goods on the public sidewalk.
Yet, in recent years, vendors have been victims of New York’s aggressive “quality of life” crackdown. They have been denied access to vending licenses. Many streets have been closed to them at the urging of powerful business groups. They receive exorbitant tickets for minor violations like vending too close to a crosswalk — more than any big businesses are required to pay for similar violations.
The Street Vendor Project is a membership-based project with more than 2,000 vendor members who are working together to create a vendors’ movement for permanent change. We reach out to vendors in the streets and storage garages and teach them about their legal rights and responsibilities. We hold meetings where we plan collective actions for getting our voices heard. We publish reports and file lawsuits to raise public awareness about vendors and the enormous contribution they make to our city.
Finally, we help vendors grow their businesses by linking them with small business training and loans.The Street Vendor Project is part of the Urban Justice Center, a non-profit organization that provides legal representation and advocacy to various marginalized groups of New Yorkers.
Press release:AG Racine Joins Multistate Lawsuit Challenging Trump Administration Attack on Health Care Access and Reproductive Rights
January 30, 2020 New HHS Rule Threatens Abortion Coverage Provided by ACA Insurance Plans to 20K+ DC Residents
WASHINGTON, D.C. – Attorney General Karl A. Racine today joined six other Attorneys General in filing a lawsuit to stop the Trump administration from threatening access to safe and legal abortion care for individuals who purchase health insurance through state health care exchanges. This coalition, led by California and New York, is challenging a new rule issued by the Department of Health and Human Services (HHS) which unlawfully reinterprets part of the Affordable Care Act (ACA). The new rule imposes expensive and confusing billing requirements on health plans that cover abortion care and are sold through state insurance exchanges. This change creates major burdens for state insurance exchanges and puts millions of consumers at risk of accidentally losing health insurance coverage. The lawsuit is seeking to stop the rule’s implementation.
“The Trump administration’s relentless attack on safe and accessible abortion care puts tens of thousands of District residents and workers in jeopardy of losing their health care access through our exchange,” said AG Racine. “If this rule is implemented, it would dramatically increase health care costs for residents and the District—and the burdens it imposes could mean that insurance companies stop offering abortion care entirely. We filed this lawsuit to stand up for the rights of District women and families to make their own reproductive decisions.”
From https://oag.dc.gov/release/ag-racine-joins-multistate-lawsuit-challenging
HHS Secretary Alex Azar voiced frustration over stakeholders who are "fiercely" pushing back against the department's proposed interoperability rules.
"Health records today are stored in a segmented, balkanized system," Azar said during keynote remarks at the 2020 annual meeting of the department's Office of the National Coordinator for Health Information Technology in Washington, D.C. "Unfortunately, some are defending the balkanized, outdated status quo and fighting our proposals fiercely."
But defending the current system is "a pretty unpopular place to be," he added.
The two interoperability proposals, released by the ONC and the CMS early last year, are a core component of the Trump administration's larger vision of "putting patients at the center of American healthcare," Azar said.
From https://www.modernhealthcare.com/information-technology/azar-scare-tactics-wont-stall-interoperability-rules?utm_source=modern-healthcare-am-tuesday&utm_medium=email&utm_campaign=20200127&utm_content=article1-readmore
"Health records today are stored in a segmented, balkanized system," Azar said during keynote remarks at the 2020 annual meeting of the department's Office of the National Coordinator for Health Information Technology in Washington, D.C. "Unfortunately, some are defending the balkanized, outdated status quo and fighting our proposals fiercely."
But defending the current system is "a pretty unpopular place to be," he added.
The two interoperability proposals, released by the ONC and the CMS early last year, are a core component of the Trump administration's larger vision of "putting patients at the center of American healthcare," Azar said.
From https://www.modernhealthcare.com/information-technology/azar-scare-tactics-wont-stall-interoperability-rules?utm_source=modern-healthcare-am-tuesday&utm_medium=email&utm_campaign=20200127&utm_content=article1-readmore
Epic, Cerner & 5 more health IT stakeholders react to HHS' interoperability rule
Jackie Drees - Tuesday, January 28th, 2020 Print | Email
Epic, Cerner, Microsoft and other prominent health IT companies and executives are speaking up about HHS' proposed interoperability rule ahead of its anticipated finalization next month.
The regulations, which were issued by CMS and ONC last year to support the MyHealthEData and 21st Century Cures Act, would require the health IT industry to adopt application programming interfaces to help patients more easily access their health data. The rule would also prohibit healthcare organizations from employing information blocking practices.
The rule is currently under review by the Office of Management and Budget and is expected to be finalized in February.
Here are reactions from seven health IT companies and executives about the rules:
1. Epic. The EHR giant has voiced its opposition of the proposed rule, citing privacy concerns relating to third-party use of patient data. The company released a statement on Jan. 27 saying that while it supports HHS' effort to improve data sharing for patients, the rule presents "serious risks to patient privacy."
Earlier this month, Epic CEO Judy Faulkner sent emails to some of the company's largest U.S. hospital clients, urging them to voice their opposition of the proposed interoperability rules. Ms. Faulkner also said Epic may consider suing HHS if the finalized version of the interoperability rule does not support adequate safety regulations.
2. Cerner. Epic's largest EHR competitor appears to be in favor of the rule. Cerner CEO Brent Shafer on Jan. 27 tweeted the following statement about ONC's proposed information blocking rule: "Let me be abundantly clear: [Cerner] embraces interoperability and the flow of information across disparate systems and healthcare entities. We fully support the proposed rule and the rulemaking process."
Cerner is also a member of the CARIN Alliance, a multi-sector alliance that aims to work with the government to overhaul barriers to consumer-directed data exchange. Representatives from the EHR vendor reportedly attended the organization's Jan. 27 event to discuss initiatives to give patients more access to their health data.
3. CARIN Alliance. The organization, which comprises more than 85 members including Google, Apple and Microsoft, met with OMB on Jan. 27 to discuss HHS' proposed rules. In its key request, the alliance asked the federal government to finalize and release the rules immediately.
"Although we may slightly differ in the specific details regarding how the proposed rules should be implemented, we are united regarding consumer access sections of the two proposed rules and in our belief that both proposed rules should be finalized and released immediately," the alliance said in a statement.
4. Microsoft Healthcare. Peter Lee, corporate vice president of Microsoft Healthcare, said the technology giant endorses the proposed rules, adding that the regulations "are correct because they're based on modern data standards."
5. Tommy Thompson. The former HHS secretary and Wisconsin governor argued that the proposed interoperability rule would force Epic to hand over its trade secrets to competitors and "unfairly harm" the state's economy, according to a Jan. 10 op-ed he wrote for the Wisconsin State Journal.
6. Aneesh Chopra. In response to Epic CEO Judy Faulkner's emailed letter to hospital and health system execs, the former White House CTO told CNBC it was "unfortunate to see this much effort placed at stalling the important, bipartisan progress we have made to open up health information — at a minimum to consumers and institutions they trust."
7. Stephanie Reel. CIO of Baltimore-based Johns Hopkins University and Health System and a member of ONC's Health IT Policy Committee’s Information Exchange Workgroup told Becker's Hospital Review: "We are committed and continue to be focused on interoperability, and we are also focused on privacy and confidentiality of the patient information and protection of all of our information assets. It is one of the most challenging times as we think about the right balance in each of these areas. The angst that I feel about the recent interoperability conversation is around the risk to innovation. I think we need to find a balance that allows us to protect each individual patient, wisely leverage our data assets, while being equally cautious about the protection of intellectual property.
I worry a bit about too much control or reluctance to expand our thinking in an innovative way. The next big discovery will come from the very creative and innovative use of technology and information. I don't want us to err on the side of being too careful and too controlling because I think there is some risk that we will not make that next big discovery or cure that dreadful form of cancer."
https://www.beckershospitalreview.com/ehrs/epic-cerner-4-more-health-it-stakeholders-react-to-hhs-interoperability-rule.html?origin=bhre&utm_source=bhre&oly_enc_id=
Why electronic patient record interoperability matters: the March 10, 2014 submission of DCCRC to the FTC
The purpose of the attached comment letter of the DC Consumer Rights Coalition is to highlight competition-related policy issues likely to arise in emerging technology markets that are subject to "network" effects, such as the growing markets for Health Information Technology ("HIT") products, including Electronic Health Records ("EHR") products. We believe that the FTC should be cognizant of the potential danger to competition should healthcare providers adopt software and other technology that incorporates exclusionary proprietary standards. The danger is that the company that offers such technology may use it to disadvantage competitors by denying them access to the proprietary standards. Such problematic situations have arisen in other markets in the past, involving, for example, AT&T, IBM, and, more recently, Microsoft. Antitrust issues raised by such exclusionary conduct may be addressed through antitrust enforcement after the fact, of course. But we believe that a preferable approach is proactive government engagement that avoids the antitrust problem by facilitating and encouraging interoperability among products of competitors in the HIT markets.
The DCCRC comment (by Don Allen Resnikoff and Katherine Jones) is here:
00020-88806.pdf (78.25 KB)
The purpose of the attached comment letter of the DC Consumer Rights Coalition is to highlight competition-related policy issues likely to arise in emerging technology markets that are subject to "network" effects, such as the growing markets for Health Information Technology ("HIT") products, including Electronic Health Records ("EHR") products. We believe that the FTC should be cognizant of the potential danger to competition should healthcare providers adopt software and other technology that incorporates exclusionary proprietary standards. The danger is that the company that offers such technology may use it to disadvantage competitors by denying them access to the proprietary standards. Such problematic situations have arisen in other markets in the past, involving, for example, AT&T, IBM, and, more recently, Microsoft. Antitrust issues raised by such exclusionary conduct may be addressed through antitrust enforcement after the fact, of course. But we believe that a preferable approach is proactive government engagement that avoids the antitrust problem by facilitating and encouraging interoperability among products of competitors in the HIT markets.
The DCCRC comment (by Don Allen Resnikoff and Katherine Jones) is here:
00020-88806.pdf (78.25 KB)
Big tech giants Apple and Microsoft are joining health IT vendors and health plans to meet with federal officials today to voice strong support for efforts to give patients access to their health data.
The Carin Alliance, a private sector collaboration made up of major health insurers, providers, health IT companies and tech giants, announced last week that it is meeting with the Office of Management and Budget (OMB) OMB to request the agency to finalize and release the proposed interoperability rules "without further delay."
It came just days after the head of electronic health record (EHR) vendor Epic emailed CEOs and presidents of hospital systems urging recipients to sign a letter alongside Epic that voices disapproval for proposed interoperability rules from the Department of Health and Human Services (HHS).
Carin Alliance released a list of attendees for the Monday meeting and talking points (PDF) on its website Friday. Among the attendees are representatives from Apple, Microsoft, Humana, Walgreens, Blue Shield of California, Salesforce, Omada Health, major health information exchange Manifest MedEx, and Mount Sinai Health System. Also on the list were representatives of Cerner, an EHR vendor and competitor to Epic.
RELATED: Epic CEO emails hospital customers urging them to speak out against ONC interoperability rule
About 40 people representing some of the biggest companies in the industry are planning to attend, either in person or by phone.
Many of the organizations are members of the Carin Alliance.
"Although we may slightly differ in the specific details regarding how the proposed rules should be implemented, we are united regarding the consumer access sections of the two proposed rules and in our belief that both proposed rules should be finalized and released immediately," the Carin Alliance said in the talking points. "It will be to the benefit of all stakeholders to finalize the rules so the industry can work on implementation while continuing to work with the public sector to improve the rules over time."
In February 2019, the Office of the National Coordinator for Health IT (ONC) issued a proposed interoperability and information-blocking rule (PDF) that defines the demands on healthcare providers and electronic health record (EHR) vendors for data sharing. The rule also outlines exceptions to the prohibition against information blocking and provides standardized criteria for application programming interface development.
The ONC rule is currently under review by the OMB, the last step before publication. The Centers for Medicare & Medicaid Services' proposed interoperability rule (PDF) also is under review at OMB.
RELATED: Anthem, Humana along with Apple and Google testing API for patient access to claims data
During the ONC Annual Meeting in Washington D.C. Monday morning, Steve Posnack, Deputy National Coordinator for Health IT, said ONC's data-sharing rule would not be released during the annual meeting, taking place today and Tuesday.
The Carin Alliance said the organizations support the timely release of the interoperability rules "with the understanding that CMS and ONC have incorporated the consensus recommendations made by the public during the comment period and with the assumption the public and private sectors can work together to improve and build upon the rules after they are released."
Google was not listed as a meeting attendee, but the tech giant is among 20 organizations—including Apple, Anthem, Blue Cross Blue Shield, Cambia Health Solutions, and Humana—involved in an initiative to do “real-world testing” of an application programming interface (API) to standardize claims data sharing.
From: https://www.fiercehealthcare.com/tech/apple-microsoft-cerner-and-major-health-plans-call-for-omb-to-release-interoperability-rules?mkt_tok=eyJpIjoiTkdSbVl6SmxNV0l5WVdReiIsInQiOiJ6ZE5UR0VHSG50K3ZIZXJIY1N1NWRld1Q1REJ3K1VzeURGRDJcL0JPN3ZpQ1U0eVRIWjJ2NERhU1pweFFTMHhBd3JjRXpQNkNGOEtsSmJXcjBnMGx3aXNKcjRESGdzcjJzVXVOeGNFVFpQaDhxQWpsNkt5OWdQa0ZwZ1hyNXlCTXoifQ%3D%3D&mrkid=730008
The Carin Alliance, a private sector collaboration made up of major health insurers, providers, health IT companies and tech giants, announced last week that it is meeting with the Office of Management and Budget (OMB) OMB to request the agency to finalize and release the proposed interoperability rules "without further delay."
It came just days after the head of electronic health record (EHR) vendor Epic emailed CEOs and presidents of hospital systems urging recipients to sign a letter alongside Epic that voices disapproval for proposed interoperability rules from the Department of Health and Human Services (HHS).
Carin Alliance released a list of attendees for the Monday meeting and talking points (PDF) on its website Friday. Among the attendees are representatives from Apple, Microsoft, Humana, Walgreens, Blue Shield of California, Salesforce, Omada Health, major health information exchange Manifest MedEx, and Mount Sinai Health System. Also on the list were representatives of Cerner, an EHR vendor and competitor to Epic.
RELATED: Epic CEO emails hospital customers urging them to speak out against ONC interoperability rule
About 40 people representing some of the biggest companies in the industry are planning to attend, either in person or by phone.
Many of the organizations are members of the Carin Alliance.
"Although we may slightly differ in the specific details regarding how the proposed rules should be implemented, we are united regarding the consumer access sections of the two proposed rules and in our belief that both proposed rules should be finalized and released immediately," the Carin Alliance said in the talking points. "It will be to the benefit of all stakeholders to finalize the rules so the industry can work on implementation while continuing to work with the public sector to improve the rules over time."
In February 2019, the Office of the National Coordinator for Health IT (ONC) issued a proposed interoperability and information-blocking rule (PDF) that defines the demands on healthcare providers and electronic health record (EHR) vendors for data sharing. The rule also outlines exceptions to the prohibition against information blocking and provides standardized criteria for application programming interface development.
The ONC rule is currently under review by the OMB, the last step before publication. The Centers for Medicare & Medicaid Services' proposed interoperability rule (PDF) also is under review at OMB.
RELATED: Anthem, Humana along with Apple and Google testing API for patient access to claims data
During the ONC Annual Meeting in Washington D.C. Monday morning, Steve Posnack, Deputy National Coordinator for Health IT, said ONC's data-sharing rule would not be released during the annual meeting, taking place today and Tuesday.
The Carin Alliance said the organizations support the timely release of the interoperability rules "with the understanding that CMS and ONC have incorporated the consensus recommendations made by the public during the comment period and with the assumption the public and private sectors can work together to improve and build upon the rules after they are released."
Google was not listed as a meeting attendee, but the tech giant is among 20 organizations—including Apple, Anthem, Blue Cross Blue Shield, Cambia Health Solutions, and Humana—involved in an initiative to do “real-world testing” of an application programming interface (API) to standardize claims data sharing.
From: https://www.fiercehealthcare.com/tech/apple-microsoft-cerner-and-major-health-plans-call-for-omb-to-release-interoperability-rules?mkt_tok=eyJpIjoiTkdSbVl6SmxNV0l5WVdReiIsInQiOiJ6ZE5UR0VHSG50K3ZIZXJIY1N1NWRld1Q1REJ3K1VzeURGRDJcL0JPN3ZpQ1U0eVRIWjJ2NERhU1pweFFTMHhBd3JjRXpQNkNGOEtsSmJXcjBnMGx3aXNKcjRESGdzcjJzVXVOeGNFVFpQaDhxQWpsNkt5OWdQa0ZwZ1hyNXlCTXoifQ%3D%3D&mrkid=730008
The Fed Wants to Loosen Rules Around Big Banks and Venture Capital
Proposed tweaks to the Volcker Rule, which curbs bank risk-taking, would allow firms to invest heavily in funds backing start-ups.
https://www.nytimes.com/2020/01/30/business/economy/volcker-rule-banks-venture-capital.html
Proposed tweaks to the Volcker Rule, which curbs bank risk-taking, would allow firms to invest heavily in funds backing start-ups.
https://www.nytimes.com/2020/01/30/business/economy/volcker-rule-banks-venture-capital.html
La. Supreme Court reviews life sentence for conviction in $30 marijuana sale
Some justices on the Louisiana Supreme Court expressed doubts regarding Derek Harris's life sentence for his conviction in a $30 marijuana sale. Harris -- who had previously been convicted of charges including dealing cocaine and simple robbery -- says ineffective counsel resulted in his lack of a challenge to the constitutionality of his conviction, although state court precedent has prevented such challenges once direct appeals are exhausted.
The Times-Picayune | The New Orleans Advocate (1/27) https://www.nola.com/news/courts/article_0e00a78a-4156-11ea-90fc-eb90a76b692f.html
Some justices on the Louisiana Supreme Court expressed doubts regarding Derek Harris's life sentence for his conviction in a $30 marijuana sale. Harris -- who had previously been convicted of charges including dealing cocaine and simple robbery -- says ineffective counsel resulted in his lack of a challenge to the constitutionality of his conviction, although state court precedent has prevented such challenges once direct appeals are exhausted.
The Times-Picayune | The New Orleans Advocate (1/27) https://www.nola.com/news/courts/article_0e00a78a-4156-11ea-90fc-eb90a76b692f.html
From DMN: British Government Refuses to Implement the EU Copyright Directive
With Brexit rapidly approaching, the United Kingdom has decided it will not enforce the EU’s Copyright Directive.
The story continues here. https://www.digitalmusicnews.com/2020/01/27/copyright-directive-british-government-eu/
From DMN: Fender Fined $6 Million for Illegal Price-Fixing Scheme
Fender has been fined 4.5 million pounds (nearly $6 million) in the UK after admitting to price-fixing. The move breaks competition laws and prevents retailers from discounting instruments.
The story continues here.
With Brexit rapidly approaching, the United Kingdom has decided it will not enforce the EU’s Copyright Directive.
The story continues here. https://www.digitalmusicnews.com/2020/01/27/copyright-directive-british-government-eu/
From DMN: Fender Fined $6 Million for Illegal Price-Fixing Scheme
Fender has been fined 4.5 million pounds (nearly $6 million) in the UK after admitting to price-fixing. The move breaks competition laws and prevents retailers from discounting instruments.
The story continues here.
DC AG announces "wage theft and worker misclassification" case win
The AG press release:
In a big win for District workers, our office announced that Power Design—a major electrical contractor—will pay $2.75 million to resolve a wage theft and worker misclassification case. The settlement will return nearly $880,000 to workers, provide $50,000 to support workforce development programs, and require a $1.8 million payment to the District. This settlement is our office’s largest wage theft recovery to date, both in value and the number of affected workers it will help.
In our 2018 lawsuit, we alleged Power Design misclassified over 500 electrical workers as independent contractors instead of employees to cut costs and avoid legal responsibilities, like overtime, paid sick leave, and taxes. This form of payroll fraud is especially common in the construction industry and allows companies to gain an unfair advantage over law-abiding competitors.
'
This is the latest effort in OAG’s fight to protect District workers. In 2017, OAG worked with the D.C. Council to obtain independent authority to investigate and bring wage theft cases. Since then, we have launched over 30 investigations and recovered millions of dollars from businesses that have stolen wages from D.C. workers. We also recently testified before Congress about our new economic report on how misclassification hurts workers, undercuts law-abiding businesses, and cheats taxpayers.
If you believe your rights have been violated by your employer, report it to OAG at (202) 727-3400 or submit a complaint to the District’s Department of Employment Services. Workers can also learn more about their rights under District law by accessing our resources.
Karl A. Racine
Attorney General
https://outlook.live.com/mail/0/inbox/id/AQMkADAwATM3ZmYAZS04MTcxLTJmMjgtMDACLTAwCgBGAAADRnoWw%2B1oGkecPn377%2FL9tQcA97M33DyMxEGb7MCV%2BuIrtgAAAgEMAAAA97M33DyMxEGb7MCV%2BuIrtgADHkpl1QAAAA%3D%3D
The AG press release:
In a big win for District workers, our office announced that Power Design—a major electrical contractor—will pay $2.75 million to resolve a wage theft and worker misclassification case. The settlement will return nearly $880,000 to workers, provide $50,000 to support workforce development programs, and require a $1.8 million payment to the District. This settlement is our office’s largest wage theft recovery to date, both in value and the number of affected workers it will help.
In our 2018 lawsuit, we alleged Power Design misclassified over 500 electrical workers as independent contractors instead of employees to cut costs and avoid legal responsibilities, like overtime, paid sick leave, and taxes. This form of payroll fraud is especially common in the construction industry and allows companies to gain an unfair advantage over law-abiding competitors.
'
This is the latest effort in OAG’s fight to protect District workers. In 2017, OAG worked with the D.C. Council to obtain independent authority to investigate and bring wage theft cases. Since then, we have launched over 30 investigations and recovered millions of dollars from businesses that have stolen wages from D.C. workers. We also recently testified before Congress about our new economic report on how misclassification hurts workers, undercuts law-abiding businesses, and cheats taxpayers.
If you believe your rights have been violated by your employer, report it to OAG at (202) 727-3400 or submit a complaint to the District’s Department of Employment Services. Workers can also learn more about their rights under District law by accessing our resources.
Karl A. Racine
Attorney General
https://outlook.live.com/mail/0/inbox/id/AQMkADAwATM3ZmYAZS04MTcxLTJmMjgtMDACLTAwCgBGAAADRnoWw%2B1oGkecPn377%2FL9tQcA97M33DyMxEGb7MCV%2BuIrtgAAAgEMAAAA97M33DyMxEGb7MCV%2BuIrtgADHkpl1QAAAA%3D%3D
From NYT
Tougher Huawei Restrictions Stall After Defense Department Objects
Proposed changes to further limit U.S. shipments to Huawei have been delayed amid arguments they could backfire.
By Ana Swanson
· Jan. 24, 2020, 8:47 a.m. ET
WASHINGTON — The Trump administration has put on hold a proposed rule change that would further restrict American sales to Huawei, the Chinese telecom giant, after some officials in the Department of Defense and other agencies argued that the measure, which was intended to protect national security, could backfire and actually harm it, according to people familiar with the matter.
The rule change, which is currently being reviewed, would close a loophole that allowed technology companies like Intel and Micron to continue shipping some products to Huawei, even after the Chinese firm was placed on a blacklist that prevented it from buying some American products last May.
But some officials have objected to the change, arguing that it would encourage foreign companies to stop using American components, ultimately weakening American firms and the country’s technological competitiveness.
Excerpt from:https://www.nytimes.com/2020/01/24/business/economy/huawei-restrictions.html
Tougher Huawei Restrictions Stall After Defense Department Objects
Proposed changes to further limit U.S. shipments to Huawei have been delayed amid arguments they could backfire.
By Ana Swanson
· Jan. 24, 2020, 8:47 a.m. ET
WASHINGTON — The Trump administration has put on hold a proposed rule change that would further restrict American sales to Huawei, the Chinese telecom giant, after some officials in the Department of Defense and other agencies argued that the measure, which was intended to protect national security, could backfire and actually harm it, according to people familiar with the matter.
The rule change, which is currently being reviewed, would close a loophole that allowed technology companies like Intel and Micron to continue shipping some products to Huawei, even after the Chinese firm was placed on a blacklist that prevented it from buying some American products last May.
But some officials have objected to the change, arguing that it would encourage foreign companies to stop using American components, ultimately weakening American firms and the country’s technological competitiveness.
Excerpt from:https://www.nytimes.com/2020/01/24/business/economy/huawei-restrictions.html
Attorney General Karl A. Racine has announced a lawsuit against the 58th Presidential Inaugural Committee and two entities that own or control the Trump International Hotel in Washington, D.C. for abusing nonprofit funds to enrich the Trump family.
In its lawsuit, the Office of the Attorney General (OAG) alleges that the Inaugural Committee, a nonprofit corporation, coordinated with the Trump family to grossly overpay for event space in the Trump International Hotel. Although the Inaugural Committee was aware that it was paying far above market rates, it never considered less expensive alternatives, and even paid for space on days when it did not hold events. The Committee also improperly used non-profit funds to throw a private party for the Trump family costing several hundred thousand dollars. OAG’s lawsuit seeks to recover the amount improperly paid to the Trump Hotel, and to direct those funds to suitable nonprofit purposes.
“District law requires nonprofits to use their funds for their stated public purpose, not to benefit private individuals or companies,” said AG Racine. “In this case, we are seeking to recover the nonprofit funds that were improperly funneled directly to the Trump family business.”
A copy of the complaint is available at: https://oag.dc.gov/sites/default/files/2020-01/Trump-PIC-Complaint.pdf
A copy of the supplemental investigation documents is available at: http://bit.ly/Trump-PIC-Complaint-Supporting-Documents
In its lawsuit, the Office of the Attorney General (OAG) alleges that the Inaugural Committee, a nonprofit corporation, coordinated with the Trump family to grossly overpay for event space in the Trump International Hotel. Although the Inaugural Committee was aware that it was paying far above market rates, it never considered less expensive alternatives, and even paid for space on days when it did not hold events. The Committee also improperly used non-profit funds to throw a private party for the Trump family costing several hundred thousand dollars. OAG’s lawsuit seeks to recover the amount improperly paid to the Trump Hotel, and to direct those funds to suitable nonprofit purposes.
“District law requires nonprofits to use their funds for their stated public purpose, not to benefit private individuals or companies,” said AG Racine. “In this case, we are seeking to recover the nonprofit funds that were improperly funneled directly to the Trump family business.”
A copy of the complaint is available at: https://oag.dc.gov/sites/default/files/2020-01/Trump-PIC-Complaint.pdf
A copy of the supplemental investigation documents is available at: http://bit.ly/Trump-PIC-Complaint-Supporting-Documents
Maryland bill would allow auto dealers to advertise a price below manufacturers Minimum Advertised Price requirement
Currently, if a dealer advertises a price below the manufacturer's MAP, the dealer loses advertising or other support that the manufacturer gives to dealers who comply with the MAP advertised prices. The amount of manufacturer money that's at stake is so high that dealers will comply. That creates a problem for consumers who want to compare prices online, from the comfort of their home. If dealers are allowed to advertise low low prices for a vehicle, other sellers of that brand have to compete on price –a benefit for consumers.
The bill is SB 178, which is coming up for a hearing before the Judicial Proceedings Committee in the Maryland Senate this coming Tuesday (Jan. 28) at 1pm. Supporters of the bill include Maryland Consumer Rights Coalition and the Consumer Federation of America.
Posting by Don Allen Resnikoff
Currently, if a dealer advertises a price below the manufacturer's MAP, the dealer loses advertising or other support that the manufacturer gives to dealers who comply with the MAP advertised prices. The amount of manufacturer money that's at stake is so high that dealers will comply. That creates a problem for consumers who want to compare prices online, from the comfort of their home. If dealers are allowed to advertise low low prices for a vehicle, other sellers of that brand have to compete on price –a benefit for consumers.
The bill is SB 178, which is coming up for a hearing before the Judicial Proceedings Committee in the Maryland Senate this coming Tuesday (Jan. 28) at 1pm. Supporters of the bill include Maryland Consumer Rights Coalition and the Consumer Federation of America.
Posting by Don Allen Resnikoff
Michigan, Tesla Cut Deal Ending Direct Sale Suit
Tesla Inc. and the Michigan Attorney General's Office have reached an agreement that will end the electric car manufacturer's federal suit attacking a 2014 law that prevented it from selling vehicles directly to consumers in the state. But -- The deal requires Michigan buyers to title their cars elsewhere, even though they'll be able to purchase them without leaving the state.
Currently, it’s tough to buy and own a Tesla in Michigan. For starters, there aren't any places allowed to sell you one; you have to physically go to another state to buy the car. But the new settlement between Tesla and the state of Michigan, reportedly about to be finalized in U.S. District Court, should allow the California EV carmaker to directly sell to customers in Michigan.
Tesla Buying (and Updating)
Credit: https://www.reuters.com/article/us-tesla-michigan/michigan-tesla-reach-agreement-for-direct-car-sales-source-idUSKBN1ZK2LP
Tesla Inc. and the Michigan Attorney General's Office have reached an agreement that will end the electric car manufacturer's federal suit attacking a 2014 law that prevented it from selling vehicles directly to consumers in the state. But -- The deal requires Michigan buyers to title their cars elsewhere, even though they'll be able to purchase them without leaving the state.
Currently, it’s tough to buy and own a Tesla in Michigan. For starters, there aren't any places allowed to sell you one; you have to physically go to another state to buy the car. But the new settlement between Tesla and the state of Michigan, reportedly about to be finalized in U.S. District Court, should allow the California EV carmaker to directly sell to customers in Michigan.
Tesla Buying (and Updating)
Credit: https://www.reuters.com/article/us-tesla-michigan/michigan-tesla-reach-agreement-for-direct-car-sales-source-idUSKBN1ZK2LP
New vertical merger guidelines disappoint antitrust experts
Excerpt from article by HARRIS MEYER at https://www.modernhealthcare.com/mergers-acquisitions/new-vertical-merger-guidelines-disappoint-antitrust-experts?utm_source=modern-healthcare-am-wednesday&utm_medium=email&utm_campaign=20200121&utm_content=article1-readmoreMany healthcare antitrust experts are disappointed that the federal government's new proposed guidelines on vertical mergers give little detail on how the government will analyze deals between firms at different levels in the supply chain, such as hospitals and physician groups.
While the Federal Trade Commission and U.S. Justice Department highlighted potential competition risks from vertical mergers in the long-anticipated guidelines, the first update since 1984, some elected officials and antitrust attorneys say the release still doesn't give enough information to step up oversight of physician practice acquisitions by hospitals, insurers and private-equity firms.
"The guidelines are short and don't say much," said Douglas Ross, a veteran antitrust attorney at Davis Wright Tremaine in Seattle. "They don't really do much new, and they don't refer at all to healthcare or use any healthcare-related examples."
Vertical mergers create some specific competitive risks including preventing rivals from accessing products from the downstream merger partner, sharing sensitive business information about competitors and enabling coordinated interaction that hobbles rival firms.
The guidance update, released on Jan. 10, comes as concerns mount over the growing consolidation of hospitals and physician practices and the impact on prices and total health spending. There is also concern about more unorthodox vertical deals like those between CVS and Aetna and between UnitedHealth Group and DaVita.
The federal government has rarely challenged vertical mergers in any industry, in contrast to its more aggressive policy toward horizontal mergers between firms competing head to head. Antitrust enforcers and courts traditionally have viewed vertical mergers as much less likely to threaten competition than horizontal mergers. They often consider such deals pro-competitive.
But the new guidance included some surprises, according to Debbie Feinstein, a former top FTC official who heads Arnold & Porter's global antitrust group.
It proposed a safe harbor for vertical mergers if the merging firms have a combined share in the relevant market of less than 20%, and the "related product" produced by the downstream partner is used in less than 20% of the relevant market.
That's widely seen as an unusually low threshold, given that antitrust enforcers generally rule out action on mergers affecting less than 30% of a market at the very least.
Second, Feinstein said the draft has "no real discussion" of the standards by which the agencies will evaluate the ability of merging companies to reduce or cut off the supply of downstream products to rival firms, known as foreclosure.
That is what the agencies, as well as state attorneys general, have examined in recent vertical transactions. Those cases involved claims that acquisition of physician groups by insurers or hospitals may foreclose competition by making it more difficult or costly for rivals to obtain physician services.
Excerpt from article by HARRIS MEYER at https://www.modernhealthcare.com/mergers-acquisitions/new-vertical-merger-guidelines-disappoint-antitrust-experts?utm_source=modern-healthcare-am-wednesday&utm_medium=email&utm_campaign=20200121&utm_content=article1-readmoreMany healthcare antitrust experts are disappointed that the federal government's new proposed guidelines on vertical mergers give little detail on how the government will analyze deals between firms at different levels in the supply chain, such as hospitals and physician groups.
While the Federal Trade Commission and U.S. Justice Department highlighted potential competition risks from vertical mergers in the long-anticipated guidelines, the first update since 1984, some elected officials and antitrust attorneys say the release still doesn't give enough information to step up oversight of physician practice acquisitions by hospitals, insurers and private-equity firms.
"The guidelines are short and don't say much," said Douglas Ross, a veteran antitrust attorney at Davis Wright Tremaine in Seattle. "They don't really do much new, and they don't refer at all to healthcare or use any healthcare-related examples."
Vertical mergers create some specific competitive risks including preventing rivals from accessing products from the downstream merger partner, sharing sensitive business information about competitors and enabling coordinated interaction that hobbles rival firms.
The guidance update, released on Jan. 10, comes as concerns mount over the growing consolidation of hospitals and physician practices and the impact on prices and total health spending. There is also concern about more unorthodox vertical deals like those between CVS and Aetna and between UnitedHealth Group and DaVita.
The federal government has rarely challenged vertical mergers in any industry, in contrast to its more aggressive policy toward horizontal mergers between firms competing head to head. Antitrust enforcers and courts traditionally have viewed vertical mergers as much less likely to threaten competition than horizontal mergers. They often consider such deals pro-competitive.
But the new guidance included some surprises, according to Debbie Feinstein, a former top FTC official who heads Arnold & Porter's global antitrust group.
It proposed a safe harbor for vertical mergers if the merging firms have a combined share in the relevant market of less than 20%, and the "related product" produced by the downstream partner is used in less than 20% of the relevant market.
That's widely seen as an unusually low threshold, given that antitrust enforcers generally rule out action on mergers affecting less than 30% of a market at the very least.
Second, Feinstein said the draft has "no real discussion" of the standards by which the agencies will evaluate the ability of merging companies to reduce or cut off the supply of downstream products to rival firms, known as foreclosure.
That is what the agencies, as well as state attorneys general, have examined in recent vertical transactions. Those cases involved claims that acquisition of physician groups by insurers or hospitals may foreclose competition by making it more difficult or costly for rivals to obtain physician services.
STATEMENT OF FTC COMMISSIONER ROHIT CHOPRA Regarding the Request for Comment on Vertical Merger Guidelines
Summary
• The 1984 Non-Horizontal Merger Guidelines should be rescinded, as they represent an antiquated, narrow, and overly permissive mode of thinking that is not reflective of today’s economy or the current approach to enforcement.
• The U.S. economy is far different than it was forty years ago. Increasing concentration, declining new firm formation, and other market trends necessitate a modernization of vertical merger review.
• The draft guidelines released for public comment miss the mark. They are not supported by an analysis of past enforcement decisions, perpetuate an overdependence on theoretical models, and do not reflect all of the ways that competition can be harmed.
• Any new guidelines must establish a comprehensive framework for assessing the modern threats to competition posed by prospective vertical mergers. I agree with rescinding the outdated and permissive 1984 Non-Horizontal Merger Guidelines1 and engaging the public in the process of putting into place a new framework. I share the objective of my colleague Chairman Simons that we must “…make clear that anticompetitive vertical mergers are not unicorns, and there should not be a presumption that all vertical mergers are benign.” However, I disagree with proposing the draft guidelines published today because they are not comprehensive or reflective of modern economic realities.
Read the full statement at https://www.ftc.gov/system/files/documents/public_statements/1561727/p810034chopravmgabstain.pdf
Summary
• The 1984 Non-Horizontal Merger Guidelines should be rescinded, as they represent an antiquated, narrow, and overly permissive mode of thinking that is not reflective of today’s economy or the current approach to enforcement.
• The U.S. economy is far different than it was forty years ago. Increasing concentration, declining new firm formation, and other market trends necessitate a modernization of vertical merger review.
• The draft guidelines released for public comment miss the mark. They are not supported by an analysis of past enforcement decisions, perpetuate an overdependence on theoretical models, and do not reflect all of the ways that competition can be harmed.
• Any new guidelines must establish a comprehensive framework for assessing the modern threats to competition posed by prospective vertical mergers. I agree with rescinding the outdated and permissive 1984 Non-Horizontal Merger Guidelines1 and engaging the public in the process of putting into place a new framework. I share the objective of my colleague Chairman Simons that we must “…make clear that anticompetitive vertical mergers are not unicorns, and there should not be a presumption that all vertical mergers are benign.” However, I disagree with proposing the draft guidelines published today because they are not comprehensive or reflective of modern economic realities.
Read the full statement at https://www.ftc.gov/system/files/documents/public_statements/1561727/p810034chopravmgabstain.pdf
Is Current Medicare Working For Patients When Doctors "Opt Out"? Will Medicare For All Work Better?
My wife and I, who are both over 65, recently received a letter from our primary care physician informing us that she and her office will be "opting out" of the Medicare program. We did a little research and learned that "opting out" of Medicare means that a physician will no longer have any contractual relationship with Medicare. More specifically, Medicare will not cover any portion of the physician's fees or pay for any services provided by the practice. The practice cannot submit any claims to Medicare. The patient also cannot submit any claims to Medicare for the services provided by the practice.
Furthermore, if you are a Medicare beneficiary and decide to continue using the practice, Medicare requires that you enter into a contract with the practice. The required contract says that the patient understands that Medicare payments will not be made for any services provided by the practice and that the patient cannot submit any claims to Medicare for services provided by the "opt- out" provider.
As a practical matter the physician's "opt out" gives us no other choice than to leave the practice, and find a doctor who has not "opted-out" of Medicare.
My wife and I have lots of insurance coverage: primary coverage from Medicare A and B, and secondary coverage from an Aetna plan. In spite of all of this coverage the contract agreement required of us by our physician will leave us with zero reimbursement for any of her services. The "Medicare Private Contract" with the physician precludes us from seeking a Medicare B denial that would be needed so we could submit a claim to Aetna as secondary insurer.
We are in the world of Catch 22. Even if we would be willing to forgo reimbursement from Medicare B and then pay the physician and then chase our Aetna insurance reimbursement, the contract language the doctor’s opt-out letter requires simply does not permit that. And our Aetna insurer will not pay a claim until there is a denial from Medicare B.
We recognize that our doctor thinks she can profitably opt out of Medicare because we are in a wealthy zip code where some people can pay medical bills without relying on Medicare, or even without private insurance. And, perhaps our doctor’s business judgment on the opt-out point is misguided. But we do not see this story as an example of Medicare working smoothly. Would Medicare for All work better? It could, but the answer does not lie in soaring rhetoric suggesting Medicare for All as a panacea.
My wife and I would like to be insured so that we receive reimbursement to see a primary care physician who will be a thoughtful helper with health problems, not merely a person who spends brief periods of time with us and relies on sending us to specialists. As older people we have had our share of serious illnesses and chronic conditions. During the past decade we have relied on our trusted primary care physician. She has provided each of us with quality information that has helped us maintain our health. We had hoped that we would continue seeing her as we age.
It strikes us that the Catch 22 problem we face applies prospectively to any patient who plans to reach age 65 and go on Medicare. At that point, age 65, they can lose all coverage for the opt-out physician’s services - a discouraging prospect for her patients of all ages.
Again, would Medicare for All work better? It could, I suppose.
Posting is by Don Allen Resnikoff, who takes full responsibility for the content
My wife and I, who are both over 65, recently received a letter from our primary care physician informing us that she and her office will be "opting out" of the Medicare program. We did a little research and learned that "opting out" of Medicare means that a physician will no longer have any contractual relationship with Medicare. More specifically, Medicare will not cover any portion of the physician's fees or pay for any services provided by the practice. The practice cannot submit any claims to Medicare. The patient also cannot submit any claims to Medicare for the services provided by the practice.
Furthermore, if you are a Medicare beneficiary and decide to continue using the practice, Medicare requires that you enter into a contract with the practice. The required contract says that the patient understands that Medicare payments will not be made for any services provided by the practice and that the patient cannot submit any claims to Medicare for services provided by the "opt- out" provider.
As a practical matter the physician's "opt out" gives us no other choice than to leave the practice, and find a doctor who has not "opted-out" of Medicare.
My wife and I have lots of insurance coverage: primary coverage from Medicare A and B, and secondary coverage from an Aetna plan. In spite of all of this coverage the contract agreement required of us by our physician will leave us with zero reimbursement for any of her services. The "Medicare Private Contract" with the physician precludes us from seeking a Medicare B denial that would be needed so we could submit a claim to Aetna as secondary insurer.
We are in the world of Catch 22. Even if we would be willing to forgo reimbursement from Medicare B and then pay the physician and then chase our Aetna insurance reimbursement, the contract language the doctor’s opt-out letter requires simply does not permit that. And our Aetna insurer will not pay a claim until there is a denial from Medicare B.
We recognize that our doctor thinks she can profitably opt out of Medicare because we are in a wealthy zip code where some people can pay medical bills without relying on Medicare, or even without private insurance. And, perhaps our doctor’s business judgment on the opt-out point is misguided. But we do not see this story as an example of Medicare working smoothly. Would Medicare for All work better? It could, but the answer does not lie in soaring rhetoric suggesting Medicare for All as a panacea.
My wife and I would like to be insured so that we receive reimbursement to see a primary care physician who will be a thoughtful helper with health problems, not merely a person who spends brief periods of time with us and relies on sending us to specialists. As older people we have had our share of serious illnesses and chronic conditions. During the past decade we have relied on our trusted primary care physician. She has provided each of us with quality information that has helped us maintain our health. We had hoped that we would continue seeing her as we age.
It strikes us that the Catch 22 problem we face applies prospectively to any patient who plans to reach age 65 and go on Medicare. At that point, age 65, they can lose all coverage for the opt-out physician’s services - a discouraging prospect for her patients of all ages.
Again, would Medicare for All work better? It could, I suppose.
Posting is by Don Allen Resnikoff, who takes full responsibility for the content
Opinion: Is Obamacare Really Unconstitutional?
https://www.nejm.org/doi/full/10.1056/NEJMp1917063
On December 18, 2019, just 3 days after the close of open enrollment on the exchanges and on the same day the House of Representatives impeached President Donald Trump, a conservative appeals court handed the President a major victory in his crusade against the Affordable Care Act (ACA). Over a stern dissent, the U.S. Court of Appeals for the Fifth Circuit declared that the law’s individual mandate is unconstitutional and that the entire rest of the law might therefore be invalid.
The full consequences of the ruling are not yet clear. Instead of deciding for itself how much or how little of the ACA could stand, the appeals court asked the Texas judge who originally decided the case to take a second look at the question. In the meantime, a consortium of Democrat-led states may ask the Supreme Court to intervene. But it’s by no means assured that the Court will take up the invitation.
We’re in for a long period of uncertainty, and it’s unlikely that we’ll know the fate of the ACA before the 2020 election. At risk are the law’s protections for people with preexisting conditions, its prohibitions on abusive insurance practices, the Medicaid expansion, subsidies for private coverage, and much more. And whether the law survives this latest brush with death may depend on whether Trump secures a second term in office.
The lawsuit arose out of congressional Republicans’ failure to repeal the ACA after Trump’s election. They didn’t have the votes for that, but they did have enough to eliminate the ACA’s penalty for going without insurance. At the time, Trump crowed that “the very unfair and unpopular Individual Mandate has been terminated.”1
The Fifth Circuit, however, saw matters differently. For the court, it was constitutionally significant that Congress, when it repealed the penalty, hadn’t actually repealed the part of the law that says that people “shall” buy insurance. The instruction was still on the books, though it was now completely unenforceable.
Why did that matter? Back in 2012, the Supreme Court held that the individual mandate would be unconstitutional if that “shall” were read as a command.2 Congress didn’t have the power to force people to buy insurance. But the Supreme Court reasoned that “shall” didn’t have to be read as a command. To avoid constitutional difficulties, the Court read the ACA as imposing a tax: either buy insurance or pay a penalty. You’ve got a choice. Since Congress undeniably has the power to levy taxes, the individual mandate — that “shall” language — was perfectly constitutional.
Once Congress wiped out the penalty, however, the law looked less like a tax: after all, it would no longer raise any revenue. And so the Fifth Circuit said that the only way to read “shall” is as a coercive command — the sort of law that, under the Supreme Court’s 2012 decision, is unconstitutional.
Lawyers of all political stripes have derided the court’s conclusion. When Congress eliminated the penalty for going without insurance, it made the individual mandate less coercive, not more so. And the Supreme Court, in 2012, already interpreted “shall” as affording people “a lawful choice.” Congress didn’t revisit that conclusion when it eliminated the penalty. The appeals court is bound by the Supreme Court’s conclusion, whether it likes it or not.
On its face, too, the decision betrays just how partisan the litigation over the ACA has become. The opinion reports, for example, that “some opponents” think “that the entire law was enacted as part of a fraud on the American people.” That kind of gratuitous jab may help to explain why the opinion is so difficult to defend in traditional legal terms. It reads, instead, as an exercise of raw political power.
What does the constitutional holding mean for the rest of the ACA? The judge who first heard the case held that the mandate’s unconstitutionality required the invalidation of the entire ACA — to use the legal jargon, that it could not be “severed” from the rest of the law. In his view, the same Congress that wiped out the tax penalty also believed that the mandate — even without a penalty — was an essential part of the entire law. No part could be saved.
On that, the appeals court disagreed. Severability analysis, it held, requires a court to use a “finer-toothed comb” when reviewing legislation. The court reasoned that parts of the ACA — including, for example, the part requiring chain restaurants to post calorie counts on their menus — don’t have much to do with the mandate at all. They could perhaps be salvaged, even if the mandate is struck down. So the Fifth Circuit sent the case back to the judge and told him to try again. Yet the court offered no guidance about “how fine-toothed that comb should be.” It was even open to the possibility that the judge could reach exactly the same conclusion: “it may still be that none of the ACA is severable from the individual mandate, even after this inquiry is concluded.”
Here, too, the Fifth Circuit’s decision is difficult to defend. As the dissenting judge wrote, if Congress in 2017 had viewed the mandate “as so essential to the rest of the ACA that it intended the entire statute to rise and fall with the coverage requirement, it is inconceivable that Congress would have declawed [it] as it did.” A hortatory instruction to buy insurance can’t be essential to anything.
With that in mind, the Fifth Circuit could simply have struck down the mandate and kept the rest of the ACA intact. Had it done so, the case, for all practical purposes, would be over: no one cares whether an unenforceable instruction to buy insurance remains on the books. Instead, the court sent the case back down to a judge with a partisan reputation who had previously invalidated the entire law. He is likely to make a similarly expansive decision the second time around.
But the process will take time — perhaps another 2 years for the Fifth Circuit to decide the inevitable appeal from the judge’s do-over, followed by another high-stakes Supreme Court case. It’s hard to resist the conclusion that the delay is strategic: declaring all or part of the ACA invalid would probably have been bad for Republicans in the 2020 election. Many parts of the ACA are quite popular, especially the protections for people with preexisting conditions and the Medicaid expansion. Invalidating those parts might have provoked a political backlash. Punting to the district court gives Republicans a little more breathing room.
Unless, of course, the Supreme Court chooses to intervene at this stage. And it might do so: the validity of the ACA is an issue of national importance, and the Fifth Circuit’s decision is absurd. Plus, it takes only four votes for the Supreme Court to agree to hear a case, and the four liberal justices can probably count on Chief Justice John Roberts, who has twice turned back more substantial challenges to the law and is unlikely to embrace a lawsuit as weak as this one. The liberal justices might opt to hear the case now instead of running the risk that Trump will be reelected and will stack the Court with hard-liners.
That said, the justices generally dislike hearing cases before they’re final. They may be especially disinclined given that the ACA will remain intact during the additional proceedings on severability. Roberts may look like a safe bet, but you never know. And the Court may prefer to avoid such a politically salient case during an election year. Perhaps the more prudent course is to wait.
Regardless, the ACA will have a cloud over it for the foreseeable future. Republicans haven’t been able to repeal the ACA through Congress. But they’re still working hard to repeal it in the courts.
- Nicholas Bagley, J.D.
https://www.nejm.org/doi/full/10.1056/NEJMp1917063
On December 18, 2019, just 3 days after the close of open enrollment on the exchanges and on the same day the House of Representatives impeached President Donald Trump, a conservative appeals court handed the President a major victory in his crusade against the Affordable Care Act (ACA). Over a stern dissent, the U.S. Court of Appeals for the Fifth Circuit declared that the law’s individual mandate is unconstitutional and that the entire rest of the law might therefore be invalid.
The full consequences of the ruling are not yet clear. Instead of deciding for itself how much or how little of the ACA could stand, the appeals court asked the Texas judge who originally decided the case to take a second look at the question. In the meantime, a consortium of Democrat-led states may ask the Supreme Court to intervene. But it’s by no means assured that the Court will take up the invitation.
We’re in for a long period of uncertainty, and it’s unlikely that we’ll know the fate of the ACA before the 2020 election. At risk are the law’s protections for people with preexisting conditions, its prohibitions on abusive insurance practices, the Medicaid expansion, subsidies for private coverage, and much more. And whether the law survives this latest brush with death may depend on whether Trump secures a second term in office.
The lawsuit arose out of congressional Republicans’ failure to repeal the ACA after Trump’s election. They didn’t have the votes for that, but they did have enough to eliminate the ACA’s penalty for going without insurance. At the time, Trump crowed that “the very unfair and unpopular Individual Mandate has been terminated.”1
The Fifth Circuit, however, saw matters differently. For the court, it was constitutionally significant that Congress, when it repealed the penalty, hadn’t actually repealed the part of the law that says that people “shall” buy insurance. The instruction was still on the books, though it was now completely unenforceable.
Why did that matter? Back in 2012, the Supreme Court held that the individual mandate would be unconstitutional if that “shall” were read as a command.2 Congress didn’t have the power to force people to buy insurance. But the Supreme Court reasoned that “shall” didn’t have to be read as a command. To avoid constitutional difficulties, the Court read the ACA as imposing a tax: either buy insurance or pay a penalty. You’ve got a choice. Since Congress undeniably has the power to levy taxes, the individual mandate — that “shall” language — was perfectly constitutional.
Once Congress wiped out the penalty, however, the law looked less like a tax: after all, it would no longer raise any revenue. And so the Fifth Circuit said that the only way to read “shall” is as a coercive command — the sort of law that, under the Supreme Court’s 2012 decision, is unconstitutional.
Lawyers of all political stripes have derided the court’s conclusion. When Congress eliminated the penalty for going without insurance, it made the individual mandate less coercive, not more so. And the Supreme Court, in 2012, already interpreted “shall” as affording people “a lawful choice.” Congress didn’t revisit that conclusion when it eliminated the penalty. The appeals court is bound by the Supreme Court’s conclusion, whether it likes it or not.
On its face, too, the decision betrays just how partisan the litigation over the ACA has become. The opinion reports, for example, that “some opponents” think “that the entire law was enacted as part of a fraud on the American people.” That kind of gratuitous jab may help to explain why the opinion is so difficult to defend in traditional legal terms. It reads, instead, as an exercise of raw political power.
What does the constitutional holding mean for the rest of the ACA? The judge who first heard the case held that the mandate’s unconstitutionality required the invalidation of the entire ACA — to use the legal jargon, that it could not be “severed” from the rest of the law. In his view, the same Congress that wiped out the tax penalty also believed that the mandate — even without a penalty — was an essential part of the entire law. No part could be saved.
On that, the appeals court disagreed. Severability analysis, it held, requires a court to use a “finer-toothed comb” when reviewing legislation. The court reasoned that parts of the ACA — including, for example, the part requiring chain restaurants to post calorie counts on their menus — don’t have much to do with the mandate at all. They could perhaps be salvaged, even if the mandate is struck down. So the Fifth Circuit sent the case back to the judge and told him to try again. Yet the court offered no guidance about “how fine-toothed that comb should be.” It was even open to the possibility that the judge could reach exactly the same conclusion: “it may still be that none of the ACA is severable from the individual mandate, even after this inquiry is concluded.”
Here, too, the Fifth Circuit’s decision is difficult to defend. As the dissenting judge wrote, if Congress in 2017 had viewed the mandate “as so essential to the rest of the ACA that it intended the entire statute to rise and fall with the coverage requirement, it is inconceivable that Congress would have declawed [it] as it did.” A hortatory instruction to buy insurance can’t be essential to anything.
With that in mind, the Fifth Circuit could simply have struck down the mandate and kept the rest of the ACA intact. Had it done so, the case, for all practical purposes, would be over: no one cares whether an unenforceable instruction to buy insurance remains on the books. Instead, the court sent the case back down to a judge with a partisan reputation who had previously invalidated the entire law. He is likely to make a similarly expansive decision the second time around.
But the process will take time — perhaps another 2 years for the Fifth Circuit to decide the inevitable appeal from the judge’s do-over, followed by another high-stakes Supreme Court case. It’s hard to resist the conclusion that the delay is strategic: declaring all or part of the ACA invalid would probably have been bad for Republicans in the 2020 election. Many parts of the ACA are quite popular, especially the protections for people with preexisting conditions and the Medicaid expansion. Invalidating those parts might have provoked a political backlash. Punting to the district court gives Republicans a little more breathing room.
Unless, of course, the Supreme Court chooses to intervene at this stage. And it might do so: the validity of the ACA is an issue of national importance, and the Fifth Circuit’s decision is absurd. Plus, it takes only four votes for the Supreme Court to agree to hear a case, and the four liberal justices can probably count on Chief Justice John Roberts, who has twice turned back more substantial challenges to the law and is unlikely to embrace a lawsuit as weak as this one. The liberal justices might opt to hear the case now instead of running the risk that Trump will be reelected and will stack the Court with hard-liners.
That said, the justices generally dislike hearing cases before they’re final. They may be especially disinclined given that the ACA will remain intact during the additional proceedings on severability. Roberts may look like a safe bet, but you never know. And the Court may prefer to avoid such a politically salient case during an election year. Perhaps the more prudent course is to wait.
Regardless, the ACA will have a cloud over it for the foreseeable future. Republicans haven’t been able to repeal the ACA through Congress. But they’re still working hard to repeal it in the courts.
The USDOJ’s Antitrust Division is asking to take part in legal arguments at Qualcomm’s February 13 appeals court hearing.
The USDOJ wishes to support Qualcomm’s attempt to overturn a ruling requiring the remedy of compulsory licensing.
The antitrust fight between the USDOJ and the FTC is unusual, particularly since the USDOJ’s position is based on a concern that is generally considered outside of the realm of antitrust: the concern is that forced licensing will compromise U.S. national security and harm an important U.S. company.
The back-story is that when the Federal Trade Commission, an independent regulatory agency, obtained a trial court level order requiring compulsory licensing of certain patents by Qualcomm, the US Department of Justice, an executive branch agency, pushed back. The USDOJ filing at document/file/1183936/download , is styled UNITED STATES’ STATEMENT OF INTEREST CONCERNING QUALCOMM’S MOTION FOR PARTIAL STAY OF INJUNCTION PENDING APPEAL.
USDOJ concern about Chinese commercial rivalry in 5G is a prominent part of the story.
The USDOJ filing explains: “Immediate implementation of the remedy could put our nation’s security at risk, potentially undermining U.S. leadership in 5G technology and standard-setting, which is vital to military readiness and other critical national interests. . . . According to the Committee on Foreign Investment in the United States (CFIUS), Qualcomm is ‘the current leading company in 5G technology development and standard setting’ due primarily to ‘its unmatched expertise and research and development (‘R&D’) expenditure. . . . [A] reduction in Qualcomm’s leadership in 5G innovation and standard-setting, ‘even in the short-term,’ could ‘significantly impact U.S. national security’ by enabling foreign-owned firms to expand their influence. [citation omitted] This is a ‘critical period of time,’ and allowing foreign-aligned firms to drive the development of 5G standards could have long-term ramifications, including cyberespionage.’”
There are complexities with regard to the contract and antitrust rationale for the FTC’s concerns about Qualcomm’s licensing practices. But we do not need to get deeply into those complexities here. For further analysis of the FTC position see https://www.essentialpatentblog.com/2019/08/ninth-circuit-stays-judge-kohs-injuncton-in-the-ftc-v-doj-competition-brawl-ftc-v-qualcomm/ Important elements of the story of the FTC prosecution and USDOJ opposition can be found in the USDOJ “STATEMENT OF INTEREST filing” cited earlier. See also BRIEF FOR THE AMERICAN ANTITRUST INSTITUTE AND PUBLIC KNOWLEDGE AS AMICI CURIAE IN SUPPORT OF PLAINTIFF-APPELLEE, filed with the Ninth Circuit Court of Appeals,[ file:///C:/Users/resni/Downloads/TSAC%20Amicus%20Br.%20of%20AAI-PK_FTC%20v.%20Qualcomm%20-%20Corrected.pdf]
Posting by Don Allen Resnikoff, who is responsible for the content
The USDOJ wishes to support Qualcomm’s attempt to overturn a ruling requiring the remedy of compulsory licensing.
The antitrust fight between the USDOJ and the FTC is unusual, particularly since the USDOJ’s position is based on a concern that is generally considered outside of the realm of antitrust: the concern is that forced licensing will compromise U.S. national security and harm an important U.S. company.
The back-story is that when the Federal Trade Commission, an independent regulatory agency, obtained a trial court level order requiring compulsory licensing of certain patents by Qualcomm, the US Department of Justice, an executive branch agency, pushed back. The USDOJ filing at document/file/1183936/download , is styled UNITED STATES’ STATEMENT OF INTEREST CONCERNING QUALCOMM’S MOTION FOR PARTIAL STAY OF INJUNCTION PENDING APPEAL.
USDOJ concern about Chinese commercial rivalry in 5G is a prominent part of the story.
The USDOJ filing explains: “Immediate implementation of the remedy could put our nation’s security at risk, potentially undermining U.S. leadership in 5G technology and standard-setting, which is vital to military readiness and other critical national interests. . . . According to the Committee on Foreign Investment in the United States (CFIUS), Qualcomm is ‘the current leading company in 5G technology development and standard setting’ due primarily to ‘its unmatched expertise and research and development (‘R&D’) expenditure. . . . [A] reduction in Qualcomm’s leadership in 5G innovation and standard-setting, ‘even in the short-term,’ could ‘significantly impact U.S. national security’ by enabling foreign-owned firms to expand their influence. [citation omitted] This is a ‘critical period of time,’ and allowing foreign-aligned firms to drive the development of 5G standards could have long-term ramifications, including cyberespionage.’”
There are complexities with regard to the contract and antitrust rationale for the FTC’s concerns about Qualcomm’s licensing practices. But we do not need to get deeply into those complexities here. For further analysis of the FTC position see https://www.essentialpatentblog.com/2019/08/ninth-circuit-stays-judge-kohs-injuncton-in-the-ftc-v-doj-competition-brawl-ftc-v-qualcomm/ Important elements of the story of the FTC prosecution and USDOJ opposition can be found in the USDOJ “STATEMENT OF INTEREST filing” cited earlier. See also BRIEF FOR THE AMERICAN ANTITRUST INSTITUTE AND PUBLIC KNOWLEDGE AS AMICI CURIAE IN SUPPORT OF PLAINTIFF-APPELLEE, filed with the Ninth Circuit Court of Appeals,[ file:///C:/Users/resni/Downloads/TSAC%20Amicus%20Br.%20of%20AAI-PK_FTC%20v.%20Qualcomm%20-%20Corrected.pdf]
Posting by Don Allen Resnikoff, who is responsible for the content
Opinion from Public Citizen: Revised NAFTA Cements New Floor for Trade PactsPharma Giveaways, Extreme Investor Rights in Past Pacts Are Out, Better Labor and Environmental Terms In After Democrats Forced Trump to Redo His 2018 NAFTA 2.0 Deal
Statement of Lori Wallach, Director, Public Citizen’s Global Trade Watch
Note: The U.S. Senate today passed the revised North American Free Trade Agreement (NAFTA) by a margin of 89 to 10. This follows passage in the U.S. House of Representatives by a margin of 385 to 41 in December 2019.
The unusually large, bipartisan votes in the Senate and House on the revised NAFTA set a new standard that to be politically viable, U.S. trade pacts no longer can include extreme corporate investor privileges or broad monopoly protections for Big Pharma and must have enforceable labor and environmental standards, in contrast to the 2016 Trans-Pacific Partnership, which never got close to congressional majority support.
Renegotiating the existing NAFTA to try to reduce its ongoing damage is not the same as creating a good trade agreement that creates jobs, raises wages and protects the environment and public health. That would additionally require climate provisions, stronger labor and environmental terms, and truly enforceable currency disciplines, and not limit consumer protections for food and product safety and labeling, the service sector, online platforms and more.
The NAFTA 2.0 deal that President Donald Trump initially signed in 2018 betrayed his campaign promise to fix NAFTA: It included new Big Pharma giveaways that lock in high drug prices, making it worse than the original, and its labor and environmental terms were too weak to counteract NAFTA’s outsourcing of jobs and pollution.
However, after congressional Democrats, unions and consumer groups forced Trump to remove Big Pharma giveaways and improve labor and environmental terms, the final revised deal is better than the original and might reduce some of NAFTA’s ongoing damage to workers and the environment. Although the new deal still includes problematic terms, the alternative is status quo NAFTA, not a more improved deal.
But this new NAFTA won’t bring back hundreds of thousands of manufacturing jobs, as Trump nonsensically claims. Nothing makes that clearer than U.S. auto manufacturers’ recent announcements that they plan to increase production in Mexico – from Ford’s decision to make its new Mustang electric SUV in Mexico to GM closing U.S. auto plants while expanding production in Mexico.
One clear and important win for consumers, workers and the environment is the gutting of NAFTA’s Investor-State Dispute Settlement (ISDS) regime. ISDS empowers multinational corporations to go before panels of three corporate lawyers to demand unlimited compensation from taxpayers over claims that domestic laws, regulations and court rulings violate special investor privileges. The lawyers can award the corporations unlimited sums to be paid by taxpayers, including for the loss of expected future profits. To date, corporations have extracted almost $400 million from North American taxpayers after attacks on energy, water, timber and toxics policies. Largely eliminating ISDS will foreclose numerous corporate attacks on environmental, health and other public interest policies and send a signal worldwide to the many countries also eager to exit the illegitimate ISDS regime.
The new NAFTA is not a template for future agreements; rather, it sets the floor from which we will fight for good trade policies that put working people and the planet first.
Source: https://www.citizen.org/news/broad-bipartisan-congressional-votes-on-revised-nafta-cement-new-floor-for-trade-pacts-pharma-giveaways-extreme-investor-rights-in-past-pacts-are-out-better-labor-and-environmental-terms-in-after/
Statement of Lori Wallach, Director, Public Citizen’s Global Trade Watch
Note: The U.S. Senate today passed the revised North American Free Trade Agreement (NAFTA) by a margin of 89 to 10. This follows passage in the U.S. House of Representatives by a margin of 385 to 41 in December 2019.
The unusually large, bipartisan votes in the Senate and House on the revised NAFTA set a new standard that to be politically viable, U.S. trade pacts no longer can include extreme corporate investor privileges or broad monopoly protections for Big Pharma and must have enforceable labor and environmental standards, in contrast to the 2016 Trans-Pacific Partnership, which never got close to congressional majority support.
Renegotiating the existing NAFTA to try to reduce its ongoing damage is not the same as creating a good trade agreement that creates jobs, raises wages and protects the environment and public health. That would additionally require climate provisions, stronger labor and environmental terms, and truly enforceable currency disciplines, and not limit consumer protections for food and product safety and labeling, the service sector, online platforms and more.
The NAFTA 2.0 deal that President Donald Trump initially signed in 2018 betrayed his campaign promise to fix NAFTA: It included new Big Pharma giveaways that lock in high drug prices, making it worse than the original, and its labor and environmental terms were too weak to counteract NAFTA’s outsourcing of jobs and pollution.
However, after congressional Democrats, unions and consumer groups forced Trump to remove Big Pharma giveaways and improve labor and environmental terms, the final revised deal is better than the original and might reduce some of NAFTA’s ongoing damage to workers and the environment. Although the new deal still includes problematic terms, the alternative is status quo NAFTA, not a more improved deal.
But this new NAFTA won’t bring back hundreds of thousands of manufacturing jobs, as Trump nonsensically claims. Nothing makes that clearer than U.S. auto manufacturers’ recent announcements that they plan to increase production in Mexico – from Ford’s decision to make its new Mustang electric SUV in Mexico to GM closing U.S. auto plants while expanding production in Mexico.
One clear and important win for consumers, workers and the environment is the gutting of NAFTA’s Investor-State Dispute Settlement (ISDS) regime. ISDS empowers multinational corporations to go before panels of three corporate lawyers to demand unlimited compensation from taxpayers over claims that domestic laws, regulations and court rulings violate special investor privileges. The lawyers can award the corporations unlimited sums to be paid by taxpayers, including for the loss of expected future profits. To date, corporations have extracted almost $400 million from North American taxpayers after attacks on energy, water, timber and toxics policies. Largely eliminating ISDS will foreclose numerous corporate attacks on environmental, health and other public interest policies and send a signal worldwide to the many countries also eager to exit the illegitimate ISDS regime.
The new NAFTA is not a template for future agreements; rather, it sets the floor from which we will fight for good trade policies that put working people and the planet first.
Source: https://www.citizen.org/news/broad-bipartisan-congressional-votes-on-revised-nafta-cement-new-floor-for-trade-pacts-pharma-giveaways-extreme-investor-rights-in-past-pacts-are-out-better-labor-and-environmental-terms-in-after/
Excerpts from Remarks of Commissioner Rebecca Kelly Slaughter As Prepared for Delivery at FTC Workshop on Non-Compete Clauses in the Workplace Washington, DC January 9, 2020
https://www.ftc.gov/system/files/documents/public_statements/1561475/slaughter_-_noncompete_clauses_workshop_remarks_1-9-20.pdf
Addressing Non-Competes and Other Labor Competition Issues
A handful of states have exhibited great leadership in enforcing against unjust non-compete restrictions and legislating to limit their usage and enforcement. This is significant and important work, but it is still only a patchwork solution to a problem that is rampant throughout much of the country. Proposed federal legislation, particularly the bill introduced by Senators Murphy and Young, is a positive development, but we need not wait for legislation to tackle this issue head-on.
The workshop we are having today is a valuable mechanism for the FTC to gather information and learn more about the impact non-compete provisions have on firms, workers, and the economy. But information gathering should not be the end of this exercise; we should also take action. Without prejudging the outcome of a rulemaking proceeding on non-competes, I strongly support the FTC’s undertaking such an endeavor. And I want to acknowledge and express gratitude to Commissioner Chopra for his white-paper calling for the FTC to take advantage of our statutory authority to engage in rulemaking on unfair methods of competition. I also want to credit the many advocacy groups who came together to petition the Commission to undertake a non-compete rulemaking specifically.
* * *
Surveys have estimated that 16 to 18 percent of all U.S. workers are currently covered by a noncompete provision, meaning that they have restrictions on where they can work after they leave, lose, or are let go from their current job. This includes 12 percent of workers who earn less than $20,000 per year and 15 percent of those who make $20,000 to $40,000 per year.5 Sandwich makers at Jimmy John’s sandwich shops were prevented for a period of two years from working at competing businesses that earn 10 percent of their revenue from selling sandwiches.
One Jimmy John’s assistant manager left her job and transitioned to a completely different industry, where she did not make as much money as she could have in the restaurant business, out of fear that Jimmy John’s would sue her over the non-compete.6 Illinois Attorney General Madigan sued and obtained a settlement where Jimmy John’s agreed to eliminate this indefensible non-compete provision in its employment contracts, which notably applied not only to the three mile radius around the Jimmy John’s where the worker was employed but also to any sandwich business located within three miles of any Jimmy John’s shop anywhere in the country.
https://www.ftc.gov/system/files/documents/public_statements/1561475/slaughter_-_noncompete_clauses_workshop_remarks_1-9-20.pdf
Addressing Non-Competes and Other Labor Competition Issues
A handful of states have exhibited great leadership in enforcing against unjust non-compete restrictions and legislating to limit their usage and enforcement. This is significant and important work, but it is still only a patchwork solution to a problem that is rampant throughout much of the country. Proposed federal legislation, particularly the bill introduced by Senators Murphy and Young, is a positive development, but we need not wait for legislation to tackle this issue head-on.
The workshop we are having today is a valuable mechanism for the FTC to gather information and learn more about the impact non-compete provisions have on firms, workers, and the economy. But information gathering should not be the end of this exercise; we should also take action. Without prejudging the outcome of a rulemaking proceeding on non-competes, I strongly support the FTC’s undertaking such an endeavor. And I want to acknowledge and express gratitude to Commissioner Chopra for his white-paper calling for the FTC to take advantage of our statutory authority to engage in rulemaking on unfair methods of competition. I also want to credit the many advocacy groups who came together to petition the Commission to undertake a non-compete rulemaking specifically.
* * *
Surveys have estimated that 16 to 18 percent of all U.S. workers are currently covered by a noncompete provision, meaning that they have restrictions on where they can work after they leave, lose, or are let go from their current job. This includes 12 percent of workers who earn less than $20,000 per year and 15 percent of those who make $20,000 to $40,000 per year.5 Sandwich makers at Jimmy John’s sandwich shops were prevented for a period of two years from working at competing businesses that earn 10 percent of their revenue from selling sandwiches.
One Jimmy John’s assistant manager left her job and transitioned to a completely different industry, where she did not make as much money as she could have in the restaurant business, out of fear that Jimmy John’s would sue her over the non-compete.6 Illinois Attorney General Madigan sued and obtained a settlement where Jimmy John’s agreed to eliminate this indefensible non-compete provision in its employment contracts, which notably applied not only to the three mile radius around the Jimmy John’s where the worker was employed but also to any sandwich business located within three miles of any Jimmy John’s shop anywhere in the country.
NYT: Big banks having a ball
JPMorgan Chase, the country’s largest bank, reported record profits on Tuesday, and Citigroup posted its best results since before the 2008 financial crisis.
Chase earned $36.4 billion last year, up from $32.5 billion in 2018. It earned $8.5 billion in the final three months of last year, also a record. Citi could not quite match that performance, but its $19.4 billion profit for 2019 beat the previous year, and its $5 billion result for the year’s final quarter surpassed the profit it earned in the same period in 2018.
One reason for their success: the 2019 turnaround in the financial markets. The end of 2018 seemed to portend a reckoning as investors fretted over the trade war and the Federal Reserve’s plans to drain cash from the financial system. But rate cuts by the Fed last year helped markets creep steadily to new highs.
JPMorgan’s fixed-income trading revenues in the final quarter of 2019, for example, were 86 percent higher than in the same period a year earlier.
From: https://www.nytimes.com/2020/01/14/business/jpmorgan-citigroup-wells-fargo-earnings.html
JPMorgan Chase, the country’s largest bank, reported record profits on Tuesday, and Citigroup posted its best results since before the 2008 financial crisis.
Chase earned $36.4 billion last year, up from $32.5 billion in 2018. It earned $8.5 billion in the final three months of last year, also a record. Citi could not quite match that performance, but its $19.4 billion profit for 2019 beat the previous year, and its $5 billion result for the year’s final quarter surpassed the profit it earned in the same period in 2018.
One reason for their success: the 2019 turnaround in the financial markets. The end of 2018 seemed to portend a reckoning as investors fretted over the trade war and the Federal Reserve’s plans to drain cash from the financial system. But rate cuts by the Fed last year helped markets creep steadily to new highs.
JPMorgan’s fixed-income trading revenues in the final quarter of 2019, for example, were 86 percent higher than in the same period a year earlier.
From: https://www.nytimes.com/2020/01/14/business/jpmorgan-citigroup-wells-fargo-earnings.html
Reuters: Product liability case secrecy hurts consumers
Excerpt:
As Reuters has documented in earlier articles in this series, a thick blanket of secrecy covers product-liability litigation in the United States. In just a handful of cases over the past several decades, hundreds of thousands of people were killed or injured by defective products – cars, drugs, guns – while information about the risks was hidden from consumers and regulators, sometimes for years, behind broad protective orders.
These orders, though meant to protect specific information such as medical records and trade secrets, often give companies wide latitude to designate as confidential material exchanged between litigants in the pretrial discovery process – internal emails, data, research, meeting minutes, sworn depositions and the like. The secrecy typically persists for the life of the case, and long after, though court documents are, by law, presumed to be public.
In an analysis of some of the largest mass defective-product cases consolidated in federal courts over the past 20 years, Reuters found 55 in which judges sealed information concerning public health and safety. And among those, only three had protective orders containing language specifically allowing information exchanged by the litigants to be shared with regulators.
https://www.reuters.com/investigates/special-report/usa-courts-secrecy-regulators/
Excerpt:
As Reuters has documented in earlier articles in this series, a thick blanket of secrecy covers product-liability litigation in the United States. In just a handful of cases over the past several decades, hundreds of thousands of people were killed or injured by defective products – cars, drugs, guns – while information about the risks was hidden from consumers and regulators, sometimes for years, behind broad protective orders.
These orders, though meant to protect specific information such as medical records and trade secrets, often give companies wide latitude to designate as confidential material exchanged between litigants in the pretrial discovery process – internal emails, data, research, meeting minutes, sworn depositions and the like. The secrecy typically persists for the life of the case, and long after, though court documents are, by law, presumed to be public.
In an analysis of some of the largest mass defective-product cases consolidated in federal courts over the past 20 years, Reuters found 55 in which judges sealed information concerning public health and safety. And among those, only three had protective orders containing language specifically allowing information exchanged by the litigants to be shared with regulators.
https://www.reuters.com/investigates/special-report/usa-courts-secrecy-regulators/
DMN: Major Radio Broadcasters Lambast the DOJ for Siding with Irving Azoff’s GMR
In response to the Department of Justice (DOJ) filing an amicus brief in support of Irving Azoff and his long-standing legal battle with the Radio Music License Committee (RMLC), the National Association of Broadcasters (NAB) has filed a motion to issue their own amicus brief, which criticizes the DOJ’s brief.
The story continues here. https://www.digitalmusicnews.com/2020/01/16/radio-broadcasters-lambaste-doj-siding-irving-azoff/
In response to the Department of Justice (DOJ) filing an amicus brief in support of Irving Azoff and his long-standing legal battle with the Radio Music License Committee (RMLC), the National Association of Broadcasters (NAB) has filed a motion to issue their own amicus brief, which criticizes the DOJ’s brief.
The story continues here. https://www.digitalmusicnews.com/2020/01/16/radio-broadcasters-lambaste-doj-siding-irving-azoff/
Two views on proposed antitrust exemption for newspapers
H.R.2054 – The “Journalism Competition and Preservation Act of 2019” has the goal of providing “a temporary safe harbor for the publishers of online content to collectively negotiate with dominant online platforms regarding the terms on which their content may be distributed.” See https://www.congress.gov/bill/116th-congress/house-bill/2054/text?q=%7B%22search%22%3A%5B%22Hr+2054%22%5D%7D&r=1
Opinion is divided, even among journalists, about whether the legislation is a good idea of bad.
Politico editorializes against, at https://www.politico.com/magazine/story/2019/06/10/newspapers-embarrassing-lobbying-campaign-227100.
Here is an excerpt:
The newspaper industry has crawled up Capitol Hill once again to beg for an antitrust exemption it thinks it needs in its fight with Google and Facebook for advertising dollars.
Currently, Google and Facebook collect 73 percent of all digital advertising. Members of the news industry believe that the two tech giants have exploited their dominance of the web to unfairly collect digital dollars that rightfully belong to the news organizations. The Journalism Competition and Preservation Act of 2019, introduced in the House in April, and its Senate version, would allow print and online news companies to cartelize into a united front against Google and Facebook. Washington Post media columnist Margaret Sullivan cheered the bill last week and other newspapers (Chicago Tribune, Cleveland Plain Dealer, Columbus Dispatch, and others) have editorialized in favor of the exemption. Under the new law, which would sunset in four years, the cartel could collectively withhold content from Google, Facebook and other sites and negotiate the terms under which the two tech giants could use their work. Anti-trust law currently prohibits such industrywide collusion.
This proposed antitrust exemption—being pushed by the 2,000-plus member News Media Alliance trade group—is misguided on several levels. For one thing, it would be wrong to pass a law that would prop up one media sector by selectively bestowing special competitive privileges on it. The bill would not allow broadcasters to join the new cartel. The bill’s supporters also falsely blame Google and Facebook for the newspaper industry’s decay when circulation declines—especially when measured per capita—predate the emergence of the web.
Margaret Sullivan of the Washington Post disagrees, at https://www.washingtonpost.com/lifestyle/style/google-and-facebook-sucked-profits-from-newspapers-publishers-are-finally-resisting/2019/06/04/d5fa2aaa-86de-11e9-98c1-e945ae5db8fb_story.html. Here is an excerpt:
But a temporary waiver — while newspapers try to right themselves at a critical time — is more than a good idea. It’s essential.
When local newspapers fail, all kinds of bad things happen. Various studies have shown that civic engagement falls off, government spending goes up, and unreliable or made-up stories get a stronger foothold. We lose our village squares, our ways of making sense of the world with shared facts, and our ability to hold public officials to account.
Before more of the remaining papers turn into “toast,” as Buffett prophesied, they need some serious, immediate help.
As for Google and Facebook, if fewer ad dollars go their way in the service of local journalism’s survival, I’m confident they will manage somehow.
H.R.2054 – The “Journalism Competition and Preservation Act of 2019” has the goal of providing “a temporary safe harbor for the publishers of online content to collectively negotiate with dominant online platforms regarding the terms on which their content may be distributed.” See https://www.congress.gov/bill/116th-congress/house-bill/2054/text?q=%7B%22search%22%3A%5B%22Hr+2054%22%5D%7D&r=1
Opinion is divided, even among journalists, about whether the legislation is a good idea of bad.
Politico editorializes against, at https://www.politico.com/magazine/story/2019/06/10/newspapers-embarrassing-lobbying-campaign-227100.
Here is an excerpt:
The newspaper industry has crawled up Capitol Hill once again to beg for an antitrust exemption it thinks it needs in its fight with Google and Facebook for advertising dollars.
Currently, Google and Facebook collect 73 percent of all digital advertising. Members of the news industry believe that the two tech giants have exploited their dominance of the web to unfairly collect digital dollars that rightfully belong to the news organizations. The Journalism Competition and Preservation Act of 2019, introduced in the House in April, and its Senate version, would allow print and online news companies to cartelize into a united front against Google and Facebook. Washington Post media columnist Margaret Sullivan cheered the bill last week and other newspapers (Chicago Tribune, Cleveland Plain Dealer, Columbus Dispatch, and others) have editorialized in favor of the exemption. Under the new law, which would sunset in four years, the cartel could collectively withhold content from Google, Facebook and other sites and negotiate the terms under which the two tech giants could use their work. Anti-trust law currently prohibits such industrywide collusion.
This proposed antitrust exemption—being pushed by the 2,000-plus member News Media Alliance trade group—is misguided on several levels. For one thing, it would be wrong to pass a law that would prop up one media sector by selectively bestowing special competitive privileges on it. The bill would not allow broadcasters to join the new cartel. The bill’s supporters also falsely blame Google and Facebook for the newspaper industry’s decay when circulation declines—especially when measured per capita—predate the emergence of the web.
Margaret Sullivan of the Washington Post disagrees, at https://www.washingtonpost.com/lifestyle/style/google-and-facebook-sucked-profits-from-newspapers-publishers-are-finally-resisting/2019/06/04/d5fa2aaa-86de-11e9-98c1-e945ae5db8fb_story.html. Here is an excerpt:
But a temporary waiver — while newspapers try to right themselves at a critical time — is more than a good idea. It’s essential.
When local newspapers fail, all kinds of bad things happen. Various studies have shown that civic engagement falls off, government spending goes up, and unreliable or made-up stories get a stronger foothold. We lose our village squares, our ways of making sense of the world with shared facts, and our ability to hold public officials to account.
Before more of the remaining papers turn into “toast,” as Buffett prophesied, they need some serious, immediate help.
As for Google and Facebook, if fewer ad dollars go their way in the service of local journalism’s survival, I’m confident they will manage somehow.
Gottshall on sewer service in DC Landlord-Tenant Court
"Years have passed since the first day that I observed “roll call” in the District of Columbia Landlord and Tenant Branch, and I no longer wonder why some tenants in default fail to appear. I unequivocally know that service practices are unreliable and unfair. There are systemic due process violations occurring in the form of improper and ineffective service of process. Most troubling is that many defendants do not appear for court simply because they do not know about their case. Unreliable and unfair service practices are a national problem. They are not unique to the District of Columbia. At least three jurisdictions have recently attempted to address sewer service through litigation, resulting in multimillion dollar settlements for victims."
From: January 2018 Solving Sewer Service: Fighting Fraud with Technology Adrian Gottshall University of the District of Columbia , https://scholarworks.uark.edu/cgi/viewcontent.cgi?article=1034&context=alr
PBS NewsHour on new state laws going into effect across the country.
From NCAA athlete reimbursement, legalization of sports betting, legalization of marijuana and criminal justice reform to raising minimum wage and the cost of electric cars, state legislatures are having a major impact on the nation’s laws. The Hill’s Reid Wilson joins Lisa Desjardins to discuss specific changes as well as three broader trends to watch going forward.
https://www.youtube.com/watch?v=LAtFe9RnXgM
From NCAA athlete reimbursement, legalization of sports betting, legalization of marijuana and criminal justice reform to raising minimum wage and the cost of electric cars, state legislatures are having a major impact on the nation’s laws. The Hill’s Reid Wilson joins Lisa Desjardins to discuss specific changes as well as three broader trends to watch going forward.
https://www.youtube.com/watch?v=LAtFe9RnXgM
NYT on the travails for Huawei
Huawei is the world’s leading maker of equipment that powers cellphone networks and a champion of Beijing’s ambitions to build new, cutting-edge technology companies. Officials in the United States have long been worried that China’s government could use Huawei’s products to gather intelligence, an accusation the company has repeatedly denied.
Huawei’s year went from bad to worse when the United States added the company to an export blacklist in May. The move effectively restricted its ability to purchase American products crucial to its smartphones and telecom gear, weighing on revenue growth.
The blocks, though, have proven somewhat porous. The Trump administration has permitted sales to Huawei that are used to maintain existing mobile networks. Some of its American suppliers determined they could lawfully continue selling nonsensitive products to the company. In October, the Trump administration said it would issue export licenses to certain United States companies selling to Huawei, further easing pressures on its supply chain.
Even so, Mr. Xu indicated that the confrontation with the United States would continue to dampen growth and said he expected Huawei to remain on the blacklist in 2020.
“Difficulty is the prelude to greater success, and adversity the whetstone of an iron-willed team. The U.S. government’s campaign against Huawei is strategic and long-term,” he wrote.
Huawei, he said, will “need to go all out” to develop software and services that work with its smartphones. Analysts have worried about whether the company’s smartphones would remain competitive since it was blocked from working with Google. Huawei had to release its latest flagship smartphone, the Mate 30 series, without regular access to Google’s apps.
Mr. Xu said the company shipped a total of 240 million smartphones in 2019, an increase of almost 17 percent over the 206 million units it sold in 2018.
From https://www.nytimes.com/2019/12/30/business/huawei-revenue-growth.html
Huawei is the world’s leading maker of equipment that powers cellphone networks and a champion of Beijing’s ambitions to build new, cutting-edge technology companies. Officials in the United States have long been worried that China’s government could use Huawei’s products to gather intelligence, an accusation the company has repeatedly denied.
Huawei’s year went from bad to worse when the United States added the company to an export blacklist in May. The move effectively restricted its ability to purchase American products crucial to its smartphones and telecom gear, weighing on revenue growth.
The blocks, though, have proven somewhat porous. The Trump administration has permitted sales to Huawei that are used to maintain existing mobile networks. Some of its American suppliers determined they could lawfully continue selling nonsensitive products to the company. In October, the Trump administration said it would issue export licenses to certain United States companies selling to Huawei, further easing pressures on its supply chain.
Even so, Mr. Xu indicated that the confrontation with the United States would continue to dampen growth and said he expected Huawei to remain on the blacklist in 2020.
“Difficulty is the prelude to greater success, and adversity the whetstone of an iron-willed team. The U.S. government’s campaign against Huawei is strategic and long-term,” he wrote.
Huawei, he said, will “need to go all out” to develop software and services that work with its smartphones. Analysts have worried about whether the company’s smartphones would remain competitive since it was blocked from working with Google. Huawei had to release its latest flagship smartphone, the Mate 30 series, without regular access to Google’s apps.
Mr. Xu said the company shipped a total of 240 million smartphones in 2019, an increase of almost 17 percent over the 206 million units it sold in 2018.
From https://www.nytimes.com/2019/12/30/business/huawei-revenue-growth.html
Free representation for low income tenants facing eviction
Just two years ago, New York City became the first city in the nation to guarantee free representation to low-income residents facing eviction. Now, six other cities have followed suit, and several more jurisdictions, including the state of Massachusetts, have versions of such a law under consideration. This month alone, headlines in the Wall Street Journal, Next City, and CityLab tell the story:
These pieces amplify and give national context to the significant local coverage emanating from cities where this civil justice solution has been adopted. This fall, Philadelphia and Cleveland became the two most recent examples.
As Jared Brey wrote for Next City, “The laws are meant to correct a common imbalance in landlord-tenant courts, where the vast majority of landlords benefit from legal representation while tenants are left on their own to figure out what rights they have in trying to avoid being evicted.”
John Pollock of the National Coalition for a Civil Right to Counsel (NCCRC), and a source in the piece, cited the litany of common problems: “The eviction mill problem, the unfairness of the results, and most importantly the dire circumstances people face…You can lose virtually everything if you lose your house: Your kids, your job, you could wind up in jail. It just keeps going.”
To learn more about the civil right to counsel movement, including links to additional media coverage and a map showing the status of the movement by-issue and by-state, visit the NCCRC website.
Just two years ago, New York City became the first city in the nation to guarantee free representation to low-income residents facing eviction. Now, six other cities have followed suit, and several more jurisdictions, including the state of Massachusetts, have versions of such a law under consideration. This month alone, headlines in the Wall Street Journal, Next City, and CityLab tell the story:
- Is Tenants’ Right to Counsel On Its Way to Becoming Standard Practice?, Jared Brey in Next City, December 10, 2019.
- The Right to Eviction Counsel Is Gaining Momentum, Kriston Capps in CityLab, December 13, 2019.
- As Rents Rise, Cities Strengthen Tenants’ Ability to Fight Eviction, Laura Kusisto in The Wall Street Journal, December 26, 2019.
These pieces amplify and give national context to the significant local coverage emanating from cities where this civil justice solution has been adopted. This fall, Philadelphia and Cleveland became the two most recent examples.
As Jared Brey wrote for Next City, “The laws are meant to correct a common imbalance in landlord-tenant courts, where the vast majority of landlords benefit from legal representation while tenants are left on their own to figure out what rights they have in trying to avoid being evicted.”
John Pollock of the National Coalition for a Civil Right to Counsel (NCCRC), and a source in the piece, cited the litany of common problems: “The eviction mill problem, the unfairness of the results, and most importantly the dire circumstances people face…You can lose virtually everything if you lose your house: Your kids, your job, you could wind up in jail. It just keeps going.”
To learn more about the civil right to counsel movement, including links to additional media coverage and a map showing the status of the movement by-issue and by-state, visit the NCCRC website.
Amazon's Ring sued over 'lax security standards' leading to hacks
BY EMILY BIRNBAUM
Amazon and its home security subsidiary Ring are facing a federal lawsuit in California over allegations that its "lax security standards" led to a series of invasive and frightening hacks over the past year.
Read the full story here
Amazon's Ring sued over 'lax security standards' leading to hacks
BY EMILY BIRNBAUM
Amazon and its home security subsidiary Ring are facing a federal lawsuit in California over allegations that its "lax security standards" led to a series of invasive and frightening hacks over the past year.
Read the full story here
President Trump's tariffs on imports led to job losses and higher prices, a new study from the Federal Reserve has found.
See https://www.marketwatch.com/story/fed-study-finds-trump-tariffs-backfired-2019-12-27
"We find that tariff increases enacted in 2018 are associated with relative reductions in manufacturing employment and relative increases in producer prices," the report by Fed economists Aaron Flaaen and Justin Pierce reads.
MarketWatch first reported the study, noting that 10 primary industries were hit by retaliatory tariffs and higher prices, including producers of magnetic and optical media, leather goods, aluminum sheet, iron and steel, motor vehicles, household appliances, sawmills, audio and video equipment, pesticide, and computer equipment.
See https://www.marketwatch.com/story/fed-study-finds-trump-tariffs-backfired-2019-12-27
"We find that tariff increases enacted in 2018 are associated with relative reductions in manufacturing employment and relative increases in producer prices," the report by Fed economists Aaron Flaaen and Justin Pierce reads.
MarketWatch first reported the study, noting that 10 primary industries were hit by retaliatory tariffs and higher prices, including producers of magnetic and optical media, leather goods, aluminum sheet, iron and steel, motor vehicles, household appliances, sawmills, audio and video equipment, pesticide, and computer equipment.
William Greider died recently at age 83.
The following essay, originally published in 1981, is widely considered his most famous piece of writing. It caused a firestorm of controversy when it first appeared. David A. Stockman, the budget director for the incoming Reagan administration, spoke too freely with Greider about his doubts over Reagan’s supply-side theory of economics. Stockman was then, in his words, “taken to the woodshed” by the president.
The essay is here: https://www.theatlantic.com/magazine/archive/1981/12/the-education-of-david-stockman/305760/
The following essay, originally published in 1981, is widely considered his most famous piece of writing. It caused a firestorm of controversy when it first appeared. David A. Stockman, the budget director for the incoming Reagan administration, spoke too freely with Greider about his doubts over Reagan’s supply-side theory of economics. Stockman was then, in his words, “taken to the woodshed” by the president.
The essay is here: https://www.theatlantic.com/magazine/archive/1981/12/the-education-of-david-stockman/305760/
Housing Trust Funds and affordable housing in Virginia and Maryland
Housing advocates hope for larger cash infusions to the Virginia Housing Trust Fund, a low-interest loan program designed to create or preserve new affordable housing around the state.
Since lawmakers created it in 2013, they’ve generally only seeded it with a few million dollars each year. The latest biennial budget allocates about $9 million annually.
Activists have considered that insufficient to meet needs around the entire state, especially considering that some Northern Virginia localities manage much larger loan programs on their own. And Virginia lags behind many other states, including neighboring Maryland, where the “Rental Housing Works” program regularly approaches $20 million annually.
From: https://www.bizjournals.com/washington/news/2019/11/19/affordable-housing-hopes-abound-in-northern-va-as.html?ana=e_wash_bn_editorschoice&j=90400451&t=Breaking%20News&mkt_tok=eyJpIjoiWkdWbE5UQTROR000T0RVNCIsInQiOiJTaWNNT05ocXlZWWtSNko5VXZiSXgzZExkTG9vMmhyaHpkTEhDbGoyTE1xOE1tdlZ3SStQNGVVZlpUdDJSNTRqM2toWlwvb2JYZVliM3RZZnN0Q1A5MHhNWHpBYUVoUHpqXC9aOTlqUUlXVmdKNUd1dmg5NnBoeEY2cWozVkhVTVBXQU1KWk9QUmEwTDlmQnVPaDNjRmF0Zz09In0%3D
Housing advocates hope for larger cash infusions to the Virginia Housing Trust Fund, a low-interest loan program designed to create or preserve new affordable housing around the state.
Since lawmakers created it in 2013, they’ve generally only seeded it with a few million dollars each year. The latest biennial budget allocates about $9 million annually.
Activists have considered that insufficient to meet needs around the entire state, especially considering that some Northern Virginia localities manage much larger loan programs on their own. And Virginia lags behind many other states, including neighboring Maryland, where the “Rental Housing Works” program regularly approaches $20 million annually.
From: https://www.bizjournals.com/washington/news/2019/11/19/affordable-housing-hopes-abound-in-northern-va-as.html?ana=e_wash_bn_editorschoice&j=90400451&t=Breaking%20News&mkt_tok=eyJpIjoiWkdWbE5UQTROR000T0RVNCIsInQiOiJTaWNNT05ocXlZWWtSNko5VXZiSXgzZExkTG9vMmhyaHpkTEhDbGoyTE1xOE1tdlZ3SStQNGVVZlpUdDJSNTRqM2toWlwvb2JYZVliM3RZZnN0Q1A5MHhNWHpBYUVoUHpqXC9aOTlqUUlXVmdKNUd1dmg5NnBoeEY2cWozVkhVTVBXQU1KWk9QUmEwTDlmQnVPaDNjRmF0Zz09In0%3D
COMMENTARY
Gig Worker Law: Not as Simple as ABC
By Eve Wagner
AB 5, the bill whose purported mission was to restore protections to workers such as ride-share drivers and freelance writers, is now being decried by some as a job-killer.
Read More https://link.law.com/click/18979364.13524/aHR0cHM6Ly93d3cubGF3LmNvbS90aGVyZWNvcmRlci8yMDE5LzEyLzIzL2dpZy13b3JrZXItbGF3LW5vdC1hcy1zaW1wbGUtYXMtYWJjLz9rdz1HaWclMjBXb3JrZXIlMjBMYXc6JTIwTm90JTIwYXMlMjBTaW1wbGUlMjBhcyUyMEFCQyZ1dG1fc291cmNlPWVtYWlsJnV0bV9tZWRpdW09ZW5sJnV0bV9jYW1wYWlnbj1pbnByYWN0aWNlYWxlcnQmdXRtX2NvbnRlbnQ9MjAxOTEyMjYmdXRtX3Rlcm09Y2E/593aad6e24b2d66c428b4da1De9aa56f8
Gig Worker Law: Not as Simple as ABC
By Eve Wagner
AB 5, the bill whose purported mission was to restore protections to workers such as ride-share drivers and freelance writers, is now being decried by some as a job-killer.
Read More https://link.law.com/click/18979364.13524/aHR0cHM6Ly93d3cubGF3LmNvbS90aGVyZWNvcmRlci8yMDE5LzEyLzIzL2dpZy13b3JrZXItbGF3LW5vdC1hcy1zaW1wbGUtYXMtYWJjLz9rdz1HaWclMjBXb3JrZXIlMjBMYXc6JTIwTm90JTIwYXMlMjBTaW1wbGUlMjBhcyUyMEFCQyZ1dG1fc291cmNlPWVtYWlsJnV0bV9tZWRpdW09ZW5sJnV0bV9jYW1wYWlnbj1pbnByYWN0aWNlYWxlcnQmdXRtX2NvbnRlbnQ9MjAxOTEyMjYmdXRtX3Rlcm09Y2E/593aad6e24b2d66c428b4da1De9aa56f8
At a time when germs are growing more resistant to common antibiotics, many companies that are developing new versions of the drugs are hemorrhaging money and going out of business, gravely undermining efforts to contain the spread of deadly, drug-resistant bacteria.
Antibiotic start-ups like Achaogen and Aradigm have gone belly up in recent months, pharmaceutical behemoths like Novartis and Allergan have abandoned the sector and many of the remaining American antibiotic companies are teetering toward insolvency. One of the biggest developers of antibiotics, Melinta Therapeutics, recently warned regulators it was running out of cash.
Experts say the grim financial outlook for the few companies still committed to antibiotic research is driving away investors and threatening to strangle the development of new lifesaving drugs at a time when they are urgently needed.
From: https://www.nytimes.com/2019/12/25/health/antibiotics-new-resistance.html
Antibiotic start-ups like Achaogen and Aradigm have gone belly up in recent months, pharmaceutical behemoths like Novartis and Allergan have abandoned the sector and many of the remaining American antibiotic companies are teetering toward insolvency. One of the biggest developers of antibiotics, Melinta Therapeutics, recently warned regulators it was running out of cash.
Experts say the grim financial outlook for the few companies still committed to antibiotic research is driving away investors and threatening to strangle the development of new lifesaving drugs at a time when they are urgently needed.
From: https://www.nytimes.com/2019/12/25/health/antibiotics-new-resistance.html
Re: Air B&B:
The Third Court of Appeals found the City of Austin’s Short Term Rental Ordinance unconstitutional for retroactively banning Type II “non-owner occupied vacation rentals” and by violating the fundamental right to assembly guaranteed under the Texas Constitution.
To read the Third Court of Appeals opinion in full, please visit:
https://files.texaspolicy.com/uploads/2019/11/27091358/STR-Opinion.pdf
The Third Court of Appeals found the City of Austin’s Short Term Rental Ordinance unconstitutional for retroactively banning Type II “non-owner occupied vacation rentals” and by violating the fundamental right to assembly guaranteed under the Texas Constitution.
To read the Third Court of Appeals opinion in full, please visit:
https://files.texaspolicy.com/uploads/2019/11/27091358/STR-Opinion.pdf
Lawsuit alleges turkey companies conspired to keep prices high
By Leah Douglas, December 19, 2019
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A new class-action lawsuit brought by two food distributors alleges that the country’s top turkey companies conspired for most of the past decade to raise turkey prices. The allegations mirror those brought in recent years against beef, pork, and chicken companies, and all revolve around the use of reports on industry production and pricing made by a secretive data company called Agri Stats.
This latest complaint, filed Wednesday in U.S. District Court in the Northern District of Illinois, alleges that between 2010 and 2017, the country’s largest turkey companies conspired to artificially raise turkey prices by coordinating production cuts. As a result, turkey prices reached an “unprecedented level.”
The suit was brought by Olean Wholesale Grocery Cooperative and John Gross and Company, two food distributors and wholesalers based in New York and Pennsylvania, respectively, who bought turkey from the defendants during the time period covered by the suit.
The defendants in the case control approximately 80 percent of the market for turkeys, and the top four — Cargill, Hormel, Butterball, and Farbest — control more than half the market, according to the complaint. Other defendants include Agri Stats, Foster Farms, Kraft Heinz, Hormel Foods, and Tyson Foods.
According to the complaint, the companies coordinated to raise prices at industry conventions, through public discussion of production cuts, and by analyzing competitor data contained in Agri Stats reports. Those reports, which are available only on a subscription basis to industry insiders, can contain proprietary information about sales, production levels and capacity, and wages paid to farmers.
From https://thefern.org/ag_insider/lawsuit-alleges-turkey-companies-conspired-to-keep-prices-high/
By Leah Douglas, December 19, 2019
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A new class-action lawsuit brought by two food distributors alleges that the country’s top turkey companies conspired for most of the past decade to raise turkey prices. The allegations mirror those brought in recent years against beef, pork, and chicken companies, and all revolve around the use of reports on industry production and pricing made by a secretive data company called Agri Stats.
This latest complaint, filed Wednesday in U.S. District Court in the Northern District of Illinois, alleges that between 2010 and 2017, the country’s largest turkey companies conspired to artificially raise turkey prices by coordinating production cuts. As a result, turkey prices reached an “unprecedented level.”
The suit was brought by Olean Wholesale Grocery Cooperative and John Gross and Company, two food distributors and wholesalers based in New York and Pennsylvania, respectively, who bought turkey from the defendants during the time period covered by the suit.
The defendants in the case control approximately 80 percent of the market for turkeys, and the top four — Cargill, Hormel, Butterball, and Farbest — control more than half the market, according to the complaint. Other defendants include Agri Stats, Foster Farms, Kraft Heinz, Hormel Foods, and Tyson Foods.
According to the complaint, the companies coordinated to raise prices at industry conventions, through public discussion of production cuts, and by analyzing competitor data contained in Agri Stats reports. Those reports, which are available only on a subscription basis to industry insiders, can contain proprietary information about sales, production levels and capacity, and wages paid to farmers.
From https://thefern.org/ag_insider/lawsuit-alleges-turkey-companies-conspired-to-keep-prices-high/
As States open the door to sports betting, the betting market has grown, and DraftKings Inc. has an agreement that would take the sports-betting company public
Best known for its fantasy-sports games, DraftKings said Monday it will merge with Diamond Eagle Acquisition Corp., which trades on the Nasdaq and is backed by former MGM movie studio Chief Executive Harry Sloan. Diamond Eagle is what is known as a blank-check company, formed in part to find another company that it would combine with or acquire.
DraftKings also struck a deal to merge with gambling-technology provider SBTech. Both combinations are expected to be completed in the first half of next year, the company said.
Several investors, including funds managed by Capital Research & Management Co., Wellington Management Co. and Franklin Templeton, have agreed to invest $304 million in a class of the combined company’s stock.
DraftKings expects the combined company to have a market value of $3.3 billion at closing and said it would have more than $500 million in unrestricted cash on hand.
A number of states have moved to authorize wagers on sports after a Supreme Court decision last year opened the door to those bets. Twenty states and the District of Columbia have legalized sports betting.
DraftKings estimates the size of the market for online sports betting and other games, such as those typically found in casinos, could reach about $40 billion in the U.S., according to a recent investor presentation. It expects a potential revenue opportunity from online gambling of $2.9 billion to $4.7 billion, the presentation showed.
From: https://www.wsj.com/articles/draftkings-to-go-public-following-merger-with-diamond-eagle-sbtech-11577109747?mod=business_lead_pos13
Best known for its fantasy-sports games, DraftKings said Monday it will merge with Diamond Eagle Acquisition Corp., which trades on the Nasdaq and is backed by former MGM movie studio Chief Executive Harry Sloan. Diamond Eagle is what is known as a blank-check company, formed in part to find another company that it would combine with or acquire.
DraftKings also struck a deal to merge with gambling-technology provider SBTech. Both combinations are expected to be completed in the first half of next year, the company said.
Several investors, including funds managed by Capital Research & Management Co., Wellington Management Co. and Franklin Templeton, have agreed to invest $304 million in a class of the combined company’s stock.
DraftKings expects the combined company to have a market value of $3.3 billion at closing and said it would have more than $500 million in unrestricted cash on hand.
A number of states have moved to authorize wagers on sports after a Supreme Court decision last year opened the door to those bets. Twenty states and the District of Columbia have legalized sports betting.
DraftKings estimates the size of the market for online sports betting and other games, such as those typically found in casinos, could reach about $40 billion in the U.S., according to a recent investor presentation. It expects a potential revenue opportunity from online gambling of $2.9 billion to $4.7 billion, the presentation showed.
From: https://www.wsj.com/articles/draftkings-to-go-public-following-merger-with-diamond-eagle-sbtech-11577109747?mod=business_lead_pos13
WSJ investigation says Huawei Staff Help Uganda Government Spy on People
Could Huawei similarly aid malign forces in the U.S.?
WSJ reporters on the ground in Uganda uncover how Chinese telecom giant Huawei is providing surveillance tools that African governments use to stifle dissent. Techniques include street cameras, cell phone hacking, and encryption breaking, all involving support from Huawei staff. The implication is that Huawei could similarly help malign forces in the U.S. In the U.S. the malign force could be China itself. DAR
The WSJ video is here: https://www.wsj.com/video/wsj-investigation-huawei-staff-help-governments-to-spy-on-people/0CE986A8-9975-4CB6-BB9C-031A24540E93.html
Could Huawei similarly aid malign forces in the U.S.?
WSJ reporters on the ground in Uganda uncover how Chinese telecom giant Huawei is providing surveillance tools that African governments use to stifle dissent. Techniques include street cameras, cell phone hacking, and encryption breaking, all involving support from Huawei staff. The implication is that Huawei could similarly help malign forces in the U.S. In the U.S. the malign force could be China itself. DAR
The WSJ video is here: https://www.wsj.com/video/wsj-investigation-huawei-staff-help-governments-to-spy-on-people/0CE986A8-9975-4CB6-BB9C-031A24540E93.html
NY Times editorial critique of USDOJ Antitrust Division's Delrahim:
Why Is the Justice Department Treating T-Mobile Like a Client?
Antitrust officials are supposed to prevent problematic corporate mergers. Instead, they’re helping shepherd deals.
By The Editorial Board https://www.nytimes.com/2019/12/20/opinion/justice-department-antitrust-sprint-tmobile.html?searchResultPosition=3
From the editorial:
The Times reported on Thursday that Mr. Delrahim worked assiduously this past summer to clear the way for the merger of two rival mobile phone companies, T-Mobile and Sprint, by helping to arrange for the two companies to sell some assets to a third company, Dish. Mr. Delrahim behaved like a man who wanted to make a deal. In text messages, which were disclosed as part of a related court case, he repeatedly coaxed and cajoled executives at the three companies, as well as federal officials who had the ability to block the merger.
Mr. Delrahim has cast his actions as a defense of the public interest. In announcing that the Justice Department had approved the merger in July, he said that he had been prepared to go to court to block the merger had Dish not participated in the agreement. The asset sales are intended to allow Dish to emerge as a viable new mobile phone company, filling the void when Sprint departs the marketplace.
But Mr. Delrahim was negotiating with himself. His campaign to secure Dish’s participation amounted to a concerted effort to satisfy his own objections to the proposed deal. Rather than defending the public interest, he was working to defend T-Mobile’s interests.
And the deeper problem is that Mr. Delrahim’s behavior was not exceptional.
FCC quizzed over Sprint, T-Mobile merger approval
CPI
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December 17, 2019The Democratic chairmen of two key House committees are questioning whether the government flouted “appropriate” procedures when it recently approved the $26 billion merger between T-Mobile and Sprint, green-lighting one of the largest telecom deals in recent history.
House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.) and Judiciary Committee Chairman Jerold Nadler (D-N.Y.) on Monday accused the Federal Communications Commission (FCC) of engaging in shady and potentially rule-breaking behavior ahead of its decision to approve the merger along party lines earlier this year.
“We have serious concerns regarding the troubling lack of transparency and an apparent lack of appropriate process leading up to the Federal Communications Commission’s approval of T-Mobile U.S., Inc.’s purchase of Sprint Corporation,” Pallone and Nadler said in a letter to FCC Chairman Ajit Pai, a Republican.
Several critics, including Democratic FCC Commissioner Jessica Rosenworcel and a coalition of advocacy groups, have claimed the FCC should have opened up the deal to public comment before voting for it 3-2 in October, a few months after the Department of Justice (DOJ) approved of the merger under an array of new conditions. And the Democrats, citing Rosenworcel, are accusing the agency of replacing initial evidence with analysis that “downplay[ed] the competitive harms of the merger” at the last minute.
“To the extent that changes were made to the draft decision based on data supplied by the parties after the draft was first circulated to the Commissioners, we are concerned that there was insufficient notice and opportunity for public review and comment,” Pallone and Nadler wrote.
Industry watchers have said the FCC’s process around approving the T-Mobile-Sprint merger was abnormal, with the Republicans offering their blessing even before any public proposal had been circulated.
Pallone and Nadler wrote that the FCC should have opened up their proposal to review after DOJ had substantially changed the terms of the deal. But the Republican-controlled agency did not seek any additional comment.
They’re further accusing the FCC of failing to disclose details about conversations during that period of time between T-Mobile representatives and FCC commissioners.
T-Mobile representatives met with FCC commissioners 25 times between July and October, but the agency has not offered a detailed account of what was discussed in those “ex-parte” meetings, according to the letter.
The Democrats are asking the FCC to produce documents about a potential public comment period and questioning whether the agency is investigating T-Mobile’s compliance with its “ex-parte” rules.
Full Content: The Hill https://thehill.com/policy/technology/474776-key-house-dems-question-whether-t-mobile-sprint-merger-went-through
DAR Comment: USDOJ policy published in 2004 on "fix-it-first" merger remedies
From https://www.justice.gov/atr/page/file/1175136/download [footnotes not included]
A Fix-It-First Remedy Is Acceptable if It Eliminates the Competitive Harm
A fix-it-first remedy is a structural remedy that the parties implement and the Division accepts before a merger is consummated.36 A fix-it-first remedy eliminates the Division’s antitrust concerns and therefore the need to file a case.37
The Division does not discourage acceptable fix-it-first remedies. If parties express an interest in pursuing a fix-it-first remedy that satisfies the conditions discussed below, the Division will consider the proposal. Indeed, in certain circumstances, a fix-it-first remedy may restore competition to the market more quickly and effectively than would a decree. This would be particularly important, for example, where a rapid divestiture would prevent asset dissipation or ensure the resolution of competitive concerns before an upcoming bid.
If an acceptable fix-it-first remedy can be implemented, the Division will exercise its Executive Branch prerogative to forego filing a case and conclude its investigation without imposing additional obligations on the parties.
A fix-it-first remedy restores premerger competition, removes the need for litigation, allows the Division to use its resources more efficiently, and saves society from incurring real costs. Moreover, a fix-it-first remedy may provide more flexibility in fashioning the appropriate divestiture.
Because different purchasers may require different sets of assets to be competitive, a fix-it-first remedy allows the assets to be tailored to a specific proposed purchaser. A consent decree, in contrast, must identify all of the assets necessary for effective competition by any potentially acceptable purchaser.
The Division will accept a fix-it-first remedy when it eliminates the competitive harm otherwise arising from the proposed merger. The same internal review is given to fix-it-first remedies as is given to consent decrees. Before exercising its prerogative not to file a case, the Division must be satisfied that the fix-it-first remedy will protect the market from any adverse competitive effects attributable to the proposed transaction.
A fix-it-first remedy will not eliminate the Division’s concerns unless the Division is confident that the proposed fix will indeed preserve the premerger level of competition. In addition, Antitrust Division attorneys reviewing fix-it-first remedies should carefully screen the proposed divestiture for any relationships between the seller and the purchaser, since the parties have, in essence, self selected the purchaser.
An acceptable fix-it-first remedy should contain no less substantive relief than would be sought if a case were filed.38 The Division, therefore, needs to conduct an investigation sufficient to determine both the nature and extent of the likely competitive harm and whether the proposed fix-it-first remedy will resolve it.39
The ACLU on the FISA Court, circa 2013
[T]he record suggests that the government has felt free to make bolder, less-supportable arguments before the secret FISA Court than it’s willing to make before real courts that are open to the public.
It has often been pointed out that the FISA Court is not a normal court, a big reason being that all of its proceedings are ex parte (that is, there is no adversarial proceeding, the court only hears from one side) and that it operates within an ocean of secrecy and compartmentalization.
From: https://www.aclu.org/blog/national-security/privacy-and-surveillance/fisa-courts-problems-run-deep-and-more-tinkering
(November, 2013)
[T]he record suggests that the government has felt free to make bolder, less-supportable arguments before the secret FISA Court than it’s willing to make before real courts that are open to the public.
It has often been pointed out that the FISA Court is not a normal court, a big reason being that all of its proceedings are ex parte (that is, there is no adversarial proceeding, the court only hears from one side) and that it operates within an ocean of secrecy and compartmentalization.
From: https://www.aclu.org/blog/national-security/privacy-and-surveillance/fisa-courts-problems-run-deep-and-more-tinkering
(November, 2013)
Government tax policies that help small business? Two views:
US Senate Passes 1-Year Extension of Excise Tax Relief for craft brewers, Legislation Advances to President Trump
The U.S. Senate today passed a tax extender package that includes a one-year extension of the tax relief in the Craft Beverage Modernization and Tax Reform Act (CMBTRA) that was slated to expire at the end of 2019.
Passage through the Senate comes a couple of days after the tax package passed the House of Representatives and in the final hours of the legislative year. The legislation now awaits President Donald Trump to sign it into law.
“We are pleased Congress has come together to prevent a $130 million tax increase on our nation’s thriving beer industry, which supports more than 2.1 million good-paying jobs,” Jim McGreevy, president and CEO of the Beer Institute, wrote in an email to the trade group’s members. “As we enter 2020, we will continue fighting for excise tax relief permanency with the popular bipartisan, bicameral Craft Beverage Modernization and Tax Relief Act.”
The extension of CBMTRA — which was passed into law in 2017 as part of the Tax Cuts and Jobs Act but scheduled to sunset at the end of 2019 — had been a priority for alcohol industry trade groups such as the BI, Brewers Association (BA), Distilled Spirits Council of the United States (DISCUS), the American Craft Spirits Association, Wine America, the Wine Institute, and the U.S. Association of Cider Makers.
If signed by President Trump, the extender would keep in place through December 31, 2020, an excise tax rate of $3.50 per barrel (a reduction from $7 per barrel) on the first 60,000 barrels for domestic brewers producing fewer than 2 million barrels annually.
The legislation also sets the federal excise tax to $16 per barrel on the first 6 million barrels for all other brewers and beer importers, while maintaining the $18 per barrel excise tax for brewers producing more than 6 million barrels.
The savings can be significant, especially for companies who are struggling with slowing growth. For example, a beer company making 20,000 barrels annually, its federal excise tax bill would be cut in half from $140,000 to $70,000.
From: https://www.brewbound.com/news/us-senate-passes-1-year-extension-of-excise-tax-relief-legislation-advances-to-president-trump
US Senate Passes 1-Year Extension of Excise Tax Relief for craft brewers, Legislation Advances to President Trump
- Justin Kendall
- Dec. 19, 2019 at 3:04 PM
The U.S. Senate today passed a tax extender package that includes a one-year extension of the tax relief in the Craft Beverage Modernization and Tax Reform Act (CMBTRA) that was slated to expire at the end of 2019.
Passage through the Senate comes a couple of days after the tax package passed the House of Representatives and in the final hours of the legislative year. The legislation now awaits President Donald Trump to sign it into law.
“We are pleased Congress has come together to prevent a $130 million tax increase on our nation’s thriving beer industry, which supports more than 2.1 million good-paying jobs,” Jim McGreevy, president and CEO of the Beer Institute, wrote in an email to the trade group’s members. “As we enter 2020, we will continue fighting for excise tax relief permanency with the popular bipartisan, bicameral Craft Beverage Modernization and Tax Relief Act.”
The extension of CBMTRA — which was passed into law in 2017 as part of the Tax Cuts and Jobs Act but scheduled to sunset at the end of 2019 — had been a priority for alcohol industry trade groups such as the BI, Brewers Association (BA), Distilled Spirits Council of the United States (DISCUS), the American Craft Spirits Association, Wine America, the Wine Institute, and the U.S. Association of Cider Makers.
If signed by President Trump, the extender would keep in place through December 31, 2020, an excise tax rate of $3.50 per barrel (a reduction from $7 per barrel) on the first 60,000 barrels for domestic brewers producing fewer than 2 million barrels annually.
The legislation also sets the federal excise tax to $16 per barrel on the first 6 million barrels for all other brewers and beer importers, while maintaining the $18 per barrel excise tax for brewers producing more than 6 million barrels.
The savings can be significant, especially for companies who are struggling with slowing growth. For example, a beer company making 20,000 barrels annually, its federal excise tax bill would be cut in half from $140,000 to $70,000.
From: https://www.brewbound.com/news/us-senate-passes-1-year-extension-of-excise-tax-relief-legislation-advances-to-president-trump
Brookings opinion: Who benefits from the “craft beverage” tax cuts? Mostly foreign and industrial producers.Adam LooneyWednesday, January 3, 2018
Adam LooneyJoseph A. Pechman Senior Fellow - Economic Studies, Urban-Brookings Tax Policy Center
The Republican tax bill includes deep cuts to alcohol excise taxes that are widely described as benefiting small “craft” brewers and distillers. In fact, most of the tax cuts go not to the little guys, but to big producers.
According to the Joint Committee on Taxation, these tax cuts, which are rolled up in a part of the bill called the “Craft Beverage Modernization and Tax Reform Act,” reduce total alcohol revenues by $4.2 billion over the two years they are in effect, a cut equal to about 20 percent of total alcohol excise tax revenues in those years.
The frequent assertion that the tax cut is for craft brewers and distillers is misleading.
The new law reduces the excise tax rate on the first 60,000 barrels of beer by 50 percent (from $7 to $3.50) no matter how small or large the brewer. It cuts the tax on the first 100,000 proof gallons of distilled spirits by 80 percent (from $13.50 to $2.70), and by 40 percent on the first 30,000 gallons of most wine (from $0.17 to $0.07 after the increased wine credit). Because these small producers are targeted with the biggest cuts, they must represent most of the revenue, right? Not true.
Small brewers (those producing less than 60,000 barrels) only produced 4.6 percent of all U.S.-made beer in 2016 (about 8 million barrels). And because they already benefited from a lower $7 per barrel tax, while most beer was taxed at $18/barrel, they accounted for only about $56 million in taxes or 1.5 percent of total beer tax revenues (including imports).[1] Cutting their taxes in half should only cost about $28 million.
The story is similar for distilled spirits. Small producers that make less than 100,000 proof gallons per year represent only 1.5 percent of all domestic taxable distilled spirits production. Collectively, they paid about 1 percent of all taxes on distilled spirits in 2016—or about $61 million in excise taxes.[2] Even with an 80 percent tax cut, that’s only $49 million.
https://www.brookings.edu/research/who-benefits-from-the-craft-beverage-tax-cuts-mostly-foreign-and-industrial-producers/
Adam LooneyJoseph A. Pechman Senior Fellow - Economic Studies, Urban-Brookings Tax Policy Center
The Republican tax bill includes deep cuts to alcohol excise taxes that are widely described as benefiting small “craft” brewers and distillers. In fact, most of the tax cuts go not to the little guys, but to big producers.
According to the Joint Committee on Taxation, these tax cuts, which are rolled up in a part of the bill called the “Craft Beverage Modernization and Tax Reform Act,” reduce total alcohol revenues by $4.2 billion over the two years they are in effect, a cut equal to about 20 percent of total alcohol excise tax revenues in those years.
The frequent assertion that the tax cut is for craft brewers and distillers is misleading.
- For every $20 of alcohol tax cuts in the legislation, only about $1 actually goes to the true craft brewers or small distillers.
- Most of the revenue—the other $19—goes to larger producers and to importers. This is largely because of new or expanded opportunities to evade or avoid the limits on what qualifies for the lowest tax rates. For instance, it’s plausible that a third to one half of all distilled spirits sold in the U.S. will qualify for the reduced rate.
- By allowing alcohol from foreign and large domestic producers to be passed off as “craft,” certain parts of the legislation may put America’s real small brewers and distillers at a competitive disadvantage.
The new law reduces the excise tax rate on the first 60,000 barrels of beer by 50 percent (from $7 to $3.50) no matter how small or large the brewer. It cuts the tax on the first 100,000 proof gallons of distilled spirits by 80 percent (from $13.50 to $2.70), and by 40 percent on the first 30,000 gallons of most wine (from $0.17 to $0.07 after the increased wine credit). Because these small producers are targeted with the biggest cuts, they must represent most of the revenue, right? Not true.
Small brewers (those producing less than 60,000 barrels) only produced 4.6 percent of all U.S.-made beer in 2016 (about 8 million barrels). And because they already benefited from a lower $7 per barrel tax, while most beer was taxed at $18/barrel, they accounted for only about $56 million in taxes or 1.5 percent of total beer tax revenues (including imports).[1] Cutting their taxes in half should only cost about $28 million.
The story is similar for distilled spirits. Small producers that make less than 100,000 proof gallons per year represent only 1.5 percent of all domestic taxable distilled spirits production. Collectively, they paid about 1 percent of all taxes on distilled spirits in 2016—or about $61 million in excise taxes.[2] Even with an 80 percent tax cut, that’s only $49 million.
https://www.brookings.edu/research/who-benefits-from-the-craft-beverage-tax-cuts-mostly-foreign-and-industrial-producers/
FOR IMMEDIATE RELEASE
Thursday, December 19, 2019
Justice Department Will Move to Significantly Modify and Extend Consent Decree with Live Nation/Ticketmaster
Justice Department and Live Nation Agree to a Number of Significant Changes, To Extend by Five and Half Years the 2010 Live Nation/Ticketmaster Final Judgment; Live Nation to Pay Costs and Fees to Taxpayers for EnforcementThe Department of Justice’s Antitrust Division will file a petition asking the court to clarify and extend by five and a half years the Final Judgment entered by the Court in United States v. Ticketmaster Entertainment, Inc., et al., Case No. 1:10-cv-00139-RMC (July 30, 2010). This is the most significant enforcement action of an existing antitrust decree by the Department in 20 years.
The 2010 Final Judgment permitted Live Nation to merge with Ticketmaster but prohibited the company from retaliating against concert venues for using another ticketing company, threatening concert venues, or undertaking other specified actions against concert venues for ten years.
Despite the prohibitions in the Final Judgment, Live Nation repeatedly and over the course of several years engaged in conduct that, in the Department’s view, violated the Final Judgment. To put a stop to this conduct and to remove any doubt about defendants’ obligations under the Final Judgment going forward, the Department and Live Nation have agreed to modify the Final Judgment to make clear that such conduct is prohibited. In addition, Live Nation has agreed to extend the term of the Final Judgment by five and a half years, which will allow concert venues and American consumers to get the benefit of the relief the Department bargained for in the original settlement. The proposed modifications to the Final Judgment will also help deter additional violations and allow for easier detection and enforcement if future violations occur.
“When Live Nation and Ticketmaster merged in 2010, the Department of Justice and the federal court imposed conditions on the company in order to preserve and promote ticketing competition.” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “Today’s enforcement action including the addition of language on retaliation and conditioning will ensure that American consumers get the benefit of the bargain that the United States and Live Nation agreed to in 2010. Merging parties will be held to their promises and the Department will not tolerate transgressions that hurt the American consumer.”
The Department today filed a motion in the U..S. District Court for the District of Columbia to reopen the docket in the underlying action, a necessary step towards filing the petition to clarify and extend the Final Judgment. The Department will file that petition once leave is granted by the court.
The clarifications to the Final Judgment the parties will seek include provisions that:
- Live Nation may not threaten to withhold concerts from a venue if the venue chooses a ticketer other than Ticketmaster;
- A threat by Live Nation to withhold any concerts because a venue chooses another ticketer is a violation of the Final Judgment;
- Withholding any concerts in response to a venue choosing a ticketer other than Ticketmaster is a violation by Live Nation of the Final Judgment;
- The Antitrust Division will appoint an independent monitor to investigate and report on Live Nation’s compliance with the Final Judgment;
- Live Nation will appoint an internal antitrust compliance officer and conduct regular internal training to ensure its employees fully comply with the Final Judgment;
- Live Nation will provide notice to current or potential venue customers of its ticketing services of the clarified and extended Final Judgment; and
- Live Nation is subject to an automatic penalty of $1,000,000 for each violation of the Final Judgment.
- Live Nation will pay costs and fees for the Department’s investigation and enforcement.
Along with the provisions described above, the proposed modifications to the Final Judgment, if approved by the court, include additional safeguards to ensure Live Nation does not punish venues that want to work with competing ticketers, and importantly, extends the term of the Final Judgment for five and half years.
Live Nation Entertainment Inc. is a Delaware corporation headquartered in Beverly Hills, California. It claims to be the largest live entertainment company in the world, active in three principal segments: concert promotion, ticketing services, and sponsorship & advertising. In 2018, Live Nation’s revenues were approximately $10..8 billion.
DAR comment: There has been a lot of expert comment criticizing the USDOJ actions as insufficient.
Feel free to use gaslight or incandescent bulbs:
From the NYT:
The Trump administration announced that it would block a rule designed to phase out older incandescent bulbs and require Americans to use energy-efficient light bulbs.
In announcing the move, the secretary of energy, Dan Brouillette, who is a former auto lobbyist, said the administration had chosen “to protect consumer choice by ensuring that the American people do not pay the price for unnecessary overregulation from the federal government.” The new rule was unnecessary, he said, because innovation and technology are already “increasing the efficiency and affordability of light bulbs without federal government intervention.”
The rule, which would have gone into effect on Jan. 1, was required under a law passed in 2007 during the administration of President George W. Bush.
https://www.nytimes.com/2019/12/20/climate/trump-light-bulb-rollback.html?action=click&module=Latest&pgtype=Homepage
From the NYT:
The Trump administration announced that it would block a rule designed to phase out older incandescent bulbs and require Americans to use energy-efficient light bulbs.
In announcing the move, the secretary of energy, Dan Brouillette, who is a former auto lobbyist, said the administration had chosen “to protect consumer choice by ensuring that the American people do not pay the price for unnecessary overregulation from the federal government.” The new rule was unnecessary, he said, because innovation and technology are already “increasing the efficiency and affordability of light bulbs without federal government intervention.”
The rule, which would have gone into effect on Jan. 1, was required under a law passed in 2007 during the administration of President George W. Bush.
https://www.nytimes.com/2019/12/20/climate/trump-light-bulb-rollback.html?action=click&module=Latest&pgtype=Homepage
Modern Healthcase opinion:
December 19, 2019 05:06 PM UPDATED 15 HOURS AGO
ACA's continued uncertain fate seen as a Republican win
opinion by SHELBY LIVINGSTON
The 5th Circuit Court of Appeals' reluctance to decide the fate of the Affordable Care Act cuts a break for the Republican lawmakers who sought to topple it while sowing uncertainty into healthcare markets that only recently found their footing.
The 5th Circuit ruled 2-1 on Wednesday that the already toothless individual mandate is unconstitutional but remanded the case back to a federal judge in Texas to determine how much of the landmark healthcare law must fall along with it. U.S. District Judge Reed O'Connor previously struck down the ACA in entirety.
What some observers saw as the appellate court's unwillingness to get its hands dirty ensures that the lawsuit, known as Texas v. U.S., will drag on beyond the 2020 presidential election. While the ACA remains the law of the land, the uncertainty around its future could once again wreak havoc on the individual health insurance exchanges.
"That means more uncertainty in the healthcare markets about the ACA's future, and it also means that it will be less evident to the voters what's going on, which will make the voters less able to hold the administration accountable at the polls for its efforts to undermine the law," said Abbe Gluck, a Yale University law professor.
What happens next is up in the air. California Attorney General Xavier Becerra said Wednesday that his state is prepared to appeal to the Supreme Court, but Thursday suggested the coalition of 20 Democratic states that defended the ACA in the face of the Republican state challenge would decide next steps as a team.
Some legal experts doubt that the high court would take the case right away. If the Supreme Court decided to hear the case before Judge O'Connor gets another swing at it, it's unlikely the justices would hold arguments before October. A decision would come down in 2021 in that situation, multiple experts said.
David Coale, a Texas-based appellate attorney at law firm Lynn Pinker Cox & Hurst, said it's more likely that the Supreme Court would want the
5th Circuit to first hear the case en banc. The Republicans, Democrats or individual plaintiffs in the lawsuit could ask for a hearing before all of the 5th Circuit judges, or one of the appellate judges themselves could move for one, he said.
If the case instead returns to the district court in Texas, it could be another year before Judge O'Connor issues a second decision. The 5th Circuit tasked him to "to employ a finer-toothed comb on remand" as he analyzes what ACA provisions could be severed from the individual mandate. Once he decides, the case would be appealed to the 5th Circuit again.
In the meantime, health insurers, hospitals and patients are stuck in limbo. Risk-averse health insurers could hike premiums or leave the individual market, as they did previously when the ACA's status was uncertain.
"When (insurers) get nervous they want to charge more because of the uncertainty and the risk they perceive of being in the market," Washington Insurance Commissioner Mike Kreidler said during a press conference on Thursday. "We have a competitive market, but at the same time they are not going to throw good money after bad if they think the risk has increased or is getting worse. That's what this court decision has done. It has raised the temperature right now."
Average ACA exchange premiums decreased for the first time in 2019, as insurers who left the market came crawling back.
Even though the 5th Circuit left the bulk of the healthcare law standing for now, most ACA supporters viewed the decision as a loss by sending the case back to a judge who already moved once to axe the law.
"The court sent the case to an extreme right-wing judge who has already made his intentions clear: to strike down as much of the ACA as possible," said Topher Spiro, vice president of health policy at the liberal Center for American Progress.
But there are bright spots for ACA supporters in the 5th Circuit's decision. Conservative and left-leaning legal experts alike had complained that Judge O'Connor did not apply a settled legal doctrine called "severability" correctly when he ruled the ACA invalid in December 2018. That doctrine holds the decision to scrap a piece of a law or destroy the whole thing rests on what Congress would have wanted.
U.S Circuit Judge Jennifer Elrod, a Republican appointee who wrote the majority opinion, noted that the lower court paid too much attention to the 2010 Congress's description of the mandate as "essential" and not enough to the 2017 Congress' intent when it got rid of the mandate but left the rest of the law on the books.
"It effectively told the district court: the test here is what the 2017 Congress wanted to do," Gluck said.
Many legal experts, including Gluck, have argued there's no question of what the 2017 Congress would have wanted because it's clear what it did: it zeroed out the individual mandate and chose to keep the rest of the ACA. Whether the lower court changes its mind based on that legal test is unclear. "I'm not optimistic," she said.
The 5th Circuit's decision to remand to the lower court also suggests that it doesn't believe the entire ACA must fall. While the court wrote that Judge O'Connor "cogently explains" why some major provisions, such as the protections for patients with pre-existing conditions, are linked to the individual mandate, he didn't explain how other provisions concerning restaurant menu guidelines and healthcare fraud were intended to work with the individual mandate.
"The basis of the decision suggests that, yes, they think some things are inseverable," said Katie Keith, a Georgetown University law professor. "But clearly they are open to some things being severed alongside the ACA. It's not entirely clear what, but they give us a couple of hints."
https://www.modernhealthcare.com/legal/acas-continued-uncertain-fate-seen-republican-win?_ptid=%7Bjcx%7DH4sIAAAAAAAAAI2QW2-CQBCF_8s-u2YvXHZ9s4ZaUwnFGquPy7LAGgRkQa1N_3uB1DYmfei8zXznTGbOBxA6BhPQLLUx4fG4isEIVCJVG63Oi54QhDnEBBIEEYM2gYhARhzoWcF1S1kSui7ZlaEPBbcj4mJO7RjbHNkqoVxZDpJcJIkro26xulSq1qqQaljtbS0WPPPF-pXv7qh3UbJtdFkMMhxZqD4wJBhEXZG6ojqLZE5jvmfSZLQoE3Pnn8ofs8nK81odqlw0auaHvodesb1CK8w6RybMjYFJU7dqBJrvfjAH68cXlz75wWxOwS_biFqLouklRZvnIyDFoRI6LcxtcNJGDxyc4J8BUgQduazf52nFr2_bh2B__E-AuurzQGxM8ZjYaEyGN1qj6mmqiqaD8Vn2lzY5mGDbdTh1KMGfXyWrCzLnAQAA&CSAuthResp=1%3A%3A303359%3A0%3A24%3Asuccess%3A8C031B8D453364BB9FE68E7A071730EB
December 19, 2019 05:06 PM UPDATED 15 HOURS AGO
ACA's continued uncertain fate seen as a Republican win
opinion by SHELBY LIVINGSTON
The 5th Circuit Court of Appeals' reluctance to decide the fate of the Affordable Care Act cuts a break for the Republican lawmakers who sought to topple it while sowing uncertainty into healthcare markets that only recently found their footing.
The 5th Circuit ruled 2-1 on Wednesday that the already toothless individual mandate is unconstitutional but remanded the case back to a federal judge in Texas to determine how much of the landmark healthcare law must fall along with it. U.S. District Judge Reed O'Connor previously struck down the ACA in entirety.
What some observers saw as the appellate court's unwillingness to get its hands dirty ensures that the lawsuit, known as Texas v. U.S., will drag on beyond the 2020 presidential election. While the ACA remains the law of the land, the uncertainty around its future could once again wreak havoc on the individual health insurance exchanges.
"That means more uncertainty in the healthcare markets about the ACA's future, and it also means that it will be less evident to the voters what's going on, which will make the voters less able to hold the administration accountable at the polls for its efforts to undermine the law," said Abbe Gluck, a Yale University law professor.
What happens next is up in the air. California Attorney General Xavier Becerra said Wednesday that his state is prepared to appeal to the Supreme Court, but Thursday suggested the coalition of 20 Democratic states that defended the ACA in the face of the Republican state challenge would decide next steps as a team.
Some legal experts doubt that the high court would take the case right away. If the Supreme Court decided to hear the case before Judge O'Connor gets another swing at it, it's unlikely the justices would hold arguments before October. A decision would come down in 2021 in that situation, multiple experts said.
David Coale, a Texas-based appellate attorney at law firm Lynn Pinker Cox & Hurst, said it's more likely that the Supreme Court would want the
5th Circuit to first hear the case en banc. The Republicans, Democrats or individual plaintiffs in the lawsuit could ask for a hearing before all of the 5th Circuit judges, or one of the appellate judges themselves could move for one, he said.
If the case instead returns to the district court in Texas, it could be another year before Judge O'Connor issues a second decision. The 5th Circuit tasked him to "to employ a finer-toothed comb on remand" as he analyzes what ACA provisions could be severed from the individual mandate. Once he decides, the case would be appealed to the 5th Circuit again.
In the meantime, health insurers, hospitals and patients are stuck in limbo. Risk-averse health insurers could hike premiums or leave the individual market, as they did previously when the ACA's status was uncertain.
"When (insurers) get nervous they want to charge more because of the uncertainty and the risk they perceive of being in the market," Washington Insurance Commissioner Mike Kreidler said during a press conference on Thursday. "We have a competitive market, but at the same time they are not going to throw good money after bad if they think the risk has increased or is getting worse. That's what this court decision has done. It has raised the temperature right now."
Average ACA exchange premiums decreased for the first time in 2019, as insurers who left the market came crawling back.
Even though the 5th Circuit left the bulk of the healthcare law standing for now, most ACA supporters viewed the decision as a loss by sending the case back to a judge who already moved once to axe the law.
"The court sent the case to an extreme right-wing judge who has already made his intentions clear: to strike down as much of the ACA as possible," said Topher Spiro, vice president of health policy at the liberal Center for American Progress.
But there are bright spots for ACA supporters in the 5th Circuit's decision. Conservative and left-leaning legal experts alike had complained that Judge O'Connor did not apply a settled legal doctrine called "severability" correctly when he ruled the ACA invalid in December 2018. That doctrine holds the decision to scrap a piece of a law or destroy the whole thing rests on what Congress would have wanted.
U.S Circuit Judge Jennifer Elrod, a Republican appointee who wrote the majority opinion, noted that the lower court paid too much attention to the 2010 Congress's description of the mandate as "essential" and not enough to the 2017 Congress' intent when it got rid of the mandate but left the rest of the law on the books.
"It effectively told the district court: the test here is what the 2017 Congress wanted to do," Gluck said.
Many legal experts, including Gluck, have argued there's no question of what the 2017 Congress would have wanted because it's clear what it did: it zeroed out the individual mandate and chose to keep the rest of the ACA. Whether the lower court changes its mind based on that legal test is unclear. "I'm not optimistic," she said.
The 5th Circuit's decision to remand to the lower court also suggests that it doesn't believe the entire ACA must fall. While the court wrote that Judge O'Connor "cogently explains" why some major provisions, such as the protections for patients with pre-existing conditions, are linked to the individual mandate, he didn't explain how other provisions concerning restaurant menu guidelines and healthcare fraud were intended to work with the individual mandate.
"The basis of the decision suggests that, yes, they think some things are inseverable," said Katie Keith, a Georgetown University law professor. "But clearly they are open to some things being severed alongside the ACA. It's not entirely clear what, but they give us a couple of hints."
https://www.modernhealthcare.com/legal/acas-continued-uncertain-fate-seen-republican-win?_ptid=%7Bjcx%7DH4sIAAAAAAAAAI2QW2-CQBCF_8s-u2YvXHZ9s4ZaUwnFGquPy7LAGgRkQa1N_3uB1DYmfei8zXznTGbOBxA6BhPQLLUx4fG4isEIVCJVG63Oi54QhDnEBBIEEYM2gYhARhzoWcF1S1kSui7ZlaEPBbcj4mJO7RjbHNkqoVxZDpJcJIkro26xulSq1qqQaljtbS0WPPPF-pXv7qh3UbJtdFkMMhxZqD4wJBhEXZG6ojqLZE5jvmfSZLQoE3Pnn8ofs8nK81odqlw0auaHvodesb1CK8w6RybMjYFJU7dqBJrvfjAH68cXlz75wWxOwS_biFqLouklRZvnIyDFoRI6LcxtcNJGDxyc4J8BUgQduazf52nFr2_bh2B__E-AuurzQGxM8ZjYaEyGN1qj6mmqiqaD8Vn2lzY5mGDbdTh1KMGfXyWrCzLnAQAA&CSAuthResp=1%3A%3A303359%3A0%3A24%3Asuccess%3A8C031B8D453364BB9FE68E7A071730EB
From the Obamacare 5th Circuit appellate ruling striking down mandate provisions; URL for the decision
[T]he individual mandate injures both the individual plaintiffs, by requiring them to buy insurance that they do not want, and the state plaintiffs,by increasing their costs of complying with the reporting requirements that accompany the individual mandate. . . . .[T]he individual mandate is unconstitutional because it can no longer be read as a tax, and there is no other constitutional provision that justifies this exercise of congressional power. . . . [O]n the severability question, we remand to the district court to provide additional analysis of the provisions of the ACA as they currently exist.
Excerpt from https://int.nyt.com/data/documenthelper/6610-obamacare-ruling/a6560c9831a0af845a00/optimized/full.pdf#page=1
[T]he individual mandate injures both the individual plaintiffs, by requiring them to buy insurance that they do not want, and the state plaintiffs,by increasing their costs of complying with the reporting requirements that accompany the individual mandate. . . . .[T]he individual mandate is unconstitutional because it can no longer be read as a tax, and there is no other constitutional provision that justifies this exercise of congressional power. . . . [O]n the severability question, we remand to the district court to provide additional analysis of the provisions of the ACA as they currently exist.
Excerpt from https://int.nyt.com/data/documenthelper/6610-obamacare-ruling/a6560c9831a0af845a00/optimized/full.pdf#page=1
From the Food and Power advocacy group:
Booker Bill Would Phase Out Factory Farms and Revive the Packers and Stockyards Act
Presidential candidate Sen. Cory Booker introduced a bill on Monday to radically reform an animal agriculture system that currently puts independent producers, rural communities, and consumers at risk.
The Farm System Reform Act would halt construction of new concentrated animal feeding operations (CAFOs) and phase out all large CAFOs by 2040, while also holding corporate meatpackers more accountable for environmental degradation and farmer exploitation.
“Our independent family farmers and ranchers are continuing to be squeezed by large, multinational corporations that, because of their buying power and size, run roughshod over the marketplace,” said Booker in a press release. “We need to fix the broken system – that means protecting family farmers and ranchers and holding corporate integrators responsible for the harm they are causing.”
While the vast majority of meat in the U.S. today comes from large-scale animal farms, this wasn’t always the case. Antitrust enforcement during the past four decades enabled meatpackers to corner livestock markets, while broader agricultural policies both directly and indirectly subsidized critical operation costs for industrial livestock operations, namely feed and manure management. Shifts to highly consolidated and contract agriculture drove 70 percent of hog farms out of business between 1992 and 2007 and doubled the number of dairy cows on factory farms between 1997 and 2012, among other changes.
These large farms introduce high concentrations of manure that pollute ground and surface water, diminish air quality, and release greenhouse gases. Many rural communities have organized to oppose new CAFO construction, and nearly two-thirds of Iowa voters support greater oversight of industrial animal agriculture, according to a new national poll by the Johns Hopkins Center for a Livable Future. About 43 percent of respondents support a ban on new CAFOs.
Booker Bill Would Phase Out Factory Farms and Revive the Packers and Stockyards Act
Presidential candidate Sen. Cory Booker introduced a bill on Monday to radically reform an animal agriculture system that currently puts independent producers, rural communities, and consumers at risk.
The Farm System Reform Act would halt construction of new concentrated animal feeding operations (CAFOs) and phase out all large CAFOs by 2040, while also holding corporate meatpackers more accountable for environmental degradation and farmer exploitation.
“Our independent family farmers and ranchers are continuing to be squeezed by large, multinational corporations that, because of their buying power and size, run roughshod over the marketplace,” said Booker in a press release. “We need to fix the broken system – that means protecting family farmers and ranchers and holding corporate integrators responsible for the harm they are causing.”
While the vast majority of meat in the U.S. today comes from large-scale animal farms, this wasn’t always the case. Antitrust enforcement during the past four decades enabled meatpackers to corner livestock markets, while broader agricultural policies both directly and indirectly subsidized critical operation costs for industrial livestock operations, namely feed and manure management. Shifts to highly consolidated and contract agriculture drove 70 percent of hog farms out of business between 1992 and 2007 and doubled the number of dairy cows on factory farms between 1997 and 2012, among other changes.
These large farms introduce high concentrations of manure that pollute ground and surface water, diminish air quality, and release greenhouse gases. Many rural communities have organized to oppose new CAFO construction, and nearly two-thirds of Iowa voters support greater oversight of industrial animal agriculture, according to a new national poll by the Johns Hopkins Center for a Livable Future. About 43 percent of respondents support a ban on new CAFOs.
The Food and Drug Administration issued a proposed rule that would allow states to pursue pilot programs to import drugs from Canada and a draft guidance that would allow drugmakers to import their own products and sell them under different drug codes.
Several states are already preparing importation program applications, and Florida and Vermont have already submitted concept papers to HHS. Florida's Republican Gov. Ron DeSantis has been a key figure in pushing President Donald Trump to allow drug importation, and he signed a state law creating an importation program in June.
Vermont, Colorado and Maine have also passed drug importation laws, and HHS officials said they worked with New Hampshire's governor on the regulatory action.
It could be years before patients would actually see imported drugs even if all steps of the plan proceed, but HHS Secretary Alex Azar said the administration is moving as quickly as possible to finalize the regulatory actions.
States wouldn't be allowed to import biologics including insulin.
From: https://www.modernhealthcare.com/law-regulation/hhs-moves-forward-prescription-drug-import-plan?utm_source=modern-healthcare-alert&utm_medium=email&utm_campaign=20191218&utm_content=hero-readmore
Several states are already preparing importation program applications, and Florida and Vermont have already submitted concept papers to HHS. Florida's Republican Gov. Ron DeSantis has been a key figure in pushing President Donald Trump to allow drug importation, and he signed a state law creating an importation program in June.
Vermont, Colorado and Maine have also passed drug importation laws, and HHS officials said they worked with New Hampshire's governor on the regulatory action.
It could be years before patients would actually see imported drugs even if all steps of the plan proceed, but HHS Secretary Alex Azar said the administration is moving as quickly as possible to finalize the regulatory actions.
States wouldn't be allowed to import biologics including insulin.
From: https://www.modernhealthcare.com/law-regulation/hhs-moves-forward-prescription-drug-import-plan?utm_source=modern-healthcare-alert&utm_medium=email&utm_campaign=20191218&utm_content=hero-readmore
Small Business and the Fight for $15: A new study shows how a rising minimum wage hurts little companies.
Wall Street Journal ^ | December 15, 2019
Here’s another volley in the debate over the “Fight for $15”: As the federal minimum wage rose from 1989-2013, small businesses in affected states suffered “lower bank credit, higher loan defaults, lower employment, a lower entry and a higher exit rate.”
That’s according to a study last week from the National Bureau of Economic Research. The analysis by three professors at the Georgia Institute of Technology exploits the fact that many states—now more than half—set their own minimum wages higher than the federal standard. This provides a natural control group. When the nationwide minimum goes up, how do the states where it applies fare in comparison?
Start with data on one million loans, averaging around $100,000, made through the Small Business Administration. For each $1 increase in the minimum wage, the authors estimate that loan amounts dropped 9% more in the affected states. The risk of default was 12% higher. The average credit score for small companies in those states showed “a sharp decline.” Business entries fell 4% in the year the minimum wage went up. A year later, business exits rose 5%.
These results, the authors say, hold throughout various statistical analyses, such as while controlling for local economic conditions. The effects are stronger in businesses like restaurants and retail, which rely on low-skilled labor. Smaller and younger companies are more severely affected as well. In short, the authors conclude: “We find that increases in the federal minimum wage worsen the financial health of small businesses in the affected states.”
By now some readers are probably thinking: Well, duh. It does not take a University of Chicago Ph.D. to suspect that raising the price of labor will make it harder to sustain a small, labor-intensive business. Don’t forget that there’s no cost-of-living adjustment
(Excerpt) Read more at wsj.com ...
Editor note: This article is included because it is interesting, not because it reflects an editorial judgment favoring a low minimum wage. DAR
Wall Street Journal ^ | December 15, 2019
Here’s another volley in the debate over the “Fight for $15”: As the federal minimum wage rose from 1989-2013, small businesses in affected states suffered “lower bank credit, higher loan defaults, lower employment, a lower entry and a higher exit rate.”
That’s according to a study last week from the National Bureau of Economic Research. The analysis by three professors at the Georgia Institute of Technology exploits the fact that many states—now more than half—set their own minimum wages higher than the federal standard. This provides a natural control group. When the nationwide minimum goes up, how do the states where it applies fare in comparison?
Start with data on one million loans, averaging around $100,000, made through the Small Business Administration. For each $1 increase in the minimum wage, the authors estimate that loan amounts dropped 9% more in the affected states. The risk of default was 12% higher. The average credit score for small companies in those states showed “a sharp decline.” Business entries fell 4% in the year the minimum wage went up. A year later, business exits rose 5%.
These results, the authors say, hold throughout various statistical analyses, such as while controlling for local economic conditions. The effects are stronger in businesses like restaurants and retail, which rely on low-skilled labor. Smaller and younger companies are more severely affected as well. In short, the authors conclude: “We find that increases in the federal minimum wage worsen the financial health of small businesses in the affected states.”
By now some readers are probably thinking: Well, duh. It does not take a University of Chicago Ph.D. to suspect that raising the price of labor will make it harder to sustain a small, labor-intensive business. Don’t forget that there’s no cost-of-living adjustment
(Excerpt) Read more at wsj.com ...
Editor note: This article is included because it is interesting, not because it reflects an editorial judgment favoring a low minimum wage. DAR
JUSTICE NEWS Department of Justice
Office of Public Affairs
FOR IMMEDIATE RELEASE
Wednesday, November 20, 2019
Former Trader for Major Multinational Bank Convicted for Price Fixing and Bid Rigging in FX Market
A former currency trader was convicted today in New York for his participation in an antitrust conspiracy to manipulate prices for emerging market currencies in the global foreign currency exchange (FX) market, the Justice Department announced today.
Following a three-week trial in the U.S. District Court for the Southern District of New York, a jury convicted Akshay Aiyer (former Executive Director at a major multinational bank) of conspiring to fix prices and rig bids in Central and Eastern European, Middle Eastern and African (CEEMEA) currencies, which were generally traded against the U.S. dollar and the euro, from at least October 2010 through at least January 2013.
Full release: https://www.justice.gov/opa/pr/former-trader-major-multinational-bank-convicted-price-fixing-and-bid-rigging-fx-market
Office of Public Affairs
FOR IMMEDIATE RELEASE
Wednesday, November 20, 2019
Former Trader for Major Multinational Bank Convicted for Price Fixing and Bid Rigging in FX Market
A former currency trader was convicted today in New York for his participation in an antitrust conspiracy to manipulate prices for emerging market currencies in the global foreign currency exchange (FX) market, the Justice Department announced today.
Following a three-week trial in the U.S. District Court for the Southern District of New York, a jury convicted Akshay Aiyer (former Executive Director at a major multinational bank) of conspiring to fix prices and rig bids in Central and Eastern European, Middle Eastern and African (CEEMEA) currencies, which were generally traded against the U.S. dollar and the euro, from at least October 2010 through at least January 2013.
Full release: https://www.justice.gov/opa/pr/former-trader-major-multinational-bank-convicted-price-fixing-and-bid-rigging-fx-market
CVS subsidiary accused by USDOJ of fraudulent billing
The federal government has joined a lawsuit alleging that Omnicare, a subsidiary of CVS Health, fraudulently billed Medicare, TRICARE and Medicaid for thousands of drugs.
https://www.fiercehealthcare.com/payer/doj-accuses-cvs-subsidiary-omnicare-fraudulent-billing?mkt_tok=eyJpIjoiT0RabU1qRXpabUV5WWpBNCIsInQiOiJHa1wvSk93bkEzVkdIOVgyd1lOcHE1dDEyRUU3cFpwTVJrdjl4ekxNNWNwTTViU2F0Z2Q0XC9Bdzl1SUx3MnI1dXcySCtGc2tXZU1ZNmcwM0o2R1wvNWNEODZQbFUwcytYQ2M5SFlNYnF0aG54anduVElQZ2ZaMHY1K1M4MGFEVEhYZyJ9&mrkid=730008
The federal government has joined a lawsuit alleging that Omnicare, a subsidiary of CVS Health, fraudulently billed Medicare, TRICARE and Medicaid for thousands of drugs.
https://www.fiercehealthcare.com/payer/doj-accuses-cvs-subsidiary-omnicare-fraudulent-billing?mkt_tok=eyJpIjoiT0RabU1qRXpabUV5WWpBNCIsInQiOiJHa1wvSk93bkEzVkdIOVgyd1lOcHE1dDEyRUU3cFpwTVJrdjl4ekxNNWNwTTViU2F0Z2Q0XC9Bdzl1SUx3MnI1dXcySCtGc2tXZU1ZNmcwM0o2R1wvNWNEODZQbFUwcytYQ2M5SFlNYnF0aG54anduVElQZ2ZaMHY1K1M4MGFEVEhYZyJ9&mrkid=730008
Tech companies file appeal over net neutrality ruling
Tech companies Etsy and Mozilla, along with 22 state governments and some other entities, are appealing a federal court decision upholding the Federal Communications Commission's repeal of the Obama-era open-internet rules. "[W]e look forward to continuing the fight to preserve net neutrality as a fundamental digital right," says Amy Keating, Mozilla's chief legal officer.
CNET (12/13), ZDNet (12/13)
Robin Hood companies use donations to buy up uncollected medical debt for pennies on the dollar, and then can tell the debtors they no longer have the debt
By Don Allen Resnikoff
PBS Newshour recently reported on an unusual company’s effort to relieve the burden of medical debt for those in need. See https://www.pbs.org/video/making-sense-rip-medical-debt-1576194798/
PBS focused on RIP Medical Debt, a group that functions as a Robin Hood debt buyer, negotiating cheap rates on large portfolios of anonymous consumer debt, and using donated money to pay the discounted price. Once they purchase the debt, they send letters to every account holder informing them that their debt has been wiped clean.
The Robin Hood idea works because most debt collectors are secondary debt-buying companies that have purchased the consumer's debt for pennies on the dollar. The largest debt-buying companies buy huge portfolios of such debt with millions of individual accounts. These same companies can turn around and collect the full amount from consumers, often through aggressive and even illegal tactics.
The Robin Hood companies buy accounts that the secondary debt-buying companies consider virtually worthless – like debts where a year of collection efforts have been unavailing. The Robin Hood companies can buy up such indebtedness for a penny or two on the dollar.
RIP Medical Debt was a struggling venture until it was the subject of a TV feature by John Oliver, who the PBS program describes as a “comedian advocate.” (It is meant as a compliment as applied to him.) Oliver popularized the Robin Hood debt collection idea when he televised his purchase of $15 million of medical debt owed by 9,000 Americans and forgave it on national television. Oliver and his "Last Week Tonight" producers paid less than $60,000 to buy a portfolio containing millions of dollars of consumer debt. You can see Oliver’s debt collection show at https://youtu.be/hxUAntt1z2c
But can the Robin Hood idea work for the individual consumer as it works for RIP Medical Debt? Not likely, according to an article at https://money.howstuffworks.com/can-you-buy-your-own-debt-pennies-the-dollar.htm Following is part of what the article says:
Unfortunately, individual consumers don't have the same access to deeply discounted debt as debt buyers purchasing thousands of accounts, explains April Kuehnhoff, staff attorney at the National Consumer Law Center. No one would sell just one uncollected debt to a person.
"Even if consumers could afford to purchase whole portfolios of debt, they wouldn't know which portfolios contain their individual account," says Kuehnhoff. "Consumer can certainly call up the original creditor or debt collector and try to negotiate a better rate or a payment plan. But they are unlikely to accept pennies on the dollar as payment for the debt."
Once debt has been resold to a debt buyer, it's almost impossible to track. Even debt-buying companies don't know the details of the accounts they're buying — names, individual debt amounts, types of debt — until they've bought them. And often the information associated with the accounts is outdated or incorrect.
Further, the type of very cheap debt that you hear about is generally old (no payment has been made on it for at least a year) and has been sold at least a couple of times. Credit.com points out that the benefits of buying your own debt (like not reporting yourself to a credit agency or adding interest to the amount owed) could also be had by trying to negotiate with your creditors at the earliest stages of debt collection.
By Don Allen Resnikoff
PBS Newshour recently reported on an unusual company’s effort to relieve the burden of medical debt for those in need. See https://www.pbs.org/video/making-sense-rip-medical-debt-1576194798/
PBS focused on RIP Medical Debt, a group that functions as a Robin Hood debt buyer, negotiating cheap rates on large portfolios of anonymous consumer debt, and using donated money to pay the discounted price. Once they purchase the debt, they send letters to every account holder informing them that their debt has been wiped clean.
The Robin Hood idea works because most debt collectors are secondary debt-buying companies that have purchased the consumer's debt for pennies on the dollar. The largest debt-buying companies buy huge portfolios of such debt with millions of individual accounts. These same companies can turn around and collect the full amount from consumers, often through aggressive and even illegal tactics.
The Robin Hood companies buy accounts that the secondary debt-buying companies consider virtually worthless – like debts where a year of collection efforts have been unavailing. The Robin Hood companies can buy up such indebtedness for a penny or two on the dollar.
RIP Medical Debt was a struggling venture until it was the subject of a TV feature by John Oliver, who the PBS program describes as a “comedian advocate.” (It is meant as a compliment as applied to him.) Oliver popularized the Robin Hood debt collection idea when he televised his purchase of $15 million of medical debt owed by 9,000 Americans and forgave it on national television. Oliver and his "Last Week Tonight" producers paid less than $60,000 to buy a portfolio containing millions of dollars of consumer debt. You can see Oliver’s debt collection show at https://youtu.be/hxUAntt1z2c
But can the Robin Hood idea work for the individual consumer as it works for RIP Medical Debt? Not likely, according to an article at https://money.howstuffworks.com/can-you-buy-your-own-debt-pennies-the-dollar.htm Following is part of what the article says:
Unfortunately, individual consumers don't have the same access to deeply discounted debt as debt buyers purchasing thousands of accounts, explains April Kuehnhoff, staff attorney at the National Consumer Law Center. No one would sell just one uncollected debt to a person.
"Even if consumers could afford to purchase whole portfolios of debt, they wouldn't know which portfolios contain their individual account," says Kuehnhoff. "Consumer can certainly call up the original creditor or debt collector and try to negotiate a better rate or a payment plan. But they are unlikely to accept pennies on the dollar as payment for the debt."
Once debt has been resold to a debt buyer, it's almost impossible to track. Even debt-buying companies don't know the details of the accounts they're buying — names, individual debt amounts, types of debt — until they've bought them. And often the information associated with the accounts is outdated or incorrect.
Further, the type of very cheap debt that you hear about is generally old (no payment has been made on it for at least a year) and has been sold at least a couple of times. Credit.com points out that the benefits of buying your own debt (like not reporting yourself to a credit agency or adding interest to the amount owed) could also be had by trying to negotiate with your creditors at the earliest stages of debt collection.
Gov. Gavin Newsom rejects PG&E Corp. plan to pay Northern California wildfire victims and exit bankruptcy.
In a letter to PG&E Chief Executive Bill Johnson, the governor declared that the company’s proposal doesn’t go far enough to make it “positioned to provide safe, reliable and affordable service.”
“The resolution of this bankruptcy must yield a radically restructured and transformed utility that is responsible and accountable,” he wrote. Among other things, he demanded an entirely new slate of directors who are subject to state approval, and a structure that would allow PG&E’s operating license to be transferred “to the state or a third-party when circumstances warrant.”
Just a week ago, PG&E announced what it believed was a breakthrough that would ease its way out of bankruptcy: a $13.5 billion settlement agreement with lawyers for more than 70,000 wildfire victims.
But the utility wasn’t home free after all. It still needed Newsom’s approval of its bankruptcy plan. Now it will have to overhaul the proposal, and quickly.
According to AB 1054, which creates a $21 billion insurance pool to help utilities pay for damages from future wildfires, PG&E needs to exit Chapter 11 by June 30 in order to participate in the fund..
AB 1054 says PG&E’s bankruptcy plan, besides compensating fire victims, must include a ramped-up program for preventing new fires, as well as other changes in how it does business. Newsom said PG&E’s proposals “do not comply with AB 1054.”
Responding to Newsom’s rejection, PG&E insisted its plan “is the best course forward for all stakeholders. We’ve welcomed feedback from all stakeholders ... and will continue to work diligently in the coming days to resolve any issues that may arise.”
Excerpt from https://www.sacbee.com/news/california/fires/article238350708.html
Some background to the California situation is in this excerpt from a PBS presentation on electricity company regulaton:
In 1992 Congress passed President Bush's Energy Policy Act (EPACT), which opened access to transmission networks to non-utility generators. EPACT further facilitated the development of a competitive market by creating another category of qualifying facilities known as exempt wholesale generators (EWGs), which were exempted from regulations faced by the traditional utilities. To assist in the implementation of PURPA and EPACT, FERC issued Order No. 888 and Order No. 889 in April 1996. The two orders provided guidelines on how to open electricity transmission networks on a nondiscriminatory basis in interstate commerce.
The passage of EPACT led states which had historically high electricity prices, such as California, to investigate whether competitive deregulated markets would benefit their consumers. In 1996, both California and Rhode Island passed deregulation legislation, giving the consumer the right to choose his electricity supplier. As of May 2001, 24 states and the District of Columbia either have passed legislation or issued a comprehensive order to restructure their electric power industry. Eighteen states currently are investigating deregulation. View the Department of Energy map depicting the status of state electricity industry restructuring activity.
As a result of the deregulation movement of the 1990s, the electric power industry is changing from a structure of regulated, local, vertically-integrated monopolies, to one in which competitive companies generate electricity, while the utilities maintain transmission and distribution networks. In the face of increased competition, investor-owned utilities (IOUs) have sought to make themselves more competitive through mergers, acquisitions and asset divestitures, leading to the industry becoming much more concentrated. By 1998, the ten largest IOUs owned almost 40% of IOU-held electricity generation-capacity.[6] Increased competition has also led to the rise of two new participants in the electric power marketplace, who buy and sell electricity without owning or operating transmission or distribution operations: power marketers, which are considered to be utilities and therefore regulated by FERC, and power brokers, which are unregulated.
From https://www.pbs.org/wgbh/pages/frontline/shows/blackout/regulation/timeline.html
In a letter to PG&E Chief Executive Bill Johnson, the governor declared that the company’s proposal doesn’t go far enough to make it “positioned to provide safe, reliable and affordable service.”
“The resolution of this bankruptcy must yield a radically restructured and transformed utility that is responsible and accountable,” he wrote. Among other things, he demanded an entirely new slate of directors who are subject to state approval, and a structure that would allow PG&E’s operating license to be transferred “to the state or a third-party when circumstances warrant.”
Just a week ago, PG&E announced what it believed was a breakthrough that would ease its way out of bankruptcy: a $13.5 billion settlement agreement with lawyers for more than 70,000 wildfire victims.
But the utility wasn’t home free after all. It still needed Newsom’s approval of its bankruptcy plan. Now it will have to overhaul the proposal, and quickly.
According to AB 1054, which creates a $21 billion insurance pool to help utilities pay for damages from future wildfires, PG&E needs to exit Chapter 11 by June 30 in order to participate in the fund..
AB 1054 says PG&E’s bankruptcy plan, besides compensating fire victims, must include a ramped-up program for preventing new fires, as well as other changes in how it does business. Newsom said PG&E’s proposals “do not comply with AB 1054.”
Responding to Newsom’s rejection, PG&E insisted its plan “is the best course forward for all stakeholders. We’ve welcomed feedback from all stakeholders ... and will continue to work diligently in the coming days to resolve any issues that may arise.”
Excerpt from https://www.sacbee.com/news/california/fires/article238350708.html
Some background to the California situation is in this excerpt from a PBS presentation on electricity company regulaton:
In 1992 Congress passed President Bush's Energy Policy Act (EPACT), which opened access to transmission networks to non-utility generators. EPACT further facilitated the development of a competitive market by creating another category of qualifying facilities known as exempt wholesale generators (EWGs), which were exempted from regulations faced by the traditional utilities. To assist in the implementation of PURPA and EPACT, FERC issued Order No. 888 and Order No. 889 in April 1996. The two orders provided guidelines on how to open electricity transmission networks on a nondiscriminatory basis in interstate commerce.
The passage of EPACT led states which had historically high electricity prices, such as California, to investigate whether competitive deregulated markets would benefit their consumers. In 1996, both California and Rhode Island passed deregulation legislation, giving the consumer the right to choose his electricity supplier. As of May 2001, 24 states and the District of Columbia either have passed legislation or issued a comprehensive order to restructure their electric power industry. Eighteen states currently are investigating deregulation. View the Department of Energy map depicting the status of state electricity industry restructuring activity.
As a result of the deregulation movement of the 1990s, the electric power industry is changing from a structure of regulated, local, vertically-integrated monopolies, to one in which competitive companies generate electricity, while the utilities maintain transmission and distribution networks. In the face of increased competition, investor-owned utilities (IOUs) have sought to make themselves more competitive through mergers, acquisitions and asset divestitures, leading to the industry becoming much more concentrated. By 1998, the ten largest IOUs owned almost 40% of IOU-held electricity generation-capacity.[6] Increased competition has also led to the rise of two new participants in the electric power marketplace, who buy and sell electricity without owning or operating transmission or distribution operations: power marketers, which are considered to be utilities and therefore regulated by FERC, and power brokers, which are unregulated.
From https://www.pbs.org/wgbh/pages/frontline/shows/blackout/regulation/timeline.html
NYT's Bradsher's opinion on China/US trade war:
President Trump’s initial retreat from his trade-war threats has handed hard-liners in China a victory
A longer, pricklier trade war and stiff Chinese resistance to economic reforms could result.
Mr. Trump on Friday outlined a partial trade deal that deferred new tariffs on $160 billion a year in Chinese-made goods, a move that would have had him taxing virtually everything China sells to the United States. He also agreed for the first time to broadly reduce tariffs he had already imposed on Chinese goods, halving tariffs on more than $100 billion a year worth of products like clothing and lawn mowers — a striking about-face for a protectionist president who last year described himself as a “tariff man.”
The White House called the deal a win. It said China had agreed to buy large quantities of American agricultural goods, giving farmers hit by the trade war some needed relief. It also means the United States economy will not suffer from new tariffs threatened for Sunday on Chinese-made goods that Americans love to buy, like toys and smartphones.
But the deal may be seen by Xi Jinping, China’s top leader, and his hard-line supporters as vindication of the intransigent stance they have taken since the spring, when a previous pact struck by Chinese moderates fell apart. Since then, China has asked that even a partial deal include tariff rollbacks. American officials resisted, debated, then relented.
In essence, a year and a half into the trade war, China seems to have hit on a winning strategy: Stay tough and let the Trump administration negotiate with itself.
From https://www.nytimes.com/2019/12/14/business/china-trade-hardliners.html
President Trump’s initial retreat from his trade-war threats has handed hard-liners in China a victory
A longer, pricklier trade war and stiff Chinese resistance to economic reforms could result.
Mr. Trump on Friday outlined a partial trade deal that deferred new tariffs on $160 billion a year in Chinese-made goods, a move that would have had him taxing virtually everything China sells to the United States. He also agreed for the first time to broadly reduce tariffs he had already imposed on Chinese goods, halving tariffs on more than $100 billion a year worth of products like clothing and lawn mowers — a striking about-face for a protectionist president who last year described himself as a “tariff man.”
The White House called the deal a win. It said China had agreed to buy large quantities of American agricultural goods, giving farmers hit by the trade war some needed relief. It also means the United States economy will not suffer from new tariffs threatened for Sunday on Chinese-made goods that Americans love to buy, like toys and smartphones.
But the deal may be seen by Xi Jinping, China’s top leader, and his hard-line supporters as vindication of the intransigent stance they have taken since the spring, when a previous pact struck by Chinese moderates fell apart. Since then, China has asked that even a partial deal include tariff rollbacks. American officials resisted, debated, then relented.
In essence, a year and a half into the trade war, China seems to have hit on a winning strategy: Stay tough and let the Trump administration negotiate with itself.
From https://www.nytimes.com/2019/12/14/business/china-trade-hardliners.html
Open Markets press release:
White Paper: The Role of Monopoly in America’s Prescription Drug Crisis
Bipartisan reform efforts to combat high drug prices often fail to recognize how pharmaceutical corporations suppress fair market competition through various forms of monopoly. In a newly published white paper by the Open Markets Institute, The Role of Monopoly in America’s Prescription Drug Crisis, we detail how increasing corporate concentration in the pharmaceutical industry, and the monopoly markets for individual drugs created by a deeply flawed and increasingly abused patent and regulatory system, are the root causes of the problem.
Drug manufacturers engage in a variety of anti-competitive practices, such as abusing the patent system, various FDA regulations, filing sham citizen petitions with the FDA, and tactics to eliminate competition. These practices are used to extend and protect monopolies and to stifle competition—and they wind up needlessly costing consumers millions of dollars each year.
These practices ultimately drive up drug prices, decrease innovation, and cause shortages and disruptions of the supply of many key drugs. They also imperil drug safety.
Brand drug manufacturers also stifle competition and gain monopoly profits by offering substantial rebates or discounts to large-scale buyers—but only if the purchasers refuse to buy a competing generic drug that might erode the brand drug’s market dominance.
Many of these problems can be solved or ameliorated through better competition policy, which can involve the application and enforcement of our antitrust laws. Other policy solutions include the forced licensing of patents, cash prizes for innovation, or price regulation, among other recommendations.
In each instance, we are looking for public policies that will reset the terms of competition and the balances of power in drug markets so that they serve the public good. Read our entire report here. https://openmarketsinstitute.org/releases/open-markets-releases-new-policy-paper-role-monopoly-americas-prescription-drug-crisis/
White Paper: The Role of Monopoly in America’s Prescription Drug Crisis
Bipartisan reform efforts to combat high drug prices often fail to recognize how pharmaceutical corporations suppress fair market competition through various forms of monopoly. In a newly published white paper by the Open Markets Institute, The Role of Monopoly in America’s Prescription Drug Crisis, we detail how increasing corporate concentration in the pharmaceutical industry, and the monopoly markets for individual drugs created by a deeply flawed and increasingly abused patent and regulatory system, are the root causes of the problem.
Drug manufacturers engage in a variety of anti-competitive practices, such as abusing the patent system, various FDA regulations, filing sham citizen petitions with the FDA, and tactics to eliminate competition. These practices are used to extend and protect monopolies and to stifle competition—and they wind up needlessly costing consumers millions of dollars each year.
These practices ultimately drive up drug prices, decrease innovation, and cause shortages and disruptions of the supply of many key drugs. They also imperil drug safety.
Brand drug manufacturers also stifle competition and gain monopoly profits by offering substantial rebates or discounts to large-scale buyers—but only if the purchasers refuse to buy a competing generic drug that might erode the brand drug’s market dominance.
Many of these problems can be solved or ameliorated through better competition policy, which can involve the application and enforcement of our antitrust laws. Other policy solutions include the forced licensing of patents, cash prizes for innovation, or price regulation, among other recommendations.
In each instance, we are looking for public policies that will reset the terms of competition and the balances of power in drug markets so that they serve the public good. Read our entire report here. https://openmarketsinstitute.org/releases/open-markets-releases-new-policy-paper-role-monopoly-americas-prescription-drug-crisis/
The NFL predicament: is there such a thing as a helmet that actually protects the brain?
A NYT article discusses the possibly futile scientific effort to create a better helmet
From the NYT: These are strange and contentious times for football. It remains America’s most popular sport. The National Football League remains a mint, pumping out revenues that have reached $15 billion annually. At the same time, youth and high school football participation has fallen steadily,[https://www.nytimes.com/interactive/2019/11/08/sports/falling-football-participation-in-america.html] driven, in part, by broad parental concern about the brutal damage wreaked by hits that shake and rattle the gray mass of mystery that is the human brain.Their worry is based in fact. When a 310-pound man who runs a 40-yard dash in five seconds flat slams into a running back, that runner’s neck and head accelerate, and the brain and its fibers twist and stretch and tear. A particularly rough hit could jar open the blood-brain barrier, the semipermeable wall that prevents bacterial pathogens from entering the brain.
The full article: https://www.nytimes.com/2019/12/12/sports/concussions-football-helmet.html
A NYT article discusses the possibly futile scientific effort to create a better helmet
From the NYT: These are strange and contentious times for football. It remains America’s most popular sport. The National Football League remains a mint, pumping out revenues that have reached $15 billion annually. At the same time, youth and high school football participation has fallen steadily,[https://www.nytimes.com/interactive/2019/11/08/sports/falling-football-participation-in-america.html] driven, in part, by broad parental concern about the brutal damage wreaked by hits that shake and rattle the gray mass of mystery that is the human brain.Their worry is based in fact. When a 310-pound man who runs a 40-yard dash in five seconds flat slams into a running back, that runner’s neck and head accelerate, and the brain and its fibers twist and stretch and tear. A particularly rough hit could jar open the blood-brain barrier, the semipermeable wall that prevents bacterial pathogens from entering the brain.
The full article: https://www.nytimes.com/2019/12/12/sports/concussions-football-helmet.html
Paul Volcker's parting shot: preserve Fed independence, and faith in U.S. institutions
Excerpt from Volcker article at https://www.ft.com/content/2389d7ec-1b3c-11ea-97df-cc63de1d73f4
Increasingly, by design or not, there appears to be a movement to undermine Americans’ faith in our government and its policies and institutions. We’ve moved well beyond former president Ronald Reagan’s credo that “government is the problem”, with its aim of reversing decades of federal expansion. Today we see something very different and far more sinister. Nihilistic forces are dismantling policies to protect our air, water, and climate. And they seek to discredit the pillars of our democracy: voting rights and fair elections, the rule of law, the free press, the separation of powers, the belief in science, and the concept of truth itself. . . .
Not since just after the second world war have we seen a president so openly seek to dictate policy to the Fed. That is a matter of great concern, given that the central bank is one of our key governmental institutions, carefully designed to be free of purely partisan attacks. I trust that the members of the Federal Reserve Board itself, the members of Congress responsible for Fed oversight, and indeed the public at large, will maintain the Fed’s ability to act in the nation’s interest, free of partisan political purposes. Monetary policy is important, but it cannot by itself sustain global leadership. We need open markets and strong allies to support economic growth and the prospects for peace.
Those constructive American policies have been a large part of my life. Instead, confidence in the US is under siege.
Excerpt from Volcker article at https://www.ft.com/content/2389d7ec-1b3c-11ea-97df-cc63de1d73f4
Increasingly, by design or not, there appears to be a movement to undermine Americans’ faith in our government and its policies and institutions. We’ve moved well beyond former president Ronald Reagan’s credo that “government is the problem”, with its aim of reversing decades of federal expansion. Today we see something very different and far more sinister. Nihilistic forces are dismantling policies to protect our air, water, and climate. And they seek to discredit the pillars of our democracy: voting rights and fair elections, the rule of law, the free press, the separation of powers, the belief in science, and the concept of truth itself. . . .
Not since just after the second world war have we seen a president so openly seek to dictate policy to the Fed. That is a matter of great concern, given that the central bank is one of our key governmental institutions, carefully designed to be free of purely partisan attacks. I trust that the members of the Federal Reserve Board itself, the members of Congress responsible for Fed oversight, and indeed the public at large, will maintain the Fed’s ability to act in the nation’s interest, free of partisan political purposes. Monetary policy is important, but it cannot by itself sustain global leadership. We need open markets and strong allies to support economic growth and the prospects for peace.
Those constructive American policies have been a large part of my life. Instead, confidence in the US is under siege.
America’s Dairy Farmers Are Hurting. A Giant Merger Could Make Things Worse.The largest dairy co-op in the United States is in talks to acquire Dean Foods, a milk processing company that sought bankruptcy protection last month.
AAmerica’s Dairy Farmers Are Hurting. A Giant Merger Could Make Things Worse. dairy co-op in the United States is in talks tThe largest dairy co-op in the United States is in talks to acquire Dean Foods, a milk processing company that sought bankruptcy protection last month.
See https://www.nytimes.com/2019/12/11/business/dean-foods-dairy-farmers-antitrust.html
See https://www.nytimes.com/2019/12/11/business/dean-foods-dairy-farmers-antitrust.html
New York Court finds that New York AG has failed to establish by a preponderance of the evidence that ExxonMobil violated the law in connection with its public disclosures concerning how ExxonMobil accounted for past, present and future climate change risks.
INDEX NO . 452044 / 2018
NYSCEF DOC. NO . 567 RECEIVED NYSCEF : 12 / 10/ 2019
SUPREME COURTOF THE STATE OF NEW YORK
NEW YORK COUNTY
PEOPLE OF THE STATE OF NEW YORK, BY LETITIA
JAMES, ATTORNEYGENERAL OF THE STATEOF NEW
YORK
Plaintiff,
- V
EXXONMOBIL CORPORATION,
Defendant.
DECISION AFTER TRIAL
OSTRAGER, J.
Following twelve days of trial and testimony from eighteen witnesses, the Court finds
that the Office of the Attorney General has failed to establish by a preponderance of the evidence
that ExxonMobil either violated the Martin Act or Executive Law 63( 12 ) in connection with its
public disclosures concerning how ExxonMobil accounted for past, present and future climate
change risks.
full opinion:
https://int.nyt.com/data/documenthelper/6569-new-york-vs-exxonmobil/eb27e49cb4cdbb4add80/optimized/full.pdf#page=1
INDEX NO . 452044 / 2018
NYSCEF DOC. NO . 567 RECEIVED NYSCEF : 12 / 10/ 2019
SUPREME COURTOF THE STATE OF NEW YORK
NEW YORK COUNTY
PEOPLE OF THE STATE OF NEW YORK, BY LETITIA
JAMES, ATTORNEYGENERAL OF THE STATEOF NEW
YORK
Plaintiff,
- V
EXXONMOBIL CORPORATION,
Defendant.
DECISION AFTER TRIAL
OSTRAGER, J.
Following twelve days of trial and testimony from eighteen witnesses, the Court finds
that the Office of the Attorney General has failed to establish by a preponderance of the evidence
that ExxonMobil either violated the Martin Act or Executive Law 63( 12 ) in connection with its
public disclosures concerning how ExxonMobil accounted for past, present and future climate
change risks.
full opinion:
https://int.nyt.com/data/documenthelper/6569-new-york-vs-exxonmobil/eb27e49cb4cdbb4add80/optimized/full.pdf#page=1
Representative García and Senator Warren Announce Introduction of the Bank Merger Review Modernization Act
The Press Release appears below, after comment by DAR
DAR Comment:
It can be argued that one reason that the Antitrust Division has enabled consolidation in banking is too much focus on narrowly defined
and local geographic and product markets. Arguably the USDOJ has not focused enough on broader national and international markets.
For example, two merging giants may have few competing retail branches in a particular locality, suggesting no competitive problem for retail banking in the locality.
But a big competition problem remains if the banks are the two most important players in a national or international market in investment banking.
It is hard to say whether the Warren press release really means to focus on the importance of local rather than broader markets, but the press release does say that the Warren legislation "requires regulators to examine how the merger would impact market concentration for individual banking products, such as commercial deposits, home mortgage lending, and small business lending rather than just the general availability of banking products in local markets."
Moving from this particular local v. broader market competition question:
As you may know, the procedure that now applies to bank mergers is that the acquiring bank first files an application with the Federal Reserve
(or one of the other regulatory agencies, as applicable), which will then pass the application on to the Antitrust Division for review.
The Federal Reserve or other regulatory agency then reviews the application concurrently with the Antitrust Division.
There is a strong argument that there is already sufficient flexibility in existing
antitrust law and regulators' "public interest" jurisdiction on which to base efforts by the USDOJ, the Federal Reserve Board (Fed), and other U.S.
government agencies to address merger enforcement more aggressively.
The great policy question raised by the Warren proposals is whether it is better to simply strengthen existing bank merger enforcement mechanisms, which take advantage of a large body of case law, or to more drastically revise the regulatory framework. My guess is that
many experienced antitrust enforcers will pick the more cautious approach.
I agree with the thoughts in the American Antitrust Institute's discussion at
https://www.antitrustinstitute.org/wp-content/uploads/2018/08/Banking-and-Financial-Services.7.22.16.pdf
Some of the thoughts there include giving the USDOJ Antitrust Division a stronger role in bank merger review, and encouraging
the Antitrust Division to be more aggressive in challenging bank mergers.
Don Allen Resnikoff
Press Release
Bicameral legislation would require bank regulators to seriously consider how the merger affects consumers and communities and whether it presents risks to financial stability
Washington, DC - Congressman Jesús "Chuy" García (D-Ill.), member of the House of Representatives Committee on Financial Services and United States Senator Elizabeth Warren (D-Mass.), member of the Senate Banking, Housing, and Urban Affairs Committee, today announced the introduction of the Bank Merger Review Modernization Act. The legislation would restrict harmful consolidation in the banking industry and protect consumers and the financial system from "Too Big to Fail" institutions, like those that caused the 2008 financial crisis. The upcoming merger between SunTrust Banks, Inc. (SunTrust) and BB&T Corporation (BB&T) will create the sixth-largest U.S. bank and first new Too Big to Fail bank since the financial crisis. Representatives Jan Schakowsky (D-Ill.) and Rashida Tlaib (D-Mich.) are original House cosponsors of the bill.
"When big banks get bigger, consumers and taxpayers usually lose. We must protect our financial system by slowing down bank consolidation. This bill will help address this, taking the Fed and FDIC off autopilot and giving consumers a voice in reviewing bank mergers," said Congressman García.
"Nearly two years ago, Chairman Powell confirmed my worst suspicions that the Fed has not declined a single merger request since before the financial crisis," said Senator Warren. "The bill Congressman García and I are announcing today would ensure that regulators do their jobs by stopping mergers that deprive communities of the banking services they need, reward banks that cheat or discriminate against their customers, and risk another financial crisis.
Before banks merge, they need approval from regulators, including the Federal Reserve ("Fed"), the Federal Deposit Insurance Corporation (FDIC), or the Office of the Comptroller of the Currency (OCC), but the review process for bank mergers is fundamentally broken. Voluntary bank mergers have driven a rapid decline in the number of banks since the financial crisis. Studies show that bank mergers can result in higher costs to consumers and decreased access to financial products, especially in rural areas. And when two large banks merge, it has even greater risks, potentially creating a bank that's too big to manage effectively or creating a new Too Big to Fail bank that could threaten financial stability.
When regulators consider a merger they are supposed to evaluate a number of factors, including: (1) whether the merger will create local monopolies for banking services; (2) whether the merged bank will be well managed; (3) whether the new bank creates risk to the financial system; and (4) the merger's effects on the public, including consumers. In practice, financial agencies almost exclusively focus their analyses on the impact of the merger on competitiveness and often pre-review the merger in secret with banks before they announce it publicly. As a result, the merger review practice lacks analytical rigor, and regulators serve as rubber stamps. Of the 3,819 bank merger applications the Fed received between 2006 and 2017, it did not decline a single one.
The Bank Merger Review Modernization Act strengthens and modernizes the statutory standards under which federal regulators analyze bank merger applications by:
https://chuygarcia.house.gov/media/press-releases/representative-garc-and-senator-warren-announce-introduction-bank-merger-review
The Press Release appears below, after comment by DAR
DAR Comment:
It can be argued that one reason that the Antitrust Division has enabled consolidation in banking is too much focus on narrowly defined
and local geographic and product markets. Arguably the USDOJ has not focused enough on broader national and international markets.
For example, two merging giants may have few competing retail branches in a particular locality, suggesting no competitive problem for retail banking in the locality.
But a big competition problem remains if the banks are the two most important players in a national or international market in investment banking.
It is hard to say whether the Warren press release really means to focus on the importance of local rather than broader markets, but the press release does say that the Warren legislation "requires regulators to examine how the merger would impact market concentration for individual banking products, such as commercial deposits, home mortgage lending, and small business lending rather than just the general availability of banking products in local markets."
Moving from this particular local v. broader market competition question:
As you may know, the procedure that now applies to bank mergers is that the acquiring bank first files an application with the Federal Reserve
(or one of the other regulatory agencies, as applicable), which will then pass the application on to the Antitrust Division for review.
The Federal Reserve or other regulatory agency then reviews the application concurrently with the Antitrust Division.
There is a strong argument that there is already sufficient flexibility in existing
antitrust law and regulators' "public interest" jurisdiction on which to base efforts by the USDOJ, the Federal Reserve Board (Fed), and other U.S.
government agencies to address merger enforcement more aggressively.
The great policy question raised by the Warren proposals is whether it is better to simply strengthen existing bank merger enforcement mechanisms, which take advantage of a large body of case law, or to more drastically revise the regulatory framework. My guess is that
many experienced antitrust enforcers will pick the more cautious approach.
I agree with the thoughts in the American Antitrust Institute's discussion at
https://www.antitrustinstitute.org/wp-content/uploads/2018/08/Banking-and-Financial-Services.7.22.16.pdf
Some of the thoughts there include giving the USDOJ Antitrust Division a stronger role in bank merger review, and encouraging
the Antitrust Division to be more aggressive in challenging bank mergers.
Don Allen Resnikoff
Press Release
Bicameral legislation would require bank regulators to seriously consider how the merger affects consumers and communities and whether it presents risks to financial stability
Washington, DC - Congressman Jesús "Chuy" García (D-Ill.), member of the House of Representatives Committee on Financial Services and United States Senator Elizabeth Warren (D-Mass.), member of the Senate Banking, Housing, and Urban Affairs Committee, today announced the introduction of the Bank Merger Review Modernization Act. The legislation would restrict harmful consolidation in the banking industry and protect consumers and the financial system from "Too Big to Fail" institutions, like those that caused the 2008 financial crisis. The upcoming merger between SunTrust Banks, Inc. (SunTrust) and BB&T Corporation (BB&T) will create the sixth-largest U.S. bank and first new Too Big to Fail bank since the financial crisis. Representatives Jan Schakowsky (D-Ill.) and Rashida Tlaib (D-Mich.) are original House cosponsors of the bill.
"When big banks get bigger, consumers and taxpayers usually lose. We must protect our financial system by slowing down bank consolidation. This bill will help address this, taking the Fed and FDIC off autopilot and giving consumers a voice in reviewing bank mergers," said Congressman García.
"Nearly two years ago, Chairman Powell confirmed my worst suspicions that the Fed has not declined a single merger request since before the financial crisis," said Senator Warren. "The bill Congressman García and I are announcing today would ensure that regulators do their jobs by stopping mergers that deprive communities of the banking services they need, reward banks that cheat or discriminate against their customers, and risk another financial crisis.
Before banks merge, they need approval from regulators, including the Federal Reserve ("Fed"), the Federal Deposit Insurance Corporation (FDIC), or the Office of the Comptroller of the Currency (OCC), but the review process for bank mergers is fundamentally broken. Voluntary bank mergers have driven a rapid decline in the number of banks since the financial crisis. Studies show that bank mergers can result in higher costs to consumers and decreased access to financial products, especially in rural areas. And when two large banks merge, it has even greater risks, potentially creating a bank that's too big to manage effectively or creating a new Too Big to Fail bank that could threaten financial stability.
When regulators consider a merger they are supposed to evaluate a number of factors, including: (1) whether the merger will create local monopolies for banking services; (2) whether the merged bank will be well managed; (3) whether the new bank creates risk to the financial system; and (4) the merger's effects on the public, including consumers. In practice, financial agencies almost exclusively focus their analyses on the impact of the merger on competitiveness and often pre-review the merger in secret with banks before they announce it publicly. As a result, the merger review practice lacks analytical rigor, and regulators serve as rubber stamps. Of the 3,819 bank merger applications the Fed received between 2006 and 2017, it did not decline a single one.
The Bank Merger Review Modernization Act strengthens and modernizes the statutory standards under which federal regulators analyze bank merger applications by:
- Guaranteeing that the Merger is in the Public Interest. The legislation clarifies and strengthens the public interest aspect of the merger review by:
- Requiring Consumer Financial Protection Bureau approval when at least one applicant offers consumer financial products;
- Strengthening the Community Reinvestment Act (CRA) by only allowing institutions with the highest rating in two out of three of their last CRA exams to merge; and
- Requiring transparent disclosure of discussions between the institutions and regulators before the merger application is filed.
- Safeguarding the Stability of the Financial System. The legislation requires regulators to use a quantifiable metric developed by the Basel Committee on Banking Supervision to evaluate systemic risk. The score is based on the size, interconnectedness, substitutability, complexity, and cross-jurisdictional activity of the institution.
- Requiring that Regulators Examine the Anticompetitive Effects on Individual Banking Products. The legislation requires regulators to examine how the merger would impact market concentration for individual banking products, such as commercial deposits, home mortgage lending, and small business lending rather than just the general availability of banking products in local markets.
- Ensuring that the Merged Bank has Adequate Financial and Managerial Resources. The legislation requires regulators to review the leadership of the merged institution to ensure that the selected individuals have strong records with respect to risk management. Larger institutions would also have their balance sheets examined to ensure that they will be on solid financial footing.
https://chuygarcia.house.gov/media/press-releases/representative-garc-and-senator-warren-announce-introduction-bank-merger-review
Huawei sues FCC over “unconstitutional” ban on the use of federal subsidies to buy its equipment
Catherine Shu@catherineshu / 1:15 am EST • December 5, 2019
Huawei said today it is suing the Federal Communications Commission, asking to overturn a ban on carriers from using money from the Universal Service Fund (USF) to buy equipment from Huawei and ZTE.
The $8.5 billion USF supports the purchase of equipment to build communications infrastructure, especially in rural communities. Huawei is asking the United States Court of Appeals for the Fifth Circuit to overrule the FCC’s order, passed on Nov. 22.
Small carriers buy equipment from Huawei and ZTE because it is dependable and cheap. According to a Reuters report, some carriers are considering Nokia and Ericsson for replacements, but their equipment is priced less competitively.
During a press conference in Shenzhen today, Glen Nager, Huawei’s lead counsel for the lawsuit, claimed the ban goes beyond the FCC’s authority and violates the constitution. “The order fails to give Huawei constitutionally required due process before stigmatizing it as a national security threat, such as an opportunity to confront supposed evidence and witnesses, and a fair and neutral hearing process,” he said.
Huawei chief legal officer Song Liuping claims that FCC chairman and Ajit Pai and other commissioners did not present evidence to back its claim that Huawei is a security threat.
“This is a common trend in Washington these days. ‘Huawei is a Chinese company.’ That’s his only excuse,” Song said. He also claimed that the FCC ignored 21 rounds of “detailed comments” submitted by Huawei to explain how the order would harm businesses in rural areas, adding “This decision, just like the Entity List decision in May, is based on politics, not security.”
In March, Huawei also cited the Constitution in another lawsuit filed against the U.S. government arguing that a ban on the use of its products by federal agencies and contractors violate due process.
From: https://techcrunch.com/2019/12/04/huawei-sues-fcc-over-unconstitutional-ban-the-use-of-federal-subsidies-to-buy-its-equipment/
Catherine Shu@catherineshu / 1:15 am EST • December 5, 2019
Huawei said today it is suing the Federal Communications Commission, asking to overturn a ban on carriers from using money from the Universal Service Fund (USF) to buy equipment from Huawei and ZTE.
The $8.5 billion USF supports the purchase of equipment to build communications infrastructure, especially in rural communities. Huawei is asking the United States Court of Appeals for the Fifth Circuit to overrule the FCC’s order, passed on Nov. 22.
Small carriers buy equipment from Huawei and ZTE because it is dependable and cheap. According to a Reuters report, some carriers are considering Nokia and Ericsson for replacements, but their equipment is priced less competitively.
During a press conference in Shenzhen today, Glen Nager, Huawei’s lead counsel for the lawsuit, claimed the ban goes beyond the FCC’s authority and violates the constitution. “The order fails to give Huawei constitutionally required due process before stigmatizing it as a national security threat, such as an opportunity to confront supposed evidence and witnesses, and a fair and neutral hearing process,” he said.
Huawei chief legal officer Song Liuping claims that FCC chairman and Ajit Pai and other commissioners did not present evidence to back its claim that Huawei is a security threat.
“This is a common trend in Washington these days. ‘Huawei is a Chinese company.’ That’s his only excuse,” Song said. He also claimed that the FCC ignored 21 rounds of “detailed comments” submitted by Huawei to explain how the order would harm businesses in rural areas, adding “This decision, just like the Entity List decision in May, is based on politics, not security.”
In March, Huawei also cited the Constitution in another lawsuit filed against the U.S. government arguing that a ban on the use of its products by federal agencies and contractors violate due process.
From: https://techcrunch.com/2019/12/04/huawei-sues-fcc-over-unconstitutional-ban-the-use-of-federal-subsidies-to-buy-its-equipment/
NFL Heads to the Supreme Court In TV Rights Case
A significant antitrust battle could upset how the league sells game telecasts for billions of dollars and usher in an era when teams would compete for licensing deals. ... NFL teams currently pool telecast rights to all live games and collectively negotiate licensing packages.
https://www.hollywoodreporter.com/thr-esq/nfl-tv-rights-why-league-aims-a-block-an-upheaval-1258901
The case of Boise v. Martin, a decade-old lawsuit, is examining whether it’s a crime for someone to sleep outside when they have nowhere else to go.
The case is now a step away from the Supreme Court.
The suit arose when a half-dozen homeless people claimed that local rules prohibiting camping on public property violated the Eighth Amendment protection against cruel and unusual punishment. The plaintiffs prevailed at the appellate level last year, putting the city at the center of a national debate on how to tackle homelessness. Now Boise — after hiring a powerhouse legal team that includes Theodore B. Olson and Theane Evangelis of Gibson, Dunn & Crutcher — has asked the Supreme Court to take the case, a decision that could come within days.
https://www.nytimes.com/2019/12/03/business/homeless-boise.html
In Utah (and perhaps some other places), high interest, small dollar loans are a big part of local small claims court matters
In Utah, payday lenders and similar companies that offer high-interest, small-dollar loans dominate small claims court. Loans for Less, for example, filed 95% of the small claims cases in South Ogden, a suburban city of 17,000 about a half-hour north of Salt Lake City on the interstate, in fiscal year 2018, according to state data.
Across Utah, high-interest lenders filed 66% of all small claims cases heard between September 2017 and September 2018, according to a new analysis of court records conducted by a team led by Christopher Peterson, a law professor at the University of Utah and the financial services director at the Consumer Federation of America, and David McNeill, a legal data consultant and CEO of Docket Reminder.
Companies can sue for up to $11,000 in Utah’s small claims courts, which are stripped of certain formalities: There are rarely lawyers, judges are not always legally trained and the rules of evidence don’t apply.
from: https://www.propublica.org/article/they-loan-you-money-then-they-get-a-warrant-for-your-arrest
In Utah, payday lenders and similar companies that offer high-interest, small-dollar loans dominate small claims court. Loans for Less, for example, filed 95% of the small claims cases in South Ogden, a suburban city of 17,000 about a half-hour north of Salt Lake City on the interstate, in fiscal year 2018, according to state data.
Across Utah, high-interest lenders filed 66% of all small claims cases heard between September 2017 and September 2018, according to a new analysis of court records conducted by a team led by Christopher Peterson, a law professor at the University of Utah and the financial services director at the Consumer Federation of America, and David McNeill, a legal data consultant and CEO of Docket Reminder.
Companies can sue for up to $11,000 in Utah’s small claims courts, which are stripped of certain formalities: There are rarely lawyers, judges are not always legally trained and the rules of evidence don’t apply.
from: https://www.propublica.org/article/they-loan-you-money-then-they-get-a-warrant-for-your-arrest
Bernie Sanders Slams MLB Over Minor League Contraction
by Kevin Reichard on November 26, 2019
DAR comment: Some media outlets are treating Bernie Sanders' comments on Major League Baseball as random fuming of an old guy from Brooklyn. Some people, like Senator Cruz, simply disagree with him. In fact, Sanders is commenting on the controversial issue of the great and sometimes misused power over employees that derives from government granted or sanctioned monopoly power of sports entities like MLB, the NFL, and the NCAA. Sanders suggests re-examining government policy on sports and antitrust.
The back story on the minor league contraction is that minor league player litigants won a significant procedural victory this past August in their litigation against Major League Baseball. That litigation alleged that illegally low wages were being paid to minor league players. See the article at https://ballparkdigest.com/2019/08/19/appeals-court-expands-scope-of-class-action-milb-player-wage-lawsuit/ The reaction from MLB apparently is to take away minor league balls and bats and partially close the minor league fields. The 11-26-2019 Kevin Reichard article, excerpts of which appear below, tells the story.
Presidential candidate and U.S. Senator Bernie Sanders (I-VT) took to Twitter to oppose Major League Baseball’s proposal to contract 42 Minor League Baseball teams, saying the move would “destroy thousands of jobs and devastate local economies.”
In negotiations for the next Professional Baseball Agreement (PBA) between Major League Baseball and Minor League Baseball, set to replace the current PBA that expires at the end of the 2020 season, MLB has put forth a series of proposals culminating in a current plan to eliminate 42 teams, restructure specific leagues, move the player draft back by two months and delay the first year of player signings by a season, and upgrade player facilities. In our coverage, we’ve outlined the proposals as well as the teams targeted for contraction, documented early political opposition to the proposal, and outlined what Minor League Baseball can do to address MLB concerns.
The arguments here are related to the economic impact of eliminating 42 teams and how local communities past the MiLB operators will be affected, along with the need to pay MiLB players a living wage. All true enough. But the real power in Sanders’ letter isn’t economic justice: it’s in the threats to examine the anti-trust exemption and revise exemptions for MLB that avoid overtime:
In other words, instead of paying Minor League Baseball players a living wage, it appears that the multi-millionaire and billionaire owners of Major League Baseball would rather throw them out on the street no matter how many fans, communities and workers get hurt in the process. If this is the type of attitude that Major League Baseball and its owners have then I think it’s time for Congress and the executive branch to seriously rethink and reconsider all the benefits it has bestowed to the league including, but not limited to, its anti-trust exemption.
The Sanders tweet and letter can be viewed here: https://twitter.com/BernieSanders/status/1199027511604260870
The 11-26-2019 Richards article is at https://ballparkdigest.com/2019/11/26/sanders-slams-mlb-over-contraction-everything-to-do-with-greed/
by Kevin Reichard on November 26, 2019
DAR comment: Some media outlets are treating Bernie Sanders' comments on Major League Baseball as random fuming of an old guy from Brooklyn. Some people, like Senator Cruz, simply disagree with him. In fact, Sanders is commenting on the controversial issue of the great and sometimes misused power over employees that derives from government granted or sanctioned monopoly power of sports entities like MLB, the NFL, and the NCAA. Sanders suggests re-examining government policy on sports and antitrust.
The back story on the minor league contraction is that minor league player litigants won a significant procedural victory this past August in their litigation against Major League Baseball. That litigation alleged that illegally low wages were being paid to minor league players. See the article at https://ballparkdigest.com/2019/08/19/appeals-court-expands-scope-of-class-action-milb-player-wage-lawsuit/ The reaction from MLB apparently is to take away minor league balls and bats and partially close the minor league fields. The 11-26-2019 Kevin Reichard article, excerpts of which appear below, tells the story.
Presidential candidate and U.S. Senator Bernie Sanders (I-VT) took to Twitter to oppose Major League Baseball’s proposal to contract 42 Minor League Baseball teams, saying the move would “destroy thousands of jobs and devastate local economies.”
In negotiations for the next Professional Baseball Agreement (PBA) between Major League Baseball and Minor League Baseball, set to replace the current PBA that expires at the end of the 2020 season, MLB has put forth a series of proposals culminating in a current plan to eliminate 42 teams, restructure specific leagues, move the player draft back by two months and delay the first year of player signings by a season, and upgrade player facilities. In our coverage, we’ve outlined the proposals as well as the teams targeted for contraction, documented early political opposition to the proposal, and outlined what Minor League Baseball can do to address MLB concerns.
The arguments here are related to the economic impact of eliminating 42 teams and how local communities past the MiLB operators will be affected, along with the need to pay MiLB players a living wage. All true enough. But the real power in Sanders’ letter isn’t economic justice: it’s in the threats to examine the anti-trust exemption and revise exemptions for MLB that avoid overtime:
In other words, instead of paying Minor League Baseball players a living wage, it appears that the multi-millionaire and billionaire owners of Major League Baseball would rather throw them out on the street no matter how many fans, communities and workers get hurt in the process. If this is the type of attitude that Major League Baseball and its owners have then I think it’s time for Congress and the executive branch to seriously rethink and reconsider all the benefits it has bestowed to the league including, but not limited to, its anti-trust exemption.
The Sanders tweet and letter can be viewed here: https://twitter.com/BernieSanders/status/1199027511604260870
The 11-26-2019 Richards article is at https://ballparkdigest.com/2019/11/26/sanders-slams-mlb-over-contraction-everything-to-do-with-greed/
Delrahim says Big Tech probe focused on abuse of dataI
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November 26, 2019
The Department of Justice’s investigation into online platforms is focused on the possibility that tech firms could use data they’ve gathered from customers to block competitors from markets they manage, according to the agency’s top antitrust official.
“If we found that they had market power in a specific, you know, in a defined market, and they have data that they could use to prevent a competitor from challenging that market? Then that could be a violation, yes, absolutely,” Assistant Attorney General Makan Delrahim told the Washington Examiner, referring to big tech corporations such as Facebook and Google.
The “defined markets” in question, Delrahim said, could be the search industry or social media. “Our investigation is focused on” the potential abuse of data by online platforms, he said.
Delrahim also noted that the DOJ was “trying to identify what other [harmful] conduct could go on in any of these, by any of these companies.”
The investigation on the use of data could put increased scrutiny on big tech companies that are already under significant pressure from Congress, regulatory agencies, and the public at large.
“This definitely seems like a trend emerging, of a focus by [Delrahim] and others on zero-price markets and the value of data,” said John Newman, a DOJ antitrust lawyer during the Obama administration and an associate professor of law at the University of Miami. “I think it’s a good sign, and I hope to see future development.”
Full Content: Washington Examiner https://www.washingtonexaminer.com/policy/economy/big-tech-investigation-focused-on-abuse-of-data-doj-antitrust-chief-says
Apple, Square Apply Early for Tariff Exemptions as List 4A Process Opens
Sounce: http://www.ftz9.org/wp-content/uploads/2019/11/TRADE-NEWS-WEEKLY-2019-November-4-November-8.pdf
DAR Comment: The 67% success rate reported for Apple suggests that Apple is doing well in exempting Chinese made components from tariffs; we lack information about whether Apple rivals are doing equally well.
The U.S. government has opened the process to request exemptions from “List 4A” tariffs on Chinese exports that were applied in September. As of November 3, 148 exemptions had been filed – on the basis of List 3 applications that could eventually reach 16,000. Given only 7.1% of List 3 filings have been assessed, List 4A applicants could be waiting a long time for a decision.
Among early List 4A filers is Apple, with 11 applications covering its iMac, Apple Watch and Airpod ranges. Apple had a 67% success rate in its List 3 applications.
Other filers in the electronics sector for List 4A include Square and Specialty Technologies. The bulk of List 4A filings by number so far though are in the leisure sector including shipments by Sea Eagle Boats which has had a 38.9% success rate in List 3 requests.
Sounce: http://www.ftz9.org/wp-content/uploads/2019/11/TRADE-NEWS-WEEKLY-2019-November-4-November-8.pdf
DAR Comment: The 67% success rate reported for Apple suggests that Apple is doing well in exempting Chinese made components from tariffs; we lack information about whether Apple rivals are doing equally well.
The U.S. government has opened the process to request exemptions from “List 4A” tariffs on Chinese exports that were applied in September. As of November 3, 148 exemptions had been filed – on the basis of List 3 applications that could eventually reach 16,000. Given only 7.1% of List 3 filings have been assessed, List 4A applicants could be waiting a long time for a decision.
Among early List 4A filers is Apple, with 11 applications covering its iMac, Apple Watch and Airpod ranges. Apple had a 67% success rate in its List 3 applications.
Other filers in the electronics sector for List 4A include Square and Specialty Technologies. The bulk of List 4A filings by number so far though are in the leisure sector including shipments by Sea Eagle Boats which has had a 38.9% success rate in List 3 requests.
WIlliam Morris Endeavor v. Writers Guild of America
The lawsuit was filed this past summer by William Morris Endeavor, Creative Artists Agency, and United Talent Agency, who argue that the guild is participating in an “illegal boycott” by having thousands of its writers terminate their representation in order to pressure the agencies to eliminate packaging fees. The WGA argues that antitrust laws preventing illegal boycotts do not apply to them, citing labor laws that allow for unions to improve their working conditions through self-organizing.
But in a legal brief filed Tuesday, November 26, the USDOJ argued that use of labor exemptions in this case is “not so facile” as the WGA membership’s mass termination of agency representation included TV showrunners who can hold other roles on a project, most commonly as a producer.
“While any construction of the labor exemptions must allow unions to restrict competition in labor markets in pursuit of legitimate labor law goals, courts must also be careful to circumscribe the application of these exemptions lest unions be ‘giv[en] free rein to extend their substantial economic power into markets for goods and services other than labor.’”
Full Content: The Wrap, Forbes https://www.forbes.com/sites/jillgoldsmith/2019/11/27/doj-antitrust-chief-boosts-talent-agencies-in-court-battle-with-wga/#353d81594f81
The lawsuit was filed this past summer by William Morris Endeavor, Creative Artists Agency, and United Talent Agency, who argue that the guild is participating in an “illegal boycott” by having thousands of its writers terminate their representation in order to pressure the agencies to eliminate packaging fees. The WGA argues that antitrust laws preventing illegal boycotts do not apply to them, citing labor laws that allow for unions to improve their working conditions through self-organizing.
But in a legal brief filed Tuesday, November 26, the USDOJ argued that use of labor exemptions in this case is “not so facile” as the WGA membership’s mass termination of agency representation included TV showrunners who can hold other roles on a project, most commonly as a producer.
“While any construction of the labor exemptions must allow unions to restrict competition in labor markets in pursuit of legitimate labor law goals, courts must also be careful to circumscribe the application of these exemptions lest unions be ‘giv[en] free rein to extend their substantial economic power into markets for goods and services other than labor.’”
Full Content: The Wrap, Forbes https://www.forbes.com/sites/jillgoldsmith/2019/11/27/doj-antitrust-chief-boosts-talent-agencies-in-court-battle-with-wga/#353d81594f81
Dentists’ Group joins antitrust suits against Delta Dental
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November 28, 2019
The American Dental Association accused Delta Dental Insurance of monopolizing dental insurance, entering a dispute in Chicago federal court that began with a wave of lawsuits filed by dental practices last month.
The antitrust suits target Delta and its independent affiliates, which form a nationwide insurance network analogous to the Blue Cross Blue Shield Association led by Anthem.
The Delta entities are accused of undermining competition by illegally dividing the country into 39 separate geographic markets, according to the proposed class actions filed in the US District Court for the Northern District of Illinois.
Full Content: Law 360
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November 28, 2019
The American Dental Association accused Delta Dental Insurance of monopolizing dental insurance, entering a dispute in Chicago federal court that began with a wave of lawsuits filed by dental practices last month.
The antitrust suits target Delta and its independent affiliates, which form a nationwide insurance network analogous to the Blue Cross Blue Shield Association led by Anthem.
The Delta entities are accused of undermining competition by illegally dividing the country into 39 separate geographic markets, according to the proposed class actions filed in the US District Court for the Northern District of Illinois.
Full Content: Law 360
The Maryland Consumer Rights Coalition Guide to Buying a Used Car
The MCRC offers a booklet of value to consumers interested in buying a used car. It's value extends beyond Maryland borders.
For lawyers who are interested in reaching out to lay people and offering consumer buying guidance, the booklet is a good teaching tool that could be used in community settings like libraries or churches.
The booklet can be found here: http://www.marylandconsumers.org/penn_station/folders/issues/auto/new__used/How_to_Buy_a_Used_Car.pdf?eType=EmailBlastContent&eId=2c326cc9-d3c7-4af3-894f-ba7202928d0b
The MCRC offers a booklet of value to consumers interested in buying a used car. It's value extends beyond Maryland borders.
For lawyers who are interested in reaching out to lay people and offering consumer buying guidance, the booklet is a good teaching tool that could be used in community settings like libraries or churches.
The booklet can be found here: http://www.marylandconsumers.org/penn_station/folders/issues/auto/new__used/How_to_Buy_a_Used_Car.pdf?eType=EmailBlastContent&eId=2c326cc9-d3c7-4af3-894f-ba7202928d0b
From PBS: Reveal investigation suggests that Indiana government may have side-tracked investigation of Amazon management's role in death of employee injured by a fork lift in an Amazon warehouse
"One particular incident in Indiana raises questions about how regulators and government officials deal with potential safety violations at the global company. Will Evans of Reveal from The Center for Investigative Reporting reports."
From the PBS Newshour program transcript:
https://www.pbs.org/newshour/show/investigation-raises-alarm-about-handling-of-worker-fatality-at-indiana-amazon-facility
"One particular incident in Indiana raises questions about how regulators and government officials deal with potential safety violations at the global company. Will Evans of Reveal from The Center for Investigative Reporting reports."
From the PBS Newshour program transcript:
- Reporter Will Evans:
[Former Indiana investigator] Stallone believes the way regulators bent over backwards to help Amazon just makes accidents more likely to happen in the future. - John Stallone:
You are gambling with people's lives every day. And that doesn't seem like you should get a pass. You have to hold people's feet to the fire. You have to be accountable for what they did or didn't provide.
https://www.pbs.org/newshour/show/investigation-raises-alarm-about-handling-of-worker-fatality-at-indiana-amazon-facility
Amazon admits to Congress that it uses ‘aggregated’ data from third-party sellers to come up with its own products
CNBC – In newly released answers to a House panel investigating four Big Tech firms, Amazon maintained it does not use data from individual third-party sellers to come up with its own products. But it does use “aggregated data” to inform its private label brands, the company said.
http://maestro.abanet.org/trk/click?ref=z11aidwdq5_0-3e8e4x3e6f10x0249&
The NFL monopoly v. Kaepernick
Recently, TMZ Sports reported that Rep. Hank Johnson (Democrat from Georgia says he believes Kaepernick is the "victim" ... because the NFL orchestrated a league-wide ban on the QB because he "exercised his 1st Amendment right."
"It's possible that Congress can do something," Johnson says . . . "Congress oversees the anti-trust exemption that we gave the NFL. The NFL is doing quite well with that anti-trust exemption, maybe it's time for us to take a fresh look at it."
The anti-trust exemption is the law President Kennedy signed back in the day which allows the individual teams to work together as a monopoly to negotiate more lucrative broadcasting deals.
See https://www.tmz.com/2019/11/19/hank-johnson-nfl-congress-anti-trust-exemption-colin-kaepernick/
NBC Sports columnist Mike Florio believes that the NFL flexed its monopolist’s muscle when it arranged a display work-out for Kaepernick to which team scouts were invited. Florio argues that the waiver the NFL wanted Kaepernick to sign, and that Kaepernick refused, was prejudicial to Kaepernick. Florio writes:
In their statement from Saturday afternoon, Kaepernick’s representatives said that “the NFL has demanded that as a precondition to the workout, Mr. Kaepernick sign an unusual liability waiver that addresses employment-related issues and rejected the standard liability waiver from physical injury proposed by Mr. Kaepernick’s representatives.” Based on the language of the waiver, that’s an overstatement of its specific contents.
That said, there’s enough language in the waiver to give a prudent, careful lawyer legitimate concern that an aggressive litigator would later argue that signing the document defeats all potential employment claims that Kaepernick could have made.
Are Johnson and Florio right? Here’s a link to the proposed waiver. You decide: https://nbcprofootballtalk.files.wordpress.com/2019/11/nov-16-workout-release-and-waiver.pdf
Posting by Don Allen Resnikoff, who is responsible for the content
Recently, TMZ Sports reported that Rep. Hank Johnson (Democrat from Georgia says he believes Kaepernick is the "victim" ... because the NFL orchestrated a league-wide ban on the QB because he "exercised his 1st Amendment right."
"It's possible that Congress can do something," Johnson says . . . "Congress oversees the anti-trust exemption that we gave the NFL. The NFL is doing quite well with that anti-trust exemption, maybe it's time for us to take a fresh look at it."
The anti-trust exemption is the law President Kennedy signed back in the day which allows the individual teams to work together as a monopoly to negotiate more lucrative broadcasting deals.
See https://www.tmz.com/2019/11/19/hank-johnson-nfl-congress-anti-trust-exemption-colin-kaepernick/
NBC Sports columnist Mike Florio believes that the NFL flexed its monopolist’s muscle when it arranged a display work-out for Kaepernick to which team scouts were invited. Florio argues that the waiver the NFL wanted Kaepernick to sign, and that Kaepernick refused, was prejudicial to Kaepernick. Florio writes:
In their statement from Saturday afternoon, Kaepernick’s representatives said that “the NFL has demanded that as a precondition to the workout, Mr. Kaepernick sign an unusual liability waiver that addresses employment-related issues and rejected the standard liability waiver from physical injury proposed by Mr. Kaepernick’s representatives.” Based on the language of the waiver, that’s an overstatement of its specific contents.
That said, there’s enough language in the waiver to give a prudent, careful lawyer legitimate concern that an aggressive litigator would later argue that signing the document defeats all potential employment claims that Kaepernick could have made.
Are Johnson and Florio right? Here’s a link to the proposed waiver. You decide: https://nbcprofootballtalk.files.wordpress.com/2019/11/nov-16-workout-release-and-waiver.pdf
Posting by Don Allen Resnikoff, who is responsible for the content
Warren vows to conduct antitrust investigation of electronic health records (EHR) market
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November 19, 2019As part of her healthcare plan for the first 100 days in office, Democratic presidential hopeful Sen. Elizabeth Warren of Massachusetts zeroed in on the electronic health records (EHR) industry for its lack of interoperability and competition, she reported on her website. [https://elizabethwarren.com/plans/m4a-transition]
“Congress spent $36 billion to get every doctor in America using EHRs, but we still do not have adequate digital information flow in healthcare — in part because two big companies make up about 85 percent of the market for medical records at big hospitals,” she wrote in her healthcare transition plan.
Ms. Warren pledged to go after health systems and IT companies that engage in information blocking. She also said she will launch an antitrust probe of the EHR market, led by the Federal Trade Commission and the Department of Justice.
Full Content: Elizabeth Warrenhttps://www.pymnts.com/antitrust/2019/big-tech-antitrust-examination-by-ags-gathers-steam/
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November 19, 2019As part of her healthcare plan for the first 100 days in office, Democratic presidential hopeful Sen. Elizabeth Warren of Massachusetts zeroed in on the electronic health records (EHR) industry for its lack of interoperability and competition, she reported on her website. [https://elizabethwarren.com/plans/m4a-transition]
“Congress spent $36 billion to get every doctor in America using EHRs, but we still do not have adequate digital information flow in healthcare — in part because two big companies make up about 85 percent of the market for medical records at big hospitals,” she wrote in her healthcare transition plan.
Ms. Warren pledged to go after health systems and IT companies that engage in information blocking. She also said she will launch an antitrust probe of the EHR market, led by the Federal Trade Commission and the Department of Justice.
Full Content: Elizabeth Warrenhttps://www.pymnts.com/antitrust/2019/big-tech-antitrust-examination-by-ags-gathers-steam/
Norwegian salmon giants receive US subpoenas in price-fixing probe
By
CPI
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November 17, 2019
The US Department of Justice (DOJ) will subpoena Mowi as part of a criminal investigation into alleged price-fixing of Atlantic salmon markets, the company disclosed.
Fellow salmon farmers Grieg Seafood and its sales arm Ocean Quality, which is co-owned with Bremnes Seashore, another Norwegian farmer, also received subpoenas, those companies stated. SalMar also confirmed a subpoena, but Leroy Seafood Group has not yet.
According to a press release, Mowi was informed it will receive a subpoena from the DOJ’s Antitrust Division “in the USA where they are opening a criminal investigation involving allegations of similar conduct,” reported Yahoo.
The news follows a previous investigation opened by the European Commission and related civil lawsuits alleging price-fixing from US consumers.
From:https://finance.yahoo.com/news/u-joins-antitrust-push-against-065644141.html
By
CPI
-
November 17, 2019
The US Department of Justice (DOJ) will subpoena Mowi as part of a criminal investigation into alleged price-fixing of Atlantic salmon markets, the company disclosed.
Fellow salmon farmers Grieg Seafood and its sales arm Ocean Quality, which is co-owned with Bremnes Seashore, another Norwegian farmer, also received subpoenas, those companies stated. SalMar also confirmed a subpoena, but Leroy Seafood Group has not yet.
According to a press release, Mowi was informed it will receive a subpoena from the DOJ’s Antitrust Division “in the USA where they are opening a criminal investigation involving allegations of similar conduct,” reported Yahoo.
The news follows a previous investigation opened by the European Commission and related civil lawsuits alleging price-fixing from US consumers.
From:https://finance.yahoo.com/news/u-joins-antitrust-push-against-065644141.html
New Bill to Shine a Light on the Hidden Causes of Foodborne Illness Outbreaks
Consumer Groups Applaud Effort to Give Food Safety Regulators Critically Needed Authority to Collect Microbiological Samples
November 22, 2019 | Press Release
Washington D.C. — Senator Kirsten Gillibrand yesterday introduced a bill that would give federal investigators at the U.S. Food and Drug Administration (FDA) a new tool to solve foodborne illness outbreaks. Members of the Safe Food Coalition say the bill is more important than ever in light of yet another outbreak linked to romaine lettuce, which today led FDA to advise consumers not to eat, and retailers not to sell, any romaine lettuce harvested from the Salinas, California growing region.
Titled the Expanded Food Safety Investigation Act of 2019, the bill would give FDA the authority to conduct microbiological sampling on concentrated animal feeding operations (CAFOs) so that foodborne illness outbreak investigators can trace back the source of pathogens like the E. coli O157:H7 bacteria linked to Romaine lettuce produced in the Yuma growing region, which killed five people last year. Congresswoman DeLauro, chair of the Congressional Food Safety Caucus, is expected to introduce a companion bill in the House later this year.
Members of the Safe Food Coalition welcomed the introduction of the bill. Under current law, federal authorities need permission to enter the premises of a CAFO to conduct sampling in connection with a foodborne illness outbreak investigation. This limitation came to the forefront during last year’s Yuma Romaine lettuce E. coli O157:H7 outbreak. Samples taken from canal water in the area suggested that the source of the outbreak may have been a large concentrated animal feeding operation in the area. Investigators were permitted to take only limited samples on the operation and were not able to identify the outbreak strain among these.
from https://consumerfed.org/press_release/new-bill-to-shine-a-light-on-the-hidden-causes-of-foodborne-illness-outbreaks/
Consumer Groups Applaud Effort to Give Food Safety Regulators Critically Needed Authority to Collect Microbiological Samples
November 22, 2019 | Press Release
Washington D.C. — Senator Kirsten Gillibrand yesterday introduced a bill that would give federal investigators at the U.S. Food and Drug Administration (FDA) a new tool to solve foodborne illness outbreaks. Members of the Safe Food Coalition say the bill is more important than ever in light of yet another outbreak linked to romaine lettuce, which today led FDA to advise consumers not to eat, and retailers not to sell, any romaine lettuce harvested from the Salinas, California growing region.
Titled the Expanded Food Safety Investigation Act of 2019, the bill would give FDA the authority to conduct microbiological sampling on concentrated animal feeding operations (CAFOs) so that foodborne illness outbreak investigators can trace back the source of pathogens like the E. coli O157:H7 bacteria linked to Romaine lettuce produced in the Yuma growing region, which killed five people last year. Congresswoman DeLauro, chair of the Congressional Food Safety Caucus, is expected to introduce a companion bill in the House later this year.
Members of the Safe Food Coalition welcomed the introduction of the bill. Under current law, federal authorities need permission to enter the premises of a CAFO to conduct sampling in connection with a foodborne illness outbreak investigation. This limitation came to the forefront during last year’s Yuma Romaine lettuce E. coli O157:H7 outbreak. Samples taken from canal water in the area suggested that the source of the outbreak may have been a large concentrated animal feeding operation in the area. Investigators were permitted to take only limited samples on the operation and were not able to identify the outbreak strain among these.
from https://consumerfed.org/press_release/new-bill-to-shine-a-light-on-the-hidden-causes-of-foodborne-illness-outbreaks/
From DMN:There’s Hope for Radio Reform, After All — Congress Introduces the ‘AM-FM Act’ to Overhaul Terrestrial Copyright Laws
US-based terrestrial radio stations don’t pay royalties on the broadcast of recordings. The newly-introduced ‘AM-FM Act’ is aiming to change that.
The story continues here. https://www.digitalmusicnews.com/2019/11/21/am-fm-act-terrestrial-radio/
US-based terrestrial radio stations don’t pay royalties on the broadcast of recordings. The newly-introduced ‘AM-FM Act’ is aiming to change that.
The story continues here. https://www.digitalmusicnews.com/2019/11/21/am-fm-act-terrestrial-radio/
Amid National Dairy Crisis, Milk Monopolists Discuss Fire-Sale Merger
Dean Foods, America’s largest dairy processor, filed for Chapter 11 bankruptcy last week, citing declining milk consumption. The producer of Dairy Pure, TruMoo, Land O’ Lakes, and more than 50 other brands also announced that it is in advanced talks to sell to Dairy Farmers of America (DFA), a cooperative that handles roughly 30 percent of all raw milk in the United States.
The merger raises concerns for dairy farmers, who have brought several class-action antitrust suits against DFA for its monopolistic control over raw milk markets and for collusion… with Dean Foods.
A Dean Foods-DFA merger would expand DFA’s control over raw milk markets and put the co-op in a dominant position to raise milk prices for consumers and lower prices paid to farmers, at a time when dairy farms are going under at a historic clip.
Read Claire Kelloway’s full story in the Washington Monthly here.https://openmarketsinstitute.cmail20.com/t/j-l-ctykylk-jldufuylr-h/
Dean Foods, America’s largest dairy processor, filed for Chapter 11 bankruptcy last week, citing declining milk consumption. The producer of Dairy Pure, TruMoo, Land O’ Lakes, and more than 50 other brands also announced that it is in advanced talks to sell to Dairy Farmers of America (DFA), a cooperative that handles roughly 30 percent of all raw milk in the United States.
The merger raises concerns for dairy farmers, who have brought several class-action antitrust suits against DFA for its monopolistic control over raw milk markets and for collusion… with Dean Foods.
A Dean Foods-DFA merger would expand DFA’s control over raw milk markets and put the co-op in a dominant position to raise milk prices for consumers and lower prices paid to farmers, at a time when dairy farms are going under at a historic clip.
Read Claire Kelloway’s full story in the Washington Monthly here.https://openmarketsinstitute.cmail20.com/t/j-l-ctykylk-jldufuylr-h/
Federal attorneys do pro bono work
A brief excerpt from an article in the November/December Washington Lawyer Magazine
By Sarah Kellogg
Pro bono service is deeply embedded in the legal profession in the UnitedStates, from Big Law to solo prac tices to federa l agencies. The work is more passion than occu pat ion, an inclination toward public service, whether
an attorney coun sels a nonprofit organizat ion, a fledgling small business, or a vulnerable individual in need of legal help.
Today, some 50 federal departments and agencies are part of the Federal Government Pro Bono Program, which operates out of the Justic e Department and administers govern ment-wide pro bone activities not only in Washington, D.C., but also in Chicago, New York City, San Francisco, Denver, and Dallas. In most agencies, a pro bono coordinator works with
a committee to oversee the processand recruit volunteers.
That this human resource went untapped - or severely underu tilized- for many years is
unfortunate.
http://washingtonlawyer.dcbar.org/november2019/index.php#/4
A brief excerpt from an article in the November/December Washington Lawyer Magazine
By Sarah Kellogg
Pro bono service is deeply embedded in the legal profession in the UnitedStates, from Big Law to solo prac tices to federa l agencies. The work is more passion than occu pat ion, an inclination toward public service, whether
an attorney coun sels a nonprofit organizat ion, a fledgling small business, or a vulnerable individual in need of legal help.
Today, some 50 federal departments and agencies are part of the Federal Government Pro Bono Program, which operates out of the Justic e Department and administers govern ment-wide pro bone activities not only in Washington, D.C., but also in Chicago, New York City, San Francisco, Denver, and Dallas. In most agencies, a pro bono coordinator works with
a committee to oversee the processand recruit volunteers.
That this human resource went untapped - or severely underu tilized- for many years is
unfortunate.
http://washingtonlawyer.dcbar.org/november2019/index.php#/4
Tim Wu's Antitrust Revival Reading List
by Tim Wu
Nov 18 · 3 min read
The following are books, articles and study that make up the antitrust revival. I include here work both belonging to the so-called New Brandeis school, and also the Neo-Arnoldian, or Post-Chicago schools.
This list is a work in progress and certainly not meant to be definitive. If there’s something missing, please email me and I’ll add it.
Books in Print
The Curse of Bigness, Tim Wu
Goliath, Matt Stoller
The Antitrust Paradigm, Restoring a Competitive Economy, Jonathan B. Baker
Radical Markets: Uprooting Capitalism and Democracy for a Just Society, Eric Posner, Glen Weyl
People, Power, and Profits: Progressive Capitalism for an Age of Discontent, Joseph E. Stiglitz
The Myth of Capitalism: Monopolies and the Death of Competition, Jonathan Tepper, Denise Hearn
Big Data and Competition Policy, Maurice Stucke & Allen Grunes
Cornered: The New Monopoly Capitalism and the Economics of Destruction, Barry Lynn
Coming Soon
Competition Overdose: How Free Market Mythology Transformed Us from Citizen Kings to Market Servants, Ariel Ezrachi, Maurice E. Stucke
Break ’Em Up: Recovering Our Freedom from Big Ag, Big Tech, and Big Money, Zephyr Teachout
Articles, Studies & Symposia
Amazon’s Antitrust Paradox, Lina Khan
The Separation of Platforms and Commerce, Lina Khan
Are U.S. Industries Becoming More Concentrated?, Gustavo Grullon, Yelena Larkin, Roni Michaely
Antitrust’s Democracy Deficit, Harry First & Spencer Weber Waller
Reassessing the Chicago School of Antitrust Symposium, forthcoming 2020, Pennsylvania Law Review.
Unlocking Antitrust Enforcement, Symposium, Yale Law Journal
The Profound Nonsense of Consumer Welfare Antitrust, Sandeep Vaheesan
Market Power & Inequality, Lina Khan & Sandeep Vaheesan
The Ideological Roots of America’s Market Power Problem, Lina Khan
The New Brandeis Movement, Lina Khan
The Unsound Theory Behind the Consumer (and Total) Welfare Goal in Antitrust, Mark Glick
American Gothic: How Chicago School Economics Distorts ‘Consumer Welfare’ in Antitrust, Mark Glick
Does the Rule of Reason Violate the Rule of Law?, Maurice Stucke
The Battle for the Soul of Antitrust, Eleanor Fox
Wealth Transfers as the Original and Primary Concern of Antitrust: The Efficiency Interpretation Challenged, Robert Lande
After Consumer Welfare, Now What?, Tim Wu
Blind Spot: The Attention Economy and the Law, Tim Wu
The New Utilities: Private Power, Social Infrastructure, and the Revival of the Public Utility Concept, K Sabeel Rahman
Horizontal Shareholding, Einer Elhauge
Tying, Bundled Discounts, and the Death of the Single Monopoly Profit Theory, Einer Elhaughe
Horizontal Shareholding and Antitrust Policy, Fiona Morton Scott, Herbert Hovenkamp
A Proposal to Limit the Anti-Competitive Power of Institutional Investors, Eric Posner, Fiona Morton Scott, E. Glen Weyl
Powerless, Marshall Steinbaum, Eric Bernstein, John Sturm
Concentration in US Labor Markets, José Azar, Ioana Marinescu, Marshall Steinbaum, Bledi Taska
Accommodating Capital and Policing Labor: Antitrust in the Two Gilded Ages, Sandeep Vaheesan
Predatory Pricing and Recoupment, Christopher R. Leslie
The Effective Competition Standard, Marshall Steinbaum, Maurice E. Stucke
Artificial Intelligence & Collusion: When Computers Inhibit Competition, Maurice Stucke
Reconsidering Competition, Maurice Stucke
America’s Concentration Crisis, Open Markets Institute
The Worst Opinion in Living Memory: AT&T/Time Warner and America’s Broken Merger Law, Chris Sagers
Market Structure and Political Law: A Taxonomy of Power, Zephyr Teachout, Lina Khan
Corporate Rules and Political Rules: Antitrust as Campaign Finance Reform, Zephyr Teachout
Antitrust Remedies for Labor Market Power, Suresh Naidu, Eric Posner, E. Glen Weyl
The Antitrust Consumer Welfare Paradox, Barak Orbach
Antitrust Populism, Barak Orbach
Antitrust As Allocator of Coordination Rights, Sanjukta Paul
by Tim Wu
Nov 18 · 3 min read
The following are books, articles and study that make up the antitrust revival. I include here work both belonging to the so-called New Brandeis school, and also the Neo-Arnoldian, or Post-Chicago schools.
This list is a work in progress and certainly not meant to be definitive. If there’s something missing, please email me and I’ll add it.
Books in Print
The Curse of Bigness, Tim Wu
Goliath, Matt Stoller
The Antitrust Paradigm, Restoring a Competitive Economy, Jonathan B. Baker
Radical Markets: Uprooting Capitalism and Democracy for a Just Society, Eric Posner, Glen Weyl
People, Power, and Profits: Progressive Capitalism for an Age of Discontent, Joseph E. Stiglitz
The Myth of Capitalism: Monopolies and the Death of Competition, Jonathan Tepper, Denise Hearn
Big Data and Competition Policy, Maurice Stucke & Allen Grunes
Cornered: The New Monopoly Capitalism and the Economics of Destruction, Barry Lynn
Coming Soon
Competition Overdose: How Free Market Mythology Transformed Us from Citizen Kings to Market Servants, Ariel Ezrachi, Maurice E. Stucke
Break ’Em Up: Recovering Our Freedom from Big Ag, Big Tech, and Big Money, Zephyr Teachout
Articles, Studies & Symposia
Amazon’s Antitrust Paradox, Lina Khan
The Separation of Platforms and Commerce, Lina Khan
Are U.S. Industries Becoming More Concentrated?, Gustavo Grullon, Yelena Larkin, Roni Michaely
Antitrust’s Democracy Deficit, Harry First & Spencer Weber Waller
Reassessing the Chicago School of Antitrust Symposium, forthcoming 2020, Pennsylvania Law Review.
Unlocking Antitrust Enforcement, Symposium, Yale Law Journal
The Profound Nonsense of Consumer Welfare Antitrust, Sandeep Vaheesan
Market Power & Inequality, Lina Khan & Sandeep Vaheesan
The Ideological Roots of America’s Market Power Problem, Lina Khan
The New Brandeis Movement, Lina Khan
The Unsound Theory Behind the Consumer (and Total) Welfare Goal in Antitrust, Mark Glick
American Gothic: How Chicago School Economics Distorts ‘Consumer Welfare’ in Antitrust, Mark Glick
Does the Rule of Reason Violate the Rule of Law?, Maurice Stucke
The Battle for the Soul of Antitrust, Eleanor Fox
Wealth Transfers as the Original and Primary Concern of Antitrust: The Efficiency Interpretation Challenged, Robert Lande
After Consumer Welfare, Now What?, Tim Wu
Blind Spot: The Attention Economy and the Law, Tim Wu
The New Utilities: Private Power, Social Infrastructure, and the Revival of the Public Utility Concept, K Sabeel Rahman
Horizontal Shareholding, Einer Elhauge
Tying, Bundled Discounts, and the Death of the Single Monopoly Profit Theory, Einer Elhaughe
Horizontal Shareholding and Antitrust Policy, Fiona Morton Scott, Herbert Hovenkamp
A Proposal to Limit the Anti-Competitive Power of Institutional Investors, Eric Posner, Fiona Morton Scott, E. Glen Weyl
Powerless, Marshall Steinbaum, Eric Bernstein, John Sturm
Concentration in US Labor Markets, José Azar, Ioana Marinescu, Marshall Steinbaum, Bledi Taska
Accommodating Capital and Policing Labor: Antitrust in the Two Gilded Ages, Sandeep Vaheesan
Predatory Pricing and Recoupment, Christopher R. Leslie
The Effective Competition Standard, Marshall Steinbaum, Maurice E. Stucke
Artificial Intelligence & Collusion: When Computers Inhibit Competition, Maurice Stucke
Reconsidering Competition, Maurice Stucke
America’s Concentration Crisis, Open Markets Institute
The Worst Opinion in Living Memory: AT&T/Time Warner and America’s Broken Merger Law, Chris Sagers
Market Structure and Political Law: A Taxonomy of Power, Zephyr Teachout, Lina Khan
Corporate Rules and Political Rules: Antitrust as Campaign Finance Reform, Zephyr Teachout
Antitrust Remedies for Labor Market Power, Suresh Naidu, Eric Posner, E. Glen Weyl
The Antitrust Consumer Welfare Paradox, Barak Orbach
Antitrust Populism, Barak Orbach
Antitrust As Allocator of Coordination Rights, Sanjukta Paul
UN leads bid for cheaper insulin, expanding access for diabetics worldwide
13 November 2019
Health
Overly expensive insulin could be a thing of the past – and life-changing news – for millions of diabetics under a plan launched by the World Health Organization (WHO) on Wednesday to diversify production globally, just ahead of World Diabetes Day.
Announcing the initiative in Geneva, the UN agency said that it had already had informal expressions of interest from pharmaceutical companies looking to produce insulin and have WHO assess whether it is safe for people to use.
“The simple fact is, that the prevalence of diabetes is growing, the amount of insulin available to treat diabetes is too low, the prices are too high, so we need to do something,” said Emer Cooke, Director of Regulation of Medicines and other Health Technologies at WHO.
Coinciding with the project launch, which comes ahead of World Diabetes Day marked each 14 November, UN Secretary-General António Guterres highlighted the impact of “catastrophic” medical expenses on sufferers.
“Diabetes damages health and undermines educational and employment aspirations for many, affecting communities and forcing families into economic hardship”, he said, particularly in low and middle-income countries.
The WHO’s two-year pilot project, unveiled on Wednesday, involves the evaluation of insulin developed by manufacturers to ensure their quality, safety, efficacy and affordability.
Room for expansion of diabetic care
Assuming there is enough interest from manufacturers and, crucially, more insulin available for diabetics, the scheme could be expanded more widely.
“We’re going to look at the number of companies that will apply, we’re going to look at how long it takes, we’re going to look at the outcomes and we’re going to see whether this makes sense and it really is increasing access”, Ms. Cooke said.
The procedure is known as prequalification and WHO has done it in the past for non-brand vaccines, including those used to treat TB, malaria and HIV.
This had resulted in massive savings for sufferers around the world, with 80 per cent of HIV patients now relying on generic products, Ms. Cooke said.
She noted too that some companies had already committed to lowering prices.
HIV drug price plunge led the way
“When (HIV) anti-retrovirals were first produced, the cost per patient per year was $10,000,” she said. “Once we opened prequalification for generic HIV products, the price went down to $300 per year.”
She added: “We’re also confident that competition will bring prices down. That way, countries will have a greater choice of products that are more affordable.”
Today, three manufacturers control most of the global market for insulin, which was discovered as a treatment for diabetes in 1921.
The medicine works by lowering blood glucose levels, a task that is usually carried out by natural insulin, which is produced by the pancreas whenever we eat.
The quadrupling in the number of people with diabetes since 1980 – to around 420 million today, mostly in low and middle-income countries - is widely attributed to poor diet and a lack of exercise.
Those with type one diabetes – around 20 million people - need insulin injections to survive, while only around half of the 65 million type-two sufferers who need insulin are able to get it, WHO said.
Diabetics forced to ration insulin
In some countries, prices are so prohibitive that some people are forced to ration their insulin.
This leaves them susceptible to heart attacks, stroke, kidney failure, blindness and lower limb amputations.
And while diabetes was the seventh leading cause of death globally in 2016, the finding is only worrying because the disease kills people prematurely, said Dr Gojka Roglic, WHO medical officer and diabetes expert.
“We all have to die of something and why not of diabetes - but (only) after celebrating our 90th birthday,” she joked. “The problem with diabetes is that it accounts for a large proportion of premature diabetes – almost half of them occur before 70.”
In low and middle-income countries, the percentage rises to around 60 per cent, Dr Roglic added.
Data collected by WHO from 24 countries on four continents showed that human insulin was available only in 61 per cent of health facilities.
The data from 2016-2019 also showed that a month’s supply of insulin costs a worker in Accra, Ghana, more than a fifth of their take-home pay.
https://news.un.org/en/story/2019/11/1051241
13 November 2019
Health
Overly expensive insulin could be a thing of the past – and life-changing news – for millions of diabetics under a plan launched by the World Health Organization (WHO) on Wednesday to diversify production globally, just ahead of World Diabetes Day.
Announcing the initiative in Geneva, the UN agency said that it had already had informal expressions of interest from pharmaceutical companies looking to produce insulin and have WHO assess whether it is safe for people to use.
“The simple fact is, that the prevalence of diabetes is growing, the amount of insulin available to treat diabetes is too low, the prices are too high, so we need to do something,” said Emer Cooke, Director of Regulation of Medicines and other Health Technologies at WHO.
Coinciding with the project launch, which comes ahead of World Diabetes Day marked each 14 November, UN Secretary-General António Guterres highlighted the impact of “catastrophic” medical expenses on sufferers.
“Diabetes damages health and undermines educational and employment aspirations for many, affecting communities and forcing families into economic hardship”, he said, particularly in low and middle-income countries.
The WHO’s two-year pilot project, unveiled on Wednesday, involves the evaluation of insulin developed by manufacturers to ensure their quality, safety, efficacy and affordability.
Room for expansion of diabetic care
Assuming there is enough interest from manufacturers and, crucially, more insulin available for diabetics, the scheme could be expanded more widely.
“We’re going to look at the number of companies that will apply, we’re going to look at how long it takes, we’re going to look at the outcomes and we’re going to see whether this makes sense and it really is increasing access”, Ms. Cooke said.
The procedure is known as prequalification and WHO has done it in the past for non-brand vaccines, including those used to treat TB, malaria and HIV.
This had resulted in massive savings for sufferers around the world, with 80 per cent of HIV patients now relying on generic products, Ms. Cooke said.
She noted too that some companies had already committed to lowering prices.
HIV drug price plunge led the way
“When (HIV) anti-retrovirals were first produced, the cost per patient per year was $10,000,” she said. “Once we opened prequalification for generic HIV products, the price went down to $300 per year.”
She added: “We’re also confident that competition will bring prices down. That way, countries will have a greater choice of products that are more affordable.”
Today, three manufacturers control most of the global market for insulin, which was discovered as a treatment for diabetes in 1921.
The medicine works by lowering blood glucose levels, a task that is usually carried out by natural insulin, which is produced by the pancreas whenever we eat.
The quadrupling in the number of people with diabetes since 1980 – to around 420 million today, mostly in low and middle-income countries - is widely attributed to poor diet and a lack of exercise.
Those with type one diabetes – around 20 million people - need insulin injections to survive, while only around half of the 65 million type-two sufferers who need insulin are able to get it, WHO said.
Diabetics forced to ration insulin
In some countries, prices are so prohibitive that some people are forced to ration their insulin.
This leaves them susceptible to heart attacks, stroke, kidney failure, blindness and lower limb amputations.
And while diabetes was the seventh leading cause of death globally in 2016, the finding is only worrying because the disease kills people prematurely, said Dr Gojka Roglic, WHO medical officer and diabetes expert.
“We all have to die of something and why not of diabetes - but (only) after celebrating our 90th birthday,” she joked. “The problem with diabetes is that it accounts for a large proportion of premature diabetes – almost half of them occur before 70.”
In low and middle-income countries, the percentage rises to around 60 per cent, Dr Roglic added.
Data collected by WHO from 24 countries on four continents showed that human insulin was available only in 61 per cent of health facilities.
The data from 2016-2019 also showed that a month’s supply of insulin costs a worker in Accra, Ghana, more than a fifth of their take-home pay.
https://news.un.org/en/story/2019/11/1051241
Uber Fined $649 Million for Saying Drivers Aren’t Employees
The move by New Jersey could reverberate across the gig economy.
New Jersey’s move against Uber reflects an intensifying national debate over how app-based companies treat their work force.
New Jersey has demanded that Uber pay $649 million for years of unpaid employment taxes for its drivers, arguing that the ride-hailing company has misclassified the workers as independent contractors and not as employees.
The state’s Department of Labor and Workforce Development issued the request this week to Uber and a subsidiary, Raiser, after an audit uncovered $530 million in back taxes that had not been paid for unemployment and disability insurance from 2014 to 2018.
Because of the nonpayment, the state is seeking another $119 million in interest.
The case represents a major escalation in how states nationwide view the employment practices at the core of many app-based companies, and the first time that a local government has sought back payroll taxes from Uber, which has hundreds of thousands of drivers in the United States.
A spokeswoman at Uber said the company disputed the state’s findings.
Excerpt from https://www.nytimes.com/2019/11/14/nyregion/uber-new-jersey-drivers.html
DC AG Racine takes lead in challenging perceived arbitration abuses
D.C. Attorney General Karl Racine, along with the AGs of 11 other states, has written a hard hitting letter to the arbitration providers asking them to provide detailed information on practices perceived as abusive, and pressuring them to stop the abuses. Here’s a link to their letter: https://oag.dc.gov/release/ag-racine-leads-12-state-coalition-ensure-workers
A press release explains: “Employees are entitled to a fair process to vindicate their workplace rights, including when they are required to do so through arbitration,” said AG Racine. “We are concerned about reports that workers in the District have encountered high costs and prolonged delays in arbitration that have prevented them from reaching resolutions. That’s why our coalition of Attorneys General has requested data from the leading arbitration firms to better understand how we can protect workers and ensure they have a fair shot at resolving disputes.”
D.C. Attorney General Karl Racine, along with the AGs of 11 other states, has written a hard hitting letter to the arbitration providers asking them to provide detailed information on practices perceived as abusive, and pressuring them to stop the abuses. Here’s a link to their letter: https://oag.dc.gov/release/ag-racine-leads-12-state-coalition-ensure-workers
A press release explains: “Employees are entitled to a fair process to vindicate their workplace rights, including when they are required to do so through arbitration,” said AG Racine. “We are concerned about reports that workers in the District have encountered high costs and prolonged delays in arbitration that have prevented them from reaching resolutions. That’s why our coalition of Attorneys General has requested data from the leading arbitration firms to better understand how we can protect workers and ensure they have a fair shot at resolving disputes.”
Mowi, SalMar ASA and Grieg Seafood ASA, three of Norway's biggest farmed salmon producers, said in separate statements on Thursday that they had either received or would get a subpoena from the U.S. Department of Justice’s Antitrust Division and that investigations would be opened.
The development in the U.S. follows raids by the European Commission in February in member states against those companies’ sites. The Commission said at the time it had concerns that they had violated EU antitrust rules prohibiting price fixing cartels and restrictive business practices. The companies were also among salmon farmers cited in a class-action lawsuit in the U.S. in April.
From: https://finance.yahoo.com/news/u-joins-antitrust-push-against-065644141.html
Note: Norwegian salmon farmers have previously received public attention because the food pellets used for the fish cause the fish to have elevated levels of PCBs, which some experts believe to be healthy. DR
The development in the U.S. follows raids by the European Commission in February in member states against those companies’ sites. The Commission said at the time it had concerns that they had violated EU antitrust rules prohibiting price fixing cartels and restrictive business practices. The companies were also among salmon farmers cited in a class-action lawsuit in the U.S. in April.
From: https://finance.yahoo.com/news/u-joins-antitrust-push-against-065644141.html
Note: Norwegian salmon farmers have previously received public attention because the food pellets used for the fish cause the fish to have elevated levels of PCBs, which some experts believe to be healthy. DR
Why Aren’t We All Buying Houses on the Internet?
Because the one thing startups can’t disrupt is the real estate agent.By HENRY GRABAR
JUNE 07, 20185:51 AM
____
DAR comment: Real estate sales enabled by web technology seems like a fertile area for disruptive business innovation. But the recent travails of the Compass real estate company and its Softbank financial sponsor suggest that the disruptions are slow in coming. The author Henry Graber suggests why -- customers like old style real estate brokering, even if it is costly. Time will tell whether Mr. Graber is right.
___________________
Between the housing crash, the subsequent housing crisis, and the unshakeable ascent of real estate reality TV, the past decade has so fundamentally changed the way Americans think about buying and selling homes that it’s easy to forget that the way we actually buy and sell homes is the same as it ever was.
For sellers: hire an agent, do a little renovation, list, and wait. For buyers: hire an agent, traverse open houses, make an offer, and wait. If you’re selling, expect to pay at least a 5 percent commission on one of the biggest financial transactions of your life.
Nearly 9 in 10 Americans use an agent to buy and sell their homes. Last year, residential commission revenue was somewhere in the range of $75 billion. And the market remains fragmented, with even the biggest brokerages managing just a tiny fraction of transactions—at least for now. “Wall Street and Silicon Valley are infatuated with the idea there isn’t an industry in the world they can’t blow to shreds with money and technology,” says Steve Murray, the president of real estate analysis firm Real Trends. There are signs that real estate’s time has come. “We’re going to see an infinite variety of changes to the way people buy and sell homes.”
According to PitchBook, an analysis firm owned by Morningstar, the amount of venture capital invested in real estate technology companies was up to $1.2 billion in 2017 from just $31 million in 2012. In May, Zillow, the online listings behemoth that also owns Trulia and StreetEasy, announced it would start buying and selling homes. Newer startups will buy houses sight unseen, or with a lifelong contract that allows the seller to remain living there until death.
There’s a general sense that the internet should do more than entertain window shoppers and generate leads for agents. It should actually make it easier and cheaper to sell a house. There’s just one issue: No one has figured out how to bypass the flesh-and-blood real estate agent.
“The old idea that real estate is never going to change, that we’re going to pay 6 percent, is completely untrue,” argues Glenn Kelman, the CEO of Seattle-based Redfin, a publicly traded brokerage whose calling card is lower commissions. For Kelman, the rush of cash into real estate startups feels like vindication for a corporate model that investors have regarded with skepticism. Redfin’s low-fee model relies on an army of in-house agents who trade typical commissions for the volume that’s possible with internet-generated leads. A Redfin world isn’t a world without real estate agents, but it is one where fewer agents do more. The nation’s 1.4 million working real estate agents do not particularly like Redfin.
Zillow has a different approach. The company hasn’t disrupted the traditional agent model; on the contrary, it’s dependent on it. In the first quarter of 2018, Zillow raked in $300 million in revenue (Redfin’s revenue for all of 2017 was $370 million); more than 70 percent of that came from the company’s “Premier Agents,” who pay for prime placement on the site to generate leads. In becoming an iBuyer (the industry’s term of art, short for “instant buyer”), the company won’t bite the real estate–brokering hand that feeds it. If anything, the pivot provides a lucrative opportunity for local agents to cement their relationships with a company that is trying to become an industrial-scale homebuyer.
You’ll wind up banking less from Zillow than you would have from a traditional sale through a local real estate agent. But the company believes there’s a big tranche of sellers who will take convenience in exchange for a smaller sum for their house. “That’s not what most consumers care about,” surmises Jeremy Wacksman, the company’s chief marketing officer. “What they care about is pushing the button and making magic happen.” Magic, in this case, means selling your house in a matter of days, even at a small discount.
Zillow aims to finish the year with 300 to 1,000 houses in its inventory. In the long term, the company imagines using its extensive reach to make it possible for families to easily coordinate sales and purchases, even across cities, eliminating the uncertainty that accompanies a move. If a new job at Disney World draws your family from Las Vegas to Orlando, Zillow might help you on both ends of the move, making sure there’s just a few days downtime between sale and purchase.
There’s another trend that explains Zillow’s logic—and that of a handful of other startups willing to engage (and able to secure funding) in the capital-intensive business of buying houses. Driven by a national, yearlong homebuilding shortage, home prices have recovered and surpassed their pre-recession value, while the homeownership rate remains just ticks above a 50-year low—a housing recovery without homeowners. This gives investors confidence in the market: There really aren’t enough places for Americans to live. Relatedly, it has created a new and prominent force in homebuying, the single-family home investor, which can be a good partner for startups looking to make quick transactions. Before Zillow announced its big push into flipping this spring, it ran a trial program called “instant offers” in Las Vegas and Orlando, working exclusively to sell houses to investor-buyers like Invitation Homes, one of the country’s largest single-family landlords.
Zillow also isn’t the first company to try acting as a middleman. San Francisco–based Opendoor has made tens of thousands of offers on homes, mostly in Sun Belt cities like Phoenix and Dallas. These places are an easier market than New York or San Francisco: The housing stock is newer, cheaper, and more suburban—which is to say, self-similar. Transactions taxes tend to be lower. The company sees itself as competing against seller uncertainty. “[Zillow] keep[s] the agents at the center of the transaction, which is in line with their business model,” says Cristin Culver, head of communications for Opendoor. “And we keep the customer at the center, which is really our North Star, and that’s the difference.” The company’s rapid appraisals make it possible for sellers to skip agents on the first transaction, and after doing some small renovations (paint, HVAC, basic repairs), Opendoor’s “All Day Open House” allows buyers to find and unlock the house themselves with a smartphone. Easy, right?
And yet most of them come with an agent, and the company says it’s one of the biggest payers of commissions in its markets today.*
Why hasn’t the internet cut out the agent, even as houses sell to internet companies with the click of a button? In part because consumers aren’t really trying to inject any startup pizzazz into the largest (and most complex) transaction of their lives. Local knowledge remains invaluable. That, and it’s hard to develop regular clients. This isn’t Seamless. In real estate, a satisfied customer isn’t coming back anytime soon.
https://slate.com/technology/2018/06/redfin-zillow-and-opendoor-cant-disrupt-real-estate-agents-and-may-not-want-to.html
Because the one thing startups can’t disrupt is the real estate agent.By HENRY GRABAR
JUNE 07, 20185:51 AM
____
DAR comment: Real estate sales enabled by web technology seems like a fertile area for disruptive business innovation. But the recent travails of the Compass real estate company and its Softbank financial sponsor suggest that the disruptions are slow in coming. The author Henry Graber suggests why -- customers like old style real estate brokering, even if it is costly. Time will tell whether Mr. Graber is right.
___________________
Between the housing crash, the subsequent housing crisis, and the unshakeable ascent of real estate reality TV, the past decade has so fundamentally changed the way Americans think about buying and selling homes that it’s easy to forget that the way we actually buy and sell homes is the same as it ever was.
For sellers: hire an agent, do a little renovation, list, and wait. For buyers: hire an agent, traverse open houses, make an offer, and wait. If you’re selling, expect to pay at least a 5 percent commission on one of the biggest financial transactions of your life.
Nearly 9 in 10 Americans use an agent to buy and sell their homes. Last year, residential commission revenue was somewhere in the range of $75 billion. And the market remains fragmented, with even the biggest brokerages managing just a tiny fraction of transactions—at least for now. “Wall Street and Silicon Valley are infatuated with the idea there isn’t an industry in the world they can’t blow to shreds with money and technology,” says Steve Murray, the president of real estate analysis firm Real Trends. There are signs that real estate’s time has come. “We’re going to see an infinite variety of changes to the way people buy and sell homes.”
According to PitchBook, an analysis firm owned by Morningstar, the amount of venture capital invested in real estate technology companies was up to $1.2 billion in 2017 from just $31 million in 2012. In May, Zillow, the online listings behemoth that also owns Trulia and StreetEasy, announced it would start buying and selling homes. Newer startups will buy houses sight unseen, or with a lifelong contract that allows the seller to remain living there until death.
There’s a general sense that the internet should do more than entertain window shoppers and generate leads for agents. It should actually make it easier and cheaper to sell a house. There’s just one issue: No one has figured out how to bypass the flesh-and-blood real estate agent.
“The old idea that real estate is never going to change, that we’re going to pay 6 percent, is completely untrue,” argues Glenn Kelman, the CEO of Seattle-based Redfin, a publicly traded brokerage whose calling card is lower commissions. For Kelman, the rush of cash into real estate startups feels like vindication for a corporate model that investors have regarded with skepticism. Redfin’s low-fee model relies on an army of in-house agents who trade typical commissions for the volume that’s possible with internet-generated leads. A Redfin world isn’t a world without real estate agents, but it is one where fewer agents do more. The nation’s 1.4 million working real estate agents do not particularly like Redfin.
Zillow has a different approach. The company hasn’t disrupted the traditional agent model; on the contrary, it’s dependent on it. In the first quarter of 2018, Zillow raked in $300 million in revenue (Redfin’s revenue for all of 2017 was $370 million); more than 70 percent of that came from the company’s “Premier Agents,” who pay for prime placement on the site to generate leads. In becoming an iBuyer (the industry’s term of art, short for “instant buyer”), the company won’t bite the real estate–brokering hand that feeds it. If anything, the pivot provides a lucrative opportunity for local agents to cement their relationships with a company that is trying to become an industrial-scale homebuyer.
You’ll wind up banking less from Zillow than you would have from a traditional sale through a local real estate agent. But the company believes there’s a big tranche of sellers who will take convenience in exchange for a smaller sum for their house. “That’s not what most consumers care about,” surmises Jeremy Wacksman, the company’s chief marketing officer. “What they care about is pushing the button and making magic happen.” Magic, in this case, means selling your house in a matter of days, even at a small discount.
Zillow aims to finish the year with 300 to 1,000 houses in its inventory. In the long term, the company imagines using its extensive reach to make it possible for families to easily coordinate sales and purchases, even across cities, eliminating the uncertainty that accompanies a move. If a new job at Disney World draws your family from Las Vegas to Orlando, Zillow might help you on both ends of the move, making sure there’s just a few days downtime between sale and purchase.
There’s another trend that explains Zillow’s logic—and that of a handful of other startups willing to engage (and able to secure funding) in the capital-intensive business of buying houses. Driven by a national, yearlong homebuilding shortage, home prices have recovered and surpassed their pre-recession value, while the homeownership rate remains just ticks above a 50-year low—a housing recovery without homeowners. This gives investors confidence in the market: There really aren’t enough places for Americans to live. Relatedly, it has created a new and prominent force in homebuying, the single-family home investor, which can be a good partner for startups looking to make quick transactions. Before Zillow announced its big push into flipping this spring, it ran a trial program called “instant offers” in Las Vegas and Orlando, working exclusively to sell houses to investor-buyers like Invitation Homes, one of the country’s largest single-family landlords.
Zillow also isn’t the first company to try acting as a middleman. San Francisco–based Opendoor has made tens of thousands of offers on homes, mostly in Sun Belt cities like Phoenix and Dallas. These places are an easier market than New York or San Francisco: The housing stock is newer, cheaper, and more suburban—which is to say, self-similar. Transactions taxes tend to be lower. The company sees itself as competing against seller uncertainty. “[Zillow] keep[s] the agents at the center of the transaction, which is in line with their business model,” says Cristin Culver, head of communications for Opendoor. “And we keep the customer at the center, which is really our North Star, and that’s the difference.” The company’s rapid appraisals make it possible for sellers to skip agents on the first transaction, and after doing some small renovations (paint, HVAC, basic repairs), Opendoor’s “All Day Open House” allows buyers to find and unlock the house themselves with a smartphone. Easy, right?
And yet most of them come with an agent, and the company says it’s one of the biggest payers of commissions in its markets today.*
Why hasn’t the internet cut out the agent, even as houses sell to internet companies with the click of a button? In part because consumers aren’t really trying to inject any startup pizzazz into the largest (and most complex) transaction of their lives. Local knowledge remains invaluable. That, and it’s hard to develop regular clients. This isn’t Seamless. In real estate, a satisfied customer isn’t coming back anytime soon.
https://slate.com/technology/2018/06/redfin-zillow-and-opendoor-cant-disrupt-real-estate-agents-and-may-not-want-to.html
AGs meet in Colorado to discuss Google antitrust probe
By CPI
-
November 12, 2019
State officials investigating Alphabet’s Google met Monday, November 11, to dive into competition issues surrounding the search giant as they press forward with an investigation into whether the company is violating antitrust laws, Reuters reported.
The officials met privately in Denver with outside experts with the goal of gaining a deeper understanding of Google’s businesses and the dynamics of the markets it operates in, including digital advertising.
The gathering comes two months after all but two states opened an antitrust investigation into Google with an initial focus on its advertising. Perhaps about a dozen states sent representatives to the meeting, Reuters reported.
The gathering was similar to one held in New York in October, where state and federal enforcers from the Justice Department and Federal Trade Commission discussed their probe of Facebook.
The probe of Google, a unit of Alphabet, is being led by the Texas attorney general’s office. Google had no comment about the meeting in Colorado, but pointed to a blog post from September in which an executive, Kent Walker, said that the company has “always worked constructively with regulators and will continue to do so.”
Texas sent the search and advertising giant a subpoena on September 9 asking for information about its online digital advertising business, which generates most of Google’s revenue and where Google is a dominant player.
Full Content: Reuters
By CPI
-
November 12, 2019
State officials investigating Alphabet’s Google met Monday, November 11, to dive into competition issues surrounding the search giant as they press forward with an investigation into whether the company is violating antitrust laws, Reuters reported.
The officials met privately in Denver with outside experts with the goal of gaining a deeper understanding of Google’s businesses and the dynamics of the markets it operates in, including digital advertising.
The gathering comes two months after all but two states opened an antitrust investigation into Google with an initial focus on its advertising. Perhaps about a dozen states sent representatives to the meeting, Reuters reported.
The gathering was similar to one held in New York in October, where state and federal enforcers from the Justice Department and Federal Trade Commission discussed their probe of Facebook.
The probe of Google, a unit of Alphabet, is being led by the Texas attorney general’s office. Google had no comment about the meeting in Colorado, but pointed to a blog post from September in which an executive, Kent Walker, said that the company has “always worked constructively with regulators and will continue to do so.”
Texas sent the search and advertising giant a subpoena on September 9 asking for information about its online digital advertising business, which generates most of Google’s revenue and where Google is a dominant player.
Full Content: Reuters
Assistant Attorney General Makan Delrahim addresses an antitrust conference at Harvard Law School, November 8, 2019
The headline news for the media is that the antitrust chief warned big tech companies that the government could pursue them for anticompetitive behavior related to their troves of data about users, including for cutting off data access to competitors.
As the New York Times reports, Delrahim said that "Antitrust enforcers cannot turn a blind eye to the serious competition questions that digital markets have raised." Also, he discussed "the ways market power can manifest in industries where data plays a key role," particularly when large amounts of data are amassed that are "quite personal and unique in nature" and offers insight into "the most intimate aspects of human choice and behavior, including personal health, emotional well-being, civic engagement and financial fitness. That, said Delrahim, can create "avenues for abuse."
Further, Delrahim explained that the acquisition of such data is especially valuable for companies in the business of selling predictions about human behavior, he said. That's how Google and Facebook — which dominate global search and social media — attract targeted advertising.
He cited Harvard Business School professor emerita Shoshana Zuboff's theory of "surveillance capitalism," which holds that the "behavioral data" those companies acquire through their nominally free services is a wholly new kind of product. Zuboff considers it massively invasive and exploitative.
Delrahim said that "although privacy fits primarily within the realm of consumer protection law, it would be a grave mistake to believe that privacy concerns can never play a role in antitrust analysis."
Delrahim said that USDOJ staff would expand to deal with high tech antitrust issues.
I was in the audience for the Delrahim talk, and I heard not just a warning to high tech businesses, but caution about the permissible scope of antitrust action. Delrahim has made similar cautious comments in the past, including in Delrahim’s address at the University of Chicago's Antitrust and Competition Conference in April of 2018.
At the earlier conference, as at the recent November 8, 2019 conference, Delrahim was respectful of what he called “evidence-based enforcement.” That is, enforcement built on credible evidence that a practice harms competition and the American consumer, or in the case of merger enforcement, that it creates an unacceptable risk of doing so.
In 2018 Delrahim explained that “Outside the realm of naked horizontal restraints such as price fixing, bid rigging, and market allocation, antitrust demands evidence of harm or likely harm to competition, often weighed against efficiencies or procompetitive justifications.”
He also said in 2018: “Taking an evidence-based approach to antitrust law should not be mistaken for an unwillingness to bring enforcement actions. In fact, where there is clear evidence of harm to competition, it is the duty of enforcers to promptly and vigorously prosecute the antitrust laws, and to refuse to settle for ineffective behavioral band-aids that fall short of curing the underlying threat to competition and consumers. . . . Evidence-based enforcement also requires a readiness to adapt our existing antitrust framework and tools to new or emerging threats to competition. It is an approach of openness to persuasion, and is adaptable to new business models and emerging technologies that create novel threats to competition and consumer welfare.”
So, where do Delrahim’s comments leave us with regard to expectations of USDOJ antitrust enforcement against big tech companies, and particularly Google, Facebook, and Amazon. It is hard to say, particularly given political forces at play that Delrahim did not address. It does seem clear that cautious and evidence based antitrust enforcement is a key part of Delrahim’s thinking. It is unlikely that Makan Delrahim and antitrust reform advocates like Tim Wu and Lina Khan are in perfect agreement.
Sources: https://www.nytimes.com/aponline/2019/11/08/business/bc-us-justice-department-antitrust-speech.html?action=click&module=editorContent&pgtype=Article®ion=CompanionColumn&contentCollection=Trending#after-pp_edpick
file:///F:/Expansion%20Drive/Antitrust%20schoarship/Assistant%20Attorney%20General%20Makan%20Delrahim%20Delivers%20Keynote%20Address%20at%20the%20University%20of%20Chicago's%20Antitrust%20and%20Competition%20Conference%20_%20OPA%20_%20Department%20of%20Justice.html
THIS POSTING IS BY DON ALLEN RESNIKOFF, WHO TAKES FULL RESPONSIBILITY FOR ITS CONTENT
Addendum, 11-14-19: A transcript of the AAG's talk is now available: https://www.justice.gov/opa/speech/assistant-attorney-general-makan-delrahim-delivers-remarks-harvard-law-school-competition
The headline news for the media is that the antitrust chief warned big tech companies that the government could pursue them for anticompetitive behavior related to their troves of data about users, including for cutting off data access to competitors.
As the New York Times reports, Delrahim said that "Antitrust enforcers cannot turn a blind eye to the serious competition questions that digital markets have raised." Also, he discussed "the ways market power can manifest in industries where data plays a key role," particularly when large amounts of data are amassed that are "quite personal and unique in nature" and offers insight into "the most intimate aspects of human choice and behavior, including personal health, emotional well-being, civic engagement and financial fitness. That, said Delrahim, can create "avenues for abuse."
Further, Delrahim explained that the acquisition of such data is especially valuable for companies in the business of selling predictions about human behavior, he said. That's how Google and Facebook — which dominate global search and social media — attract targeted advertising.
He cited Harvard Business School professor emerita Shoshana Zuboff's theory of "surveillance capitalism," which holds that the "behavioral data" those companies acquire through their nominally free services is a wholly new kind of product. Zuboff considers it massively invasive and exploitative.
Delrahim said that "although privacy fits primarily within the realm of consumer protection law, it would be a grave mistake to believe that privacy concerns can never play a role in antitrust analysis."
Delrahim said that USDOJ staff would expand to deal with high tech antitrust issues.
I was in the audience for the Delrahim talk, and I heard not just a warning to high tech businesses, but caution about the permissible scope of antitrust action. Delrahim has made similar cautious comments in the past, including in Delrahim’s address at the University of Chicago's Antitrust and Competition Conference in April of 2018.
At the earlier conference, as at the recent November 8, 2019 conference, Delrahim was respectful of what he called “evidence-based enforcement.” That is, enforcement built on credible evidence that a practice harms competition and the American consumer, or in the case of merger enforcement, that it creates an unacceptable risk of doing so.
In 2018 Delrahim explained that “Outside the realm of naked horizontal restraints such as price fixing, bid rigging, and market allocation, antitrust demands evidence of harm or likely harm to competition, often weighed against efficiencies or procompetitive justifications.”
He also said in 2018: “Taking an evidence-based approach to antitrust law should not be mistaken for an unwillingness to bring enforcement actions. In fact, where there is clear evidence of harm to competition, it is the duty of enforcers to promptly and vigorously prosecute the antitrust laws, and to refuse to settle for ineffective behavioral band-aids that fall short of curing the underlying threat to competition and consumers. . . . Evidence-based enforcement also requires a readiness to adapt our existing antitrust framework and tools to new or emerging threats to competition. It is an approach of openness to persuasion, and is adaptable to new business models and emerging technologies that create novel threats to competition and consumer welfare.”
So, where do Delrahim’s comments leave us with regard to expectations of USDOJ antitrust enforcement against big tech companies, and particularly Google, Facebook, and Amazon. It is hard to say, particularly given political forces at play that Delrahim did not address. It does seem clear that cautious and evidence based antitrust enforcement is a key part of Delrahim’s thinking. It is unlikely that Makan Delrahim and antitrust reform advocates like Tim Wu and Lina Khan are in perfect agreement.
Sources: https://www.nytimes.com/aponline/2019/11/08/business/bc-us-justice-department-antitrust-speech.html?action=click&module=editorContent&pgtype=Article®ion=CompanionColumn&contentCollection=Trending#after-pp_edpick
file:///F:/Expansion%20Drive/Antitrust%20schoarship/Assistant%20Attorney%20General%20Makan%20Delrahim%20Delivers%20Keynote%20Address%20at%20the%20University%20of%20Chicago's%20Antitrust%20and%20Competition%20Conference%20_%20OPA%20_%20Department%20of%20Justice.html
THIS POSTING IS BY DON ALLEN RESNIKOFF, WHO TAKES FULL RESPONSIBILITY FOR ITS CONTENT
Addendum, 11-14-19: A transcript of the AAG's talk is now available: https://www.justice.gov/opa/speech/assistant-attorney-general-makan-delrahim-delivers-remarks-harvard-law-school-competition
From the NY Times: https://www.nytimes.com/2019/11/10/opinion/big-business-consumer-prices.html#after-story-ad-1
A new book, “The Great Reversal: How America Gave Up on Free Markets.”
In one industry after another, Thomas Phillipon writes, a few companies have grown so large that they have the power to keep prices high and wages low. It’s great for those corporations — and bad for almost everyone else.
Many Americans have a choice between only two internet providers. The airline industry is dominated by four large carriers. Amazon, Apple, Facebook and Google are growing ever larger. One or two hospital systems control many local markets. Home Depot and Lowe’s have displaced local hardware stores. Regional pharmacy chains like Eckerd and Happy Harry’s have been swallowed by national giants.
Other researchers have also documented rising corporate concentration. Philippon’s biggest contribution is to explain that it isn’t some natural result of globalization and technological innovation. If it were, the trends would be similar around the world. But they’re not. Big companies have become only slightly larger in Europe this century — rather than much larger, as in the United States.
What explains the difference? Politics.
The European economy certainly has its problems, but antitrust policy isn’t one of them. The European Union has kept competition alive by blocking mergers and insisting that established companies make room for new entrants. In telecommunications, smaller companies often have the right to use infrastructure built by the giants. That’s why Philippon’s parents can choose among five internet providers, including a low-cost company that brought down prices for everyone.
In air travel, European discount carriers like easyJet have received better access to the gate slots they need to operate. The largest four European airlines control only about 40 percent of the market. In the United States, that share is 80 percent, and, as you’d expect, airfares are higher. Even Southwest Airlines has begun to behave less like a low-fare carrier.
The irony is that Europe is implementing market-based ideas — like telecommunications deregulation and low-cost airlines — that Americans helped pioneer. “E.U. consumers are better off than American consumers today,” Philippon writes, “because the E.U. has adopted the U.S. playbook, which the U.S. itself has abandoned.”
A new book, “The Great Reversal: How America Gave Up on Free Markets.”
In one industry after another, Thomas Phillipon writes, a few companies have grown so large that they have the power to keep prices high and wages low. It’s great for those corporations — and bad for almost everyone else.
Many Americans have a choice between only two internet providers. The airline industry is dominated by four large carriers. Amazon, Apple, Facebook and Google are growing ever larger. One or two hospital systems control many local markets. Home Depot and Lowe’s have displaced local hardware stores. Regional pharmacy chains like Eckerd and Happy Harry’s have been swallowed by national giants.
Other researchers have also documented rising corporate concentration. Philippon’s biggest contribution is to explain that it isn’t some natural result of globalization and technological innovation. If it were, the trends would be similar around the world. But they’re not. Big companies have become only slightly larger in Europe this century — rather than much larger, as in the United States.
What explains the difference? Politics.
The European economy certainly has its problems, but antitrust policy isn’t one of them. The European Union has kept competition alive by blocking mergers and insisting that established companies make room for new entrants. In telecommunications, smaller companies often have the right to use infrastructure built by the giants. That’s why Philippon’s parents can choose among five internet providers, including a low-cost company that brought down prices for everyone.
In air travel, European discount carriers like easyJet have received better access to the gate slots they need to operate. The largest four European airlines control only about 40 percent of the market. In the United States, that share is 80 percent, and, as you’d expect, airfares are higher. Even Southwest Airlines has begun to behave less like a low-fare carrier.
The irony is that Europe is implementing market-based ideas — like telecommunications deregulation and low-cost airlines — that Americans helped pioneer. “E.U. consumers are better off than American consumers today,” Philippon writes, “because the E.U. has adopted the U.S. playbook, which the U.S. itself has abandoned.”
Class Actions 101 for the year 2019: If you are an attorney wondering whether it is a good idea to bring a class action against Juul, dozens of other attorneys have gotten ahead of you. Maybe hundreds. DAR
Judge Orrick Picks Team of 4 as Interim Leaders in Juul MDL
By Ross Todd | November 08, 2019 at 08:04 PM
Interim leadership includes Sarah London, of Lieff Cabraser, Dena Sharp of Girard Sharp, Ellen Relkin of Weitz & Luxenberg, and Dean Kawamoto of Keller Rohrback, but the appointment doesn’t necessarily cement their place in the final leadership structure.
The federal judge overseeing a batch of cases against e-cigarette maker Juul has chosen four plaintiffs lawyers to lead the case in its early stages.
At the end of a marathon hearing Friday where more than 40 lawyers gave two-minute pitches for leadership positions in the multidistrict litigation, U.S. District Judge William Orrick III appointed four lawyers to handle preliminary matters for plaintiffs: Sarah London, a partner at San Francisco’s Lieff Cabraser Heimann & Bernstein, Dena Sharp, of Girard Sharp in San Francisco, Ellen Relkin of Weitz & Luxenberg in New York, and Dean Kawamoto of Keller Rohrback in Seattle.
Orrick indicated in an order issued in the run-up to Friday’s initial case management conference that he wanted to have an interim team in place to handle logistics until he can complete an “initial census” of the cases before him in the multidistrict litigation. An “initial census” refers to the idea, increasingly floated by the defense bar, that judges should vet cases early on in multidistrict litigation in order to weed out meritless claims and to determine the different sorts of plaintiffs and claims within a particular MDL.
“I feel a great sense of urgency to deal with the issues in this case because of the seriousness of the allegations and the need for us to be collectively involved to search for truth and resolution in this matter,” Orrick told a packed courtroom at the top of Friday’s hearing.
Orrick has called on Jaime Dodge, the founding director of Emory University School of Law’s Institute for Complex Litigation and Mass Claims, for help with the initial census.
Orrick indicated in his pre-hearing order that appointment to the initial team would not be a guarantee of inclusion on the final leadership structure of the cases, which focus on Juul’s marketing, particularly to children, and alleged injuries caused by its products—including addiction, pulmonary disease, and seizures. Juul faces a mix of personal injury and addiction cases as well as proposed class actions brought on behalf of consumers, school districts and state and local governments, as well as cases seeking medical monitoring for Juul users going forward.
A line of lawyers trailed outside the courtroom door ahead of the hearing.
Orrick allowed most attorneys only two minutes to express why they or their firm should be chosen for leadership and to pitch ways to expedite a resolution to the case. Lieff Cabraser’s London, whom Orrick had previously tapped to coordinate some preliminary issues with defendants, spoke first and was allowed about five minutes to outline the universe of 163 cases in the MDL so far.
London encouraged the judge to ultimately pick a slate of 22 lawyers on a proposed leadership team that pitches alongside proposed co-lead counsel at San Francisco’s Gutride Safier and New York’s Douglas & London.
“We need a sizable group of lawyers who can work well together,” said London, whose group had proposed that class actions, personal injury cases, and the municipal cases proceed together, rather than on separate tracks. London said that plaintiffs needed to be able to adapt to developing circumstances.
Friday’s hearing came as Juul in October agreed to stop selling fruit-flavored e-cigarettes. The company also reached a legal settlement with California’s Center for Environmental Health that limits how the company can market its product to minors.
“We need be able to take our formation and direct it in the direction to get the job done,” London said.
Girard Sharp name partner Dena Sharp, who had backed a rival leadership structure advocating for separate tracks for different types of cases, said Friday that it was obvious that there “was not a whole lot of difference” between the groups and that everyone on the plaintiffs side of the room had a shared interest.
“It surely is if nothing else a public health emergency at this point,” Sharp said. She said that the proposal for different tracks was directed at giving clients and the court someone specific they could call on and hold accountable.
Orrick indicated in his pre-hearing order that the group chosen Friday would “address preliminary discovery issues, such as the Protective Order, ESI Protocol, selection of necessary vendors, and discovery planning that can occur before the final leadership team is in place.”
Orrick said Friday that he wanted to make sure to get the structure of the case right and to get the results of the case census would help him do that.
“I want this case to move forward in a speedy and collaborative and efficient way,” Orrick said.
Source: https://www.law.com/therecorder/2019/11/08/judge-orrick-picks-team-of-4-as-interim-leaders-in-juul-mdl/?kw=Judge%20Orrick%20Picks%20Team%20of%204%20as%20Interim%20Leaders%20in%20Juul%20MDL&utm_source=email&utm_medium=enl&utm_campaign=newsroomupdate&utm_content=20191108&utm_term=ca&slreturn=20191010220052
Judge Orrick Picks Team of 4 as Interim Leaders in Juul MDL
By Ross Todd | November 08, 2019 at 08:04 PM
Interim leadership includes Sarah London, of Lieff Cabraser, Dena Sharp of Girard Sharp, Ellen Relkin of Weitz & Luxenberg, and Dean Kawamoto of Keller Rohrback, but the appointment doesn’t necessarily cement their place in the final leadership structure.
The federal judge overseeing a batch of cases against e-cigarette maker Juul has chosen four plaintiffs lawyers to lead the case in its early stages.
At the end of a marathon hearing Friday where more than 40 lawyers gave two-minute pitches for leadership positions in the multidistrict litigation, U.S. District Judge William Orrick III appointed four lawyers to handle preliminary matters for plaintiffs: Sarah London, a partner at San Francisco’s Lieff Cabraser Heimann & Bernstein, Dena Sharp, of Girard Sharp in San Francisco, Ellen Relkin of Weitz & Luxenberg in New York, and Dean Kawamoto of Keller Rohrback in Seattle.
Orrick indicated in an order issued in the run-up to Friday’s initial case management conference that he wanted to have an interim team in place to handle logistics until he can complete an “initial census” of the cases before him in the multidistrict litigation. An “initial census” refers to the idea, increasingly floated by the defense bar, that judges should vet cases early on in multidistrict litigation in order to weed out meritless claims and to determine the different sorts of plaintiffs and claims within a particular MDL.
“I feel a great sense of urgency to deal with the issues in this case because of the seriousness of the allegations and the need for us to be collectively involved to search for truth and resolution in this matter,” Orrick told a packed courtroom at the top of Friday’s hearing.
Orrick has called on Jaime Dodge, the founding director of Emory University School of Law’s Institute for Complex Litigation and Mass Claims, for help with the initial census.
Orrick indicated in his pre-hearing order that appointment to the initial team would not be a guarantee of inclusion on the final leadership structure of the cases, which focus on Juul’s marketing, particularly to children, and alleged injuries caused by its products—including addiction, pulmonary disease, and seizures. Juul faces a mix of personal injury and addiction cases as well as proposed class actions brought on behalf of consumers, school districts and state and local governments, as well as cases seeking medical monitoring for Juul users going forward.
A line of lawyers trailed outside the courtroom door ahead of the hearing.
Orrick allowed most attorneys only two minutes to express why they or their firm should be chosen for leadership and to pitch ways to expedite a resolution to the case. Lieff Cabraser’s London, whom Orrick had previously tapped to coordinate some preliminary issues with defendants, spoke first and was allowed about five minutes to outline the universe of 163 cases in the MDL so far.
London encouraged the judge to ultimately pick a slate of 22 lawyers on a proposed leadership team that pitches alongside proposed co-lead counsel at San Francisco’s Gutride Safier and New York’s Douglas & London.
“We need a sizable group of lawyers who can work well together,” said London, whose group had proposed that class actions, personal injury cases, and the municipal cases proceed together, rather than on separate tracks. London said that plaintiffs needed to be able to adapt to developing circumstances.
Friday’s hearing came as Juul in October agreed to stop selling fruit-flavored e-cigarettes. The company also reached a legal settlement with California’s Center for Environmental Health that limits how the company can market its product to minors.
“We need be able to take our formation and direct it in the direction to get the job done,” London said.
Girard Sharp name partner Dena Sharp, who had backed a rival leadership structure advocating for separate tracks for different types of cases, said Friday that it was obvious that there “was not a whole lot of difference” between the groups and that everyone on the plaintiffs side of the room had a shared interest.
“It surely is if nothing else a public health emergency at this point,” Sharp said. She said that the proposal for different tracks was directed at giving clients and the court someone specific they could call on and hold accountable.
Orrick indicated in his pre-hearing order that the group chosen Friday would “address preliminary discovery issues, such as the Protective Order, ESI Protocol, selection of necessary vendors, and discovery planning that can occur before the final leadership team is in place.”
Orrick said Friday that he wanted to make sure to get the structure of the case right and to get the results of the case census would help him do that.
“I want this case to move forward in a speedy and collaborative and efficient way,” Orrick said.
Source: https://www.law.com/therecorder/2019/11/08/judge-orrick-picks-team-of-4-as-interim-leaders-in-juul-mdl/?kw=Judge%20Orrick%20Picks%20Team%20of%204%20as%20Interim%20Leaders%20in%20Juul%20MDL&utm_source=email&utm_medium=enl&utm_campaign=newsroomupdate&utm_content=20191108&utm_term=ca&slreturn=20191010220052
Amazon’s China business is bigger than ever.
That is because it has aggressively recruited Chinese manufacturers and merchants to sell to consumers outside the country. And these sellers, in turn, represent a high proportion of problem listings found on the site, according to a Wall Street Journal investigation.
The Journal earlier this year uncovered 10,870 items for sale between May and August that have been declared unsafe by federal agencies, are deceptively labeled, lacked federally-required warnings, or are banned by federal regulators. Amazon said it investigated the items, and some listings were taken down after the Journal’s reporting.
Of 1,934 sellers whose addresses could be determined, 54% were based in China, according to a Journal analysis of data from research firm Marketplace Pulse.
Amazon’s China recruiting is one reason why its platform increasingly resembles an unruly online flea market. A new product listing is uploaded to Amazon from China every 1/50th of a second, according to slides its officials showed a December conference in the industrial port city of Ningbo.
Chinese factories are squeezing profit margins for middlemen who sell on Amazon’s third-party platform. Some U.S. sellers fear the next step will be to cut them out entirely.
Excert from https://www.wsj.com/articles/amazons-heavy-recruitment-of-chinese-sellers-puts-consumers-at-risk-11573489075 [paywall]
________________________
That is because it has aggressively recruited Chinese manufacturers and merchants to sell to consumers outside the country. And these sellers, in turn, represent a high proportion of problem listings found on the site, according to a Wall Street Journal investigation.
The Journal earlier this year uncovered 10,870 items for sale between May and August that have been declared unsafe by federal agencies, are deceptively labeled, lacked federally-required warnings, or are banned by federal regulators. Amazon said it investigated the items, and some listings were taken down after the Journal’s reporting.
Of 1,934 sellers whose addresses could be determined, 54% were based in China, according to a Journal analysis of data from research firm Marketplace Pulse.
Amazon’s China recruiting is one reason why its platform increasingly resembles an unruly online flea market. A new product listing is uploaded to Amazon from China every 1/50th of a second, according to slides its officials showed a December conference in the industrial port city of Ningbo.
Chinese factories are squeezing profit margins for middlemen who sell on Amazon’s third-party platform. Some U.S. sellers fear the next step will be to cut them out entirely.
Excert from https://www.wsj.com/articles/amazons-heavy-recruitment-of-chinese-sellers-puts-consumers-at-risk-11573489075 [paywall]
________________________
Mark Steinbach has provided an article from the Daily Record (a newspaper covering Baltimore's legal, real estate and business communities). It described a program in which pro bono and Legal Aid lawyers provide pro bono advice to people at multiple library branches once a week for a couple of hours.
Here's a link to info on Maryland's program: https://www.prattlibrary.org/lawyer/
Here's the article from the Daily Record:
Lawyer in the Library program offers free aid in city neighborhoods
By: Louis Krauss November 5, 2019
When Shantelle Middleton walked into the Enoch Pratt Free Library on Pennsylvania Avenue Tuesday, she didn’t expect to discover lawyers ready to provide information to help with her longstanding divorce and tax issues.
“I was actually coming to get my son some PlayStation games, and the lady informed me at the door about this program, so I figured why not kill two birds with one stone,” Middleton said.
Each Tuesday, Maryland Legal Aid sends a team of lawyers to the library as part of its Lawyer in the Library program. The program started with just one lawyer in 2015, immediately after the riots following Freddie Gray’s death in police custody.
This week, six attorneys were on hand at the Pennsylvania Avenue branch, each at a booth in the library’s basement. Half were Maryland Legal Aid staff attorneys, while the rest were lawyers working pro bono. Three of the booths were devoted to consultations about expunging criminal records and the rest focused on matters related to housing assistance, family law and public benefits.
Middleton, who waited for her consultation along with her elementary school-aged son, said she was surprised at how many attorneys were on hand to offer help.
“I was kind of shocked, given the type of urban community we’re in,” Middleton said. “I didn’t know we had so much at our disposal. It was a big relief.”
After hearing each client’s case, the attorneys confer with other Legal Aid staff before deciding if — and how — they can help or whether they should direct the client to other pro bono services.
Following the 2015 riots, which took place near the Pennsylvania Avenue branch of the library, Legal Aid attorney Todd Cagwin said the organization decided to start the free legal consultation service knowing it would help city residents, particularly those looking to expunge their records of minor offenses.
Since then the service has expanded and now operates in six city library branches, according to the Maryland Legal Aid website. Cagwin said the organization recently hired a lawyer to offer legal services in city public schools.
In recent weeks, the library also has added free wellness checks, administered by a Johns Hopkins doctor.
With the Legal Aid program running only from 1 to 3 p.m. on Tuesdays, there’s often a long line of people waiting for legal help. On Tuesday, about a dozen people waited to meet with a lawyer.
Wendy Thomas Wolock, a volunteer attorney for the Maryland Legal Aid program, said she came out of retirement to help review expungement cases. She said it’s more fun to practice law when she doesn’t have to do it for a living.
“Kids make stupid mistakes, some more so than others,” Wolock said, explaining what motivated her to help with expungements. “Everyone deserves a second chance, and so I wanted to help facilitate this.”
More information about the Lawyer in the Library program can be found here.https://www.prattlibrary.org/lawyer/
-----
Here's a link to info on Maryland's program: https://www.prattlibrary.org/lawyer/
Here's the article from the Daily Record:
Lawyer in the Library program offers free aid in city neighborhoods
By: Louis Krauss November 5, 2019
When Shantelle Middleton walked into the Enoch Pratt Free Library on Pennsylvania Avenue Tuesday, she didn’t expect to discover lawyers ready to provide information to help with her longstanding divorce and tax issues.
“I was actually coming to get my son some PlayStation games, and the lady informed me at the door about this program, so I figured why not kill two birds with one stone,” Middleton said.
Each Tuesday, Maryland Legal Aid sends a team of lawyers to the library as part of its Lawyer in the Library program. The program started with just one lawyer in 2015, immediately after the riots following Freddie Gray’s death in police custody.
This week, six attorneys were on hand at the Pennsylvania Avenue branch, each at a booth in the library’s basement. Half were Maryland Legal Aid staff attorneys, while the rest were lawyers working pro bono. Three of the booths were devoted to consultations about expunging criminal records and the rest focused on matters related to housing assistance, family law and public benefits.
Middleton, who waited for her consultation along with her elementary school-aged son, said she was surprised at how many attorneys were on hand to offer help.
“I was kind of shocked, given the type of urban community we’re in,” Middleton said. “I didn’t know we had so much at our disposal. It was a big relief.”
After hearing each client’s case, the attorneys confer with other Legal Aid staff before deciding if — and how — they can help or whether they should direct the client to other pro bono services.
Following the 2015 riots, which took place near the Pennsylvania Avenue branch of the library, Legal Aid attorney Todd Cagwin said the organization decided to start the free legal consultation service knowing it would help city residents, particularly those looking to expunge their records of minor offenses.
Since then the service has expanded and now operates in six city library branches, according to the Maryland Legal Aid website. Cagwin said the organization recently hired a lawyer to offer legal services in city public schools.
In recent weeks, the library also has added free wellness checks, administered by a Johns Hopkins doctor.
With the Legal Aid program running only from 1 to 3 p.m. on Tuesdays, there’s often a long line of people waiting for legal help. On Tuesday, about a dozen people waited to meet with a lawyer.
Wendy Thomas Wolock, a volunteer attorney for the Maryland Legal Aid program, said she came out of retirement to help review expungement cases. She said it’s more fun to practice law when she doesn’t have to do it for a living.
“Kids make stupid mistakes, some more so than others,” Wolock said, explaining what motivated her to help with expungements. “Everyone deserves a second chance, and so I wanted to help facilitate this.”
More information about the Lawyer in the Library program can be found here.https://www.prattlibrary.org/lawyer/
-----
From DMN
After Receiving Just $98 in Soundtrack Royalties, the Creators of Spinal Tap Settle Their $400 Million Lawsuit Against Vivendi Marsha Silva
November 5, 2019
The creators of the legendary rock mockumentary This Is Spinal Tap have settled their dispute with Universal Music Group (UMG) parent Vivendi relating to the soundtrack of the film and related recordings.The film’s creators include Harry Shearer, Christopher Guest, Michael McKean and Rob Reiner.
Under the terms of the agreement, UMG will continue to distribute recordings relating to This Is Spinal Tap. Though eventually these rights will return to the creators. Previously, it was reported that, between 1989 and 2006, they received only $98 in royalties from the soundtrack.
In 2016, the four filed a broader $400 million lawsuit against UMG’s parent Vivendi, alleging breach of contract, fraud and anti-competitive business practices against Studio Canal, which is another subsidiary of Vivendi. This suit related to all intellectual properties related to the film, including merchandising, and would seem to be only partially resolved by the settlement.
Like with music royalties, the creators of the film have received little in terms of merchandising royalty: $81 since 1984.Made with little budget, This Is Spinal Tap spawned the mockumentary genre and has been included in many lists of the greatest movies of all time. This includes the New York Times Guide to the Best 1,000 Movies Ever Made, Entertainment Weekly’s 100 Greatest Movies of All Time and Total Film’s the 100 Greatest Movies of All Time.
In the decades after the film’s release, hundreds of thousands of Spinal Tap recordings have sold around the world, and they are still available in both physical and digital formats.
In response to the settlement, Harry Shearer said, “I must admit, from the moment we first began mediation with them to now, I’ve been impressed by UMG’s respect for creatives and their distinctive desire to seek a prompt and equitable solution to the issues.”ly' to Pay Nearly $10 Million Owed to Artists, Bank-Appointed Administrator Says
Christopher Guest also commented on the agreement. He said, “It was refreshing to be treated so constructively and with such courtesy by UMG and I’m pleased we have been able to resolve this.
https://www.digitalmusicnews.com/2019/10/23/pledgemusic-unlikely-to-pay-artists/
Editorial comment by DAR: Linking this article to broader issues, a 52 second video of a legendary and brilliant Spinal Tap drummer spontaneously exploding is here: https://www.youtube.com/watch?v=TW6W9iOjTKM
After Receiving Just $98 in Soundtrack Royalties, the Creators of Spinal Tap Settle Their $400 Million Lawsuit Against Vivendi Marsha Silva
November 5, 2019
The creators of the legendary rock mockumentary This Is Spinal Tap have settled their dispute with Universal Music Group (UMG) parent Vivendi relating to the soundtrack of the film and related recordings.The film’s creators include Harry Shearer, Christopher Guest, Michael McKean and Rob Reiner.
Under the terms of the agreement, UMG will continue to distribute recordings relating to This Is Spinal Tap. Though eventually these rights will return to the creators. Previously, it was reported that, between 1989 and 2006, they received only $98 in royalties from the soundtrack.
In 2016, the four filed a broader $400 million lawsuit against UMG’s parent Vivendi, alleging breach of contract, fraud and anti-competitive business practices against Studio Canal, which is another subsidiary of Vivendi. This suit related to all intellectual properties related to the film, including merchandising, and would seem to be only partially resolved by the settlement.
Like with music royalties, the creators of the film have received little in terms of merchandising royalty: $81 since 1984.Made with little budget, This Is Spinal Tap spawned the mockumentary genre and has been included in many lists of the greatest movies of all time. This includes the New York Times Guide to the Best 1,000 Movies Ever Made, Entertainment Weekly’s 100 Greatest Movies of All Time and Total Film’s the 100 Greatest Movies of All Time.
In the decades after the film’s release, hundreds of thousands of Spinal Tap recordings have sold around the world, and they are still available in both physical and digital formats.
In response to the settlement, Harry Shearer said, “I must admit, from the moment we first began mediation with them to now, I’ve been impressed by UMG’s respect for creatives and their distinctive desire to seek a prompt and equitable solution to the issues.”ly' to Pay Nearly $10 Million Owed to Artists, Bank-Appointed Administrator Says
Christopher Guest also commented on the agreement. He said, “It was refreshing to be treated so constructively and with such courtesy by UMG and I’m pleased we have been able to resolve this.
https://www.digitalmusicnews.com/2019/10/23/pledgemusic-unlikely-to-pay-artists/
Editorial comment by DAR: Linking this article to broader issues, a 52 second video of a legendary and brilliant Spinal Tap drummer spontaneously exploding is here: https://www.youtube.com/watch?v=TW6W9iOjTKM
CMS may not have power to make hospitals disclose negotiated prices
The Trump administration wants hospitals to tell the public how much they get paid for healthcare services, but many experts don't think the CMS has the authority to force those disclosures.
READ MORE >https://www.modernhealthcare.com/law-regulation/cms-may-not-have-power-make-hospitals-disclose-negotiated-prices?utm_source=modern-healthcare-am-wednesday&utm_medium=email&utm_campaign=20191105&utm_content=article1-readmore
The Trump administration wants hospitals to tell the public how much they get paid for healthcare services, but many experts don't think the CMS has the authority to force those disclosures.
READ MORE >https://www.modernhealthcare.com/law-regulation/cms-may-not-have-power-make-hospitals-disclose-negotiated-prices?utm_source=modern-healthcare-am-wednesday&utm_medium=email&utm_campaign=20191105&utm_content=article1-readmore
Hacked voting machines and registration rolls
A few months ago Senate Intelligence Committee released a 67-page report [https://www.intelligence.senate.gov/sites/default/files/documents/Report_Volume1.pdf] concluding that, leading up to the 2016 election, Russians hacked voting machines and registration rolls in all 50 states, and they are likely still doing so.
From a Slate article:
J. Alex Halderman, a computer scientist who has tested vulnerabilities for more than a decade, testified to the Senate committee that he and his team “created attacks that can spread from machine to machine, like a computer virus, and silently change election outcomes.” They studied touch-screen and optical-scan systems, and “in every single case,” he said, “we found ways for attackers to sabotage machines and steal votes.”
Another way to throw an election might be to attack systems that manage voter-registration lists, which the hackers also did in some states. Remove people from the lists—focusing on areas dominated by members of the party that the hacker wants to lose—and they won’t be able to vote.
One former senior intelligence official told me, “If I was going to hack such a system, I’d leave the records alone and corrupt the tally software”—the programs that count the votes and transmit results to a central headquarters. The transmission is done through a network, which is vulnerable to hackers. Some data are transmitted from the voting machines via USB ports, which are also easy to hack.
In the past decade, many states have installed voting machines with paper backups. (One of the measures blocked in the Senate this week would have required them.) But the Senate report notes that 19 states do not conduct complete postelection audits to compare these ballots to the electronic results; five of them do not audit at all. Paper backups mean little if nobody looks at them.
Computerized voting might be inherently vulnerable. Matt Blaze, who holds the McDevitt Chair of Computer Science at Georgetown Law, said at a hacking conference in Washington earlier this year, “Voting security is by far the hardest problem I have ever encountered.”
The American system compounds the difficulties. The voting process must be transparent but also secret. Every vote must be counted, but no one should be able to trace a specific ballot back to a specific person—thus making verification impossible. More daunting, states, counties, and even local election districts set and enforce their own rules and standards. The Senate report notes that when President Barack Obama tried to declare elections to be “critical infrastructure,” which would have allowed intelligence and law enforcement agencies to offer technical assistance on security, many states resisted, fearing a “federal takeover.”
Finally, even if someone found a solution to the problem and convinced every election district to comply, some hacker might find a way around it. The offense-defense race in cyberspace will probably never end.
However, there is a solution to this problem, and it’s maddeningly simple: Take presidential elections out of cyberspace. In other words, go back to the paper ballot.
From: slate.com/news-and-politics/2019/07/elections-hacking-russia-senate-intelligence-committee.html
Google’s $2.1 billion acquisition of Fitbit Inc.
The acquisition means that means two of the largest technology companies will now dominate the U.S. market for fitness tracking devices and data, and the purchase is already coming under fire from U.S. lawmakers.
Google and Fitbit expect the deal to face protracted regulatory review in light of the current political focus on competition and privacy issues in the tech industry, a person familiar with the transaction said.
And two of the company’s major critics in Congress urged regulators to conduct just such a thorough review.
“Why should Google be permitted to acquire even more companies while they’re under DOJ antitrust investigation?” Josh Hawley, a Republican U.S. senator from Missouri, said on Twitter referring to the Justice Department. Representative David Cicilline, who heads the House antitrust investigation into the big tech companies, also criticized the deal.
“Google is signaling that it will continue to flex and expand its power in spite of this immense scrutiny,” said Cicilline, a Democrat from Rhode Island. “Google’s proposed acquisition of Fitbit would also give the company deep insights into Americans’ most sensitive information -- such as their health and location data -- threatening to further entrench its market power online.”
Excerpt from https://www.bloomberg.com/news/articles/2019-11-01/google-s-fitbit-acquisition-likely-to-face-antitrust-scrutiny
The acquisition means that means two of the largest technology companies will now dominate the U.S. market for fitness tracking devices and data, and the purchase is already coming under fire from U.S. lawmakers.
Google and Fitbit expect the deal to face protracted regulatory review in light of the current political focus on competition and privacy issues in the tech industry, a person familiar with the transaction said.
And two of the company’s major critics in Congress urged regulators to conduct just such a thorough review.
“Why should Google be permitted to acquire even more companies while they’re under DOJ antitrust investigation?” Josh Hawley, a Republican U.S. senator from Missouri, said on Twitter referring to the Justice Department. Representative David Cicilline, who heads the House antitrust investigation into the big tech companies, also criticized the deal.
“Google is signaling that it will continue to flex and expand its power in spite of this immense scrutiny,” said Cicilline, a Democrat from Rhode Island. “Google’s proposed acquisition of Fitbit would also give the company deep insights into Americans’ most sensitive information -- such as their health and location data -- threatening to further entrench its market power online.”
Excerpt from https://www.bloomberg.com/news/articles/2019-11-01/google-s-fitbit-acquisition-likely-to-face-antitrust-scrutiny
John Feinstein's cynical take on NCAA allowing student athletes to be paid
"They were like the robber coming out of a bank who is surrounded by the police. And they held up their hands and said, we give up. . . .Yes, I'm really sorry. And now let's negotiate."
The full interview of Feinstein is here: https://www.pbs.org/newshour/show/after-ncaa-announcement-is-allowing-compensation-for-student-athletes-inevitable
"They were like the robber coming out of a bank who is surrounded by the police. And they held up their hands and said, we give up. . . .Yes, I'm really sorry. And now let's negotiate."
The full interview of Feinstein is here: https://www.pbs.org/newshour/show/after-ncaa-announcement-is-allowing-compensation-for-student-athletes-inevitable
NBCWashington
Washington DC and e-scooter safety
By Jodie Fleischer, Rick Yarborough and Steve Jones
A man riding this e-scooter at was struck and killed by an SUV at Dupont Circle Sept. 18, 2018.
The News4 I-Team found at least 16 people around the country have died using rented e-scooters since September 2018.
And despite city leaders efforts to get a handle on this growing trend, the I-Team found the decision-makers often have little hard data to consider.
"I need data of all kinds," D.C. Councilmember Mary Cheh told the I-Team.ties Trying to Curb E-Scooter Injuries
She oversees the District's committee on transportation and says she's researching how other cities have curbed their scooter situation.
For example, Portland, Oregon, requires all riders to wear helmets. In Nashville, e-scooter riders must be 18 and have a driver's license. Atlanta banned scooter-riding on sidewalks. Beverly Hills, California, banned e-scooters all together.
"I'm not interested in banning them, but I do think we need to have some better regulation," Cheh said.
She's hosting a public hearing Monday 11-4-2019 to get input from scooter riders as well as pedestrians and drivers who've been impacted. Cheh has proposed halting scooter use overnight when it's harder to see riders, but she's open to many ideas.
Excerpt from https://www.nbcwashington.com/investigations/Cities-Look-for-Ways-to-Curb-E-Scooter-Injuries-564127151.html
NYT: TikTok v. Silicon Valley
TikTok, which is run by a seven-year-old company in Beijing called ByteDance, allows people to create short, snappy videos and share them around the world. That simple concept has fueled its rise to quickly become one of the world’s largest social networks and to mount the most direct incursion yet by a Chinese company into Silicon Valley’s turf.
Now the American internet companies are pushing back. Through knockoffs, potential acquisitions and not-so-subtle references to Chinese censorship, TikTok’s competitors have been trying to protect their home turf from the service’s advancement. They haven’t had much luck so far.
Over the past 12 months, TikTok’s app has been downloaded more than 750 million times, compared with 715 million for Facebook, 450 million for Instagram, 300 million for YouTube and 275 million for Snapchat, according to the research firm Sensor Tower.
But TikTok’s American competitors could still get some help from their government. The Committee on Foreign Investment in the United States, a federal panel that reviews foreign acquisitions of American firms, is now reviewing ByteDance’s two-year-old acquisition of Musical.ly, the American company that became TikTok, The New York Times and Reuters reported on Friday. Members of Congress had asked for a review last month.
From: https://www.nytimes.com/2019/11/03/technology/tiktok-facebook-youtube.html?action=click&auth=login-email&login=email&module=News&pgtype=Homepage
TikTok, which is run by a seven-year-old company in Beijing called ByteDance, allows people to create short, snappy videos and share them around the world. That simple concept has fueled its rise to quickly become one of the world’s largest social networks and to mount the most direct incursion yet by a Chinese company into Silicon Valley’s turf.
Now the American internet companies are pushing back. Through knockoffs, potential acquisitions and not-so-subtle references to Chinese censorship, TikTok’s competitors have been trying to protect their home turf from the service’s advancement. They haven’t had much luck so far.
Over the past 12 months, TikTok’s app has been downloaded more than 750 million times, compared with 715 million for Facebook, 450 million for Instagram, 300 million for YouTube and 275 million for Snapchat, according to the research firm Sensor Tower.
But TikTok’s American competitors could still get some help from their government. The Committee on Foreign Investment in the United States, a federal panel that reviews foreign acquisitions of American firms, is now reviewing ByteDance’s two-year-old acquisition of Musical.ly, the American company that became TikTok, The New York Times and Reuters reported on Friday. Members of Congress had asked for a review last month.
From: https://www.nytimes.com/2019/11/03/technology/tiktok-facebook-youtube.html?action=click&auth=login-email&login=email&module=News&pgtype=Homepage
Australia Says Google Misled Consumers Over Location Tracking
The company did not disclose the need to disable two different Android settings to stop data collection, regulators said in a lawsuit.
Isabella Kwai
SYDNEY, Australia — Australian regulators on Tuesday accused Google of misleading consumers about its collection of their personal location information through its Android mobile operating system, the latest government action against a tech company over its handling of vast quantities of user data.
The Australian Competition and Consumer Commission alleged in a lawsuit that Google falsely led users to believe that disabling the “Location History” setting on Android phones would stop the company from collecting their location data. But users were actually required to also turn off a second setting, “Web and App Activity,” that was enabled by default.
Excerpt from https://www.nytimes.com/2019/10/29/world/australia/australia-google-location.html
The company did not disclose the need to disable two different Android settings to stop data collection, regulators said in a lawsuit.
Isabella Kwai
SYDNEY, Australia — Australian regulators on Tuesday accused Google of misleading consumers about its collection of their personal location information through its Android mobile operating system, the latest government action against a tech company over its handling of vast quantities of user data.
The Australian Competition and Consumer Commission alleged in a lawsuit that Google falsely led users to believe that disabling the “Location History” setting on Android phones would stop the company from collecting their location data. But users were actually required to also turn off a second setting, “Web and App Activity,” that was enabled by default.
Excerpt from https://www.nytimes.com/2019/10/29/world/australia/australia-google-location.html
DMN: U.S. Appeals Court Revives Taylor Swift ‘Shake It Off’ Copyright Infringement Lawsuit
A federal court has reversed a lower court decision to dismiss a lawsuit against superstar Taylor Swift, which accuses her of plagiarizing the chorus from her song “Shake It Off.”
The story continues here.
A federal court has reversed a lower court decision to dismiss a lawsuit against superstar Taylor Swift, which accuses her of plagiarizing the chorus from her song “Shake It Off.”
The story continues here.
WSJ: Credit rating company conflicts of interest unresolved
After the financial crisis, Washington focused on the credit-ratings firms and the conflict of interest that made them “essential cogs in the wheel of financial destruction,” according to the federal government’s report on the crisis.
But the government didn’t eliminate the conflict, where the firms are paid by the entities whose bonds they rate. Instead, the Securities and Exchange Commission decided that enabling ratings firms to publish unsolicited ratings on securities they weren’t hired to analyze would be the best solution. The agency crafted a rule to give them access to deal data to publish such ratings.
A decade later, the verdict on that plan is in: The program was a failure.
Since the plan’s enactment in 2010, there is little evidence of any unsolicited ratings being published under the program, according to the ratings firms, a trade association, the SEC and a committee of bond investors advising the agency.
The SEC declined to answer questions about the program, but said in response to a public records request that, after a “thorough search” of its records, it “did not locate or identify” any examples of unsolicited ratings published by ratings firms under the program.
Moody’s, S&P Global, Fitch Ratings and Kroll Bond Rating Agency all said their respective firms haven’t produced any unsolicited ratings under the SEC’s rule. DBRS and Morningstar, which recently merged, said they didn’t produce any unsolicited ratings in 2019 and aren’t expecting to do so in the future.
The reason is simple: Ratings firms don’t get paid for unsolicited grades. And if they do issue them, they run the risk of upsetting issuers who don’t want lower ratings assigned to their deals.
For a longer version of this story online, click here.
After the financial crisis, Washington focused on the credit-ratings firms and the conflict of interest that made them “essential cogs in the wheel of financial destruction,” according to the federal government’s report on the crisis.
But the government didn’t eliminate the conflict, where the firms are paid by the entities whose bonds they rate. Instead, the Securities and Exchange Commission decided that enabling ratings firms to publish unsolicited ratings on securities they weren’t hired to analyze would be the best solution. The agency crafted a rule to give them access to deal data to publish such ratings.
A decade later, the verdict on that plan is in: The program was a failure.
Since the plan’s enactment in 2010, there is little evidence of any unsolicited ratings being published under the program, according to the ratings firms, a trade association, the SEC and a committee of bond investors advising the agency.
The SEC declined to answer questions about the program, but said in response to a public records request that, after a “thorough search” of its records, it “did not locate or identify” any examples of unsolicited ratings published by ratings firms under the program.
Moody’s, S&P Global, Fitch Ratings and Kroll Bond Rating Agency all said their respective firms haven’t produced any unsolicited ratings under the SEC’s rule. DBRS and Morningstar, which recently merged, said they didn’t produce any unsolicited ratings in 2019 and aren’t expecting to do so in the future.
The reason is simple: Ratings firms don’t get paid for unsolicited grades. And if they do issue them, they run the risk of upsetting issuers who don’t want lower ratings assigned to their deals.
For a longer version of this story online, click here.
State AGs, experts mull legal grounds for building Facebook case
By
CPI
-
October 22, 2019
State attorneys general and federal investigators gathered Monday with public policy and antitrust experts to explore the legal grounds on which they could build an antitrust case against social media giant Facebook Inc., according to people familiar with the matter.
New York Attorney General Letitia James, who has emerged as a lead figure in investigations of Facebook by more than 40 attorneys general, organized the event at her office. A spokesman for Ms. James declined to discuss it with The Wall Street Journal.
Representatives of at least 10 state attorneys general attended the meeting, according to a person familiar with it. Current and former Justice Department and Federal Trade Commission staffers, as well as academics, were also present, according to a meeting agenda viewed by the Journal. There is no formal working relationship between the attorneys general and the speakers who were at the meeting.
Full Content: Wall Street Journal
By
CPI
-
October 22, 2019
State attorneys general and federal investigators gathered Monday with public policy and antitrust experts to explore the legal grounds on which they could build an antitrust case against social media giant Facebook Inc., according to people familiar with the matter.
New York Attorney General Letitia James, who has emerged as a lead figure in investigations of Facebook by more than 40 attorneys general, organized the event at her office. A spokesman for Ms. James declined to discuss it with The Wall Street Journal.
Representatives of at least 10 state attorneys general attended the meeting, according to a person familiar with it. Current and former Justice Department and Federal Trade Commission staffers, as well as academics, were also present, according to a meeting agenda viewed by the Journal. There is no formal working relationship between the attorneys general and the speakers who were at the meeting.
Full Content: Wall Street Journal
ExxonMobil went on trial Tuesday in New York, where the oil giant stands accused by the NY AG of defrauding investors by misleading them about the risks it faces from future climate regulations.
The civil case is the first major climate change lawsuit to reach trial in the United States, and it is the culmination of four years of investigation by the New York state attorney general's office.
The central allegation is that Exxon fraudulently used two sets of books to estimate the risks it faces as governments take steps to cut greenhouse gas emissions: one that was shared with investors and another that was used only internally. The public estimate was higher, suggesting a future with stricter limits on emissions, while the internal figures were lower, reflecting more lenient regulations.
Lawyers for Attorney General Letitia James, who took office this year, a few months after the lawsuit was filed, have argued that this practice exposed investors to greater risks than Exxon had disclosed and inflated the company's value.
Excerpt from https://insideclimatenews.org/news/22102019/exxon-climate-fraud-trial-starts-new-york-letitia-james-tar-sands
The civil case is the first major climate change lawsuit to reach trial in the United States, and it is the culmination of four years of investigation by the New York state attorney general's office.
The central allegation is that Exxon fraudulently used two sets of books to estimate the risks it faces as governments take steps to cut greenhouse gas emissions: one that was shared with investors and another that was used only internally. The public estimate was higher, suggesting a future with stricter limits on emissions, while the internal figures were lower, reflecting more lenient regulations.
Lawyers for Attorney General Letitia James, who took office this year, a few months after the lawsuit was filed, have argued that this practice exposed investors to greater risks than Exxon had disclosed and inflated the company's value.
Excerpt from https://insideclimatenews.org/news/22102019/exxon-climate-fraud-trial-starts-new-york-letitia-james-tar-sands
TikTok app poses potential national security risk, says senior DemocratChuck Schumer and Tom Cotton urged inquiry, noting app reportedly censors material such as Hong Kong protest content
@adamgabbattThu 24 Oct 2019 13.18 EDTLast modified on Thu 24 Oct 2019 13.49 EDT
Chuck Schumer, the most senior Democrat in the Senate, has urged the government to investigate TikTok, describing the China-owned social media app as “a potential counter-intelligence threat we cannot ignore” and warning it could be used to interfere in US elections.TikTok, which allows users to share short videos online, has enjoyed wild success since it launched in 2017, and has been downloaded more than 1bn times.
Schumer and Tom Cotton, the Republican senator from Arkansas, co-wrote a letter to the acting director of national intelligence on Wednesday. The pair said they were writing “to express our concerns about TikTok … and the national security risks posed by its growing use in the United States”.
They wrote: “TikTok reportedly censors materials deemed politically sensitive to the Chinese Communist party, including content related to the recent Hong Kong protests, as well as references to Tiananmen Square, Tibetan and Taiwanese independence, and the treatment of the Uighurs.
The platform is also a potential target of foreign influence campaigns like those carried out during the 2016 election on US-based social media platforms.”
Credit: The Guardian
The letter is here:
NYT: Pentagon and the tech industry are collaborating on secure supply chains for essential components and software
DAR editorial comment: US military coordination with US tech companies is not new. But collaboration between the US military and US tech companies has taken on heightened significance as tensions between the US and China increase. Those tensions raise security issues with regard to certain electronic components and software. In addition, US-China rivalry drives government interest in supporting US companies as they compete with rival Chinese companies.
Without denigrating the policy arguments for US military support and collaboration with domestic tech companies, those arguments can run counter to ordinary competition practices. If security concerns and international commercial rivalries can be put to one side, the vendor with the best and cheapest product ordinarily wins the purchase order.
It is, however, unlikely that security concerns and international commercial rivalries can be put to one side. That being the case, it seems that for a number of products and services the usual competition practices that would otherwise apply will not apply. As a consequence, usual competition enforcement policies will be affected. Enforcement may be reduced. Merger enforcement agencies is an example. See https://www.nytimes.com/2018/03/12/technology/trump-broadcom-qualcomm-merger.html
Excerpt follows from NYT article at https://www.nytimes.com/2019/10/25/technology/pentagon-taiwan-tsmc-chipmaker.html?login=email&auth=login-email#after-story-ad-2
Federal agencies are grappling with a deep-rooted technology conundrum. The United States has long fielded the most advanced weaponry by exploiting electronic components once exclusively produced in the country. Chips help tanks, aircraft, rockets and ships navigate, communicate with one another and engage enemy targets.
But domestic production lines of many chips have long since moved overseas, raising questions about supply interruptions in the event of political or military crises abroad. Those fears have been exacerbated by the increasing importance of particular components — such as programmable chips that figure prominently in the F-35 fighter jet, which are designed by the Silicon Valley company Xilinx and mainly fabricated in Taiwan.
Some chips, such as the wireless baseband processors needed for new 5G communications abilities that Pentagon officials covet, require advanced manufacturing technology that has become a key selling point of TSMC.
“We in the Defense Department cannot afford to be shut out of all of those capabilities,” said Lisa Porter, deputy under secretary for research and engineering, in remarks at an event in July that were later widely circulated among chip makers.
Dr. Porter, at a technology event in Los Angeles on Wednesday, said secure supply chains for both essential components and software were a “macro” issue that the Pentagon and the tech industry had to collaborate on. She declined to discuss specific efforts to bolster American chip production. A Defense Department spokesman also declined to comment.
It is all up to when we can close the cost gap,” said Mark Liu, the chairman of TSMC.
In another sign of action, Skywater Technology, a Minnesota chip manufacturing service, said this week that the Defense Department would invest up to $170 million to increase its production and enhance technologies, such as the ability to produce chips that can withstand radiation in space.
The Skywater investment illustrates how the Pentagon is also wrestling with how to upgrade aging technology at domestic companies that make small volumes of classified chips tailored for the military. Such “trusted” factories, as they are called, operate under Pentagon rules aimed at preventing sabotage or data theft.
DAR editorial comment: US military coordination with US tech companies is not new. But collaboration between the US military and US tech companies has taken on heightened significance as tensions between the US and China increase. Those tensions raise security issues with regard to certain electronic components and software. In addition, US-China rivalry drives government interest in supporting US companies as they compete with rival Chinese companies.
Without denigrating the policy arguments for US military support and collaboration with domestic tech companies, those arguments can run counter to ordinary competition practices. If security concerns and international commercial rivalries can be put to one side, the vendor with the best and cheapest product ordinarily wins the purchase order.
It is, however, unlikely that security concerns and international commercial rivalries can be put to one side. That being the case, it seems that for a number of products and services the usual competition practices that would otherwise apply will not apply. As a consequence, usual competition enforcement policies will be affected. Enforcement may be reduced. Merger enforcement agencies is an example. See https://www.nytimes.com/2018/03/12/technology/trump-broadcom-qualcomm-merger.html
Excerpt follows from NYT article at https://www.nytimes.com/2019/10/25/technology/pentagon-taiwan-tsmc-chipmaker.html?login=email&auth=login-email#after-story-ad-2
Federal agencies are grappling with a deep-rooted technology conundrum. The United States has long fielded the most advanced weaponry by exploiting electronic components once exclusively produced in the country. Chips help tanks, aircraft, rockets and ships navigate, communicate with one another and engage enemy targets.
But domestic production lines of many chips have long since moved overseas, raising questions about supply interruptions in the event of political or military crises abroad. Those fears have been exacerbated by the increasing importance of particular components — such as programmable chips that figure prominently in the F-35 fighter jet, which are designed by the Silicon Valley company Xilinx and mainly fabricated in Taiwan.
Some chips, such as the wireless baseband processors needed for new 5G communications abilities that Pentagon officials covet, require advanced manufacturing technology that has become a key selling point of TSMC.
“We in the Defense Department cannot afford to be shut out of all of those capabilities,” said Lisa Porter, deputy under secretary for research and engineering, in remarks at an event in July that were later widely circulated among chip makers.
Dr. Porter, at a technology event in Los Angeles on Wednesday, said secure supply chains for both essential components and software were a “macro” issue that the Pentagon and the tech industry had to collaborate on. She declined to discuss specific efforts to bolster American chip production. A Defense Department spokesman also declined to comment.
It is all up to when we can close the cost gap,” said Mark Liu, the chairman of TSMC.
In another sign of action, Skywater Technology, a Minnesota chip manufacturing service, said this week that the Defense Department would invest up to $170 million to increase its production and enhance technologies, such as the ability to produce chips that can withstand radiation in space.
The Skywater investment illustrates how the Pentagon is also wrestling with how to upgrade aging technology at domestic companies that make small volumes of classified chips tailored for the military. Such “trusted” factories, as they are called, operate under Pentagon rules aimed at preventing sabotage or data theft.
Is the market for real estate agents broken?
A recent study suggests it is. The study is “Can Free Entry Be Inefficient? Fixed Commissions and Social Waste in the Real Estate Industry,” by the economists Chang-Tai Hsieh, a professor at the University of Chicago, and Enrico Moretti, a professor at the University of California, Berkeley. https://faculty.chicagobooth.edu/chang-tai.hsieh/research/jpe%20real%20estate.pdf
As explained in a recent NYT article, the authors point out that the total in commissions paid for selling a home — as much as 6 percent, when agents for both sellers and buyers are taken into account — appears to be stuck at a high rate.
That’s said to be because the house seller typically sets and pays the commission that goes to the buyer’s agent. This arrangement appears to have neutered competition over commission rates. It ensures that relatively few individual sellers deviate from the norm of paying high commission rates, because if they did, buyers’ agents might respond by steering clients toward someone else’s house. So while sellers would like to cut commission rates, it’s generally not in an individual’s interests to be the first to do so.
Some homeowners opt out of the whole system and sell their homes without agents, but most stick with the high-commission norm. As a result, competition has done little to reduce real estate commissions.
But the high commissions haven’t made most real estate agents rich: The median agent earned $48,690 in 2018, according to the Bureau of Labor Statistics.
Instead, the commissions have created a bloated and unproductive sector. That’s because the possibility of earning enormous commissions is so powerful an incentive that it has led thousands of people to become real estate agents.
When lots of agents chase a limited number of deals, many of them end up underemployed, working on only a handful of deals annually.
Credit: https://www.nytimes.com/2019/10/24/business/real-estate-fee-for-service.html?login=email&auth=login-email&login=google&auth=login-google
A recent study suggests it is. The study is “Can Free Entry Be Inefficient? Fixed Commissions and Social Waste in the Real Estate Industry,” by the economists Chang-Tai Hsieh, a professor at the University of Chicago, and Enrico Moretti, a professor at the University of California, Berkeley. https://faculty.chicagobooth.edu/chang-tai.hsieh/research/jpe%20real%20estate.pdf
As explained in a recent NYT article, the authors point out that the total in commissions paid for selling a home — as much as 6 percent, when agents for both sellers and buyers are taken into account — appears to be stuck at a high rate.
That’s said to be because the house seller typically sets and pays the commission that goes to the buyer’s agent. This arrangement appears to have neutered competition over commission rates. It ensures that relatively few individual sellers deviate from the norm of paying high commission rates, because if they did, buyers’ agents might respond by steering clients toward someone else’s house. So while sellers would like to cut commission rates, it’s generally not in an individual’s interests to be the first to do so.
Some homeowners opt out of the whole system and sell their homes without agents, but most stick with the high-commission norm. As a result, competition has done little to reduce real estate commissions.
But the high commissions haven’t made most real estate agents rich: The median agent earned $48,690 in 2018, according to the Bureau of Labor Statistics.
Instead, the commissions have created a bloated and unproductive sector. That’s because the possibility of earning enormous commissions is so powerful an incentive that it has led thousands of people to become real estate agents.
When lots of agents chase a limited number of deals, many of them end up underemployed, working on only a handful of deals annually.
Credit: https://www.nytimes.com/2019/10/24/business/real-estate-fee-for-service.html?login=email&auth=login-email&login=google&auth=login-google
The actress Rose McGowan has sued Harvey Weinstein and the lawyers David Boies and Lisa Bloom, accusing them of directing a campaign of covert and illegal measures meant to discredit her and prevent her from going public with her rape accusation against him
The lawsuit includes Ms. McGowan’s account of attempts to interfere with her plan to publish a memoir, “Brave,” including sending an undercover agent to befriend her and then steal a copy of the manuscript. It also describes efforts to derail the reporting by The New York Times and The New Yorker that ultimately exposed decades of accusations against Mr. Weinstein and helped ignite the #MeToo movement.
The lawsuit, filed in Federal District Court in Los Angeles, said that Mr. Weinstein tapped into a team of professionals whose goal was to “ensure that Ms. McGowan’s story never saw the light of day, and — if it did — that no one would believe her.”
Besides Mr. Weinstein, Mr. Boies and Ms. Bloom, the lawsuit names the lawyers’ firms as defendants, as well as Black Cube, a private intelligence firm that used undercover agents to approach women who had accused Mr. Weinstein of sexual misconduct.
See https://www.nytimes.com/2019/10/23/arts/rose-mcgowan-harvey-weinstein-lawsuit.html
A copy of the federal court Complaint ROSE MCGOWAN, Plaintiff, vs. HARVEY WEINSTEIN, DAVID BOIES, BOIES SCHILLER FLEXNER LLP, LISA BLOOM, THE BLOOM FIRM, B.C. STRATEGIES LTD. D/B/A BLACK CUBE, Defendants. is here: https://www.scribd.com/document/431737010/McGowan-v-Weinstein#fullscreen&from_embed
The lawsuit includes Ms. McGowan’s account of attempts to interfere with her plan to publish a memoir, “Brave,” including sending an undercover agent to befriend her and then steal a copy of the manuscript. It also describes efforts to derail the reporting by The New York Times and The New Yorker that ultimately exposed decades of accusations against Mr. Weinstein and helped ignite the #MeToo movement.
The lawsuit, filed in Federal District Court in Los Angeles, said that Mr. Weinstein tapped into a team of professionals whose goal was to “ensure that Ms. McGowan’s story never saw the light of day, and — if it did — that no one would believe her.”
Besides Mr. Weinstein, Mr. Boies and Ms. Bloom, the lawsuit names the lawyers’ firms as defendants, as well as Black Cube, a private intelligence firm that used undercover agents to approach women who had accused Mr. Weinstein of sexual misconduct.
See https://www.nytimes.com/2019/10/23/arts/rose-mcgowan-harvey-weinstein-lawsuit.html
A copy of the federal court Complaint ROSE MCGOWAN, Plaintiff, vs. HARVEY WEINSTEIN, DAVID BOIES, BOIES SCHILLER FLEXNER LLP, LISA BLOOM, THE BLOOM FIRM, B.C. STRATEGIES LTD. D/B/A BLACK CUBE, Defendants. is here: https://www.scribd.com/document/431737010/McGowan-v-Weinstein#fullscreen&from_embed
More on Attorney David Boies and Private Espionage for clients
David Boies Pleads Not Guilty
The superlawyer in such cases as Bush v. Gore and the fight for gay marriage rights makes no apologies for representing Harvey Weinstein and Theranos with zeal.
https://www.nytimes.com/2018/09/21/business/david-boies-pleads-not-guilty.html
Techdirt doesn't buy it
Shut Up David Boies . . . . by Mike Masnick (8-23-19)
NPR has an incredible story about the media and Jeffrey Epstein. You should read the whole damn thing, because no summary here will do it justice. It covers multiple attempts by various large media organizations, including Vanity Fair, the NY Times and ABC to report on Jeffrey Epstein over the years, and how Epstein, intimidated, coaxed and even potentially bought off reporters to get more favorable coverage, or to kill stories outright. It's horrific and awful and everything along those lines. Go read it.
But, I'm going to focus on the fact that NPR quotes David Boies throughout the piece, acting horrified at how the media fell down on this. He's 100% correct about that, but he's the wrong fucking messenger given his own long history doing pretty much exactly what Epstein is reported to have done regarding the media in this particular piece. Boies is defending some of Epstein's victims, and good on him to be a strong advocate for his clients and against Epstein. But this quote is not one David Boies should be making:
"We count on the press to uncover problems, not merely to report on when problems have been prosecuted and when people have been indicted, but to uncover problems before they reach that stage," says David Boies, an attorney for several of Epstein's accusers. "And here you had a terrible problem. A horrific series of abuses."
Shall we review some of the record on David Boies and his attempts to intimidate and silence the press when they tried to "uncover problems before they reach that stage"? As you may recall, one of David Boies' big clients was... Harvey Weinstein. And, as Ronan Farrow at the New Yorker reported in great detail, Boies and his firm seemed to work very, very hard to stop anyone from revealing Weinstein's problems with multiple women.
Excerpt from https://www.techdirt.com/articles/20190822/23204542844/shut-up-david-boies-you-hypocritical-censorial-oaf.shtml
David Boies and Alan Dershowitz
As the Washington Post put it, "as they reach an age when other esteemed elder statesmen of the bar might be basking in acclaim for their life’s work, the 78-year-old Boies and the 80-year-old Dershowitz are brutally yoked in a subplot of the Jeffrey Epstein sex trafficking case." The melodrama that has played out between the men includes a Florida Bar complaint filed by Dershpwiz.
See: https://www.washingtonpost.com/lifestyle/style/its-alan-dershowitz-vs-david-boies-again-and-again/2019/08/13/925bcb60-b798-11e9-a091-6a96e67d9cce_story.html
David Boies Pleads Not Guilty
The superlawyer in such cases as Bush v. Gore and the fight for gay marriage rights makes no apologies for representing Harvey Weinstein and Theranos with zeal.
https://www.nytimes.com/2018/09/21/business/david-boies-pleads-not-guilty.html
Techdirt doesn't buy it
Shut Up David Boies . . . . by Mike Masnick (8-23-19)
NPR has an incredible story about the media and Jeffrey Epstein. You should read the whole damn thing, because no summary here will do it justice. It covers multiple attempts by various large media organizations, including Vanity Fair, the NY Times and ABC to report on Jeffrey Epstein over the years, and how Epstein, intimidated, coaxed and even potentially bought off reporters to get more favorable coverage, or to kill stories outright. It's horrific and awful and everything along those lines. Go read it.
But, I'm going to focus on the fact that NPR quotes David Boies throughout the piece, acting horrified at how the media fell down on this. He's 100% correct about that, but he's the wrong fucking messenger given his own long history doing pretty much exactly what Epstein is reported to have done regarding the media in this particular piece. Boies is defending some of Epstein's victims, and good on him to be a strong advocate for his clients and against Epstein. But this quote is not one David Boies should be making:
"We count on the press to uncover problems, not merely to report on when problems have been prosecuted and when people have been indicted, but to uncover problems before they reach that stage," says David Boies, an attorney for several of Epstein's accusers. "And here you had a terrible problem. A horrific series of abuses."
Shall we review some of the record on David Boies and his attempts to intimidate and silence the press when they tried to "uncover problems before they reach that stage"? As you may recall, one of David Boies' big clients was... Harvey Weinstein. And, as Ronan Farrow at the New Yorker reported in great detail, Boies and his firm seemed to work very, very hard to stop anyone from revealing Weinstein's problems with multiple women.
Excerpt from https://www.techdirt.com/articles/20190822/23204542844/shut-up-david-boies-you-hypocritical-censorial-oaf.shtml
David Boies and Alan Dershowitz
As the Washington Post put it, "as they reach an age when other esteemed elder statesmen of the bar might be basking in acclaim for their life’s work, the 78-year-old Boies and the 80-year-old Dershowitz are brutally yoked in a subplot of the Jeffrey Epstein sex trafficking case." The melodrama that has played out between the men includes a Florida Bar complaint filed by Dershpwiz.
See: https://www.washingtonpost.com/lifestyle/style/its-alan-dershowitz-vs-david-boies-again-and-again/2019/08/13/925bcb60-b798-11e9-a091-6a96e67d9cce_story.html
Ronan Farrow on attorney David Boies and private espionage
In his new book Catch and Kill, Ronan Farrow reports that accused sexual predator Harvey Weinstein engaged David Boies as his attorney. Boies is a liberal icon who represented Al Gore in Bush v Gore. Farrow reports that Boies signed off on a contract with a private espionage company, Black Cube. Black Cube then tracked complainants in an effort to discourage efforts to bring Weinstein to account. Black Cube’s private espionage included a successful effort by a female Black Cube spy to befriend a complainant, Rose McGowan, and pump her for information.
One of Weinstein’s goals was to stop publication of a story in the New York Times that was unfavorable to Weinstein — even though Boies’ law firm represented the Times.
Like John Careyrou, the author of the book Bad Blood, which tells the story of fraud by promoters of a medical blood testing device, Farrow expresses strong disapproval of the Boies firm’s behavior. (See my earlier discussion of the Careyrou book.) But, like Careyrou, Farrow is careful not to suggest illegal or actionably unethical behavior. There is an apparent reason. The private espionage activities of the operatives engaged by the Boies firm are not too different from the sort of investigative activity that routinely occurs in divorce cases where an aggrieved spouse seeks evidence of bad behavior by the other. But both authors Farrow and Careyrou think that further discussion is warranted about the appropriate bounds for private espionage.
Farrow put a fine point on his concerns when he recently appeared on the PBS Newshour:
But there is a point at which when sophisticated lawyers, in this case, Harvey Weinstein's attorney, David Boies, something of a liberal hero, hired some of these former Mossad agents, who in turn hired subcontractors who were chasing me, chasing other reporters, staking us out.
There were multiple secret agents with false identities following accusers, following reporters. The question is, as you say, where's the line? And I think that, correctly, there's a conversation happening now in response to this reporting in this book about maybe a need for more accountability.
See https://www.pbs.org/newshour/show/what-ronan-farrow-discovered-about-the-systems-that-cover-up-sexual-misconduct
For readers interested in more detail, excerpts from Catch and Kill that focus on Black Cube espionage can be located at https://www.newyorker.com/news/annals-of-espionage/the-black-cube-chronicles-the-double-agent
This posting is by Don Allen Resnikoff, who takes full responsibility for its content
In his new book Catch and Kill, Ronan Farrow reports that accused sexual predator Harvey Weinstein engaged David Boies as his attorney. Boies is a liberal icon who represented Al Gore in Bush v Gore. Farrow reports that Boies signed off on a contract with a private espionage company, Black Cube. Black Cube then tracked complainants in an effort to discourage efforts to bring Weinstein to account. Black Cube’s private espionage included a successful effort by a female Black Cube spy to befriend a complainant, Rose McGowan, and pump her for information.
One of Weinstein’s goals was to stop publication of a story in the New York Times that was unfavorable to Weinstein — even though Boies’ law firm represented the Times.
Like John Careyrou, the author of the book Bad Blood, which tells the story of fraud by promoters of a medical blood testing device, Farrow expresses strong disapproval of the Boies firm’s behavior. (See my earlier discussion of the Careyrou book.) But, like Careyrou, Farrow is careful not to suggest illegal or actionably unethical behavior. There is an apparent reason. The private espionage activities of the operatives engaged by the Boies firm are not too different from the sort of investigative activity that routinely occurs in divorce cases where an aggrieved spouse seeks evidence of bad behavior by the other. But both authors Farrow and Careyrou think that further discussion is warranted about the appropriate bounds for private espionage.
Farrow put a fine point on his concerns when he recently appeared on the PBS Newshour:
But there is a point at which when sophisticated lawyers, in this case, Harvey Weinstein's attorney, David Boies, something of a liberal hero, hired some of these former Mossad agents, who in turn hired subcontractors who were chasing me, chasing other reporters, staking us out.
There were multiple secret agents with false identities following accusers, following reporters. The question is, as you say, where's the line? And I think that, correctly, there's a conversation happening now in response to this reporting in this book about maybe a need for more accountability.
See https://www.pbs.org/newshour/show/what-ronan-farrow-discovered-about-the-systems-that-cover-up-sexual-misconduct
For readers interested in more detail, excerpts from Catch and Kill that focus on Black Cube espionage can be located at https://www.newyorker.com/news/annals-of-espionage/the-black-cube-chronicles-the-double-agent
This posting is by Don Allen Resnikoff, who takes full responsibility for its content
FROM DMN:
House of Representatives Passes Small Claims Copyright Bill for Infringements Under $30,000
There’s big news on the copyright front — for small infractions.
The story continues here. https://www.digitalmusicnews.com/2019/10/23/small-claims-copyright-bill-house/
House of Representatives Passes Small Claims Copyright Bill for Infringements Under $30,000
There’s big news on the copyright front — for small infractions.
The story continues here. https://www.digitalmusicnews.com/2019/10/23/small-claims-copyright-bill-house/
NY AG on multistate investigation of Facebook
“After continued bipartisan conversations with attorneys general from around the country, today I am announcing that we have vastly expanded the list of states, districts, and territories investigating Facebook for potential antitrust violations. . . . Our investigation now has the support of 47 attorneys general from around the nation, who are all concerned that Facebook may have put consumer data at risk, reduced the quality of consumers’ choices, and increased the price of advertising. As we continue our investigation, we will use every investigative tool at our disposal to determine whether Facebook’s actions stifled competition and put users at risk.”
https://ag.ny.gov/press-release/2019/attorney-general-james-gives-update-facebook-antitrust-investigation
Low energy FTC enforcement?
NYT:
The popular skin care brand Sunday Riley has agreed to settle complaints filed by the Federal Trade Commission that the company posted fake reviews of its products online.
The settlement, which was announced on Monday, does not provide consumers with refunds, and it does not force Sunday Riley to admit any wrongdoing: The company simply agreed not to break the law in the future.
https://www.nytimes.com/2019/10/22/us/sunday-riley-fake-reviews.html
NYT:
The popular skin care brand Sunday Riley has agreed to settle complaints filed by the Federal Trade Commission that the company posted fake reviews of its products online.
The settlement, which was announced on Monday, does not provide consumers with refunds, and it does not force Sunday Riley to admit any wrongdoing: The company simply agreed not to break the law in the future.
https://www.nytimes.com/2019/10/22/us/sunday-riley-fake-reviews.html
NYT: Deed theft fraud in Brooklyn
A booming real estate market in Brooklyn is fueling a crime that law enforcement authorities say has taken hold in largely African-American neighborhoods that are being gentrified — deed theft, which involves deceiving or sometimes coercing a homeowner into signing forms that transfer ownership of a property.
In many cases, a homeowner is made to believe the documents involve some type of financial assistance, but in fact turn out to be the property deed.
Bedford-Stuyvesant and Crown Heights, both known for their collection of largely intact townhouses that cost a fraction of what similar homes sell for in Manhattan, have become hotbeds for deed theft, according to law enforcement authorities. Homeowners in Prospect Heights, Brownsville and East New York have also been targeted.
Of the nearly 3,000 deed fraud complaints recorded by the city since 2014, 1,350 — about 45 percent — have come from Brooklyn, according to data compiled by the city’s Department of Finance. (The borough accounts for roughly 30 percent of the city’s housing units.)
The authorities believe the problem may be more widespread since homeowners may not realize right away that they have been victimized.
“It’s just a drop in the bucket,” Eric Gonzalez, the Brooklyn district attorney, said at a recent town hall meeting in Bedford-Stuyvesant. “It’s really hot in the real estate market in Brooklyn. People want to steal our homes.”
Excerpt from https://www.nytimes.com/2019/10/21/nyregion/deed-theft-brooklyn.html?action=click&module=Top%20Stories&pgtype=Homepage
A booming real estate market in Brooklyn is fueling a crime that law enforcement authorities say has taken hold in largely African-American neighborhoods that are being gentrified — deed theft, which involves deceiving or sometimes coercing a homeowner into signing forms that transfer ownership of a property.
In many cases, a homeowner is made to believe the documents involve some type of financial assistance, but in fact turn out to be the property deed.
Bedford-Stuyvesant and Crown Heights, both known for their collection of largely intact townhouses that cost a fraction of what similar homes sell for in Manhattan, have become hotbeds for deed theft, according to law enforcement authorities. Homeowners in Prospect Heights, Brownsville and East New York have also been targeted.
Of the nearly 3,000 deed fraud complaints recorded by the city since 2014, 1,350 — about 45 percent — have come from Brooklyn, according to data compiled by the city’s Department of Finance. (The borough accounts for roughly 30 percent of the city’s housing units.)
The authorities believe the problem may be more widespread since homeowners may not realize right away that they have been victimized.
“It’s just a drop in the bucket,” Eric Gonzalez, the Brooklyn district attorney, said at a recent town hall meeting in Bedford-Stuyvesant. “It’s really hot in the real estate market in Brooklyn. People want to steal our homes.”
Excerpt from https://www.nytimes.com/2019/10/21/nyregion/deed-theft-brooklyn.html?action=click&module=Top%20Stories&pgtype=Homepage
From the SF Fed: Healthy Aging: A Conceptual Model of Community-based Solutions in the Face of Climate Change and Global Demographic Changes
Climate change and shifting demographic patterns require innovative ideas about how to build and adapt community infrastructure that helps older individuals thrive. Urban planners, and community investors will need to consider aging populations as they think about how the built environment can promote healthy local communities in the face of a changing climate that has acute and unique consequences for individuals aged 65 and over.
Seciah Aquino, Josefina Flores Morales, Max Aung, Mary Keovisai, and Jennifer K. McGee-Avila
The article is here:
https://www.frbsf.org/community-development/publications/community-development-investment-review/2019/october/healthy-aging-a-conceptual-model-of-community-based-solutions-in-the-face-of-climate-change-and-global-demographic-changes/
Climate change and shifting demographic patterns require innovative ideas about how to build and adapt community infrastructure that helps older individuals thrive. Urban planners, and community investors will need to consider aging populations as they think about how the built environment can promote healthy local communities in the face of a changing climate that has acute and unique consequences for individuals aged 65 and over.
Seciah Aquino, Josefina Flores Morales, Max Aung, Mary Keovisai, and Jennifer K. McGee-Avila
The article is here:
https://www.frbsf.org/community-development/publications/community-development-investment-review/2019/october/healthy-aging-a-conceptual-model-of-community-based-solutions-in-the-face-of-climate-change-and-global-demographic-changes/
Mississippi exits AGs' T-Mobile Suit
The coalition of 18 state attorneys general suing to block the Sprint-T-Mobile merger lost Mississippi, which departed the lawsuit. Mississippi struck a settlement deal securing additional mobile coverage commitments in return for support for the merger.
The coalition of 18 state attorneys general suing to block the Sprint-T-Mobile merger lost Mississippi, which departed the lawsuit. Mississippi struck a settlement deal securing additional mobile coverage commitments in return for support for the merger.
Pay to Delay’ Generic Drug Arrangements Banned in California (1)
Oct. 7, 2019,
California is the first U.S. state to ban drugmakers from brokering agreements that delay generic drugs from reaching the market with a bill signed by Gov. Gavin Newsom (D).
“California will use our market power and our moral power to take on big drug companies and prevent them from keeping affordable generic drugs out of the hands of people who need them,” Newsom said. “Competition in the pharmaceutical industry helps lower prices for Californians who rely on life-saving treatments.”
California Attorney General Xavier Becerra (D) backed the measure, A.B. 824, [https://src.bna.com/LKm] to target settlements in drug patent infringement lawsuits between brand-name and generic drug companies.
Excerpt Credit: Bloomberg (paywall)
Oct. 7, 2019,
California is the first U.S. state to ban drugmakers from brokering agreements that delay generic drugs from reaching the market with a bill signed by Gov. Gavin Newsom (D).
“California will use our market power and our moral power to take on big drug companies and prevent them from keeping affordable generic drugs out of the hands of people who need them,” Newsom said. “Competition in the pharmaceutical industry helps lower prices for Californians who rely on life-saving treatments.”
California Attorney General Xavier Becerra (D) backed the measure, A.B. 824, [https://src.bna.com/LKm] to target settlements in drug patent infringement lawsuits between brand-name and generic drug companies.
Excerpt Credit: Bloomberg (paywall)
Pacific Gas and Electric Co. bondholders and wildfire victims have joined forces and proposed their own reorganization plan as they try to wrest control of the bankrupt company from its stockholders.
The two groups told PG&E’s bankruptcy judge Thursday their proposal would include a $24 billion settlement to pay everyone owed money because of fires started by the company’s power lines in recent years, the San Francisco Chronicle reported.
PG&E has offered to pay individual victims from a trust capped at $8.4 billion and reached settlements with insurers and local governments of $11 billion and $1 billion, respectively.
The bondholders’ proposal would invest $28.4 billion in exchange for a 58.8% stake in the utility’s parent PG&E Corp., diluting the firms who currently own shares of the company. The investment would fund creation of a $24 billion trust, in cash and stock, to pay claims from various fires in which the company was involved.
The trust would be acceptable to wildfire victims because they would designate someone to “manage the process,” attorneys for the committees of wildfire victims and bondholders involved in the PG&E case said in their joint filing.
https://www.sfchronicle.com/business/article/PG-E-fire-victims-bondholders-team-up-in-attempt-14453810.php
The two groups told PG&E’s bankruptcy judge Thursday their proposal would include a $24 billion settlement to pay everyone owed money because of fires started by the company’s power lines in recent years, the San Francisco Chronicle reported.
PG&E has offered to pay individual victims from a trust capped at $8.4 billion and reached settlements with insurers and local governments of $11 billion and $1 billion, respectively.
The bondholders’ proposal would invest $28.4 billion in exchange for a 58.8% stake in the utility’s parent PG&E Corp., diluting the firms who currently own shares of the company. The investment would fund creation of a $24 billion trust, in cash and stock, to pay claims from various fires in which the company was involved.
The trust would be acceptable to wildfire victims because they would designate someone to “manage the process,” attorneys for the committees of wildfire victims and bondholders involved in the PG&E case said in their joint filing.
https://www.sfchronicle.com/business/article/PG-E-fire-victims-bondholders-team-up-in-attempt-14453810.php
Washington is adding 28 Chinese companies, government offices and security bureaus to a United States blacklist over their alleged role in facilitating human rights abuses in China's Xinjiang region.
Monday's announcement targets some of China's top artificial intelligence companies in a similar way to the US move against smartphone giant Huawei earlier this year, and comes just days before crucial trade talks between the two sides.
In a statement, the US Commerce Department said "these entities have been implicated in human rights violations and abuses in the implementation of China's campaign of repression, mass arbitrary detention, and high-technology surveillance against Uyghurs, Kazakhs, and other members of Muslim minority groups in [Xinjiang].
"https://www.cnn.com/2019/10/08/business/us-china-xinjiang-black-list-intl-hnk/index.html
Monday's announcement targets some of China's top artificial intelligence companies in a similar way to the US move against smartphone giant Huawei earlier this year, and comes just days before crucial trade talks between the two sides.
In a statement, the US Commerce Department said "these entities have been implicated in human rights violations and abuses in the implementation of China's campaign of repression, mass arbitrary detention, and high-technology surveillance against Uyghurs, Kazakhs, and other members of Muslim minority groups in [Xinjiang].
"https://www.cnn.com/2019/10/08/business/us-china-xinjiang-black-list-intl-hnk/index.html
Playing Both Sides: Branded Sales, Generic Drugs, and Antitrust Policy
CPI
-
October 7, 2019By Michael A. Carrier (Rutgers Law School),Mark A. Lemley (Stanford Law School) & Shawn P. Miller(University of San Diego)
The issue of high drug prices has recently exploded into public consciousness. And while many potential explanations have been offered, one has avoided scrutiny. Why has the growth in generic drugs not resulted in lower drug prices?
In this article, we explore a phenomenon we call “playing both sides”: companies that participate in pharmaceutical markets as both brand owners and generics. We hypothesize that companies that earn a significant amount of their revenue from patented drugs may have less incentive to aggressively pursue a generic agenda, since patented drugs generate far more revenue for firms than generic drugs do.
To investigate this phenomenon, we built a comprehensive database of all major pharmaceutical companies, evaluating where their revenue comes from, how that has changed over time, and how it relates to their behavior in court. Despite broad industry trends toward specialization, about one third of the firms we study have opted for a mixed business model over time. And those firms behave differently than pure generic firms. Our data show that when companies with significant generic sales play both sides, they behave differently than firms with a purer generic revenue stream. Dollar for dollar, the pure generic firms in our study challenged more patents as invalid or not infringed than the mixed firms. Further, “mixed generic” companies with growing brand sales (or a growing share of their revenue from brand sales) are more likely to settle the patent challenges they bring; companies with growing generic share are less likely to settle and more likely to take those cases to judgment. And when they do go to judgment, patent challengers with a greater generic share are more likely to win those challenges while companies with higher brand sales are less likely to win.
In short, we find evidence to support the hypothesis that generic companies that make more of their revenue from patented drugs are less likely to pursue challenges to judgment and less likely to win when they do. Playing both sides may reduce the incentive of generic challengers to fight as hard as possible to win the case before them. That may be especially true of the sorts of challenges that affect not just the patent in the instant case but might change legal doctrines that may ultimately hurt the generic challenger’s brand business.
Our article’s findings suggest a more nuanced antitrust analysis of mergers involving generic companies and patent settlements in which generics delay entering the market. In challenging more patents, settling fewer cases by agreeing to delay entry, and winning more of the cases they do bring, pure generic companies promise to unleash the generic competition that they were intended to. In the wide-ranging effort to lower drug prices, we must pay attention not only to whether a drug is patented but also to who is, or is not, challenging that patent and why.
Continue Reading… https://papers.ssrn.com/sol3/Papers.cfm?abstract_id=3350629
CPI
-
October 7, 2019By Michael A. Carrier (Rutgers Law School),Mark A. Lemley (Stanford Law School) & Shawn P. Miller(University of San Diego)
The issue of high drug prices has recently exploded into public consciousness. And while many potential explanations have been offered, one has avoided scrutiny. Why has the growth in generic drugs not resulted in lower drug prices?
In this article, we explore a phenomenon we call “playing both sides”: companies that participate in pharmaceutical markets as both brand owners and generics. We hypothesize that companies that earn a significant amount of their revenue from patented drugs may have less incentive to aggressively pursue a generic agenda, since patented drugs generate far more revenue for firms than generic drugs do.
To investigate this phenomenon, we built a comprehensive database of all major pharmaceutical companies, evaluating where their revenue comes from, how that has changed over time, and how it relates to their behavior in court. Despite broad industry trends toward specialization, about one third of the firms we study have opted for a mixed business model over time. And those firms behave differently than pure generic firms. Our data show that when companies with significant generic sales play both sides, they behave differently than firms with a purer generic revenue stream. Dollar for dollar, the pure generic firms in our study challenged more patents as invalid or not infringed than the mixed firms. Further, “mixed generic” companies with growing brand sales (or a growing share of their revenue from brand sales) are more likely to settle the patent challenges they bring; companies with growing generic share are less likely to settle and more likely to take those cases to judgment. And when they do go to judgment, patent challengers with a greater generic share are more likely to win those challenges while companies with higher brand sales are less likely to win.
In short, we find evidence to support the hypothesis that generic companies that make more of their revenue from patented drugs are less likely to pursue challenges to judgment and less likely to win when they do. Playing both sides may reduce the incentive of generic challengers to fight as hard as possible to win the case before them. That may be especially true of the sorts of challenges that affect not just the patent in the instant case but might change legal doctrines that may ultimately hurt the generic challenger’s brand business.
Our article’s findings suggest a more nuanced antitrust analysis of mergers involving generic companies and patent settlements in which generics delay entering the market. In challenging more patents, settling fewer cases by agreeing to delay entry, and winning more of the cases they do bring, pure generic companies promise to unleash the generic competition that they were intended to. In the wide-ranging effort to lower drug prices, we must pay attention not only to whether a drug is patented but also to who is, or is not, challenging that patent and why.
Continue Reading… https://papers.ssrn.com/sol3/Papers.cfm?abstract_id=3350629
The Trump administration has begun inserting legal protections into recent trade agreements that shield online platforms like Facebook, Twitter and YouTube from lawsuits,
a move that could help lock in America’s tech-friendly regulations around the world even as they are being newly questioned at home.
The protections, which stem from a 1990s law, have already been tucked into the administration’s two biggest trade deals — the United States-Mexico-Canada Agreement and a pact with Japan that President Trump signed on Monday. American negotiators have proposed including the language in other prospective deals, including with the European Union, Britain and members of the World Trade Organization.
From: https://www.nytimes.com/2019/10/07/business/tech-shield-trade-deals.html?action=click&module=Top%20Stories&pgtype=Homepage
a move that could help lock in America’s tech-friendly regulations around the world even as they are being newly questioned at home.
The protections, which stem from a 1990s law, have already been tucked into the administration’s two biggest trade deals — the United States-Mexico-Canada Agreement and a pact with Japan that President Trump signed on Monday. American negotiators have proposed including the language in other prospective deals, including with the European Union, Britain and members of the World Trade Organization.
From: https://www.nytimes.com/2019/10/07/business/tech-shield-trade-deals.html?action=click&module=Top%20Stories&pgtype=Homepage
Sellers and former employees familiar with Amazon’s internal strategy say the company is increasingly focused on boosting its profits on the backs of its sellers — often without any clear upside for customers.
The services include charging sellers thousands of dollars to speak to account managers, as well as making it necessary to purchase ads to guarantee the top spot on a search page. Plus, Amazon is aggressively pushing its own brands — something that may be cheaper for consumers in the short run, but demonstrates its overall power over pricing and merchandise on the site. That gives it an advantage over rival products and sellers who rely on Amazon for their livelihood and have few alternatives if they want to thrive selling online.
Amazon says its success is dependent on those sellers and insists it always prioritizes shoppers.
From:
https://www.washingtonpost.com/technology/2019/10/01/amazon-sellers-say-online-retail-giant-is-trying-help-itself-not-consumers/?arc404=true
The services include charging sellers thousands of dollars to speak to account managers, as well as making it necessary to purchase ads to guarantee the top spot on a search page. Plus, Amazon is aggressively pushing its own brands — something that may be cheaper for consumers in the short run, but demonstrates its overall power over pricing and merchandise on the site. That gives it an advantage over rival products and sellers who rely on Amazon for their livelihood and have few alternatives if they want to thrive selling online.
Amazon says its success is dependent on those sellers and insists it always prioritizes shoppers.
From:
https://www.washingtonpost.com/technology/2019/10/01/amazon-sellers-say-online-retail-giant-is-trying-help-itself-not-consumers/?arc404=true
The NY AG's Complaint against a New York student loan servicer
https://ag.ny.gov/sites/default/files/pheaa_complaint_with_file_stamp.pdf
Excerpt:
7. PHEAA, operating under the name FedLoan Servicing (“FedLoan”), services loans held by the U.S. Department of Education originated under the federal Direct Loan program, including those of New Yorkers, and those Federal Family Education Loan Program (“FFEL”) loans owned by the federal government. PHEAA also services privately-owned FFEL loans and private student loans for tens of thousands of borrowers in New York and nationwide.4
8. FedLoan also has an exclusive contract with the U.S. Department of Education to service the accounts of borrowers seeking PSLF. 5 2 153 Cong. Rec. 9540 (2007) (statement of Sen. Harkin), https://www.congress.gov/crec/2007/07/19/CREC-2007- 07-19-pt1-PgS9534.pdf. 3 Bayliss Fiddiman et al., Student Debt: An Overlooked Barrier to Increasing Teacher Diversity 3, 9 (2019), https://www.americanprogress.org/issues/education-postsecondary/reports/2019/07/09/471850/student-debtoverlooked-barrier-increasing-teacher-diversity/. 4 PHEAA conducts its student loan servicing business both as American Education Services (“AES”) and FedLoan Servicing (“FedLoan”) (collectively referred to as “PHEAA”). AES services private (non-federally guaranteed) loans and federally-guaranteed loans originated under the (now-discontinued) Federal Family Education Loan Program (“FFEL”) that are owned by private companies. FedLoan services Direct loans (loans made directly by the federal government under the current program) and FFEL loans that are owned by the federal government. The majority of the NYAG’s claims relate to PHEAA’s conduct under the FedLoan name. To the extent that this Complaint refers to conduct by the company under both names, it will refer to the company as PHEAA. 5 This includes all borrowers who file a form indicating an intention to participate in PSLF and meet certain initial eligibility requirements, even if they later decide not to pursue PSLF. Case 1:19-cv-09155 Document 1 Filed 10/03/19 Page 5 of 70 3
9. Because FedLoan is the exclusive servicer of PSLF, borrowers have no choice but to rely on FedLoan to administer PSLF fairly and correctly.
10. FedLoan has, however, failed miserably in its administration of PSLF.
11. FedLoan has proven itself unwilling or unable to perform its most fundamental task as exclusive PSLF servicer—accurately counting the qualifying payments borrowers make towards the 120 required for forgiveness. FedLoan’s failure to accurately count eligible payments drives up the cost of borrowers’ loans, extends the time that they are in repayment, and leads to improper denials when borrowers apply for loan forgiveness.
12. To add insult to injury, borrowers who attempt to question FedLoan’s counts are left waiting for months to over a year for an explanation.
13. Furthermore, FedLoan places the burden of identifying and correcting its multitude of errors on the borrowers themselves; fails to apply policies consistently; and fails to inform borrowers of options to seek appeals or “overrides” to fix FedLoan’s mistakes or undo their consequences.
14. FedLoan’s failure to properly administer the program is a significant contributor to the shockingly high rate of rejection of PSLF forgiveness applications—more than 98% of all PSLF applications have been rejected as ineligible for forgiveness. Fewer than 900 out of more than 90,000 applicants have had loan discharges processed as of June 2019.
15. FedLoan promises borrowers that it has “one goal: to help you successfully repay your loans” and that “[w]e are here to help you with every step of the [PSLF] process.”
16. But, in fact, one of the biggest obstacles borrowers face in obtaining the forgiveness they have earned is FedLoan itself. Case 1:19-cv-09155 Document 1 Filed 10/03/19 Page 6 of 70 4
17. PHEAA also fails to fairly and correctly administer income-driven repayment (“IDR”) plans, which are intended to help struggling borrowers avoid delinquency and default by limiting monthly payments based on income and household size. Among other issues, FedLoan fails to timely process IDR applications and fails to accurately calculate monthly payments.6 These delays and mistakes harm struggling borrowers and drive up the cost of their loans.
18. PHEAA’s deceptive, unfair, and abusive practices (as both FedLoan and AES) also include steering borrowers to less beneficial repayment options such as forbearance or consolidation instead of IDR plans and making false statements to borrowers with cancer about their eligibility for a special deferment.
19. PHEAA has consistently demonstrated that it is unwilling to devote the resources required to carry out its servicing obligations in a timely and competent way.
20. Student loan borrowers have no choice of servicer. PHEAA borrowers are thus trapped with a company that disregards its responsibilities and leaves them stuck with the consequences of its errors—often thousands of dollars’ worth.
21. Ultimately, PHEAA’s cavalier approach to its responsibilities has meant it has deprived borrowers of benefits which they have earned and which Congress intended them to have. Faced with PHEAA’s incompetent and indifferent servicing, borrowers report simply giving up on their hopes of ever achieving loan forgiveness or other benefits. One borrower struggling with PHEAA’s errors echoed many other complaints when she lamented, “I feel that I have no recourse in dealing with this situation since [FedLoan] is the exclusive servicer for PSLF and that [FedLoan] can do whatever they want on whatever timetable they want.”
Judge prolongs order blocking D.C.'s online sports betting contract
The District of Columbia's plan to allow online sports betting remains on hold after a D.C. Superior Court judge extended his restraining order against the awarding of a $215 million contract to Intralot, a Greek company. Judge John Campbell says he plans to rule soon on a lawsuit that claims the District's awarding of a no-bid contract runs afoul of federal law.
The Washington Post (tiered subscription model) (10/1)
The District of Columbia's plan to allow online sports betting remains on hold after a D.C. Superior Court judge extended his restraining order against the awarding of a $215 million contract to Intralot, a Greek company. Judge John Campbell says he plans to rule soon on a lawsuit that claims the District's awarding of a no-bid contract runs afoul of federal law.
The Washington Post (tiered subscription model) (10/1)
Should the public get free access to published State laws and annotations?
Georgia is suing Public.Resource.Org for disseminating the state’s Official Code of Georgia Annotated for free on the Internet. Georgia argues that while its laws can’t be copyrighted, the same isn’t true for annotations—such as the summaries of judicial interpretations of the laws—which are prepared by a private contractor. The Eleventh Circuit opinion putting them in the public domain “threatens to upend the longstanding arrangements of Georgia and numerous other states,” counsel of record Joshua Johnson of Vinson & Elkins argues in Georgia v. Public.Resource.Org.
The U.S. Government, Matthew Bender & Co. and The Software and Information Industry Association argue that only government edicts that carry the force of law should be exempt from copyright.
Public.Resource.Org is a nonprofit dedicated to improving public access to all sources of the law. It hasn’t filed its merits brief yet, but at the cert stage it acknowledged the uncertain state of the government edict doctrine and invited the court to take the case. It argues that the Georgia General Assembly “is the driving force behind the annotations’ creation” and that the Georgia Code Revision Commission “directly supervises and controls” their preparation.
Excerpt from https://www.law.com/therecorder/2019/09/27/scotus-2019-ip-cases-wont-be-boring-law-professors-say/?kw=SCOTUS%27%202019%20IP%20Cases%20Won%27t%20Be%20Boring%2C%20Law%20Professors%20Say&utm_source=email&utm_medium=enl&utm_campaign=newsupdate&utm_content=20190930&utm_term=ca
Georgia is suing Public.Resource.Org for disseminating the state’s Official Code of Georgia Annotated for free on the Internet. Georgia argues that while its laws can’t be copyrighted, the same isn’t true for annotations—such as the summaries of judicial interpretations of the laws—which are prepared by a private contractor. The Eleventh Circuit opinion putting them in the public domain “threatens to upend the longstanding arrangements of Georgia and numerous other states,” counsel of record Joshua Johnson of Vinson & Elkins argues in Georgia v. Public.Resource.Org.
The U.S. Government, Matthew Bender & Co. and The Software and Information Industry Association argue that only government edicts that carry the force of law should be exempt from copyright.
Public.Resource.Org is a nonprofit dedicated to improving public access to all sources of the law. It hasn’t filed its merits brief yet, but at the cert stage it acknowledged the uncertain state of the government edict doctrine and invited the court to take the case. It argues that the Georgia General Assembly “is the driving force behind the annotations’ creation” and that the Georgia Code Revision Commission “directly supervises and controls” their preparation.
Excerpt from https://www.law.com/therecorder/2019/09/27/scotus-2019-ip-cases-wont-be-boring-law-professors-say/?kw=SCOTUS%27%202019%20IP%20Cases%20Won%27t%20Be%20Boring%2C%20Law%20Professors%20Say&utm_source=email&utm_medium=enl&utm_campaign=newsupdate&utm_content=20190930&utm_term=ca
Resnikoff review of Chris Sagers' new book in DC Bar magazine
Commentary by Don Resnikoff
Please see my review of Chris SAgers' book at http://washingtonlawyer.dcbar.org/october2019/index.php#/38
The book is
United States v. Apple: Competition in America
Publisher: Harvard University Press
Publication date: September, 2019
In my brief commentary I suggest that there is great wisdom in Chris’s decision to look at antitrust history and policy from the perspective of a particular antitrust case that has generated a lot of public discussion. One great benefit is that his writing is likely to be accessible to nonexpert readers.
The book is well timed, coming at a moment of great uncertainty about the goals of antitrust law. Political figures like Elizabeth Warren and Bernie Sanders argue for bigger and bolder antitrust enforcement against large companies with the goal of reducing their political influence. And looming trade disputes with China appear to encourage US government engagement in industry planning and protection of non-Chinese companies engaged in product areas like 5G telecom. Daniel Sokol and others have pointed out that such industry planning undermines traditional open competition goals.
Chris seems to regret the uncertainties of current antitrust thinking: For reasons he explains in his book, he is a strong supporter of the traditional antitrust rationale that drove the prosecutors who challenged the price-fixing behavior of the book publishers and Apple’s connivance with them.
Posted by Don Allen Resnikoff, who is responsible for the content
Commentary by Don Resnikoff
Please see my review of Chris SAgers' book at http://washingtonlawyer.dcbar.org/october2019/index.php#/38
The book is
United States v. Apple: Competition in America
Publisher: Harvard University Press
Publication date: September, 2019
In my brief commentary I suggest that there is great wisdom in Chris’s decision to look at antitrust history and policy from the perspective of a particular antitrust case that has generated a lot of public discussion. One great benefit is that his writing is likely to be accessible to nonexpert readers.
The book is well timed, coming at a moment of great uncertainty about the goals of antitrust law. Political figures like Elizabeth Warren and Bernie Sanders argue for bigger and bolder antitrust enforcement against large companies with the goal of reducing their political influence. And looming trade disputes with China appear to encourage US government engagement in industry planning and protection of non-Chinese companies engaged in product areas like 5G telecom. Daniel Sokol and others have pointed out that such industry planning undermines traditional open competition goals.
Chris seems to regret the uncertainties of current antitrust thinking: For reasons he explains in his book, he is a strong supporter of the traditional antitrust rationale that drove the prosecutors who challenged the price-fixing behavior of the book publishers and Apple’s connivance with them.
Posted by Don Allen Resnikoff, who is responsible for the content
Maryland gas station becomes first in U.S. to ditch oil for 100% EV charging
By John Elkin September 27, 2019 4:54PM PST
RS Automotive of Takoma Park, a suburb of Washington, D.C., opened as a local gas station in 1958.
Depeswar Doley, owner of the station since 1997, said he was already unhappy with the way oil and gasoline companies structure contracts. They can limit the use of multiple suppliers, includ clauses that extend contracts when a certain volume of sales is not met, and limit maintenance support. These business factors were pushing him to consider other options.
A public works manager for the city of Takoma Park, Maryland, first suggested to Doley a conversation with the Electric Vehicle Institute (EVI).
With help from the institute and the Maryland Energy Administration, Doley secured a $786,000 grant to convert the station. There are more than 20,700 registered EVs in Maryland, and the area also has an electric taxi service in need of more chargers for their business.
Matthew Wade, EVI CEO, said the area has had issues with the supply of charging stations not meeting the demand of EVs. Takoma Park had just two chargers, one in a community center parking lot and the other at a street location.
“They were fully utilized throughout the day; people were lining up,” Wade said. “The city was happy they were being used, but then they said, ‘Wait, no one can get in this parking lot, because these taxis are using these chargers.” Wade says the gas station layout, which is designed for traffic flow, will help alleviate that problem.
The station will feature four dispensers that connect to a high-powered, 200-kilowatt system. The system will allow four vehicles to charge simultaneously and reach 80% battery charge in 20 to 30 minutes. Drivers can go inside and sit in an automated convenience store with screens that allow drivers to track their vehicle’s charging progress.
Doley stated: “You notice there are not too many electric vehicles on the road,” he said. “So it’s not something that I expect to become rich overnight or something like that, but it’s a good cause [and] good for the environment.
https://www.digitaltrends.com/cars/maryland-gas-station-eschews-fossil-fuel-or-electric-charging/
Controvery: California Bar Proposals for Fee-Sharing, Nonattorney Ownership
"This is madness. Why are we even contemplating allowing non-attorneys to practice law and provide legal advice?" one Big Law partner said in a letter to the California bar. Here's a snapshot of some of the other comments.
By Cheryl Miller | September 23, 2019 at 10:25 PM
Hundreds of responses received over the last two months about various California bar proposals that could alter fee-sharing and open a door to nonattorney ownership of firms reveal a common thread: Most of those who shared their thoughts don’t support a wholesale reshaping of how legal clients are served in the Golden State.
The bar asked for opinions on 16 concepts under consideration by the Task Force on Access Through Innovation of Legal Services, a panel charged with proposing ways to increase the availability of legal help. The concepts under consideration range from promoting greater use of technology to allowing different forms of fee-sharing.
Many of the respondents are solo practitioners or lawyers at small firms, although several Big Law names responded, too. The deadline for submitting comments on the state bar committee’s ideas for restructuring legal services in California ended Monday.
“This is madness. Why are we even contemplating allowing non-attorneys to practice law and provide legal advice? There are attorneys admitted to the bar of this state who are barely competent and provide questionable advice. They also commit ethical malfeasance,” Los Angeles-based Alston & Bird partner Elizabeth Sperling said in a letter. “How much worse will it be for people who are not even attorneys?”
The task force is expected to send its final recommendations to the bar’s board of trustees in January. Changes will need the approval of the California Supreme Court and possibly the Legislature.
Excerpt from: https://www.law.com/therecorder/2019/09/23/california-lawyers-slam-bar-proposals-for-fee-sharing-non-attorney-ownership/?kw=California%20Lawyers%20Slam%20Bar%20Proposals%20for%20Fee-Sharing%2C%20Non-Attorney%20Ownership&utm_source=email&utm_medium=enl&utm_campaign=newsupdate&utm_content=20190924&utm_term=ca
"This is madness. Why are we even contemplating allowing non-attorneys to practice law and provide legal advice?" one Big Law partner said in a letter to the California bar. Here's a snapshot of some of the other comments.
By Cheryl Miller | September 23, 2019 at 10:25 PM
Hundreds of responses received over the last two months about various California bar proposals that could alter fee-sharing and open a door to nonattorney ownership of firms reveal a common thread: Most of those who shared their thoughts don’t support a wholesale reshaping of how legal clients are served in the Golden State.
The bar asked for opinions on 16 concepts under consideration by the Task Force on Access Through Innovation of Legal Services, a panel charged with proposing ways to increase the availability of legal help. The concepts under consideration range from promoting greater use of technology to allowing different forms of fee-sharing.
Many of the respondents are solo practitioners or lawyers at small firms, although several Big Law names responded, too. The deadline for submitting comments on the state bar committee’s ideas for restructuring legal services in California ended Monday.
“This is madness. Why are we even contemplating allowing non-attorneys to practice law and provide legal advice? There are attorneys admitted to the bar of this state who are barely competent and provide questionable advice. They also commit ethical malfeasance,” Los Angeles-based Alston & Bird partner Elizabeth Sperling said in a letter. “How much worse will it be for people who are not even attorneys?”
The task force is expected to send its final recommendations to the bar’s board of trustees in January. Changes will need the approval of the California Supreme Court and possibly the Legislature.
Excerpt from: https://www.law.com/therecorder/2019/09/23/california-lawyers-slam-bar-proposals-for-fee-sharing-non-attorney-ownership/?kw=California%20Lawyers%20Slam%20Bar%20Proposals%20for%20Fee-Sharing%2C%20Non-Attorney%20Ownership&utm_source=email&utm_medium=enl&utm_campaign=newsupdate&utm_content=20190924&utm_term=ca
FROM DMN:
U.S. Judiciary Committee Urges the Removal of DMCA-Style Safe Harbor Provisions from Global Trade Treaties
Marsha Silva
September 23, 2019
On September 23rd the U.S. House Judiciary Committee wrote a letter to the U.S. Trade Representative, who is currently negotiating a new free trade agreement between the United States, Mexico and Canada.
The letter expressed concerns about the inclusion of a safe harbor provision that is similar to the one that exists in the Digital Millennium Copyright Act (DMCA).
The safe harbor provision in the DMCA protects internet service providers (ISPs) and user-generated platforms from the copyright infringements of their users — as long as they remove such infringements and take action against those who repeatedly violate the law. The first draft of the new trade agreement includes this provision and the music industry is not happy about it.
“The effects of Section 512 and the appropriate role of a copyright safe harbor have become the subject of much attention in recent years,” the letter declares. “Some have called on Congress to update these very provisions, enacted in the days of a dial-up Internet.”
Mitch Glazier, president of the Recording Industry Association of America (RIAA), said in response to the provision’s inclusion that trade treaties should encourage “more accountability on public platforms” for copyright infringements and not less of it.
The RIAA has been repeatedly lobbying Congress in regards to this issue. That pressure may be the source of the letter, in which the Judiciary Committee specifically pointed out that the safe harbor provision has been a topic of debate. It also mentions that a number of parties would like to see it changed as it relates to U.S. law.
Interestingly, the anti-DMCA move comes amidst a growing backlash against tech giants like Alphabet/Google and Facebook.
Of the pair, Google remains notorious for exploiting DMCA provisions, both on its core search results and YouTube. Across the country, California has already taken steps to clampdown on ‘gig economy’ tech giants Uber and Lyft, though it’s unclear how that spills into broader anti-tech legislation nationwide.
The letter also made note of the fact that the U.S. Government has been reviewing the safe harbor provision for a number of years. Lawmakers are expected to announce policy decisions by the end of this year.
The letter further mentioned the new Copyright Directive issued by the European Union. The Directive has dramatically increased liabilities for service providers and may affect the debate over the provisions in the United States.
While the Judiciary Committee insists that it is not taking an official stand on the safe harbor provision, it believes that adding the provision to new trade treaties would not be wise.
Of course, service providers don’t concur with this sentiment.
Here’s a full copy of the letter. https://www.digitalmusicnews.com/wp-content/uploads/2019/09/Ambassador-Lighthizer-USMCA-letter-9.17.19.pdf
U.S. Judiciary Committee Urges the Removal of DMCA-Style Safe Harbor Provisions from Global Trade Treaties
Marsha Silva
September 23, 2019
On September 23rd the U.S. House Judiciary Committee wrote a letter to the U.S. Trade Representative, who is currently negotiating a new free trade agreement between the United States, Mexico and Canada.
The letter expressed concerns about the inclusion of a safe harbor provision that is similar to the one that exists in the Digital Millennium Copyright Act (DMCA).
The safe harbor provision in the DMCA protects internet service providers (ISPs) and user-generated platforms from the copyright infringements of their users — as long as they remove such infringements and take action against those who repeatedly violate the law. The first draft of the new trade agreement includes this provision and the music industry is not happy about it.
“The effects of Section 512 and the appropriate role of a copyright safe harbor have become the subject of much attention in recent years,” the letter declares. “Some have called on Congress to update these very provisions, enacted in the days of a dial-up Internet.”
Mitch Glazier, president of the Recording Industry Association of America (RIAA), said in response to the provision’s inclusion that trade treaties should encourage “more accountability on public platforms” for copyright infringements and not less of it.
The RIAA has been repeatedly lobbying Congress in regards to this issue. That pressure may be the source of the letter, in which the Judiciary Committee specifically pointed out that the safe harbor provision has been a topic of debate. It also mentions that a number of parties would like to see it changed as it relates to U.S. law.
Interestingly, the anti-DMCA move comes amidst a growing backlash against tech giants like Alphabet/Google and Facebook.
Of the pair, Google remains notorious for exploiting DMCA provisions, both on its core search results and YouTube. Across the country, California has already taken steps to clampdown on ‘gig economy’ tech giants Uber and Lyft, though it’s unclear how that spills into broader anti-tech legislation nationwide.
The letter also made note of the fact that the U.S. Government has been reviewing the safe harbor provision for a number of years. Lawmakers are expected to announce policy decisions by the end of this year.
The letter further mentioned the new Copyright Directive issued by the European Union. The Directive has dramatically increased liabilities for service providers and may affect the debate over the provisions in the United States.
While the Judiciary Committee insists that it is not taking an official stand on the safe harbor provision, it believes that adding the provision to new trade treaties would not be wise.
Of course, service providers don’t concur with this sentiment.
Here’s a full copy of the letter. https://www.digitalmusicnews.com/wp-content/uploads/2019/09/Ambassador-Lighthizer-USMCA-letter-9.17.19.pdf
Boeing US$4.7B Embraer deal faces EU antitrust probe
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Boeing is set to face an EU antitrust investigation into its bid for a controlling stake in the commercial aircraft arm of Brazil’s Embraer, Reuters reported on Monday, September 23.
According to Reuters, the deal would reshape a global passenger jet duopoly and reinforce Western plane-makers against newcomers from China, Russia, and Japan.
It would give Boeing a foothold in the lower end of the market, enabling it to better compete with the CSeries jets designed by Canada’s Bombardier and backed by European rival Airbus.
The European Commission, which has set an October 4 deadline for its preliminary review of the deal, did not respond to a request for immediate comment.
The EU competition enforcer will launch a full-scale investigation following the end of its review, which could take up to five months and raises pressure on Boeing to offer concessions to address competition concerns.
Full Content: Reuters https://www.reuters.com/article/us-embraer-m-a-boeing-eu-exclusive/exclusive-boeing-bid-for-embraer-unit-faces-eu-antitrust-probe-sources-idUSKBN1W8127
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Boeing is set to face an EU antitrust investigation into its bid for a controlling stake in the commercial aircraft arm of Brazil’s Embraer, Reuters reported on Monday, September 23.
According to Reuters, the deal would reshape a global passenger jet duopoly and reinforce Western plane-makers against newcomers from China, Russia, and Japan.
It would give Boeing a foothold in the lower end of the market, enabling it to better compete with the CSeries jets designed by Canada’s Bombardier and backed by European rival Airbus.
The European Commission, which has set an October 4 deadline for its preliminary review of the deal, did not respond to a request for immediate comment.
The EU competition enforcer will launch a full-scale investigation following the end of its review, which could take up to five months and raises pressure on Boeing to offer concessions to address competition concerns.
Full Content: Reuters https://www.reuters.com/article/us-embraer-m-a-boeing-eu-exclusive/exclusive-boeing-bid-for-embraer-unit-faces-eu-antitrust-probe-sources-idUSKBN1W8127
California leads two-dozen states and cities suing the Trump administration over blocking of stricter state emissions standards
The lawsuit complaint is here: https://drive.google.com/file/d/1W2MIlMOr9Sc_5WSESoed09tJuvaKEnW9/view
Excerpt:
State Plaintiffs respectfully request that the Preemption Regulation be declared unlawful and set aside because it
exceeds NHTSA’s authority, contravenes Congressional intent, and is arbitrary and capricious,
and because NHTSA has failed to conduct the analysis required under the National
Environmental Policy Act (“NEPA”).
2. The Preemption Regulation declares that the federal Energy Policy and
Conservation Act of 1975, Pub. L. No. 94-163, 89 Stat. 871 (“EPCA”), preempts state laws that
regulate greenhouse gas emissions from new passenger cars and light trucks. The Preemption
Regulation targets by name the greenhouse gas emission and zero-emission vehicle standards
promulgated by the State of California (“the California standards”) and adopted by twelve other
states.
3. California has had emissions standards for light-duty vehicles for 60 years.
And the California standards at issue in this case are longstanding and fundamental parts of
many State Plaintiffs’ efforts to protect public health and welfare in their states, to meet state
goals for the reduction of harmful air pollution including greenhouse gases, and to attain or
maintain federal air quality standards. Indeed, the California standards are one of the most
effective state policies to reduce greenhouse gases and other pollutant emissions from the
transportation sector. The California standards are projected to result in more than 2 million
additional zero-emission vehicles on the road by 2025 and, in the absence of the existing federal
standards, to reduce greenhouse emissions by more than 66 million metric tons per year by 2030,
greater than the amount emitted by all power plants in California.
4. The federal government has repeatedly approved several State Plaintiffs’ use
of the California standards as necessary for a wide variety of purposes. It has granted waivers of
preemption under section 209(b) of the Clean Air Act for both the greenhouse gas (GHG)
standards (which set limits for greenhouse gas emissions from new vehicles) and the zero-
emission vehicle (“ZEV”) standards (which require that a certain percentage of new vehicles be
ZEVs). The federal government has also approved both the GHG standards and ZEV standards
as necessary components of several State Plaintiffs’ plans to attain National Ambient Air Quality
Standards under the Clean Air Act. And it has approved state reliance on the ZEV standards in
determining the pollution impacts of transportation planning decisions. Moreover, for the last
decade, the federal government has harmonized its own greenhouse gas emissions standards and
its fuel economy standards with the California standards.
5. California has been regulating vehicle emissions since 1959. Its authority to do
so has been repeatedly recognized, reaffirmed, and even expanded by Congress. In a series of
statutes and amendments adopted over five decades, including in EPCA itself and bills enacted
both before and after its passage, Congress has preserved California’s authority to adopt vehicle
emissions standards and relied on those standards as a model for the federal government and for
other states.
6. NHTSA’s Preemption Regulation flies in the face of this history. It purports to
declare that both California’s GHG standards and its ZEV standards are expressly preempted
because, in NHTSA’s current view, they are “related to fuel economy standards” within the
meaning of EPCA’s preemption provision, 49 U.S.C. § 32919. The Preemption Regulation also
purports to declare the California standards conflict-preempted under EPCA.
7. The United States Environmental Protection Agency (EPA) expressly relies on
the Preemption Regulation in its separate action withdrawing a waiver of preemption for the
California standards that EPA previously granted under Section 209(b) of the Clean Air Act.
Before this action, neither EPA nor NHTSA had ever taken final action premised on the notion
that EPCA preempts emissions standards for which California has a waiver of preemption under
the Clean Air Act.
8. Nowhere does Congress, in EPCA or any other statute, authorize NHTSA to
issue a regulation declaring that state laws are preempted by EPCA.
9. The Preemption Regulation is not only in excess of NHTSA’s jurisdiction, it is
also wrong as a matter of law. NHTSA’s position that the California standards—which regulate
vehicle emissions, not fuel economy—are preempted by EPCA contravenes EPCA itself, the
Clean Air Act, and various amendments to both statutes. It directly conflicts with the decisions
of the two federal courts that considered this question and held that California’s standards are not
preempted by EPCA. It also contradicts the Supreme Court’s decision in Massachusetts v. EPA,
549 U.S. 497 (2007), which rejected the federal government’s argument that greenhouse gas
emissions standards under the Clean Air Act interfered with NHTSA’s ability to set fuel
economy standards under EPCA.
10. Other flaws with the Preemption Regulation are evident on its face. The
Preemption Regulation declares that California’s GHG standards conflict with federal fuel
economy standards—despite the fact that California’s standards provide that manufacturers may
(and many in fact do) comply by meeting federal GHG standards issued in conjunction with
federal fuel economy standards.
11. The Preemption Regulation also declares that California’s decades-old ZEV
standards are both “related to fuel economy standards” and in conflict with them. Preemption
Regulation, p. 50. But EPCA itself demonstrates the opposite. In EPCA, Congress has not
authorized NHTSA to set fuel economy standards for vehicles, including ZEVs, that run
exclusively on alternative fuels like electricity. And it has prohibited NHTSA from taking the
availability of ZEVs into account when setting federal fuel economy standards, meaning that
ZEVs do not affect fuel economy standards. 49 U.S.C. § 32902(h)(1).
12. In addition, NHTSA has failed to consider the damage the Preemption
Regulation will inflict on the environment and public health and welfare, flouting the
Case 1:19-cv-02826 Document 1 Filed 09/20/19 Page 7 of 51
8
requirements of NEPA, 42 U.S.C. §§ 4321-4347. Remarkably, NHTSA has conducted no
analysis at all of the environmental impacts of a regulation that purports to preempt air pollution
laws in effect in states that represent more than a third of the nation’s automobile market.
13. For all of these and other reasons, State Plaintiffs respectfully request that this
Court declare the Preemption Regulation unlawful, set it aside, and enjoin its implementation.
The lawsuit complaint is here: https://drive.google.com/file/d/1W2MIlMOr9Sc_5WSESoed09tJuvaKEnW9/view
Excerpt:
State Plaintiffs respectfully request that the Preemption Regulation be declared unlawful and set aside because it
exceeds NHTSA’s authority, contravenes Congressional intent, and is arbitrary and capricious,
and because NHTSA has failed to conduct the analysis required under the National
Environmental Policy Act (“NEPA”).
2. The Preemption Regulation declares that the federal Energy Policy and
Conservation Act of 1975, Pub. L. No. 94-163, 89 Stat. 871 (“EPCA”), preempts state laws that
regulate greenhouse gas emissions from new passenger cars and light trucks. The Preemption
Regulation targets by name the greenhouse gas emission and zero-emission vehicle standards
promulgated by the State of California (“the California standards”) and adopted by twelve other
states.
3. California has had emissions standards for light-duty vehicles for 60 years.
And the California standards at issue in this case are longstanding and fundamental parts of
many State Plaintiffs’ efforts to protect public health and welfare in their states, to meet state
goals for the reduction of harmful air pollution including greenhouse gases, and to attain or
maintain federal air quality standards. Indeed, the California standards are one of the most
effective state policies to reduce greenhouse gases and other pollutant emissions from the
transportation sector. The California standards are projected to result in more than 2 million
additional zero-emission vehicles on the road by 2025 and, in the absence of the existing federal
standards, to reduce greenhouse emissions by more than 66 million metric tons per year by 2030,
greater than the amount emitted by all power plants in California.
4. The federal government has repeatedly approved several State Plaintiffs’ use
of the California standards as necessary for a wide variety of purposes. It has granted waivers of
preemption under section 209(b) of the Clean Air Act for both the greenhouse gas (GHG)
standards (which set limits for greenhouse gas emissions from new vehicles) and the zero-
emission vehicle (“ZEV”) standards (which require that a certain percentage of new vehicles be
ZEVs). The federal government has also approved both the GHG standards and ZEV standards
as necessary components of several State Plaintiffs’ plans to attain National Ambient Air Quality
Standards under the Clean Air Act. And it has approved state reliance on the ZEV standards in
determining the pollution impacts of transportation planning decisions. Moreover, for the last
decade, the federal government has harmonized its own greenhouse gas emissions standards and
its fuel economy standards with the California standards.
5. California has been regulating vehicle emissions since 1959. Its authority to do
so has been repeatedly recognized, reaffirmed, and even expanded by Congress. In a series of
statutes and amendments adopted over five decades, including in EPCA itself and bills enacted
both before and after its passage, Congress has preserved California’s authority to adopt vehicle
emissions standards and relied on those standards as a model for the federal government and for
other states.
6. NHTSA’s Preemption Regulation flies in the face of this history. It purports to
declare that both California’s GHG standards and its ZEV standards are expressly preempted
because, in NHTSA’s current view, they are “related to fuel economy standards” within the
meaning of EPCA’s preemption provision, 49 U.S.C. § 32919. The Preemption Regulation also
purports to declare the California standards conflict-preempted under EPCA.
7. The United States Environmental Protection Agency (EPA) expressly relies on
the Preemption Regulation in its separate action withdrawing a waiver of preemption for the
California standards that EPA previously granted under Section 209(b) of the Clean Air Act.
Before this action, neither EPA nor NHTSA had ever taken final action premised on the notion
that EPCA preempts emissions standards for which California has a waiver of preemption under
the Clean Air Act.
8. Nowhere does Congress, in EPCA or any other statute, authorize NHTSA to
issue a regulation declaring that state laws are preempted by EPCA.
9. The Preemption Regulation is not only in excess of NHTSA’s jurisdiction, it is
also wrong as a matter of law. NHTSA’s position that the California standards—which regulate
vehicle emissions, not fuel economy—are preempted by EPCA contravenes EPCA itself, the
Clean Air Act, and various amendments to both statutes. It directly conflicts with the decisions
of the two federal courts that considered this question and held that California’s standards are not
preempted by EPCA. It also contradicts the Supreme Court’s decision in Massachusetts v. EPA,
549 U.S. 497 (2007), which rejected the federal government’s argument that greenhouse gas
emissions standards under the Clean Air Act interfered with NHTSA’s ability to set fuel
economy standards under EPCA.
10. Other flaws with the Preemption Regulation are evident on its face. The
Preemption Regulation declares that California’s GHG standards conflict with federal fuel
economy standards—despite the fact that California’s standards provide that manufacturers may
(and many in fact do) comply by meeting federal GHG standards issued in conjunction with
federal fuel economy standards.
11. The Preemption Regulation also declares that California’s decades-old ZEV
standards are both “related to fuel economy standards” and in conflict with them. Preemption
Regulation, p. 50. But EPCA itself demonstrates the opposite. In EPCA, Congress has not
authorized NHTSA to set fuel economy standards for vehicles, including ZEVs, that run
exclusively on alternative fuels like electricity. And it has prohibited NHTSA from taking the
availability of ZEVs into account when setting federal fuel economy standards, meaning that
ZEVs do not affect fuel economy standards. 49 U.S.C. § 32902(h)(1).
12. In addition, NHTSA has failed to consider the damage the Preemption
Regulation will inflict on the environment and public health and welfare, flouting the
Case 1:19-cv-02826 Document 1 Filed 09/20/19 Page 7 of 51
8
requirements of NEPA, 42 U.S.C. §§ 4321-4347. Remarkably, NHTSA has conducted no
analysis at all of the environmental impacts of a regulation that purports to preempt air pollution
laws in effect in states that represent more than a third of the nation’s automobile market.
13. For all of these and other reasons, State Plaintiffs respectfully request that this
Court declare the Preemption Regulation unlawful, set it aside, and enjoin its implementation.
USDOJ's antitrust chief's defense of antitrust concerns with automaker agreement to adhere to California auto emission policies:
When competitors agree with each other on how to act in the marketplace, antitrust law enforcers have to step in, writes Assistant AG Makan Delrahim.
The loftiest of purported motivations do not excuse anti-competitive collusion among rivals. That’s long-standing antitrust law.
The law recognizes that when companies compete, consumers win. It deems competition to be intrinsically good, because rivalry, particularly in the form of free markets, benefits consumers by offering them both better prices and products. In turn, antitrust law negatively views conduct that harms competition.
Indeed, the Supreme Court has made it clear that in seeking to cultivate competition, antitrust laws should not render judgment on the “moral” aspirations behind the conduct.
While companies are free to make any individual public commitments or set any sales or technical limits for themselves, when competitors agree with each other on how they should act in the marketplace, antitrust law enforcers have stepped in and taken a good, hard look. Anti-competitive agreements among competitors — regardless of the purported beneficial goal — are outlawed because they reduce the incentives for companies to compete vigorously, which in turn can raise prices, reduce innovation and ultimately harm consumers.
Indeed, in multiple instances, the Supreme Court has struck down collective efforts by engineers to enhance “public safety” as well as a collective effort by criminal defense lawyers with the goal of improving quality of representation for “indigent criminal defendants.” Even laudable ends do not justify collusive means in our chosen system of laws.
This is why the nonpartisan nature of antitrust enforcement remains of utmost importance. Antitrust enforcement must prioritize protecting competition. And we do so.
The Antitrust Division’s decisions to look into an industry are based on whether the underlying conduct has the potential to harm competition. It does not look into industries because of political objectives, nor can it refrain from examining possible anti-competitive conduct because it would be politically unpopular.
Nevertheless, media personalities and politicians recently have levied the charge of “politicization” of antitrust in light of enforcement scrutiny that may not align with their political objectives. Fortunately for all Americans, the Department of Justice’s sole consideration is the law.
No goal, well-intentioned or otherwise, is an excuse for collusion or other anti-competitive behavior that runs afoul of the antitrust laws. Those who criticize even the prospect of an antitrust investigation should know that, when it comes to antitrust, politically popular ends should not justify turning a blind eye to the competition laws.
Makan Delrahim is Assistant Attorney General of the Antitrust Division, U.S. Department of Justice.
https://www.usatoday.com/story/opinion/2019/09/12/doj-antitrust-division-popular-ends-dont-justify-collusion-editorials-debates/2306078001/
When competitors agree with each other on how to act in the marketplace, antitrust law enforcers have to step in, writes Assistant AG Makan Delrahim.
The loftiest of purported motivations do not excuse anti-competitive collusion among rivals. That’s long-standing antitrust law.
The law recognizes that when companies compete, consumers win. It deems competition to be intrinsically good, because rivalry, particularly in the form of free markets, benefits consumers by offering them both better prices and products. In turn, antitrust law negatively views conduct that harms competition.
Indeed, the Supreme Court has made it clear that in seeking to cultivate competition, antitrust laws should not render judgment on the “moral” aspirations behind the conduct.
While companies are free to make any individual public commitments or set any sales or technical limits for themselves, when competitors agree with each other on how they should act in the marketplace, antitrust law enforcers have stepped in and taken a good, hard look. Anti-competitive agreements among competitors — regardless of the purported beneficial goal — are outlawed because they reduce the incentives for companies to compete vigorously, which in turn can raise prices, reduce innovation and ultimately harm consumers.
Indeed, in multiple instances, the Supreme Court has struck down collective efforts by engineers to enhance “public safety” as well as a collective effort by criminal defense lawyers with the goal of improving quality of representation for “indigent criminal defendants.” Even laudable ends do not justify collusive means in our chosen system of laws.
This is why the nonpartisan nature of antitrust enforcement remains of utmost importance. Antitrust enforcement must prioritize protecting competition. And we do so.
The Antitrust Division’s decisions to look into an industry are based on whether the underlying conduct has the potential to harm competition. It does not look into industries because of political objectives, nor can it refrain from examining possible anti-competitive conduct because it would be politically unpopular.
Nevertheless, media personalities and politicians recently have levied the charge of “politicization” of antitrust in light of enforcement scrutiny that may not align with their political objectives. Fortunately for all Americans, the Department of Justice’s sole consideration is the law.
No goal, well-intentioned or otherwise, is an excuse for collusion or other anti-competitive behavior that runs afoul of the antitrust laws. Those who criticize even the prospect of an antitrust investigation should know that, when it comes to antitrust, politically popular ends should not justify turning a blind eye to the competition laws.
Makan Delrahim is Assistant Attorney General of the Antitrust Division, U.S. Department of Justice.
https://www.usatoday.com/story/opinion/2019/09/12/doj-antitrust-division-popular-ends-dont-justify-collusion-editorials-debates/2306078001/
Five Years Later, Led Zeppelin’s “Stairway to Heaven” Copyright Lawsuit Is Still Going
Marsha Silva
September 20, 2019
For years, rock legends Led Zeppelin have had to battle in court to fight charges of widespread plagiarism during their illustrious recording career in the 1970s.The latest battle has been over their classic song “Stairway to Heaven,” and amazingly, court proceedings are now in their fifth year. On September 23rd, the battle continues — once again — in federal court.
That’s when the full ‘en banc’ panel of the U.S. Court of Appeals for the Ninth Circuit is scheduled to hear oral arguments in the copyright infringement lawsuit that the descendants of Randy Wolfe initially filed against Led Zeppelin. The descendants insist that the opening cords of “Stairway to Heaven” were stolen from a song that the late guitarist wrote called “Taurus,” which was performed by the band Spirit.
After an initial complaint in 2014, the case went to trial in California, and a jury ultimately found in favor of Led Zeppelin. But the plaintiffs in the case appealed the verdict and a 3-member panel of the Ninth Circuit unanimously overturned the verdict because the judge gave jurors erroneous information about U.S. copyright law.
The lawsuit raises a number of questions relating to what exactly is protected by U.S. copyright law. Many believe that the outcome of the case could affect other pending copyright infringement cases, such as the one pitting Marvin Gaye’s “Let’s Get It On” against Ed Sheeran and his “Thinking Out Loud”. It could also spur other cases if the lawsuit proves successful.
Unlike in previous copyright infringement cases involving Led Zeppelin, the music industry is firmly behind the band.In August, more than 120 music artists filed an amicus brief in support of the band. The artists have said that if the lawsuit against Led Zeppelin succeeds, it could seriously hamper creativity in music. Even more impressively, the U.S. government also filed an amicus brief on behalf of Led Zeppelin, citing the need to “foster innovation and creative expression.”
https://www.digitalmusicnews.com/2019/09/20/led-zeppelin-stairway-to-heaven-copyright-lawsuit-resumes/#comments
Marsha Silva
September 20, 2019
For years, rock legends Led Zeppelin have had to battle in court to fight charges of widespread plagiarism during their illustrious recording career in the 1970s.The latest battle has been over their classic song “Stairway to Heaven,” and amazingly, court proceedings are now in their fifth year. On September 23rd, the battle continues — once again — in federal court.
That’s when the full ‘en banc’ panel of the U.S. Court of Appeals for the Ninth Circuit is scheduled to hear oral arguments in the copyright infringement lawsuit that the descendants of Randy Wolfe initially filed against Led Zeppelin. The descendants insist that the opening cords of “Stairway to Heaven” were stolen from a song that the late guitarist wrote called “Taurus,” which was performed by the band Spirit.
After an initial complaint in 2014, the case went to trial in California, and a jury ultimately found in favor of Led Zeppelin. But the plaintiffs in the case appealed the verdict and a 3-member panel of the Ninth Circuit unanimously overturned the verdict because the judge gave jurors erroneous information about U.S. copyright law.
The lawsuit raises a number of questions relating to what exactly is protected by U.S. copyright law. Many believe that the outcome of the case could affect other pending copyright infringement cases, such as the one pitting Marvin Gaye’s “Let’s Get It On” against Ed Sheeran and his “Thinking Out Loud”. It could also spur other cases if the lawsuit proves successful.
Unlike in previous copyright infringement cases involving Led Zeppelin, the music industry is firmly behind the band.In August, more than 120 music artists filed an amicus brief in support of the band. The artists have said that if the lawsuit against Led Zeppelin succeeds, it could seriously hamper creativity in music. Even more impressively, the U.S. government also filed an amicus brief on behalf of Led Zeppelin, citing the need to “foster innovation and creative expression.”
https://www.digitalmusicnews.com/2019/09/20/led-zeppelin-stairway-to-heaven-copyright-lawsuit-resumes/#comments
DMN: CA statute protecting Uber gig workers hits music industry (and probably others)
California’s AB5 was signed into law this week without any exemptions or concessions for the music industry. So what happened?
California’s AB5 is designed to curtail contractor abuse by tech giants like Uber, Lyft, and GrubHub. But the law generated disastrous implications for a number of other industries reliant upon temporary contractors.
Talk to the Recording Industry Association of America (RIAA), American Association of Independent Musicians (A2IM), and the Music Artists Coalition (MAC), and California’s AB5 has the power to destroy the state’s music industry. Richard Burgess, president of A2IM, told DMN that the bill would single-handedly“gut the music industry” by making it impossible to hire the ad-hoc teams required to produce music and collaborate creatively.
Yet despite aggressive protests and consultations with California lawmakers, the bill was recently signed into law by Governor Gavin Newsom without any music industry exemptions — without even a mention of the industry at all. Meanwhile, a raft of other industries and professionals, including lawyers, fisherman, plumbers, barbers, tutors, and even newspapers won special exemptions and considerations from lawmakers.
So what happened?According to California Assemblywoman Lorena Gonzalez, the lead sponsor of AB5, the music industry simply couldn’t craft a workable set of compromises. Instead, they chose to fight the legislation entirely. “We were hopeful they would reach an agreement, but once language was drafted to chart a path forward… the recording industry preferred no legislation at all,” Gonzalez said.
Excerpt from https://www.digitalmusicnews.com/2019/09/19/music-industry-infighting-ab5/
California’s AB5 was signed into law this week without any exemptions or concessions for the music industry. So what happened?
California’s AB5 is designed to curtail contractor abuse by tech giants like Uber, Lyft, and GrubHub. But the law generated disastrous implications for a number of other industries reliant upon temporary contractors.
Talk to the Recording Industry Association of America (RIAA), American Association of Independent Musicians (A2IM), and the Music Artists Coalition (MAC), and California’s AB5 has the power to destroy the state’s music industry. Richard Burgess, president of A2IM, told DMN that the bill would single-handedly“gut the music industry” by making it impossible to hire the ad-hoc teams required to produce music and collaborate creatively.
Yet despite aggressive protests and consultations with California lawmakers, the bill was recently signed into law by Governor Gavin Newsom without any music industry exemptions — without even a mention of the industry at all. Meanwhile, a raft of other industries and professionals, including lawyers, fisherman, plumbers, barbers, tutors, and even newspapers won special exemptions and considerations from lawmakers.
So what happened?According to California Assemblywoman Lorena Gonzalez, the lead sponsor of AB5, the music industry simply couldn’t craft a workable set of compromises. Instead, they chose to fight the legislation entirely. “We were hopeful they would reach an agreement, but once language was drafted to chart a path forward… the recording industry preferred no legislation at all,” Gonzalez said.
Excerpt from https://www.digitalmusicnews.com/2019/09/19/music-industry-infighting-ab5/
CFPB explains its position that statute provision protecting Director from Removal is unconstitutional:
NCAA response to California Senate Bill 206--Measure would upend level playing field for all student-athletes
The NCAA Board of Governors sent a letter to California Gov. Gavin Newsom, making clear its belief that this bill would wipe out the distinction between college and professional athletics and eliminate the element of fairness that supports all of college sports. Text of the letter follows:
Governor Newsom:
The 1,100 schools that make up the NCAA have always, in everything we do, supported a level playing field for all student-athletes. This core belief extends to each member college and university in every state across the nation.
California Senate Bill 206 would upend that balance. If the bill becomes law and California’s 58 NCAA schools are compelled to allow an unrestricted name, image and likeness scheme, it would erase the critical distinction between college and professional athletics and, because it gives those schools an unfair recruiting advantage, would result in them eventually being unable to compete in NCAA competitions. These outcomes are untenable and would negatively impact more than 24,000 California student-athletes across three divisions.
Right now, nearly half a million student-athletes in all 50 states compete under the same rules. This bill would remove that essential element of fairness and equal treatment that forms the bedrock of college sports.
The NCAA continues to focus on the best interests of all student-athletes nationwide. NCAA member schools already are working on changing rules for all student-athletes to appropriately use their name, image and likeness in accordance with our values — but not pay them to play. The
NCAA has consistently stood by its belief that student-athletes are students first, and they should not be employees of the university.
It isn’t possible to resolve the challenges of today’s college sports environment in this way — by one state taking unilateral action. With more than 1,100 schools and nearly 500,000 student-athletes across the nation, the rules and policies of college sports must be established through the Association’s collaborative governance system. A national model of collegiate sport requires mutually agreed upon rules.
We urge the state of California to reconsider this harmful and, we believe, unconstitutional bill and hope the state will be a constructive partner in our efforts to develop a fair name, image and likeness approach for all 50 states.
Sincerely,
Members of the NCAA Board of Governors
- Stevie Baker-Watson, DePauw University
- M. Grace Calhoun, University of Pennsylvania
- Ken Chenault, General Catalyst
- Mary Sue Coleman, Association of American Universities
- John DeGioia, Georgetown University
- Michael Drake, The Ohio State University
- Philip DiStefano, University of Colorado, Boulder
- Mark Emmert, NCAA
- Sue Henderson, New Jersey City University
- Grant Hill, CBS/Warner and The Atlanta Hawks
- Sandra Jordan, University of South Carolina Aiken
- Renu Khator, University of Houston
- Laura Liesman, Georgian Court University
- Ronald Machtley, Bryant University
- The Rev. James Maher, Niagara University
- Denis McDonough, Former White House Chief of Staff
- Tori Murden McClure, Spalding University
- Gary Olson, Daemen College
- Denise Trauth, Texas State University
- Satish Tripathi, University at Buffalo, the State University of New York
- David Wilson, Morgan State University
- Randy Woodson, North Carolina State University
Media Contact
Stacey
Osburn
NCAA Director of Public and Media Relations
NCAA
317-917-6117
https://mail.yahoo.com/b/folders/1/messages/ABfzRqwJ-TciXYHiMQwZqCqmxA4?.src=ym&reason=myc&folderType=INBOX&showImages=true&offset=0
Competition policy and U.S. efforts to constrain Chinese competition in rail passenger cars*
Congress is soon expected to approve legislation with bipartisan sponsorship that would effectively bar a Chinese company that manufactures railroad passenger cars for subways, CRRC Corporation, from competing for new contracts in the United States. Government entities like the city of Chicago would be denied federal financial support for contracts with the company. The White House has expressed its support for the effort [https://www.whitehouse.gov/wp-content/uploads/2019/09/Letter-to-the-Chairs-and-Ranking-Members-of-the-House-and-Senate-Armed-Services-Committees.pdf].
A New York Times article explains that the rationale for the legislation, an add-on to a military spending bill, is at least partly economic and political: the Chinese government has pumped money into building globally competitive businesses, often creating overcapacity in markets like steel, solar panels and trains.
The Times article explains that Chinese government support for Chinese companies has lowered prices for consumers — including American taxpayers who pay for subway cars. While a subway car has not been manufactured solely by an American company in decades, CRRC’s low prices have raised concerns among American freight train manufacturing companies that the CRRC company could ultimately move into — and demolish — their business.
The Times article says that CRRC has consistently underbid its competitors, winning over urban transit agencies that are saddled with aging infrastructure and tight budgets. For the Chicago L, CRRC’s Chicago subsidiary bid $1.55 million per car, compared with a bid of $1.82 million per car by Bombardier, the Canadian manufacturer. And CRRC also proposed to build a Chicago manufacturing facility and create 170 new jobs.
Legislators argue that Chinese state-owned companies are not pursuing profit, but the policy aims of the Chinese government to dominate key global industries like electric cars, robotics and rail.
“When you can subsidize, when you can wholly own an enterprise like China does, you can create a wholly unlevel playing field,” said Senator Tammy Baldwin, a Wisconsin Democrat who is a co-sponsor of the legislation. “We’re used to that unlevel playing field existing between the U.S. and China, but now it’s happening in our own backyard.”
From the perspective of competition policy, bipartisan support for legislation that handicaps particular Chinese competitors and favors non-Chinese competitors is an important development. It is a policy quite different from simply allowing municipal and other consumers to pick products based on price and quality.
The legislation directed at CRRC is not an isolated example of US government interest in industrial policy directed against Chinese companies. For example, Senator Marco Rubio’s recently published study on meeting the challenges of Chinese competition, particularly in the IT sector, endorses an industrial policy approach: “The fundamental issue for the U.S. and other western nations, and the IT sector is how to respond to a managed economy [in China] with a well-financed strategy to create a domestic industry intended to displace foreign suppliers.”
The bottom line point is that at the moment there is a growing tension between a competition policy that encourages consumers to buy based simply on considerations of price and quality, and an industrial policy based on disadvantaging Chinese companies perceived as competing unfairly.
For the purposes of this brief comment the point is not that industrial policy directed against Chinese companies and favoring other companies is necessarily wrong, or that it is novel to have such an industrial policy. Similar policies have been used by the U.S. government in the past. The point is simply that government efforts to disadvantage Chinese competition are currently increasing, with broadening bipartisan support, increasing the importance of dialogue among advocates who are skeptical of US government industrial policies that limit Chinese competition, and those who advocate for putting constraints on Chinese competitors.
*The views expressed are entirely the responsibility of Don Allen Resnikoff
Additional sources:
https://www.nytimes.com/2019/09/14/business/chinese-train-national-security.html
https://www.congress.gov/bill/116th-congress/house-bill/2500/text#toc-H3A11FD2AB8A744FD8678D9165826EF95 [at Section 896]
"Tensions between Antitrust and Industrial Policy" by D. Daniel ...
https://scholarship.law.ufl.edu › facultypub
by DD Sokol - 2015 - Cited by 22 - Related articles
Sound antitrust law and policy is in tension with industrial policy. Antitrust promotes consumer welfare whereas industrial policy promotes government intervention for privileged groups or industries.
Congress is soon expected to approve legislation with bipartisan sponsorship that would effectively bar a Chinese company that manufactures railroad passenger cars for subways, CRRC Corporation, from competing for new contracts in the United States. Government entities like the city of Chicago would be denied federal financial support for contracts with the company. The White House has expressed its support for the effort [https://www.whitehouse.gov/wp-content/uploads/2019/09/Letter-to-the-Chairs-and-Ranking-Members-of-the-House-and-Senate-Armed-Services-Committees.pdf].
A New York Times article explains that the rationale for the legislation, an add-on to a military spending bill, is at least partly economic and political: the Chinese government has pumped money into building globally competitive businesses, often creating overcapacity in markets like steel, solar panels and trains.
The Times article explains that Chinese government support for Chinese companies has lowered prices for consumers — including American taxpayers who pay for subway cars. While a subway car has not been manufactured solely by an American company in decades, CRRC’s low prices have raised concerns among American freight train manufacturing companies that the CRRC company could ultimately move into — and demolish — their business.
The Times article says that CRRC has consistently underbid its competitors, winning over urban transit agencies that are saddled with aging infrastructure and tight budgets. For the Chicago L, CRRC’s Chicago subsidiary bid $1.55 million per car, compared with a bid of $1.82 million per car by Bombardier, the Canadian manufacturer. And CRRC also proposed to build a Chicago manufacturing facility and create 170 new jobs.
Legislators argue that Chinese state-owned companies are not pursuing profit, but the policy aims of the Chinese government to dominate key global industries like electric cars, robotics and rail.
“When you can subsidize, when you can wholly own an enterprise like China does, you can create a wholly unlevel playing field,” said Senator Tammy Baldwin, a Wisconsin Democrat who is a co-sponsor of the legislation. “We’re used to that unlevel playing field existing between the U.S. and China, but now it’s happening in our own backyard.”
From the perspective of competition policy, bipartisan support for legislation that handicaps particular Chinese competitors and favors non-Chinese competitors is an important development. It is a policy quite different from simply allowing municipal and other consumers to pick products based on price and quality.
The legislation directed at CRRC is not an isolated example of US government interest in industrial policy directed against Chinese companies. For example, Senator Marco Rubio’s recently published study on meeting the challenges of Chinese competition, particularly in the IT sector, endorses an industrial policy approach: “The fundamental issue for the U.S. and other western nations, and the IT sector is how to respond to a managed economy [in China] with a well-financed strategy to create a domestic industry intended to displace foreign suppliers.”
The bottom line point is that at the moment there is a growing tension between a competition policy that encourages consumers to buy based simply on considerations of price and quality, and an industrial policy based on disadvantaging Chinese companies perceived as competing unfairly.
For the purposes of this brief comment the point is not that industrial policy directed against Chinese companies and favoring other companies is necessarily wrong, or that it is novel to have such an industrial policy. Similar policies have been used by the U.S. government in the past. The point is simply that government efforts to disadvantage Chinese competition are currently increasing, with broadening bipartisan support, increasing the importance of dialogue among advocates who are skeptical of US government industrial policies that limit Chinese competition, and those who advocate for putting constraints on Chinese competitors.
*The views expressed are entirely the responsibility of Don Allen Resnikoff
Additional sources:
https://www.nytimes.com/2019/09/14/business/chinese-train-national-security.html
https://www.congress.gov/bill/116th-congress/house-bill/2500/text#toc-H3A11FD2AB8A744FD8678D9165826EF95 [at Section 896]
"Tensions between Antitrust and Industrial Policy" by D. Daniel ...
https://scholarship.law.ufl.edu › facultypub
by DD Sokol - 2015 - Cited by 22 - Related articles
Sound antitrust law and policy is in tension with industrial policy. Antitrust promotes consumer welfare whereas industrial policy promotes government intervention for privileged groups or industries.
DMN:
Small Claims Copyright Court Is Getting Closer to Reality — A Full Congressional Vote On the ‘CASE Act’ Is Next
What if smaller copyright infringement cases could be quickly resolved in the U.S. legal system — just like Small Claims Court? That’s the idea behind the newly-revived CASE Act.
The story continues here. https://www.digitalmusicnews.com/2019/09/11/case-act-small-claims-copyright-court/
Small Claims Copyright Court Is Getting Closer to Reality — A Full Congressional Vote On the ‘CASE Act’ Is Next
What if smaller copyright infringement cases could be quickly resolved in the U.S. legal system — just like Small Claims Court? That’s the idea behind the newly-revived CASE Act.
The story continues here. https://www.digitalmusicnews.com/2019/09/11/case-act-small-claims-copyright-court/
NYT Opinion
A Cruel Parody of Antitrust Enforcement
The Justice Department is roughing up Mr. Trump’s political enemies and threatening the environment.
By The NYT Editorial Board
President Trump’s Justice Department — for it is increasingly clear that the department has been reduced to an arm of the White House — has opened an antitrust investigation of four auto companies that had the temerity to defy the president by voluntarily agreeing to reduce auto emissions below the level required by current federal law.
The investigation is an act of bullying, plain and simple: a nakedly political abuse of authority.
The department is supposed to prevent companies from acting in their own interest at the expense of the public. The four automakers, by contrast, are acting in the public interest.
That the government of the United States would fight to loosen emissions standards in the face of the growing threat posed by climate change also boggles the mind. Not content to fiddle while the planet burns, Mr. Trump is fanning the flames.
Ford, BMW North America, Volkswagen Group of America and Honda struck a deal with the State of California in July. They agreed to reach an average fuel efficiency standard of at least 51 miles per gallon by 2026. That falls short of an Obama administration rule that would have required average fuel efficiency of 54.5 miles per gallon by 2025. But it is certainly better than the goal of 37 miles per gallon favored by the Trump administration.
Mr. Trump reacted to the deal with predictable fury. The administration denounced it as a “P.R. stunt,” and threatened to end California’s longstanding authority to set its own tougher fuel efficiency standards — an attempt that would surely end up in court.
Now the administration has gone further, firing a shot across the bows of the automakers that signed the deal, and of those that might. The Times reported the German government warned Mercedes-Benz not to join the California agreement after learning of the federal investigation.
Antitrust law grants the government broad authority to police anticompetitive practices, and the Justice Department has dressed up its actions with the fig leaf that the companies may have colluded by collectively agreeing to the tougher standards, which could result in higher prices for new cars and light trucks.
The investigation is particularly striking because the department has shown little interest in preventing corporations from engaging in actual anticompetitive behavior.
From https://www.nytimes.com/section/opinion
o o o o o o o o o
LA Times opinion:
Editorial: Trump is trying to bully California and carmakers into giving up on climate change
(Los Angeles Times)
By THE TIMES EDITORIAL BOARD
SEP. 6, 2019
Sometimes it seems like the only consistent policy coming out of the White House these days is vindictiveness.
Case in point: Still seething over California’s end-run around its plan to roll back fuel economy and greenhouse gas emissions targets on new cars, the Trump administration has launched an antitrust investigation into four automakers that reached an agreement with the state to make their cars run cleaner.
The administration also sent a letter to California officials warning darkly of “legal consequences” if the state does not abandon the agreement. And it’s considering revoking California’s long-standing authority to set tougher auto pollution standards than those required by the federal government — an authority Congress has provided at least since 1967 in recognition of the state’s own efforts to clean its dirty air.
This is a blatant attempt to use the power of the federal government to bully companies that disagree with the president. It’s especially galling that the administration would use the threat of a Justice Department investigation to pressure automakers to make cars that are worse for consumers, worse for the environment and worse for a rapidly warming planet.
In July, Gov. Gavin Newsom announced that the four companies — Ford Motor Co., Volkswagen of America, Honda and BMW — had reached a deal with the state in which they agreed to ignore the Trump administration’s plan to relax tailpipe emissions standards. Instead they would continue making their fleets more fuel-efficient and cleaner, albeit at a slightly slower pace than the original Obama-era rules required.
The rationale behind the deal was straightforward and hardly the kind of nefarious backroom dealing suggested by the Trump administration. California has the unique authority under the Clean Air Act to set its own auto emissions standards, no matter the Trump rollback, and other states can then adopt California’s model.
Carmakers plan their fleets years in advance and don’t want to sell different cars to meet different standards state by state. They want one nationwide standard. Automakers pushed the Trump administration to forgo the rollback, saying it would hurt their bottom lines and produce “untenable” instability. They wanted a compromise with California. The administration refused. So a handful of companies volunteered to meet California’s standard.
Sources told the Wall Street Journal that the Justice Department’s antitrust enforcers had acted on their own initiative — really? — out of concern that the four major automakers had conspired to limit competition by agreeing to a tougher California standard. Under the department’s logic, consumers would be harmed by reducing the availability of lower-mileage vehicles in the state.
But it’s routine for regulators to get industry feedback on the rules they’re developing. And antitrust experts say there’s nothing illegal about industry figures banding together to support a public policy, even when members of that industry take opposing positions on what the policy should be. There’s so little legal justification for what the Justice Department is doing, Congress should conduct an inquiry into why it’s happening.
It’s laughable to think that the Justice Department is suddenly worried about cartels. According to the American Antitrust Institute, enforcement of federal antitrust law has taken a nosedive in the last two and a half years. Meanwhile, the administration’s torching of federal regulations has terminated countless pro-competitive policies adopted by its predecessors.
No, the Justice Department’s move fits into a pattern of the Trump administration bringing the hammer down on those who rile the onion-skinned president. Examples include the department’s lawsuit against AT&T’s acquisition of CNN’s owner, Time Warner (the lawsuit failed), its effort to deny local policing grants to states like California that don’t support the administration’s immigration policies, and the president’s threat to withhold disaster aid to California’s fire victims because of the state’s logging rules.
Now the president is mad that car companies don’t want the regulatory relief he’s proposed, and he’s mad that companies chose to side with California. Rather than admit he was wrong and accept defeat, his administration is willing to use its immense power to try to punish dissent.
https://www.latimes.com/opinion/story/2019-09-06/trump-administration-california-carmakers-climate-change
The California agreement language is here:
https://ww2.arb.ca.gov/news/california-and-major-automakers-reach-groundbreaking-framework-agreement-clean-emission
https://ww2.arb.ca.gov/sites/default/files/2019-07/Auto%20Terms%20Signed.pdf
The DOT warning letter follows. There is a letter from USDOJ, but we don't have access to it.
https://ww2.arb.ca.gov/news/california-and-major-automakers-reach-groundbreaking-framework-agreement-clean-emission
https://ww2.arb.ca.gov/sites/default/files/2019-07/Auto%20Terms%20Signed.pdf
The DOT warning letter follows. There is a letter from USDOJ, but we don't have access to it.
Law 360: Experts skeptical about USDOJ investigation of automaker conspiracy to lower emissions
Antitrust experts are skeptical that the DOJ will be able to make a case that the agreement unlawfully restricts competition.
"This is not price-fixing, it's not restriction of output, it's an agreement on stricter emissions standards," Cornell Law School antitrust law professor George Hay said. "At the end of the day, even if you prove the worst of how this agreement came about, there's still an issue of if it translates to an antitrust violation."
Competitors agreeing to a set of technological or legal standards doesn't say anything about how they'll compete with each other, Constantine Cannon LLP antitrust partner Ankur Kapoor said.
"They're not giving any sensitive business information to one another, they're not exchanging price information or cost information, or even information about how they're going to meet these standards," Kapoor said. "I would think that the DOJ will take a look and say, 'OK, we've seen it and there's no issue here.'"
Morrison & Foerster LLP antitrust partner Lisa Phelan said the DOJ could be implying that the automakers are effectively agreeing not to sell certain, higher-polluting cars and that reduces consumer choice.
"But the impact of that on the total number of cars still available is unlikely to be found to be significant to any relevant market," said Phelan, a former chief of the DOJ Antitrust Division's National Criminal Enforcement and Washington Criminal I sections.
Even if the automakers' actions are anti-competitive, experts say they have a pretty strong defense against an antitrust charge. If they're agreeing to comply with California regulations, the state-action immunity doctrine allows states to restrain competition as long as they actively supervise it and it's pursuant to a clearly articulated state policy.
There's also the so-called Noerr-Pennington doctrine, which immunizes private entities from antitrust suits if they're attempting to influence public policy, even if the resulting policy is anti-competitive.
"With those elements in mind, the whole exercise here smacks a little bit of political overreach," said Simpson Thacher & Bartlett LLP partner John Terzaken, a former criminal enforcement director of the Antitrust Division. "I know there was a suggestion that this isn't being driven politically, but you have to look at that with a bit of a jaundiced eye, if you've got two different executive branch agencies now reaching out to California on the very same issue."
New York University School of Law antitrust professor Harry First said the suspicion that DOJ antitrust enforcement is motivated by President Donald Trump's politics has hung over his administration since the litigation unsuccessfully challenging the AT&T-Time Warner merger.
"It's like alarm bells are going off on this," First said.
Read more at: https://www.law360.com/competition/articles/1196186/trump-doj-turn-up-heat-on-calif-car-emissions-deal?copied=1 [pay wall]
Antitrust experts are skeptical that the DOJ will be able to make a case that the agreement unlawfully restricts competition.
"This is not price-fixing, it's not restriction of output, it's an agreement on stricter emissions standards," Cornell Law School antitrust law professor George Hay said. "At the end of the day, even if you prove the worst of how this agreement came about, there's still an issue of if it translates to an antitrust violation."
Competitors agreeing to a set of technological or legal standards doesn't say anything about how they'll compete with each other, Constantine Cannon LLP antitrust partner Ankur Kapoor said.
"They're not giving any sensitive business information to one another, they're not exchanging price information or cost information, or even information about how they're going to meet these standards," Kapoor said. "I would think that the DOJ will take a look and say, 'OK, we've seen it and there's no issue here.'"
Morrison & Foerster LLP antitrust partner Lisa Phelan said the DOJ could be implying that the automakers are effectively agreeing not to sell certain, higher-polluting cars and that reduces consumer choice.
"But the impact of that on the total number of cars still available is unlikely to be found to be significant to any relevant market," said Phelan, a former chief of the DOJ Antitrust Division's National Criminal Enforcement and Washington Criminal I sections.
Even if the automakers' actions are anti-competitive, experts say they have a pretty strong defense against an antitrust charge. If they're agreeing to comply with California regulations, the state-action immunity doctrine allows states to restrain competition as long as they actively supervise it and it's pursuant to a clearly articulated state policy.
There's also the so-called Noerr-Pennington doctrine, which immunizes private entities from antitrust suits if they're attempting to influence public policy, even if the resulting policy is anti-competitive.
"With those elements in mind, the whole exercise here smacks a little bit of political overreach," said Simpson Thacher & Bartlett LLP partner John Terzaken, a former criminal enforcement director of the Antitrust Division. "I know there was a suggestion that this isn't being driven politically, but you have to look at that with a bit of a jaundiced eye, if you've got two different executive branch agencies now reaching out to California on the very same issue."
New York University School of Law antitrust professor Harry First said the suspicion that DOJ antitrust enforcement is motivated by President Donald Trump's politics has hung over his administration since the litigation unsuccessfully challenging the AT&T-Time Warner merger.
"It's like alarm bells are going off on this," First said.
Read more at: https://www.law360.com/competition/articles/1196186/trump-doj-turn-up-heat-on-calif-car-emissions-deal?copied=1 [pay wall]
Editorial comment (DAR): Compare threat to Alabama from Hurricane Dorian; threat to competition and consumers from automaker agreement to adhere to more stringent California emission standards. The answer may not be perfectly clear. Here is one theory of antitrust harm heard around the office Nespresso machine: The automaker/California agreement will harm pollution insensitive consumers wishing to get the lower price that may attach to higher polluting cars. The agreement not to produce cheaper higher emission cars will mean pollution insensitive consumers will be forced to pay more. On the other hand, maybe procompetitive justifications support the automaker actions. See the article below.
o o o o o o
More compare and contrast:
Procompetitive Justifications in Antitrust Law
94 Indiana Law Journal 501 (2019)
University of Memphis Legal Studies Research Paper No. 167
44 Pages Posted: 15 Aug 2017 Last revised: 9 Jun 2019
John M. NewmanUniversity of Miami - School of Law
Abstract
The Rule of Reason, which has come to dominate modern antitrust law, allows defendants the opportunity to justify their conduct by demonstrating “procompetitive” effects. Seizing the opportunity, defendants have begun offering increasingly numerous and creative explanations for their behavior.
But which of these myriad justifications are valid? To leading jurists and scholars, this remains an “open question," even an “absolute mystery." Examination of the relevant case law reveals a tangle of competing approaches and seemingly irreconcilable opinions. The ongoing lack of clarity in this area is inexcusable: procompetitive-justification analysis is absolutely vital to a properly functioning antitrust enterprise.
In response, this article provides answers and clarity. It identifies the “market failure” approach as doctrinally correct and economically optimal. The leading alternatives pose an unacceptably high risk of error, in the form of both false positives and false negatives. The article concludes by identifying the proper method for assessing procompetitive justifications. This three-step analytical framework increases transparency and minimizes errors, thereby maximizing societal welfare.
Yet More compare and contrast:
Four top Audi employees indicted in Dieselgate scandal19New charges shed more light on how the emissions cheating went down
By Sean O'Kane@sokane1 Jan 17, 2019,
A federal grand jury in Detroit has indicted four former Audi managers for their alleged role in the German automaker’s scheme to cheat US emissions testing on diesel-powered cars, according to a new court document published Thursday. Audi’s malfeasance was part of a larger effort from parent company Volkswagen Group to sell millions of cars with engines that were dirtier than regulations allowed, a scandal that was uncovered in 2015 and has since been dubbed “Dieselgate.”
Richard Bauder, Axel Eiser, Stefan Knirsch, and Carsten Nagel were charged with multiple counts of violating the Clean Air Act, committing wire fraud, and conspiracy to defraud the United States. All of them ran different parts of Audi’s engine development and testing divisions, and worked on the diesel engines that used “defeat devices” to cheat EPA emissions tests. None of the four are in custody, and all are believed to be in Germany, according to Reuters.
13 VOLKSWAGEN EMPLOYEES HAVE NOW BEEN CHARGED, BUT ONLY A FEW ARE IN PRISON
The total number of people who have been charged in the US over alleged involvement in Dieselgate is now 13. Volkswagen Group pled guilty in US court in 2017, and has agreed to pay back more than $20 billion to states, dealers, regulators, and individual owners. Multiple former executives are in prison, and Volkswagen’s CEO at the time — Martin Winterkorn — swiftly resigned when the news broke in 2015.
Ripple effects were still showing up, even before Thursday’s indictments. Audi’s CEO was forced out in October after he was arrested by German authorities. The European Union’s antitrust regulators are also investigating whether Volkswagen, BMW, and Daimler (the parent company of Mercedes-Benz) colluded to slow the rollout of better emissions technology. And Winterkorn has been indicted in the US on charges similar to the ones announced Thursday, though he remains in Germany.
The new indictment offers some of the clearest detail about how Audi’s scheme played out. Bauder and another diesel engine development lead, Zaccheo Giovanni Pamio (who was indicted in 2017), began designing a new 3.0 liter diesel engine in 2006 that was meant to be used in cars that would be marketed as “clean diesel,” according to the indictment. This engine was designed to use a technology that reduced emissions of harmful nitrogen dioxide, or NOx. The tradeoff, though, was that the cleaner the tailpipe emissions got, the worse the engine’s fuel economy became.
AUDI’S INSISTENCE ON LARGE TRUNK SPACE AND HIGH-END AUDIO SYSTEMS CONTRIBUTED TO THE MESS, ACCORDING TO THE INDICTMENT
According to the indictment, Bauder, Pamio, and the co-conspirators realized they “could not calibrate a diesel engine that would meet the strict NOx emissions standards in the United States” while also hitting high fuel economy targets — especially because of specific design constraints imposed by Audi, which called for a “large trunk and a high-end sound system.”
To get around this, prosecutors say that Bauder directed Audi employees to design the defeat device that made it possible to cheat emissions tests. In short, what they came up with was a piece of software that could recognize when a car was going through the EPA’s emissions tests. It would then restrict emissions to a level that complied with the standards. But when the car got back out onto the open road, it would emit up to 40 times as much NOx as was legally allowed.
From https://www.theverge.com/2019/1/17/18187558/audi-charges-dieselgate-scandal-indictment-cheating
Reminder: The editor, Don Resnikoff, is fully responsible for views that may be expressed or implied concerning the automaker/California agreement.
o o o o o o
More compare and contrast:
Procompetitive Justifications in Antitrust Law
94 Indiana Law Journal 501 (2019)
University of Memphis Legal Studies Research Paper No. 167
44 Pages Posted: 15 Aug 2017 Last revised: 9 Jun 2019
John M. NewmanUniversity of Miami - School of Law
Abstract
The Rule of Reason, which has come to dominate modern antitrust law, allows defendants the opportunity to justify their conduct by demonstrating “procompetitive” effects. Seizing the opportunity, defendants have begun offering increasingly numerous and creative explanations for their behavior.
But which of these myriad justifications are valid? To leading jurists and scholars, this remains an “open question," even an “absolute mystery." Examination of the relevant case law reveals a tangle of competing approaches and seemingly irreconcilable opinions. The ongoing lack of clarity in this area is inexcusable: procompetitive-justification analysis is absolutely vital to a properly functioning antitrust enterprise.
In response, this article provides answers and clarity. It identifies the “market failure” approach as doctrinally correct and economically optimal. The leading alternatives pose an unacceptably high risk of error, in the form of both false positives and false negatives. The article concludes by identifying the proper method for assessing procompetitive justifications. This three-step analytical framework increases transparency and minimizes errors, thereby maximizing societal welfare.
Yet More compare and contrast:
Four top Audi employees indicted in Dieselgate scandal19New charges shed more light on how the emissions cheating went down
By Sean O'Kane@sokane1 Jan 17, 2019,
A federal grand jury in Detroit has indicted four former Audi managers for their alleged role in the German automaker’s scheme to cheat US emissions testing on diesel-powered cars, according to a new court document published Thursday. Audi’s malfeasance was part of a larger effort from parent company Volkswagen Group to sell millions of cars with engines that were dirtier than regulations allowed, a scandal that was uncovered in 2015 and has since been dubbed “Dieselgate.”
Richard Bauder, Axel Eiser, Stefan Knirsch, and Carsten Nagel were charged with multiple counts of violating the Clean Air Act, committing wire fraud, and conspiracy to defraud the United States. All of them ran different parts of Audi’s engine development and testing divisions, and worked on the diesel engines that used “defeat devices” to cheat EPA emissions tests. None of the four are in custody, and all are believed to be in Germany, according to Reuters.
13 VOLKSWAGEN EMPLOYEES HAVE NOW BEEN CHARGED, BUT ONLY A FEW ARE IN PRISON
The total number of people who have been charged in the US over alleged involvement in Dieselgate is now 13. Volkswagen Group pled guilty in US court in 2017, and has agreed to pay back more than $20 billion to states, dealers, regulators, and individual owners. Multiple former executives are in prison, and Volkswagen’s CEO at the time — Martin Winterkorn — swiftly resigned when the news broke in 2015.
Ripple effects were still showing up, even before Thursday’s indictments. Audi’s CEO was forced out in October after he was arrested by German authorities. The European Union’s antitrust regulators are also investigating whether Volkswagen, BMW, and Daimler (the parent company of Mercedes-Benz) colluded to slow the rollout of better emissions technology. And Winterkorn has been indicted in the US on charges similar to the ones announced Thursday, though he remains in Germany.
The new indictment offers some of the clearest detail about how Audi’s scheme played out. Bauder and another diesel engine development lead, Zaccheo Giovanni Pamio (who was indicted in 2017), began designing a new 3.0 liter diesel engine in 2006 that was meant to be used in cars that would be marketed as “clean diesel,” according to the indictment. This engine was designed to use a technology that reduced emissions of harmful nitrogen dioxide, or NOx. The tradeoff, though, was that the cleaner the tailpipe emissions got, the worse the engine’s fuel economy became.
AUDI’S INSISTENCE ON LARGE TRUNK SPACE AND HIGH-END AUDIO SYSTEMS CONTRIBUTED TO THE MESS, ACCORDING TO THE INDICTMENT
According to the indictment, Bauder, Pamio, and the co-conspirators realized they “could not calibrate a diesel engine that would meet the strict NOx emissions standards in the United States” while also hitting high fuel economy targets — especially because of specific design constraints imposed by Audi, which called for a “large trunk and a high-end sound system.”
To get around this, prosecutors say that Bauder directed Audi employees to design the defeat device that made it possible to cheat emissions tests. In short, what they came up with was a piece of software that could recognize when a car was going through the EPA’s emissions tests. It would then restrict emissions to a level that complied with the standards. But when the car got back out onto the open road, it would emit up to 40 times as much NOx as was legally allowed.
From https://www.theverge.com/2019/1/17/18187558/audi-charges-dieselgate-scandal-indictment-cheating
Reminder: The editor, Don Resnikoff, is fully responsible for views that may be expressed or implied concerning the automaker/California agreement.
Mercado Little Spain chef Jose Andres blames payroll ‘glitch’ for underpaid staff
By Emily Saul
August 29, 2019 | 5:46pm
Mercado Little Spain chef accused of skimping stafferVictims of the $15 minimum wageJoe Biden’s no anti-racist champ and other commentaryCuomo aide rips de Blasio for touting $15 minimum wage at Dem debateRenowned chef José Andres claims a payroll defect is to blame for underpaid employees at his Hudson Yards eatery Mercado Little Spain — but employees aren’t swallowing it.
“We found a glitch in how we paid some wages in NYC- some underpaid, more overpaid. I apologize to everyone who was underpaid. We’re correcting it today,” Andres tweeted Wednesday, two days after bartender Tina Braunstein filed a suit against him and the restaurant in Manhattan federal court claiming she was paid below minimum wage.
Yet Braunstein’s attorney Maimon Kirschenbaum told The Post Andres’ statement was “farcical” — and said he’s been retained by another employee who was so disgusted with the tony chef’s payment practices that she quit just a few days into her job at the popular Mercado Little Spain.
An amended version of the class action lawsuit naming Cindy Martinez was filed Thursday.
“The violations are serious and far surpass a ‘glitch,'” Kirschenbaum wrote in the new document.
“Service employees were forced to perform hours of menial non-tipped work while being paid the ‘tip credit’ hourly rate of $10, which is less than the full minimum wage of $15,” the papers read. “Defendants’ blatant minimum wage violation has no relation to any alleged software glitch. Rather, Defendants saved money by having tipped employees perform non-tipped setup and breakdown work while illegally paying them as though they were receiving tips for that work.”
https://nypost.com/2019/08/29/mercado-little-spain-chef-jose-andres-blames-payroll-glitch-for-underpaid-staff/
Linda Greenhouse and Tony Picadio on gun rights
and the US Supreme Court
Rights of gun owners have become an increasingly fraught issue as incidents of gun violence in the U.S. occur with alarming frequency.
Linda Greenhouse, a veteran New York Times journalist, commented a few weeks ago on what she called the “growing impatience of some members of the court for a chance to move the boundaries of the Second Amendment from the home — where its 2008 decision in District of Columbia v. Heller had located the amendment’s protection of the right to bear arms — out to the wider world.”
Recently, the U.S. supreme Court granted certiorari in order to consider the Second Amendment issues in New York State Rifle and Pistol Association, Inc., et al. v. The City of New York, et al. At issue is a New York City regulation that prohibited most licensed handgun owners from taking their guns out of the city, even to a second home or to a shooting range for target practice.
Greenhouse suggests that this New York case is potentially the vehicle that Justices Samuel Alito, Clarence Thomas, Neil Gorsuch and Brett Kavanaugh may have been waiting for — a chance to turn the ambiguous and quite narrow Heller decision into a broader constitutional charter for gun rights.
On July 22, New York City filed with the Supreme Court a “suggestion of mootness” and a request to suspend the briefing schedule. The city explained that two interlocking developments had occurred: In the session just ended, the State Legislature had amended the handgun licensing statute to require localities to allow licensed handgun owners to transport their guns to second homes and target ranges outside the city; and the New York City Police Department, which supervises gun licensing, had amended the prior regulation to permit the same activities. The city argued [https://www.supremecourt.gov/DocketPDF/18/18-280/108869/20190722151524926_18-280%20Suggestion%20of%20Mootness.pdf] that since the lawsuit had challenged only the second-home and shooting-range limitations, the plaintiffs now had everything they had asked for and there was nothing left for the Supreme Court to decide.
Greenhouse writes that “The Rifle & Pistol Association has fought back vigorously against mootness, arguing in a 33-page brief [https://www.supremecourt.gov/DocketPDF/18/18-280/110978/20190801121009552_18-280%20NYSRPA%20suggestion%20of%20mootness%20opposition.pdf] that ‘the city has not even tried to hide the fact that its paramount goal is to evade the prospect of a binding unfavorable decision from this court.’” Further, “the new regulation falls ‘far short’ of satisfying the plaintiffs and is ‘plainly designed to provide the bare minimum of what the city believes will suffice to moot this case, and not an inch more.’ . . . ‘The city manifestly has not altered its view that any possession of a handgun outside the home, even when the handgun is unloaded and stored away, is a privilege that the city can micromanage, rather than an individual right.’”
The justices have put the mootness dispute on the agenda for discussion at their first closed-door conference of the new term, on Oct. 1.
Linda Greenhouse’s editorial bottom line is this: if the court rules the way the plaintiffs’ lawyers are urging in the New York case and “adopts ‘strict scrutiny’ as the only valid judicial approach to assessing the constitutionality of any limitation, then the political branches will effectively lose the ability to enact what the emerging political consensus deems to be common-sense regulations.”
With regard to the underlying 2008 decision in District of Columbia v. Heller, attorney Anthony Picadio explained in his article discussing the case that while a 5 to 4 majority of the Supreme Court, in the opinion written by Justice Scalia, declared DC’s firearm regulatory scheme unconstitutional, it did so only to the extent that it prohibited possession of an operable handgun in a home for self-defense purposes.
Anthony Picadio’s article criticizes the Heller decision. He points out that the history of the Second Amendment in the lower courts since the Heller decision does in fact support Justice Thomas’ lament [in a case dissent] that the courts have failed to afford the Second Amendment “the respect due an enumerated constitutional right.”
Mr. Picadio suggests that perhaps one of the reasons that expansive treatment of the Second Amendment has been so disfavored by the lower courts is a growing recognition that it was never intended by those who drafted and adopted it to grant any rights to own or use a firearm unconnected to membership in a militia.
Moreover, Justice Scalia’s opinion “is based on an erroneous reading of colonial history and the drafting history of the Second Amendment,’’ Mr. Picadio wrote. “If the Second Amendment had been understood to have the meaning given to it by Justice Scalia, it would not have been ratified by Virginia and the other slave states.”
The amendment began with the phrase “a well regulated Militia’’ because the Virginian founders wanted to be sure guns didn’t get into the hands of enslaved black Virginians or free black Virginians, Mr. Picadio argues. With the state’s all-white militia, this amendment helped do just that.
Mr. Picadio’s article appears in the PENNSYLVANIA BAR ASSOCIATION QUARTERLY | January 2019
A copy of the Picadio article accompanies a newspaper op-ed at https://www.post-gazette.com/opinion/brian-oneill/2019/02/10/Brian-O-Neill-Slavery-root-of-the-Second-Amendment/stories/201902100107
Mr. Picadio will speak at a luncheon program at the DC Bar on October 15.
Linda Greenhouse’s August 15, 2019 article on the Second Amendment is at https://www.nytimes.com/2019/08/15/opinion/guns-supreme-court.html
The editor, Don Allen Resnikoff, takes full responsibility for the content of this article and any opinions that may be implied.
and the US Supreme Court
Rights of gun owners have become an increasingly fraught issue as incidents of gun violence in the U.S. occur with alarming frequency.
Linda Greenhouse, a veteran New York Times journalist, commented a few weeks ago on what she called the “growing impatience of some members of the court for a chance to move the boundaries of the Second Amendment from the home — where its 2008 decision in District of Columbia v. Heller had located the amendment’s protection of the right to bear arms — out to the wider world.”
Recently, the U.S. supreme Court granted certiorari in order to consider the Second Amendment issues in New York State Rifle and Pistol Association, Inc., et al. v. The City of New York, et al. At issue is a New York City regulation that prohibited most licensed handgun owners from taking their guns out of the city, even to a second home or to a shooting range for target practice.
Greenhouse suggests that this New York case is potentially the vehicle that Justices Samuel Alito, Clarence Thomas, Neil Gorsuch and Brett Kavanaugh may have been waiting for — a chance to turn the ambiguous and quite narrow Heller decision into a broader constitutional charter for gun rights.
On July 22, New York City filed with the Supreme Court a “suggestion of mootness” and a request to suspend the briefing schedule. The city explained that two interlocking developments had occurred: In the session just ended, the State Legislature had amended the handgun licensing statute to require localities to allow licensed handgun owners to transport their guns to second homes and target ranges outside the city; and the New York City Police Department, which supervises gun licensing, had amended the prior regulation to permit the same activities. The city argued [https://www.supremecourt.gov/DocketPDF/18/18-280/108869/20190722151524926_18-280%20Suggestion%20of%20Mootness.pdf] that since the lawsuit had challenged only the second-home and shooting-range limitations, the plaintiffs now had everything they had asked for and there was nothing left for the Supreme Court to decide.
Greenhouse writes that “The Rifle & Pistol Association has fought back vigorously against mootness, arguing in a 33-page brief [https://www.supremecourt.gov/DocketPDF/18/18-280/110978/20190801121009552_18-280%20NYSRPA%20suggestion%20of%20mootness%20opposition.pdf] that ‘the city has not even tried to hide the fact that its paramount goal is to evade the prospect of a binding unfavorable decision from this court.’” Further, “the new regulation falls ‘far short’ of satisfying the plaintiffs and is ‘plainly designed to provide the bare minimum of what the city believes will suffice to moot this case, and not an inch more.’ . . . ‘The city manifestly has not altered its view that any possession of a handgun outside the home, even when the handgun is unloaded and stored away, is a privilege that the city can micromanage, rather than an individual right.’”
The justices have put the mootness dispute on the agenda for discussion at their first closed-door conference of the new term, on Oct. 1.
Linda Greenhouse’s editorial bottom line is this: if the court rules the way the plaintiffs’ lawyers are urging in the New York case and “adopts ‘strict scrutiny’ as the only valid judicial approach to assessing the constitutionality of any limitation, then the political branches will effectively lose the ability to enact what the emerging political consensus deems to be common-sense regulations.”
With regard to the underlying 2008 decision in District of Columbia v. Heller, attorney Anthony Picadio explained in his article discussing the case that while a 5 to 4 majority of the Supreme Court, in the opinion written by Justice Scalia, declared DC’s firearm regulatory scheme unconstitutional, it did so only to the extent that it prohibited possession of an operable handgun in a home for self-defense purposes.
Anthony Picadio’s article criticizes the Heller decision. He points out that the history of the Second Amendment in the lower courts since the Heller decision does in fact support Justice Thomas’ lament [in a case dissent] that the courts have failed to afford the Second Amendment “the respect due an enumerated constitutional right.”
Mr. Picadio suggests that perhaps one of the reasons that expansive treatment of the Second Amendment has been so disfavored by the lower courts is a growing recognition that it was never intended by those who drafted and adopted it to grant any rights to own or use a firearm unconnected to membership in a militia.
Moreover, Justice Scalia’s opinion “is based on an erroneous reading of colonial history and the drafting history of the Second Amendment,’’ Mr. Picadio wrote. “If the Second Amendment had been understood to have the meaning given to it by Justice Scalia, it would not have been ratified by Virginia and the other slave states.”
The amendment began with the phrase “a well regulated Militia’’ because the Virginian founders wanted to be sure guns didn’t get into the hands of enslaved black Virginians or free black Virginians, Mr. Picadio argues. With the state’s all-white militia, this amendment helped do just that.
Mr. Picadio’s article appears in the PENNSYLVANIA BAR ASSOCIATION QUARTERLY | January 2019
A copy of the Picadio article accompanies a newspaper op-ed at https://www.post-gazette.com/opinion/brian-oneill/2019/02/10/Brian-O-Neill-Slavery-root-of-the-Second-Amendment/stories/201902100107
Mr. Picadio will speak at a luncheon program at the DC Bar on October 15.
Linda Greenhouse’s August 15, 2019 article on the Second Amendment is at https://www.nytimes.com/2019/08/15/opinion/guns-supreme-court.html
The editor, Don Allen Resnikoff, takes full responsibility for the content of this article and any opinions that may be implied.
N.J. Division of Consumer Affairs Brings First Action to Enforce State’s Fantasy Sports Law
Minneapolis-Based “SportsHub” to Pay $30,000 for Unlawfully Operating a Fantasy Sports Site in New Jersey
Consent Order is here: https://www.nj.gov/oag/newsreleases19/SportsHub-Games-Network-Inc_Consent-Order.pdf
NEWARK – Attorney General Gurbir S. Grewal and the Division of Consumer Affairs (“the Division”) today announced that SportsHub Games Network, Inc. (“SportsHub”) has agreed to pay a $30,000 civil penalty for unlawfully operating an online fantasy sports site in New Jersey without a permit. The Minneapolis-based games provider also agreed to change its business practices to resolve allegations that its conduct violated the state’s consumer protection laws by, among other things, failing to clearly and conspicuously disclose that SportsHub collects personal information from consumers’ social media accounts and that it shares certain personal information with third parties.
SportsHub, which operates “Fanball,” “CDM Sports,” “National Fantasy Football Championships,” “Whatif Sports,” “Leaguesafe,” and other fantasy sports games, is the first operator to be penalized under New Jersey’s Fantasy Sports Act (“FSA”), a 2017 statute legalizing and regulating internet fantasy gaming activities in the state.
“New Jersey’s fantasy sports law offers fans an opportunity to fully immerse themselves in the sports they love, while ensuring a safe and enjoyable experience for all who participate,” said Attorney General Grewal. “As the settlement announced today illustrates, New Jersey enforces the laws in place to ensure transparency and protect consumers from hidden threats to their online privacy.”
https://www.nj.gov/oag/newsreleases19/pr20190827a.html
Minneapolis-Based “SportsHub” to Pay $30,000 for Unlawfully Operating a Fantasy Sports Site in New Jersey
Consent Order is here: https://www.nj.gov/oag/newsreleases19/SportsHub-Games-Network-Inc_Consent-Order.pdf
NEWARK – Attorney General Gurbir S. Grewal and the Division of Consumer Affairs (“the Division”) today announced that SportsHub Games Network, Inc. (“SportsHub”) has agreed to pay a $30,000 civil penalty for unlawfully operating an online fantasy sports site in New Jersey without a permit. The Minneapolis-based games provider also agreed to change its business practices to resolve allegations that its conduct violated the state’s consumer protection laws by, among other things, failing to clearly and conspicuously disclose that SportsHub collects personal information from consumers’ social media accounts and that it shares certain personal information with third parties.
SportsHub, which operates “Fanball,” “CDM Sports,” “National Fantasy Football Championships,” “Whatif Sports,” “Leaguesafe,” and other fantasy sports games, is the first operator to be penalized under New Jersey’s Fantasy Sports Act (“FSA”), a 2017 statute legalizing and regulating internet fantasy gaming activities in the state.
“New Jersey’s fantasy sports law offers fans an opportunity to fully immerse themselves in the sports they love, while ensuring a safe and enjoyable experience for all who participate,” said Attorney General Grewal. “As the settlement announced today illustrates, New Jersey enforces the laws in place to ensure transparency and protect consumers from hidden threats to their online privacy.”
https://www.nj.gov/oag/newsreleases19/pr20190827a.html
NYT: Sacklers vs. States: Settlement Talks Stumble Over Foreign Business
The Sackler family is willing to give up Purdue Pharma to settle all claims related to the opioid crisis, but is resisting a quick sale of its overseas drug company.
By Matthew Goldstein, Danny Hakim and Jan Hoffman
Purdue Pharma’s negotiations to settle thousands of lawsuits over the company’s role in the opioids crisis have turned into a standoff between members of the Sackler family, who own the company, and a group of state attorneys general over how much the family should pay and whether it can continue selling drugs abroad.
The Sacklers are deep in negotiations that, if finalized, would force them to give up ownership of Purdue, the company widely blamed for the onset of the opioid epidemic with its aggressive marketing of the prescription painkiller OxyContin. But they want to keep selling OxyContin and other drugs abroad for as many as seven more years, through another company they own, Mundipharma, based in Cambridge, England.
Some attorneys general, particularly in wealthier states like New York, Massachusetts and Connecticut, are resisting that and other issues related to the foreign business.
“Connecticut demands that the Sacklers and Purdue management be forced completely out of the opioid business, domestically and internationally, and that they never be allowed to return,” said Attorney General William Tong of Connecticut.
https://www.nytimes.com/2019/08/30/health/purdue-sacklers-opioids-settlement.html
The Sackler family is willing to give up Purdue Pharma to settle all claims related to the opioid crisis, but is resisting a quick sale of its overseas drug company.
By Matthew Goldstein, Danny Hakim and Jan Hoffman
Purdue Pharma’s negotiations to settle thousands of lawsuits over the company’s role in the opioids crisis have turned into a standoff between members of the Sackler family, who own the company, and a group of state attorneys general over how much the family should pay and whether it can continue selling drugs abroad.
The Sacklers are deep in negotiations that, if finalized, would force them to give up ownership of Purdue, the company widely blamed for the onset of the opioid epidemic with its aggressive marketing of the prescription painkiller OxyContin. But they want to keep selling OxyContin and other drugs abroad for as many as seven more years, through another company they own, Mundipharma, based in Cambridge, England.
Some attorneys general, particularly in wealthier states like New York, Massachusetts and Connecticut, are resisting that and other issues related to the foreign business.
“Connecticut demands that the Sacklers and Purdue management be forced completely out of the opioid business, domestically and internationally, and that they never be allowed to return,” said Attorney General William Tong of Connecticut.
https://www.nytimes.com/2019/08/30/health/purdue-sacklers-opioids-settlement.html
NYT:Streaming Video Will Soon Look Like the Bad Old Days of TV
As media monoliths bundle their offerings, consumers will once again have to pay for a bunch of shows they don’t want.
By Matthew Ball
https://www.nytimes.com/2019/08/22/opinion/netflix-hulu-cable.html
As media monoliths bundle their offerings, consumers will once again have to pay for a bunch of shows they don’t want.
By Matthew Ball
https://www.nytimes.com/2019/08/22/opinion/netflix-hulu-cable.html
California Authorities Investigating Amazon for Shadow Liquor Store as Prime Now Expands Alcohol Delivery
Last week, a wine industry publication and search engine, Wine-Searcher, claimed that Amazon violated California law to expand its alcohol delivery business.
In order to deliver alcohol in California, retailers need to have a brick-and-mortar store that’s open to the public for at least half as long as their delivery hours. But when Wine-Searcher visited one of Amazon’s alleged liquor stores in Los Angeles they found a warehouse, but no store.
Now the California Department of Alcoholic Beverage Control is investigatingwhether or not Amazon’s LA location meets state qualifications for a liquor store. Amazon has licenses for at least seven other warehouse “liquor stores"in California as it expands alcohol delivery through Prime Now.
Regardless of whether Amazon broke the law, it is apparent that they intend to focus on delivering alcohol, not running liquor stores in business parks. This gives Amazon a competitive advantage over other California alcohol retailers who must pay for staff, stocking, and real estate. The move threatens store owners as well as craft producers, and raises public health concerns about sales to minors.
Amazon offers two-hour delivery of beer, wine, and sometimes spirits in twelve cities through its Prime Now service. Depending on local law, Amazon customers may order booze from Whole Foods, a third-party alcohol retailer, or Amazon’s Prime Now warehouses. All three options are available in Los Angeles.
See http://www.foodandpower.net/2019/08/29/california-beverage-control-investigating-amazon-for-shadow-liquor-store-as-prime-now-expands-alcohol-delivery/
Last week, a wine industry publication and search engine, Wine-Searcher, claimed that Amazon violated California law to expand its alcohol delivery business.
In order to deliver alcohol in California, retailers need to have a brick-and-mortar store that’s open to the public for at least half as long as their delivery hours. But when Wine-Searcher visited one of Amazon’s alleged liquor stores in Los Angeles they found a warehouse, but no store.
Now the California Department of Alcoholic Beverage Control is investigatingwhether or not Amazon’s LA location meets state qualifications for a liquor store. Amazon has licenses for at least seven other warehouse “liquor stores"in California as it expands alcohol delivery through Prime Now.
Regardless of whether Amazon broke the law, it is apparent that they intend to focus on delivering alcohol, not running liquor stores in business parks. This gives Amazon a competitive advantage over other California alcohol retailers who must pay for staff, stocking, and real estate. The move threatens store owners as well as craft producers, and raises public health concerns about sales to minors.
Amazon offers two-hour delivery of beer, wine, and sometimes spirits in twelve cities through its Prime Now service. Depending on local law, Amazon customers may order booze from Whole Foods, a third-party alcohol retailer, or Amazon’s Prime Now warehouses. All three options are available in Los Angeles.
See http://www.foodandpower.net/2019/08/29/california-beverage-control-investigating-amazon-for-shadow-liquor-store-as-prime-now-expands-alcohol-delivery/
Pa. AG Can Bring Parallel Navient Claims, CFPB Tells 3rd Circ.
The Consumer Financial Protection Bureau has told the Third Circuit in an amicus brief that its governing statute allows for parallel enforcement by the agency and state attorneys general.
From DMN: U.S. Department of Justice Urged by Senators to Investigate Live Nation, Ticketmaster
Two Democratic U.S. Senators are asking the Department of Justice’s (DOJ) antitrust division to investigate online ticket markets, which they insist “are not working for American consumers.”
The story continues here.https://www.digitalmusicnews.com/2019/08/28/senate-department-of-justice-live-nation-ticketmaster/
Two Democratic U.S. Senators are asking the Department of Justice’s (DOJ) antitrust division to investigate online ticket markets, which they insist “are not working for American consumers.”
The story continues here.https://www.digitalmusicnews.com/2019/08/28/senate-department-of-justice-live-nation-ticketmaster/
Do mortgage lenders ever engage in bait-and-switch? Here is a story from the past --2014-- that suggests that the answer for some lenders is "yes."
-Amerisave to pay $19 million for alleged bait-and-switch mortgage scheme
By James R. Hood
08/12/2014 | ConsumerAffairs | Finance News
Amerisave.comAmerisave Mortgage Corp. will pay $14.8 million in refunds to consumers taken in by what the Consumer Financial Protection Bureau (CFPB) says was a deceptive bait-and-switch mortgage-lending scheme that harmed tens of thousands of consumers. It will also pay a $4.5 million penalty.
The Bureau will administer the refunds and the amount each eligible consumer will receive will vary based on how much that consumer paid Amerisave. A third-party settlement administrator will be contacting eligible consumers once a restitution process is established.
“Amerisave lured consumers in with deceptive advertising, trapped them with costly upfront fees, and then illegally overcharged them for services from an undisclosed affiliate,” said CFPB Director Richard Cordray. “By the time consumers could have discovered the advertised low rates were too good to be true, they had already committed to pay hundreds of dollars to Amerisave."
Patrick Markert, identified as the owner of both Amerisave and its affiliated Novo Appraisal Management Co., will pay a $1.5 million penalty.
The Bureau found that Amerisave lured consumers by advertising misleading interest rates, locked them in with costly up-front fees, failed to honor its advertised rates, and then illegally overcharged them for affiliated “third-party” services.
Amerisave, which operates in all 50 states, advertised its interest rates and terms heavily over the last several years, using banner ads and searchable rate tables in its Internet ads. But the Bureau charged that Amerisave posted inaccurate rates on these banner ads and rate tables.
When consumers were directed to Amerisave’s own website, Amerisave gave consumers quotes based on an 800 FICO score, even where consumers had previously entered a FICO score below 800 on the third-party website that led them to Amerisave. This resulted in Amerisave offering many consumers misleadingly low quotes.
Amerisave required consumers to order and give payment authorization information for an appraisal before it would provide a Good Faith Estimate (GFE) for the mortgage, and did not tell consumers until later that the appraisal orders were being referred to its own affiliated company, Novo.
At closing, Amerisave also charged consumers for “appraisal validation” reports, without disclosing that the service was provided by its affiliate Novo, which had marked up the fees by as much as 900%.
Penalties outlinedThe CFPB order requires Amerisave, Novo, and Markert to take the following actions:
· Pay $14.8 million in consumer refunds: Amerisave and Novo must provide $14.8 million in refunds to the consumers harmed by the false advertising, impermissible fees, and illegal referrals during the period covered by the order.
· Stop advertising unavailable mortgage rates: The order requires Amerisave to ensure that it will not engage in deceptive mortgage advertising practices. Those practices include, but are not limited to, advertising unavailable rates on third-party searchable rate tables, advertising deceptive rates in its banner ads, and giving consumers mortgage quotes based on an undisclosed 800 credit score.
· No longer charge illegal fees: Amerisave will not charge fees or make referrals to its affiliates before giving consumers the proper disclosure forms.
· Pay $6 million in fines: Amerisave will make a $4.5 million penalty payment, and Patrick Markert will make an additional $1.5 million penalty payment, to the Bureau’s Civil Penalty Fund.
https://www.consumeraffairs.com/news/amerisave-to-pay-19-million-for-bait-and-switch-mortgage-scheme-081214.html
Editor's note: The story was prompted by information about current bad bait and switch experiences by potential mortgage borrowers.
-Amerisave to pay $19 million for alleged bait-and-switch mortgage scheme
By James R. Hood
08/12/2014 | ConsumerAffairs | Finance News
Amerisave.comAmerisave Mortgage Corp. will pay $14.8 million in refunds to consumers taken in by what the Consumer Financial Protection Bureau (CFPB) says was a deceptive bait-and-switch mortgage-lending scheme that harmed tens of thousands of consumers. It will also pay a $4.5 million penalty.
The Bureau will administer the refunds and the amount each eligible consumer will receive will vary based on how much that consumer paid Amerisave. A third-party settlement administrator will be contacting eligible consumers once a restitution process is established.
“Amerisave lured consumers in with deceptive advertising, trapped them with costly upfront fees, and then illegally overcharged them for services from an undisclosed affiliate,” said CFPB Director Richard Cordray. “By the time consumers could have discovered the advertised low rates were too good to be true, they had already committed to pay hundreds of dollars to Amerisave."
Patrick Markert, identified as the owner of both Amerisave and its affiliated Novo Appraisal Management Co., will pay a $1.5 million penalty.
The Bureau found that Amerisave lured consumers by advertising misleading interest rates, locked them in with costly up-front fees, failed to honor its advertised rates, and then illegally overcharged them for affiliated “third-party” services.
Amerisave, which operates in all 50 states, advertised its interest rates and terms heavily over the last several years, using banner ads and searchable rate tables in its Internet ads. But the Bureau charged that Amerisave posted inaccurate rates on these banner ads and rate tables.
When consumers were directed to Amerisave’s own website, Amerisave gave consumers quotes based on an 800 FICO score, even where consumers had previously entered a FICO score below 800 on the third-party website that led them to Amerisave. This resulted in Amerisave offering many consumers misleadingly low quotes.
Amerisave required consumers to order and give payment authorization information for an appraisal before it would provide a Good Faith Estimate (GFE) for the mortgage, and did not tell consumers until later that the appraisal orders were being referred to its own affiliated company, Novo.
At closing, Amerisave also charged consumers for “appraisal validation” reports, without disclosing that the service was provided by its affiliate Novo, which had marked up the fees by as much as 900%.
Penalties outlinedThe CFPB order requires Amerisave, Novo, and Markert to take the following actions:
· Pay $14.8 million in consumer refunds: Amerisave and Novo must provide $14.8 million in refunds to the consumers harmed by the false advertising, impermissible fees, and illegal referrals during the period covered by the order.
· Stop advertising unavailable mortgage rates: The order requires Amerisave to ensure that it will not engage in deceptive mortgage advertising practices. Those practices include, but are not limited to, advertising unavailable rates on third-party searchable rate tables, advertising deceptive rates in its banner ads, and giving consumers mortgage quotes based on an undisclosed 800 credit score.
· No longer charge illegal fees: Amerisave will not charge fees or make referrals to its affiliates before giving consumers the proper disclosure forms.
· Pay $6 million in fines: Amerisave will make a $4.5 million penalty payment, and Patrick Markert will make an additional $1.5 million penalty payment, to the Bureau’s Civil Penalty Fund.
https://www.consumeraffairs.com/news/amerisave-to-pay-19-million-for-bait-and-switch-mortgage-scheme-081214.html
Editor's note: The story was prompted by information about current bad bait and switch experiences by potential mortgage borrowers.
Amazon responds to investigation revealing thousands of banned and unsafe items on its marketplace
BY NAT LEVY on August 23, 2019 at 10:17 am
Amazon’s marketplace for third-party sellers has become a huge part of its business, making up nearly 60 percent of gross merchandise sales last year. However, a new investigation by The Wall Street Journal shows that thousands of unsafe products have made their way onto the marketplace, the latest example of a tech giant struggling to police the platform it created.
WSJ found 4,152 items for sale on Amazon that had been banned or declared unsafe by federal regulators or were deceptively labeled. That included more than 2,000 listings for toys and medication that did not have warnings about health risks for children. Nearly half of those items were listed as shipping from Amazon warehouses.
After WSJ brought its findings to Amazon, 57 percent of the listings in question had their wording altered or were removed. Amazon told WSJ it reviewed and addressed the listings, and that company policies require all products to comply with laws and regulations.
Underscoring the challenges Amazon faces in policing the platform, more than 100 items that Amazon had previously removed popped up in new listings, WSJ found. Amazon then removed the items again and told WSJ it was refining its tools to make sure they wouldn’t re-appear.
The report was impactful enough that Amazon published a blog post in response, detailing the steps it takes to make sure products on its third-party marketplace are safe. The company spent more than $400 million in 2018 to protect its stores and customers and “ensure products offered are safe, compliant, and authentic.”
Amazon has a “dedicated global team of compliance specialists” that reviews product safety information. Amazon in 2018 “blocked more than three billion suspect listings for various forms of abuse, including non-compliance, before they were published to our store.”
Amazon uses automated tools to scan the items on its website for changes. And the company has systems in place to quickly look into any potential concerns.
“For example, if a customer reports a concern with a product, a customer service associate can instantly trigger an investigation,” according to the blog post. “Additionally, because of our direct relationships with customers, we are able to trace and directly notify customers who purchased a particular product online and alert them to a potential safety issue — our systems are far more effective than other online and offline retailers and customers can feel confident they’ll have the information they need.”
WSJ’s investigation comes after Amazon lauded 150 new tools it has built so far this year to help sellers grow their businesses on the third-party marketplace. Amazon said it is investing $15 billion this year to “empower” sellers on its platform.
Like many of its fellow tech giants, Amazon has drawn increased scrutiny from regulators recently, and the third-party marketplace is at the center of those inquiries. However, regulators are looking not at safety issues but potential anti-trust concerns on the marketplace.
Amazon’s issues are the latest indication of the industry-wide struggle among tech giants to control their massive platforms. Facebook and Twitter are at the center of yet another political disinformation campaign. Google’s YouTube is working to reverse a trend of hate speech and extremism populating its platform. And Microsoft’s LinkedIn is in a constant battle to catch and eliminate fake accounts.
From:https://www.geekwire.com/2019/amazon-responds-investigation-revealing-thousands-banned-unsafe-items-marketplace/
New York regulators have reached a settlement worth up to $2.7 million with a hedge fund that provided financing and assistance to a large rent-to-own home firm accused of engaging in predatory business practices.
The settlement announced Tuesday requires the hedge fund, Atalaya Capital Management, to provide at least $20,000 in restitution to the more than 100 state residents who thought they were entering into deals to ultimately buy homes from Vision Property Management.
Atalaya, a $5 billion hedge fund based in New York, also agreed to pay a $250,000 civil penalty under the settlement, reached with the state attorney general and the Department of Financial Services. The deal came less than a month after the agencies filed a lawsuit against Vision, [https://www.nytimes.com/2019/08/01/business/rent-to-own-vision-lawsuit.html?module=inline] saying the company had operated an “illegal, unlicensed mortgage lending” business by using deceptive rent-to-own agreements to sell often-rundown homes.
The consent decree is here:
https://www.dfs.ny.gov/system/files/documents/2019/08/ea190827_atalaya.pdf
Here is an excerpt from the decree:
5. As d_iscussed below, Atalaya provided financing to subsidiaries of Vision, a South Carolina company that buys distressed residential real properties at a discount and sells many of them at a substantial markup to lower income, working class consumers. The NY AG and the Department filed an action against Vision and its chief executive_ officer on August 1, 2019 in the Southern District ofNew York. The People of the State of New York, et al. v. Vision Property Management, LLC, et al., 19-cv-7191-JSR (Aug. 1, 2019). Vision's Seller Financing Business Model
6. The properties purchased and resold by Vision generally have been vacant for a long time and often require significant repairs to make them habitable and compliant with local building codes. The purchase price that Vision pays to acquire these properties, which are purchased in bulk from government entities or from private parties that have been unable to sell them via traditional channels, reflects that condition. Vision is not generally in the business of repairing or rehabilitating these properties. Rather, it typically passed the cost to repair the properties· to the consumer.
7. Vision targets consumers who want to own a home but, due to bad credit or other issues, could not qualify for a "traditional loan." Vision claims that it offers a "unique" program that can be their path to the "American dream of homeownership." Vision characterizes itself as a consumer-friendly alternative to larger irresponsible financial institutions.
8. Vision's "unique" business model is structured as seller financing. Seller financing simply means that the property seller, rather than a bank, provides the funding to finance a property purchase. Instead of advancing money to the purchaser as a typical mortgage lender would, the seller extends credit by deferring payment of the full purchase price in exchange for the purchaser making installment payments over a specified period of time and at a set interest rate until the loan is repaid. 3
9. Vision originally used a Contract for Deed ("CFD") agreement to carry out its seller financing transactions. A typical CFD agreement included a purchase agreement and a promissory note that obligated the consumer to pay principal and interest, at a rate between 7% and 10%, typically over a twenty or thirty-year period. The right to occupy, and the obligation to maintain and repair the property, transferred to the consumer upon the execution of the CFD agreement, but Vision retained record ownership until the consumer paid off the balance of the purchase price. Thus, instead of transferring title and filing a mortgage against the property, Vision retained title ownership as security on the purchaser's obligation to repay the loan.
10. While Vision's CFD agreements facialiy charged an interest rate between 7% and 10%, the agreements included financing charges that could raise the rate as high as 25% in certain circumstances where interest payments were capitalized.
The settlement announced Tuesday requires the hedge fund, Atalaya Capital Management, to provide at least $20,000 in restitution to the more than 100 state residents who thought they were entering into deals to ultimately buy homes from Vision Property Management.
Atalaya, a $5 billion hedge fund based in New York, also agreed to pay a $250,000 civil penalty under the settlement, reached with the state attorney general and the Department of Financial Services. The deal came less than a month after the agencies filed a lawsuit against Vision, [https://www.nytimes.com/2019/08/01/business/rent-to-own-vision-lawsuit.html?module=inline] saying the company had operated an “illegal, unlicensed mortgage lending” business by using deceptive rent-to-own agreements to sell often-rundown homes.
The consent decree is here:
https://www.dfs.ny.gov/system/files/documents/2019/08/ea190827_atalaya.pdf
Here is an excerpt from the decree:
5. As d_iscussed below, Atalaya provided financing to subsidiaries of Vision, a South Carolina company that buys distressed residential real properties at a discount and sells many of them at a substantial markup to lower income, working class consumers. The NY AG and the Department filed an action against Vision and its chief executive_ officer on August 1, 2019 in the Southern District ofNew York. The People of the State of New York, et al. v. Vision Property Management, LLC, et al., 19-cv-7191-JSR (Aug. 1, 2019). Vision's Seller Financing Business Model
6. The properties purchased and resold by Vision generally have been vacant for a long time and often require significant repairs to make them habitable and compliant with local building codes. The purchase price that Vision pays to acquire these properties, which are purchased in bulk from government entities or from private parties that have been unable to sell them via traditional channels, reflects that condition. Vision is not generally in the business of repairing or rehabilitating these properties. Rather, it typically passed the cost to repair the properties· to the consumer.
7. Vision targets consumers who want to own a home but, due to bad credit or other issues, could not qualify for a "traditional loan." Vision claims that it offers a "unique" program that can be their path to the "American dream of homeownership." Vision characterizes itself as a consumer-friendly alternative to larger irresponsible financial institutions.
8. Vision's "unique" business model is structured as seller financing. Seller financing simply means that the property seller, rather than a bank, provides the funding to finance a property purchase. Instead of advancing money to the purchaser as a typical mortgage lender would, the seller extends credit by deferring payment of the full purchase price in exchange for the purchaser making installment payments over a specified period of time and at a set interest rate until the loan is repaid. 3
9. Vision originally used a Contract for Deed ("CFD") agreement to carry out its seller financing transactions. A typical CFD agreement included a purchase agreement and a promissory note that obligated the consumer to pay principal and interest, at a rate between 7% and 10%, typically over a twenty or thirty-year period. The right to occupy, and the obligation to maintain and repair the property, transferred to the consumer upon the execution of the CFD agreement, but Vision retained record ownership until the consumer paid off the balance of the purchase price. Thus, instead of transferring title and filing a mortgage against the property, Vision retained title ownership as security on the purchaser's obligation to repay the loan.
10. While Vision's CFD agreements facialiy charged an interest rate between 7% and 10%, the agreements included financing charges that could raise the rate as high as 25% in certain circumstances where interest payments were capitalized.
Not everyone loves the public nuisance theory adopted by the Court in the Oklahoma AG's opioid case against Johnson and Johnson
Following is an excerpt from a dissenting view published at https://legalnewsline.com/stories/512627243-it-keeps-changing-oklahoma-s-opioid-strategy-is-a-700-year-old-english-law-that-used-to-regulate-wandering-sheep:
A prominent scholarly examination of the evolution of nuisance law suggests Ausness and the North Dakota judge are right – or were, depending on how nuisance law might change in the wake of the opioid litigation. In “Is Public Nuisance a Tort?” Professor Thomas W. Merrill of Columbia Law School wrote that efforts by environmentalists to retool nuisance law as a weapon against pollution and other social problems in the early 1970s had largely failed -- until state attorneys general rediscovered nuisance in the late 1990s with the help of private lawyers. [See https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1829493]
Most of the tobacco lawsuits in the 1990s claimed the marketing of cigarettes was a public nuisance, for example, although the only court to decide the matter rejected that theory in a 1997 decision. A federal judge in New York rejected similar claims that the gasoline additive MTBE was a public nuisance, but in both cases lawyers negotiated lucrative settlements that showered them with fees.
Gun lawsuits may have been headed the same way until Congress passed a statute eliminating most liability for gun manufacturers over crimes committed with their products. Federal courts in New York and California also rejected lawsuits accusing gasoline manufacturers of causing the “public nuisance” of global warming.
The biggest success for public nuisance advocates so far was in California, where a state appeals court in California upheld a judgment requiring several manufacturers to “abate” lead paint in thousands of aging buildings because they advertised the product before World War II. The California and U.S. supreme courts refused to hear further appeals of that decision.
The main reason these cases have gained any traction may be a subtle change in the definition of “public nuisance” in the Restatement (Second) of Torts in 1972. Restatements are guidebooks to the common law for judges and attorneys published by the American Law Institute. After several fierce debates, ALI members supported broadening public nuisance law to address environmental damage, Merrill wrote, even though there was no case law to support the change.
- - - -
Also, See the WSJ comment at https://www.wsj.com/articles/an-oklahoma-opioid-stickup-11566861973
The WSJ points out that the public nuisance theories have been pressed by outside counsel engaged by states and paid on a contingent fee basis.
Editor's Note: The views of the Wall Street Journal editorial writers, Legal News Line and Professor Merrill are presented in the interests of presenting an array of views for discussion, and are not intended to represent views of DCCRC or the editor. DAR
D.C. AG sues Marriott for hidden "drip" pricing
From The D.C. Complaint:
COMPLAINT FOR VIOLATIONS OF THE CONSUMER PROTECTION PROCEDURES ACT
The District of Columbia (“District”), by the Office of the Attorney General, brings this action pursuant to D.C. Code § 28-3909 for injunctive relief, consumer restitution, costs, and civil penalties against Defendant Marriott International, Inc. (“Marriott”) for violations of the District’s Consumer Protection Procedures Act (“CPPA”), D.C. Code § 28-3901, et seq. In support of its claims, the District states as follows:
INTRODUCTION
1. This is a straight-forward price deception case. For at least the last decade, Marriott has used an unlawful trade practice called “drip pricing” in advertising its hotel rooms whereby Marriott initially hides a portion of a hotel room’s daily rate from consumers. Marriott calls this hidden portion of the room rate a number of terms, including a “resort fee,” “amenity fee” and a “destination fee.”
The full Complaint: https://oag.dc.gov/sites/default/files/2019-07/Marriott-Complaint.pdf
From The D.C. Complaint:
COMPLAINT FOR VIOLATIONS OF THE CONSUMER PROTECTION PROCEDURES ACT
The District of Columbia (“District”), by the Office of the Attorney General, brings this action pursuant to D.C. Code § 28-3909 for injunctive relief, consumer restitution, costs, and civil penalties against Defendant Marriott International, Inc. (“Marriott”) for violations of the District’s Consumer Protection Procedures Act (“CPPA”), D.C. Code § 28-3901, et seq. In support of its claims, the District states as follows:
INTRODUCTION
1. This is a straight-forward price deception case. For at least the last decade, Marriott has used an unlawful trade practice called “drip pricing” in advertising its hotel rooms whereby Marriott initially hides a portion of a hotel room’s daily rate from consumers. Marriott calls this hidden portion of the room rate a number of terms, including a “resort fee,” “amenity fee” and a “destination fee.”
The full Complaint: https://oag.dc.gov/sites/default/files/2019-07/Marriott-Complaint.pdf
Large telecom companies and attorneys general from every state forming a new pact for combating robocalls
Under the agreement, the companies are promising to work to prevent illegal robocalls on their networks and to work with state law enforcement investigating the calls’ origins, according to the office of North Carolina Attorney General Josh Stein.
The participating companies include AT&T Inc., Verizon Communications Inc., T-Mobile US Inc., Sprint Corp., CenturyLink Inc.and seven other large carriers, Mr. Stein’s office said.
Among the companies’ promises: to provide customers with free call-blocking technology, investigate and trace illegal calls and confirm the identity of their commercial customers as part of cooperation with law enforcement.
https://www.bloomberg.com/news/articles/2019-08-22/all-50-states-are-preparing-to-tackle-robocalls-in-telecom-deal?srnd=premium
Under the agreement, the companies are promising to work to prevent illegal robocalls on their networks and to work with state law enforcement investigating the calls’ origins, according to the office of North Carolina Attorney General Josh Stein.
The participating companies include AT&T Inc., Verizon Communications Inc., T-Mobile US Inc., Sprint Corp., CenturyLink Inc.and seven other large carriers, Mr. Stein’s office said.
Among the companies’ promises: to provide customers with free call-blocking technology, investigate and trace illegal calls and confirm the identity of their commercial customers as part of cooperation with law enforcement.
https://www.bloomberg.com/news/articles/2019-08-22/all-50-states-are-preparing-to-tackle-robocalls-in-telecom-deal?srnd=premium
Cnet: State attorneys general will reportedly kick off antitrust investigation into tech giants
A group of states will add its voices to the DOJ and FTC reviews into big tech companies, a report says.
BY
AUGUST 19, 2019 4:05 PM PDT
Another antitrust investigation will be kicked off against US tech giants, according to a report, this time coming from a group of state attorneys general. Citing sources, The Wall Street Journal reported Monday the probe could be launched in September and could look into whether companies like Google, Facebook and Amazon use their power to stifle competition in the market.
It follows the Department of Justice last month announcing its own antitrust review of how online platforms achieved market power and whether they are using that power to reduce competition and stifle innovation. And that investigation followed the Federal Trade Commission in February forming a task force to monitor competition among tech platforms.
"A dozen" state attorneys general met with officials from the Department of Justice in July to discuss the investigation, the report said.
From:
https://www.cnet.com/news/state-attorneys-general-will-reportedly-kick-off-antitrust-investigation-into-tech-giants/
A group of states will add its voices to the DOJ and FTC reviews into big tech companies, a report says.
BY
AUGUST 19, 2019 4:05 PM PDT
Another antitrust investigation will be kicked off against US tech giants, according to a report, this time coming from a group of state attorneys general. Citing sources, The Wall Street Journal reported Monday the probe could be launched in September and could look into whether companies like Google, Facebook and Amazon use their power to stifle competition in the market.
It follows the Department of Justice last month announcing its own antitrust review of how online platforms achieved market power and whether they are using that power to reduce competition and stifle innovation. And that investigation followed the Federal Trade Commission in February forming a task force to monitor competition among tech platforms.
"A dozen" state attorneys general met with officials from the Department of Justice in July to discuss the investigation, the report said.
From:
https://www.cnet.com/news/state-attorneys-general-will-reportedly-kick-off-antitrust-investigation-into-tech-giants/
From BizJournal: New restrictions on short-term rentals in the District through home-sharing services like Airbnb could finally go into effect in the coming months, as officials gear up to start enforcing a law passed by the D.C. Council last year.
The Zoning Commission has scheduled a hearing for Oct. 17 on proposed amendments to the city’s zoning rules to allow for home-sharing across many residential areas, according to online records. Lawmakers have been anxiously awaiting action from the commission on the matter, despite passing new short-term rental rules last November that prompted a clash with Mayor Muriel Bowser.
Most home-sharing is technically illegal in the city at the moment, though District inspectors have largely declined to police it too closely. The new law would officially legalize the practice, though it would be subject to a series of restrictions favored largely by hotel executives and workers designed to curb short-term rentals. For instance, property owners will be barred from renting out second homes, or renting spare rooms in their primary residence for more than 90 days a year.
Bowser fiercely opposed the council’s changes and warned that the law may be unconstitutional, arguing that home-sharing has thrived without the council’s interference. Nevertheless, the legislation passed unanimously.
The new rules are set to officially take effect on Oct. 1, but Council Chairman Phil Mendelson has repeatedly warned that the Zoning Commission will need to take action before the law can actually work, in practice. Namely, officials need to conform the District’s zoning code to make short-term rentals a permitted “accessory use” for many properties in the city.
The commission is set to consider a series of changes this fall, adding a definition of short-term rentals to the regulations and stipulating that they’ll be acceptable uses in a variety of areas zoned residential or mixed-use buildings.
Crucially, the proposed zoning changes come courtesy of Mendelson’s office, not anyone in Bowser’s administration.
The chairman has pressed for months for the Office of Planning to submit a report to the commission, outlining potential text amendments to the code instead. But staff there still have not done so, spokespeople for both Mendelson and the planning office confirmed.
Mendelson accused Bowser this spring of deliberately slow-walking that report in an attempt to stall the implementation of the Airbnb-focused rules, though District planners insisted they simply needed more time. The chairman didn’t find that argument convincing, and worked through the budget to compel the planning office to release the report.
At first he threatened to withhold any permits for new government buildings — when that attracted some push back, he settled instead for adding a provisionto the budget barring the city from issuing permits for any construction at the RFK stadium site or at Franklin Park, a downtown space that’s planned for a full renovation.
But instead of waiting on a report from OP, Mendelson decided to submit his own proposed changes, and invited planners to comment on them. Planning office spokeswoman Mekdy Alemayehu says staff there is working on something now, but they haven’t settled yet on whether they’ll submit a report before the Oct. 17 hearing.
Airbnb previously estimated that roughly 6,500 people in the District made use of the service in 2017, generating a total of $82 million in income.
https://www.bizjournals.com/washington/news/2019/08/21/new-d-c-airbnb-restrictions-could-soon-take-effect.html?ana=e_ae_set3&j=89840341&t=Afternoon&mkt_tok=eyJpIjoiWVRBM05qWm1aV1poTXprNCIsInQiOiJUcHlPUFFVTDlqcDVlQThRYnhWSlUwUUcwbEdwU0xJZ0gyYUJMTEh0ajJ0UGptdHpSSUZzMlNjNk9KZVl0dHJyQVNkeXlOU293WjZ6Q2cxemFIV2lQQWhvQ2tNc1cwSTZocU96RGlkZWlGaVJJVUNsT0tua3dcLzhEbzlZc1JaSkpKbzAwYllsUkJRNjBLK05DWDZON0VRPT0ifQ%3D%3D
The Zoning Commission has scheduled a hearing for Oct. 17 on proposed amendments to the city’s zoning rules to allow for home-sharing across many residential areas, according to online records. Lawmakers have been anxiously awaiting action from the commission on the matter, despite passing new short-term rental rules last November that prompted a clash with Mayor Muriel Bowser.
Most home-sharing is technically illegal in the city at the moment, though District inspectors have largely declined to police it too closely. The new law would officially legalize the practice, though it would be subject to a series of restrictions favored largely by hotel executives and workers designed to curb short-term rentals. For instance, property owners will be barred from renting out second homes, or renting spare rooms in their primary residence for more than 90 days a year.
Bowser fiercely opposed the council’s changes and warned that the law may be unconstitutional, arguing that home-sharing has thrived without the council’s interference. Nevertheless, the legislation passed unanimously.
The new rules are set to officially take effect on Oct. 1, but Council Chairman Phil Mendelson has repeatedly warned that the Zoning Commission will need to take action before the law can actually work, in practice. Namely, officials need to conform the District’s zoning code to make short-term rentals a permitted “accessory use” for many properties in the city.
The commission is set to consider a series of changes this fall, adding a definition of short-term rentals to the regulations and stipulating that they’ll be acceptable uses in a variety of areas zoned residential or mixed-use buildings.
Crucially, the proposed zoning changes come courtesy of Mendelson’s office, not anyone in Bowser’s administration.
The chairman has pressed for months for the Office of Planning to submit a report to the commission, outlining potential text amendments to the code instead. But staff there still have not done so, spokespeople for both Mendelson and the planning office confirmed.
Mendelson accused Bowser this spring of deliberately slow-walking that report in an attempt to stall the implementation of the Airbnb-focused rules, though District planners insisted they simply needed more time. The chairman didn’t find that argument convincing, and worked through the budget to compel the planning office to release the report.
At first he threatened to withhold any permits for new government buildings — when that attracted some push back, he settled instead for adding a provisionto the budget barring the city from issuing permits for any construction at the RFK stadium site or at Franklin Park, a downtown space that’s planned for a full renovation.
But instead of waiting on a report from OP, Mendelson decided to submit his own proposed changes, and invited planners to comment on them. Planning office spokeswoman Mekdy Alemayehu says staff there is working on something now, but they haven’t settled yet on whether they’ll submit a report before the Oct. 17 hearing.
Airbnb previously estimated that roughly 6,500 people in the District made use of the service in 2017, generating a total of $82 million in income.
https://www.bizjournals.com/washington/news/2019/08/21/new-d-c-airbnb-restrictions-could-soon-take-effect.html?ana=e_ae_set3&j=89840341&t=Afternoon&mkt_tok=eyJpIjoiWVRBM05qWm1aV1poTXprNCIsInQiOiJUcHlPUFFVTDlqcDVlQThRYnhWSlUwUUcwbEdwU0xJZ0gyYUJMTEh0ajJ0UGptdHpSSUZzMlNjNk9KZVl0dHJyQVNkeXlOU293WjZ6Q2cxemFIV2lQQWhvQ2tNc1cwSTZocU96RGlkZWlGaVJJVUNsT0tua3dcLzhEbzlZc1JaSkpKbzAwYllsUkJRNjBLK05DWDZON0VRPT0ifQ%3D%3D
From DMN: Taylor Swift and the complicated world of recording artists' IP rights:
Taylor Swift is about to make life very complicated for music industry heavyweights Scooter Braun and Scott Borchetta.
Earlier today (August 22nd), Taylor Swift confirmed during an interview with Robin Roberts on “Good Morning America” that she intends to re-record her first 5 albums so that she can gain control over the songs’ master recordings.
This follows earlier comments on “CBS Sunday Morning” indicating that re-recordings were happening.
During the “Good Morning America” interview, Swift indicated that her contract allows her to re-record the 5 albums beginning in November of next year, and this is when she plans to start the process. She further indicated that she’s pumped up about the effort — and damn serious about doing it.
The re-recordings would likely flood platforms like Apple Music and Spotify, resulting in duplicate versions and lots of confusion. The move, if successful, is almost guaranteed to diminish the value of the original catalog, and could spark legal warfare over Swift’s right to re-record.
Swift went on to say that she will be re-recording the music because she feels that music artists should have the right to their own music, which is currently not the case with her previous records.
Those recordings now belong to music manager Scooter Braun, whose Ithaca Holdings bought the rights to Swift’s recordings this past summer through the purchase of Scott Borchetta’s Big Machine Label Group. Ithaca Holdings reportedly paid $300 million for the purchase, with a large percentage of that price predicated on the long-term value of Swift’s intellectual property.
https://www.digitalmusicnews.com/2019/08/22/taylor-swift-re-record-albums-1-5/
Taylor Swift is about to make life very complicated for music industry heavyweights Scooter Braun and Scott Borchetta.
Earlier today (August 22nd), Taylor Swift confirmed during an interview with Robin Roberts on “Good Morning America” that she intends to re-record her first 5 albums so that she can gain control over the songs’ master recordings.
This follows earlier comments on “CBS Sunday Morning” indicating that re-recordings were happening.
During the “Good Morning America” interview, Swift indicated that her contract allows her to re-record the 5 albums beginning in November of next year, and this is when she plans to start the process. She further indicated that she’s pumped up about the effort — and damn serious about doing it.
The re-recordings would likely flood platforms like Apple Music and Spotify, resulting in duplicate versions and lots of confusion. The move, if successful, is almost guaranteed to diminish the value of the original catalog, and could spark legal warfare over Swift’s right to re-record.
Swift went on to say that she will be re-recording the music because she feels that music artists should have the right to their own music, which is currently not the case with her previous records.
Those recordings now belong to music manager Scooter Braun, whose Ithaca Holdings bought the rights to Swift’s recordings this past summer through the purchase of Scott Borchetta’s Big Machine Label Group. Ithaca Holdings reportedly paid $300 million for the purchase, with a large percentage of that price predicated on the long-term value of Swift’s intellectual property.
https://www.digitalmusicnews.com/2019/08/22/taylor-swift-re-record-albums-1-5/
Himes and Perez:
Blowing The Whistle on the Lack Of Antitrust Whistleblower Protection
By CPI on August 12, 2019No Comment
By Jay L. Himes & Matthew J. Perez –
With the Antitrust Criminal Penalty Enhancement and Reform Act (“ACPERA”) set to sunset in June 2020, legislators and relevant stakeholders will debate the law’s renewal and what changes, if any, should be made. A priority in the discussion should be whistleblower protection for individuals who disclose antitrust violations to the Department of Justice. Three protective features are appropriate. First, anti-retaliation protection for whistleblowers should be enacted. Second, a civil remedy for whistleblowers who suffer retaliation should be created. Finally, a bounty program to further incent whistleblowers to come forward should be adopted. The positive experiences of federal agencies with bounty programs confirm the adage: “money talks.”
Click here for the full article.https://www.competitionpolicyinternational.com/wp-content/uploads/2019/08/CPI-Himes-Perez.pdf
Blowing The Whistle on the Lack Of Antitrust Whistleblower Protection
By CPI on August 12, 2019No Comment
By Jay L. Himes & Matthew J. Perez –
With the Antitrust Criminal Penalty Enhancement and Reform Act (“ACPERA”) set to sunset in June 2020, legislators and relevant stakeholders will debate the law’s renewal and what changes, if any, should be made. A priority in the discussion should be whistleblower protection for individuals who disclose antitrust violations to the Department of Justice. Three protective features are appropriate. First, anti-retaliation protection for whistleblowers should be enacted. Second, a civil remedy for whistleblowers who suffer retaliation should be created. Finally, a bounty program to further incent whistleblowers to come forward should be adopted. The positive experiences of federal agencies with bounty programs confirm the adage: “money talks.”
Click here for the full article.https://www.competitionpolicyinternational.com/wp-content/uploads/2019/08/CPI-Himes-Perez.pdf
From DMN: Spotify, Apple, Pandora, Amazon, Google Warn Against Ditching the PRO Consent Decrees — “The Resulting Chaos Will Be Felt by Everyone in the Music Industry”
August 12, 2019
Should the Department of Justice really do away with the ASCAP and BMI Consent Decrees?Not according to major streaming services like Spotify, Apple Music, Pandora/Sirius, Amazon Music, and YouTube owner Google/Alphabet. As the U.S. Department of Justice deliberates over whether to trash the decades-old Decrees for the licensing of public performances, the streaming services — represented by DiMA — have issued a dire warning of a Decree-less future.
In a formal statement submitted to the DOJ ahead of the weekend — and subsequently emailed to Digital Music News — the message from DiMA was starkly clear. “We are living in a golden age of music in which fans and creators alike are benefiting from a highly competitive marketplace that allows any piece of music to be enjoyed wherever and whenever we want, all at the push of the button,” the blue-sky statement begins.
“This benefits music fans, artists, songwriters and all of us in the music ecosystem, which is why it is no surprise that everyone from small businesses and restaurants to the streaming platforms DiMA represents have had a singular message for the Justice Department: the ASCAP and BMI consent decrees are vital to ensuring a robust and competitive music marketplace today and for the future.”
Removing the Decrees, especially without any secondary licensing plan in place, would lead to outright chaos. “Terminating or choosing an arbitrary end date for these well-established decrees prior to a new legal framework being established would thrust the music marketplace into chaos,” the statement continues.
“And make no mistake, the resulting chaos will be felt by everyone in the music industry, but most of all by consumers: prices will rise, competition will deteriorate and the quality and variety of music readily available to music fans will decline.”
rner Chappell Music Inks a Stone Temple Pilots Worldwide Publishing Deal
Also joining DiMA in the warning was the Radio Music Licensing Committee, or RMLC, which also has a strong interest in maintaining regulated, low-cost performance licensing.Ironically, even though streaming platforms are slowly cannibalizing traditional radio and their attempts to transition online, both camps have a very similar interest when it comes to keeping publishing licensing costs low.
Here’s the complete statement, shared by DiMA CEO Garrett Levin to DMN:“We are living in a golden age of music in which fans and creators alike are benefiting from a highly competitive marketplace that allows any piece of music to be enjoyed wherever and whenever we want, all at the push of the button. This benefits music fans, artists, songwriters and all of us in the music ecosystem, which is why it is no surprise that everyone from small businesses and restaurants to the streaming platforms DiMA represents have had a singular message for the Justice Department: the ASCAP and BMI consent decrees are vital to ensuring a robust and competitive music marketplace today and for the future.
“The competitive protections provided by the decrees have been a cornerstone in the successful evolution of the U.S. music industry into the economic and cultural juggernaut it is today. Terminating or choosing an arbitrary end date for these well-established decrees prior to a new legal framework being established would thrust the music marketplace into chaos. And make no mistake, the resulting chaos will be felt by everyone in the music industry, but most of all by consumers: prices will rise, competition will deteriorate and the quality and variety of music readily available to music fans will decline.
“Given the paramount importance of maintaining these competitive protections, DiMA and the Radio Music License Committee today called on the Department of Justice to formally establish a blue-ribbon federal advisory committee to assist in the review process. Such a committee of industry stakeholders, including artist and consumer representatives, could fully study the decrees and provide helpful policy recommendations to DOJ and Congress. This is a critical step to guaranteeing a vibrant competitive music marketplace for today, tomorrow, and for generations to come.”
The groups also entered a more elaborated breakdown on the matter.That broadened statement delineates the arguments against the Decrees in greater depth, and includes a recommendation to create a Federal Advisory Committee instead of a ‘rushed comment period’. It also raises the reality that major publishers, as well as their ASCAP and BMI agents, will attempt to dramatically increase performance licensing fees if the
Consent Decrees are lifted
The Department of Justice first enacted the Consent Decrees in 1941 to prevent anti-competitive pricing in the performance licensing market. That licensing has been administered by two major groups, ASCAP and BMI, for which the Decrees remain in effect today.
The result of the Decrees was that any business in the United States could play virtually any song they pleased, so long as they paid relatively low-cost statutory fees. That also extended into traditional radio and online radio and even on-demand streaming formats, though publishers argue that the Decrees are out-of-date and run afoul of fair, open market practices.
Both ASCAP and BMI have been protesting the Consent Decrees for decades, and not one employee of either group has worked in an environment without the regulations in place. All of which makes it fairly exciting that the DOJ is seriously considering removing the statutes, though the removals would certainly introduce lots of uncertainties for all sides.
https://www.digitalmusicnews.com/2019/08/12/spotify-pandora-amazon-google-consent-decrees/
August 12, 2019
Should the Department of Justice really do away with the ASCAP and BMI Consent Decrees?Not according to major streaming services like Spotify, Apple Music, Pandora/Sirius, Amazon Music, and YouTube owner Google/Alphabet. As the U.S. Department of Justice deliberates over whether to trash the decades-old Decrees for the licensing of public performances, the streaming services — represented by DiMA — have issued a dire warning of a Decree-less future.
In a formal statement submitted to the DOJ ahead of the weekend — and subsequently emailed to Digital Music News — the message from DiMA was starkly clear. “We are living in a golden age of music in which fans and creators alike are benefiting from a highly competitive marketplace that allows any piece of music to be enjoyed wherever and whenever we want, all at the push of the button,” the blue-sky statement begins.
“This benefits music fans, artists, songwriters and all of us in the music ecosystem, which is why it is no surprise that everyone from small businesses and restaurants to the streaming platforms DiMA represents have had a singular message for the Justice Department: the ASCAP and BMI consent decrees are vital to ensuring a robust and competitive music marketplace today and for the future.”
Removing the Decrees, especially without any secondary licensing plan in place, would lead to outright chaos. “Terminating or choosing an arbitrary end date for these well-established decrees prior to a new legal framework being established would thrust the music marketplace into chaos,” the statement continues.
“And make no mistake, the resulting chaos will be felt by everyone in the music industry, but most of all by consumers: prices will rise, competition will deteriorate and the quality and variety of music readily available to music fans will decline.”
rner Chappell Music Inks a Stone Temple Pilots Worldwide Publishing Deal
Also joining DiMA in the warning was the Radio Music Licensing Committee, or RMLC, which also has a strong interest in maintaining regulated, low-cost performance licensing.Ironically, even though streaming platforms are slowly cannibalizing traditional radio and their attempts to transition online, both camps have a very similar interest when it comes to keeping publishing licensing costs low.
Here’s the complete statement, shared by DiMA CEO Garrett Levin to DMN:“We are living in a golden age of music in which fans and creators alike are benefiting from a highly competitive marketplace that allows any piece of music to be enjoyed wherever and whenever we want, all at the push of the button. This benefits music fans, artists, songwriters and all of us in the music ecosystem, which is why it is no surprise that everyone from small businesses and restaurants to the streaming platforms DiMA represents have had a singular message for the Justice Department: the ASCAP and BMI consent decrees are vital to ensuring a robust and competitive music marketplace today and for the future.
“The competitive protections provided by the decrees have been a cornerstone in the successful evolution of the U.S. music industry into the economic and cultural juggernaut it is today. Terminating or choosing an arbitrary end date for these well-established decrees prior to a new legal framework being established would thrust the music marketplace into chaos. And make no mistake, the resulting chaos will be felt by everyone in the music industry, but most of all by consumers: prices will rise, competition will deteriorate and the quality and variety of music readily available to music fans will decline.
“Given the paramount importance of maintaining these competitive protections, DiMA and the Radio Music License Committee today called on the Department of Justice to formally establish a blue-ribbon federal advisory committee to assist in the review process. Such a committee of industry stakeholders, including artist and consumer representatives, could fully study the decrees and provide helpful policy recommendations to DOJ and Congress. This is a critical step to guaranteeing a vibrant competitive music marketplace for today, tomorrow, and for generations to come.”
The groups also entered a more elaborated breakdown on the matter.That broadened statement delineates the arguments against the Decrees in greater depth, and includes a recommendation to create a Federal Advisory Committee instead of a ‘rushed comment period’. It also raises the reality that major publishers, as well as their ASCAP and BMI agents, will attempt to dramatically increase performance licensing fees if the
Consent Decrees are lifted
The Department of Justice first enacted the Consent Decrees in 1941 to prevent anti-competitive pricing in the performance licensing market. That licensing has been administered by two major groups, ASCAP and BMI, for which the Decrees remain in effect today.
The result of the Decrees was that any business in the United States could play virtually any song they pleased, so long as they paid relatively low-cost statutory fees. That also extended into traditional radio and online radio and even on-demand streaming formats, though publishers argue that the Decrees are out-of-date and run afoul of fair, open market practices.
Both ASCAP and BMI have been protesting the Consent Decrees for decades, and not one employee of either group has worked in an environment without the regulations in place. All of which makes it fairly exciting that the DOJ is seriously considering removing the statutes, though the removals would certainly introduce lots of uncertainties for all sides.
https://www.digitalmusicnews.com/2019/08/12/spotify-pandora-amazon-google-consent-decrees/
The ITT fraudulent student loan settlement
See it at https://files.consumerfinance.gov/f/documents/cfpb_ITT_proposed-stipulated-judgement_2019-08.pdf
"6. The Bureau alleges that the acts and practices described in its Complaint resulted in students enrolling in CUSO Loans that in many cases they did not want, did not understand, or did not even realize they were getting. The Bureau alleges that ITT students experienced substantial injury as a result of the CUSO Loans. "
See it at https://files.consumerfinance.gov/f/documents/cfpb_ITT_proposed-stipulated-judgement_2019-08.pdf
"6. The Bureau alleges that the acts and practices described in its Complaint resulted in students enrolling in CUSO Loans that in many cases they did not want, did not understand, or did not even realize they were getting. The Bureau alleges that ITT students experienced substantial injury as a result of the CUSO Loans. "
AAI Asks Ninth Circuit to Preserve Consumer Recoveries Under State Antitrust Law (Stromberg v. Qualcomm)
AAI has filed an amicus brief in the Ninth Circuit arguing that states that bar antitrust suits by indirect purchasers should not prevent indirect purchasers from recovering in states that allow such suits.
The AAI brief argues that Qualcomm and the DOJ have not shown a “conflict” under California choice-of-law rules for all the same reasons the Supreme Court did not find a conflict under the preemption doctrine in Arc America. The brief also explains why it is incorrect to presume that follower states have different interests than repealer states. Both are aligned on substantive antitrust policy, and both rely on private civil actions to compensate victims and deter future violations. They merely differ as to who they permit to sue, which does not create a conflict under choice-of-law rules.
Read More https://www.antitrustinstitute.org/work-product/aai-asks-ninth-circuit-to-preserve-consumer-recoveries-under-state-antitrust-law-stromberg-v-qualcomm/
AAI has filed an amicus brief in the Ninth Circuit arguing that states that bar antitrust suits by indirect purchasers should not prevent indirect purchasers from recovering in states that allow such suits.
The AAI brief argues that Qualcomm and the DOJ have not shown a “conflict” under California choice-of-law rules for all the same reasons the Supreme Court did not find a conflict under the preemption doctrine in Arc America. The brief also explains why it is incorrect to presume that follower states have different interests than repealer states. Both are aligned on substantive antitrust policy, and both rely on private civil actions to compensate victims and deter future violations. They merely differ as to who they permit to sue, which does not create a conflict under choice-of-law rules.
Read More https://www.antitrustinstitute.org/work-product/aai-asks-ninth-circuit-to-preserve-consumer-recoveries-under-state-antitrust-law-stromberg-v-qualcomm/
Baseball Minor League Class Action on Wages Allowed to Go Forward
Minor League Baseball players suing over wages won a victory as the Ninth Circuit upheld a lower court's decision to certify a national Fair Labor Standards Act collective and California class action certification. The opinion is here:
https://www.courthousenews.com/wp-content/uploads/2019/08/minorleague.pdf
Minor League Baseball players suing over wages won a victory as the Ninth Circuit upheld a lower court's decision to certify a national Fair Labor Standards Act collective and California class action certification. The opinion is here:
https://www.courthousenews.com/wp-content/uploads/2019/08/minorleague.pdf
Texas AG Press release: AG Paxton: Texas to Join Multistate Lawsuit Challenging the Sprint/T‑Mobile Merger
Today, Texas Attorney General Ken Paxton announced that Texas intends to join a coalition of 13 other states, and the District of Columbia, in challenging the proposed merger of Sprint and T-Mobile, the 3rd and 4th largest providers of mobile wireless telecommunications services in the United States. The merger, if consummated, would result in a substantial harm to competition in the market for mobile wireless telecommunications services, both nationwide, and specifically within the State of Texas.
“While we appreciate the time and effort that went into the agreement between the parties and the U.S. Dept. of Justice, the Texas Attorney General has an independent obligation to protect Texas consumers. After careful evaluation of the proposed merger and the settlement, we do not anticipate that the proposed new entrant will replace the competitive role of Sprint anytime soon,” Attorney General Paxton said. “It is the Attorney General’s responsibility to preserve free market competition, which has proven to result in lower prices and better quality for consumers. The bargain struck by the U.S. Dept. of Justice is not in the best interest of working Texans, who need affordable mobile wireless telecommunication services that are fit to match the speed and technological innovation demands of Texas’ growing economy.”
The New York and California co-led lawsuit was originally filed on June 11 and includes the attorneys general of Colorado, Connecticut, Hawaii, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, Virginia, Wisconsin, and the District of Columbia. Today, at a hearing in the U.S. District court for the Southern District of New York, counsel for New York advised the court that they will be seeking leave for Texas and possibly other states to join the lawsuit next week.
https://www.texasattorneygeneral.gov/news/releases/ag-paxton-texas-join-multistate-lawsuit-challenging-sprintt-mobile-merger
Today, Texas Attorney General Ken Paxton announced that Texas intends to join a coalition of 13 other states, and the District of Columbia, in challenging the proposed merger of Sprint and T-Mobile, the 3rd and 4th largest providers of mobile wireless telecommunications services in the United States. The merger, if consummated, would result in a substantial harm to competition in the market for mobile wireless telecommunications services, both nationwide, and specifically within the State of Texas.
“While we appreciate the time and effort that went into the agreement between the parties and the U.S. Dept. of Justice, the Texas Attorney General has an independent obligation to protect Texas consumers. After careful evaluation of the proposed merger and the settlement, we do not anticipate that the proposed new entrant will replace the competitive role of Sprint anytime soon,” Attorney General Paxton said. “It is the Attorney General’s responsibility to preserve free market competition, which has proven to result in lower prices and better quality for consumers. The bargain struck by the U.S. Dept. of Justice is not in the best interest of working Texans, who need affordable mobile wireless telecommunication services that are fit to match the speed and technological innovation demands of Texas’ growing economy.”
The New York and California co-led lawsuit was originally filed on June 11 and includes the attorneys general of Colorado, Connecticut, Hawaii, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, Virginia, Wisconsin, and the District of Columbia. Today, at a hearing in the U.S. District court for the Southern District of New York, counsel for New York advised the court that they will be seeking leave for Texas and possibly other states to join the lawsuit next week.
https://www.texasattorneygeneral.gov/news/releases/ag-paxton-texas-join-multistate-lawsuit-challenging-sprintt-mobile-merger
NY AG press release: Rent to own company sued by State
Attorney General James And DFS Superintendent Lacewell Take Action Against Fraudulent Mortgage LenderNEW YORK –
Attorney General Letitia James and New York Superintendent of Financial Services Linda A. Lacewell today filed suit in federal court [https://ag.ny.gov/sites/default/files/filed_-_ecf_stamp_-_nyag_nysdfs_v._vision_property_management_llc_et_al._-_19-cv-7191.pdf] against Vision Property Management, LLC; the company’s CEO, Alex Szkaradek; and a number of other companies affiliated with Vision for operating an illegal, deceptive, and unlicensed mortgage lending business in New York since at least 2011. By offering disguised, predatory subprime home loans and illegal finance-lease hybrid agreements, Vision and the other defendants took part in fraudulent activities that repeatedly targeted and took advantage of financially vulnerable New Yorkers.
“For nearly a decade, Vision put profits above people — fraudulently targeting, preying upon, and exploiting aspiring homeowners, including people with disabilities, the elderly, and those living on fixed income,” said Attorney General Letitia James. “These deceptive and abusive practices have trapped New Yorkers in mold-infested, dilapidated homes, and wrongfully placed the onus on consumers to pay the price. This behavior is unacceptable, which is why my office is aggressively prosecuting Vision and will do the same against any company or individual that tries to defraud New Yorkers.”
“As alleged in the complaint, Vision swindled vulnerable New Yorkers who wanted nothing more than the American dream of homeownership but instead got distressed properties with unsafe, squalid conditions and high-interest, predatory loans,” said Superintendent Linda A. Lacewell.
“We took this action to protect New York consumers by putting an end to these illegal, predatory and unconscionable business practices and holding Vision and its CEO accountable under New York State law and applicable federal laws. I am proud of the exemplary work of the DFS colleagues who investigated Vision’s activities for over two years, analyzed thousands of documents, and who worked to protect New Yorkers and bring this company to justice.”
The complaint alleges that Vision specializes in buying severely distressed properties and then markets those properties — at a substantial markup to consumers — without making any necessary repairs or renovations, and without fully disclosing to consumers the many conditions that exist and repairs that must be made for safe habitation. Vision targets low-income consumers eager to share in the “American dream” of homeownership, claiming that its “unique” business model provides this path to homeownership. But, in reality, Vision’s illegal business model has generated significant profits by skirting consumer protections and financial regulations and trapping vulnerable consumers with high cost mortgages for uninhabitable homes.
Vision’s deceptive tactics have left many of its consumers in dilapidated homes with unhealthy and hazardous conditions, while simultaneously requiring them to pay subprime, or high-cost, interest rates — in the range of 10% to 25% — on top of paying for extensive repairs and renovations just to make their homes habitable.
Vision has engaged in approximately 150 such transactions in New York since 2011 without possessing the legally required licenses to engage in mortgage lending. Furthermore, Vision entered into contracts with financially strained consumers that illegally required them to shoulder the burden of ensuring their properties were habitable. Often, consumers were deceived and trapped into paying for the treatment and repair of dangerous and unhealthy conditions in their new homes, including infestations, faulty electrical wiring, missing heaters and septic systems, mold, and asbestos, as well as severely damaged and rotted out, floors, walls, and roofs.
Vision has violated laws applicable to both mortgage lending and the leasing of residential properties, as well as numerous state and federal consumer protection laws.
In the suit — being filed in the Southern District of New York — Attorney General James and Superintendent Lacewell are seeking to end Vision’s ongoing illegal activity in New York, secure restitution and damages for all consumers injured by these practices, and obtain statutory penalties.
The matter is being handled by Assistant Attorney General Noah Popp of the Consumer Frauds and Protection Bureau, under the supervision of Jane M. Azia, Chief of the Consumer Frauds and Protection Bureau, and Chief Deputy Attorney General for Social Justice Meghan Faux. The Bureau of Consumer Frauds and Protection is overseen by Chief Deputy Attorney General for Economic Justice Christopher D’Angelo.
Additional attorneys at the Department of Financial Services involved with this litigation include Peter C. Dean of the Real Estate Finance Division and Cynthia M. Reed, Supervising Attorney in the Consumer Protection and Financial Enforcement Division.
https://ag.ny.gov/sites/default/files/filed_-_ecf_stamp_-_nyag_nysdfs_v._vision_property_management_llc_et_al._-_19-cv-7191.pdf
Attorney General James And DFS Superintendent Lacewell Take Action Against Fraudulent Mortgage LenderNEW YORK –
Attorney General Letitia James and New York Superintendent of Financial Services Linda A. Lacewell today filed suit in federal court [https://ag.ny.gov/sites/default/files/filed_-_ecf_stamp_-_nyag_nysdfs_v._vision_property_management_llc_et_al._-_19-cv-7191.pdf] against Vision Property Management, LLC; the company’s CEO, Alex Szkaradek; and a number of other companies affiliated with Vision for operating an illegal, deceptive, and unlicensed mortgage lending business in New York since at least 2011. By offering disguised, predatory subprime home loans and illegal finance-lease hybrid agreements, Vision and the other defendants took part in fraudulent activities that repeatedly targeted and took advantage of financially vulnerable New Yorkers.
“For nearly a decade, Vision put profits above people — fraudulently targeting, preying upon, and exploiting aspiring homeowners, including people with disabilities, the elderly, and those living on fixed income,” said Attorney General Letitia James. “These deceptive and abusive practices have trapped New Yorkers in mold-infested, dilapidated homes, and wrongfully placed the onus on consumers to pay the price. This behavior is unacceptable, which is why my office is aggressively prosecuting Vision and will do the same against any company or individual that tries to defraud New Yorkers.”
“As alleged in the complaint, Vision swindled vulnerable New Yorkers who wanted nothing more than the American dream of homeownership but instead got distressed properties with unsafe, squalid conditions and high-interest, predatory loans,” said Superintendent Linda A. Lacewell.
“We took this action to protect New York consumers by putting an end to these illegal, predatory and unconscionable business practices and holding Vision and its CEO accountable under New York State law and applicable federal laws. I am proud of the exemplary work of the DFS colleagues who investigated Vision’s activities for over two years, analyzed thousands of documents, and who worked to protect New Yorkers and bring this company to justice.”
The complaint alleges that Vision specializes in buying severely distressed properties and then markets those properties — at a substantial markup to consumers — without making any necessary repairs or renovations, and without fully disclosing to consumers the many conditions that exist and repairs that must be made for safe habitation. Vision targets low-income consumers eager to share in the “American dream” of homeownership, claiming that its “unique” business model provides this path to homeownership. But, in reality, Vision’s illegal business model has generated significant profits by skirting consumer protections and financial regulations and trapping vulnerable consumers with high cost mortgages for uninhabitable homes.
Vision’s deceptive tactics have left many of its consumers in dilapidated homes with unhealthy and hazardous conditions, while simultaneously requiring them to pay subprime, or high-cost, interest rates — in the range of 10% to 25% — on top of paying for extensive repairs and renovations just to make their homes habitable.
Vision has engaged in approximately 150 such transactions in New York since 2011 without possessing the legally required licenses to engage in mortgage lending. Furthermore, Vision entered into contracts with financially strained consumers that illegally required them to shoulder the burden of ensuring their properties were habitable. Often, consumers were deceived and trapped into paying for the treatment and repair of dangerous and unhealthy conditions in their new homes, including infestations, faulty electrical wiring, missing heaters and septic systems, mold, and asbestos, as well as severely damaged and rotted out, floors, walls, and roofs.
Vision has violated laws applicable to both mortgage lending and the leasing of residential properties, as well as numerous state and federal consumer protection laws.
In the suit — being filed in the Southern District of New York — Attorney General James and Superintendent Lacewell are seeking to end Vision’s ongoing illegal activity in New York, secure restitution and damages for all consumers injured by these practices, and obtain statutory penalties.
The matter is being handled by Assistant Attorney General Noah Popp of the Consumer Frauds and Protection Bureau, under the supervision of Jane M. Azia, Chief of the Consumer Frauds and Protection Bureau, and Chief Deputy Attorney General for Social Justice Meghan Faux. The Bureau of Consumer Frauds and Protection is overseen by Chief Deputy Attorney General for Economic Justice Christopher D’Angelo.
Additional attorneys at the Department of Financial Services involved with this litigation include Peter C. Dean of the Real Estate Finance Division and Cynthia M. Reed, Supervising Attorney in the Consumer Protection and Financial Enforcement Division.
https://ag.ny.gov/sites/default/files/filed_-_ecf_stamp_-_nyag_nysdfs_v._vision_property_management_llc_et_al._-_19-cv-7191.pdf
"Free Market" Coalition Letter to DOJ — Re: Antitrust Consent Decrees with the Two Largest Music Collectives August 7, 2019
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To: The Honorable William P. Barr
Dear Attorney General Barr,
The undersigned free market organizations write to raise serious concerns regarding the possible termination, sunset or significant changes to the antitrust consent decrees between the Department of Justice and the two largest music collectives: the American Society of Composers, Authors, and Publishers (ASCAP) and Broadcast Music, Inc. (BMI).
The Department’s Antitrust Division is currently reviewing scores of legacy consent decrees for possible termination. Many of these decrees are outdated, governing industries that no longer exist or markets that no longer pose antitrust concerns. In those cases, such needless regulation should be eliminated. The ASCAP and BMI consent decrees, however, remain extremely relevant to a functioning marketplace. Millions of businesses across the country rely on the efficiencies and anticompetitive protections that these decrees provide.
The market for music licenses is inherently anticompetitive, and traditional free market principles do not necessarily translate. Rather than competing against one another to sell their products, the vast majority of songwriters and publishers have chosen instead to band together under the ASCAP and BMI umbrella (representing about ninety-five percent of all music) in order to collectively set a standard price for music.
This approach of music sellers colluding instead of competing recently led a Federal court to find that SESAC, the next largest music collective, with less than five percent of all music licenses, does possess market power. This finding resulted in the much smaller SESAC agreeing to an antitrust settlement with terms similar to the ASCAP and BMI consent decrees.
This sort of market power, collusion, and price fixing is antithetical to a traditional free market, yet it remains necessary for the music licensing market to operate efficiently. Most businesses, from restaurants to local radio stations, must license millions of songs to indemnify themselves from ruinous infringement damages. Rather than negotiate with thousands of individual rights holders, ASCAP and BMI offer a one-stop shop opportunity. Similarly, thousands of rights holders rely upon the scale of ASCAP and BMI to maximize the enforcement of their copyrights.
These benefits, however necessary to market efficiency, should not excuse ASCAP and BMI from the nation’s antitrust laws.
Given the anticompetitive nature of the music licensing market as a whole, ending the ASCAP and BMI consent decrees would assuredly necessitate some other form of government regulation over the market. Disrupting entire industries, potentially harming millions of individual businesses in the process, only to trade one form of regulation for another, is not in line with conservative, free market principles.
Sincerely,
George Landrith, President, Frontiers of Freedom
Rick Manning, President , Americans for Limited Government
Andrew Quinlan, President, Center for Freedom & Prosperity
Chuck Muth, President, Citizen Outreach
Chris Salcedo, Executive Director, The Conservative Hispanic Society
Mario Lopez, President, Hispanic Leadership Fund
Patrice Onwuka, Senior Policy Analyst, Independent Women’s Forum
Andrew Langer, President, Institute for Liberty
Hector V. Barreto, Chairman & CEO, The Latino Coalition
Seton Motley, President, Less Government
Peter Ferrara, Senior Policy Advisor, National Tax Limitation Committee
Tom Zawistowski, President, We the People Convention
https://www.ff.org/coalition-letter-to-doj/
Can a mortgage lender bypass mortgage foreclosure and sue directly on the underlying note?
That is what happened to a recent client at the DC Bar’s pro bono clinic. Her mortgage lender bypassed mortgage foreclosure and sued directly on the underlying promissory note. The client’s story had its own peculiarities, but brings to mind the question of whether such suits on the underlying note occur frequently instead of foreclosure, and if so why.
I found a helpful discussion in a posting by Alperlaw, a Florida law firm. The posting explains that a mortgagor’s suit directly on a note may dodge some consumer protections that apply to mortgage foreclosures.
The Alper posting explains that as a general matter when you buy a house you sign a promissory note to evidence the obligation to repay the house loan. The mortgage is a security instrument that gives the lender an interest in the house which he can foreclose if you default. Your personal obligation to the lender is based on the underlying note. A lender has the option to sue you for repayment under the note without foreclosing the mortgage. If the lender sues on the note, you, the borrower, will have a personal judgment against you for your default under the note, and the lender still retains his mortgage security in most jurisdictions.
So, why would a lender chose not to foreclose a mortgage on your home and sue you directly on the note. The Alper posting explains that, among other things:
1. The government has given homeowners more rights under the government mortgage modification program (HAMP) which regulations make foreclosures slower and more expensive for banks.
2. Banks who take back properties on foreclosure have to deal with delinquent HOA bills, unpaid taxes, and house repairs.
3. Legally, its much easier for a bank to get a personal judgment against the borrower through a suit on the note than it is to get a personal judgment in a deficiency claim after foreclosure.
4. Where there are environmental issues, banks do not want to foreclose and take over ownership of potential environmental liabilities.
Government programs designed to protect homeowners from foreclosure by requiring loan modifications may have in fact damaged homeowners by giving banks the incentive to sue for personal liability when they mostly have not to this point pursued large scale deficiency claims? The Alper comment suggests that it would not be the first time that government programs have had unintended consequences.
http://www.assetprotectionfl.com/2010/08/government-programs-and-market-conditions-may-lead-lenders-to-postpone-foreclosure-and-sue-homeowner-directly-on-underlying-note/
http://www.assetprotectionfl.com/2010/08/government-programs-and-market-conditions-may-lead-lenders-to-postpone-foreclosure-and-sue-homeowner-directly-on-underlying-note/
That is what happened to a recent client at the DC Bar’s pro bono clinic. Her mortgage lender bypassed mortgage foreclosure and sued directly on the underlying promissory note. The client’s story had its own peculiarities, but brings to mind the question of whether such suits on the underlying note occur frequently instead of foreclosure, and if so why.
I found a helpful discussion in a posting by Alperlaw, a Florida law firm. The posting explains that a mortgagor’s suit directly on a note may dodge some consumer protections that apply to mortgage foreclosures.
The Alper posting explains that as a general matter when you buy a house you sign a promissory note to evidence the obligation to repay the house loan. The mortgage is a security instrument that gives the lender an interest in the house which he can foreclose if you default. Your personal obligation to the lender is based on the underlying note. A lender has the option to sue you for repayment under the note without foreclosing the mortgage. If the lender sues on the note, you, the borrower, will have a personal judgment against you for your default under the note, and the lender still retains his mortgage security in most jurisdictions.
So, why would a lender chose not to foreclose a mortgage on your home and sue you directly on the note. The Alper posting explains that, among other things:
1. The government has given homeowners more rights under the government mortgage modification program (HAMP) which regulations make foreclosures slower and more expensive for banks.
2. Banks who take back properties on foreclosure have to deal with delinquent HOA bills, unpaid taxes, and house repairs.
3. Legally, its much easier for a bank to get a personal judgment against the borrower through a suit on the note than it is to get a personal judgment in a deficiency claim after foreclosure.
4. Where there are environmental issues, banks do not want to foreclose and take over ownership of potential environmental liabilities.
Government programs designed to protect homeowners from foreclosure by requiring loan modifications may have in fact damaged homeowners by giving banks the incentive to sue for personal liability when they mostly have not to this point pursued large scale deficiency claims? The Alper comment suggests that it would not be the first time that government programs have had unintended consequences.
http://www.assetprotectionfl.com/2010/08/government-programs-and-market-conditions-may-lead-lenders-to-postpone-foreclosure-and-sue-homeowner-directly-on-underlying-note/
http://www.assetprotectionfl.com/2010/08/government-programs-and-market-conditions-may-lead-lenders-to-postpone-foreclosure-and-sue-homeowner-directly-on-underlying-note/
No-deal Brexit: pause competition law to avoid food shortages, say manufacturers
Companies want guarantee they won’t be fined for working together to direct supplies
Jasper Jolly and Rebecca Smithers
Wed 7 Aug 2019 06.34 EDTLast modified on Wed 7 Aug 2019 16.00 EDT
The Food and Drink Federation said ministers had not yet confirmed that controls over collaboration would be lifted. Photograph: Nick Ansell/PA
Britain’s food and drinks industry has asked the government to suspend competition law in the event of a no-deal Brexit so that firms can work together to avert food shortages without facing large fines for collusion.
Collaboration between large companies is controlled to prevent cartels harming consumers’ interests. The Food and Drink Federation (FDF) told the BBC the government had not yet confirmed whether companies would be able to work together to direct food supplies to the areas of greatest need if there were delays as a result of crashing out of the EU.
Many trade experts, from the government’s own analysts to the Bank of England, expect a no-deal Brexit to cause severe disruption at ports, potentially delaying food imports. Boris Johnson has committed to leaving the EU on 31 October whatever the implications, and has put Michael Gove in charge of preparing to exit without a deal.
FDF members, including large companies such as Associated British Foods, Mondelēz and Nestlé, risked incurring large fines from the Competition and Markets Authority (CMA) if they collaborated, the industry body said.
“Competition law is important, but in the event of no-deal disruption, if the government wants the food supply chain to work together to tackle likely shortages – to decide where to prioritise shipments – they will have to provide cast-iron written reassurances that competition law will not be strictly applied to those discussions,” FDF’s chief operating officer, Tim Rycroft, said.
Full article: https://www.theguardian.com/business/2019/aug/07/no-deal-brexit-call-to-suspend-competition-law-to-avert-food-shortages
Companies want guarantee they won’t be fined for working together to direct supplies
Jasper Jolly and Rebecca Smithers
Wed 7 Aug 2019 06.34 EDTLast modified on Wed 7 Aug 2019 16.00 EDT
The Food and Drink Federation said ministers had not yet confirmed that controls over collaboration would be lifted. Photograph: Nick Ansell/PA
Britain’s food and drinks industry has asked the government to suspend competition law in the event of a no-deal Brexit so that firms can work together to avert food shortages without facing large fines for collusion.
Collaboration between large companies is controlled to prevent cartels harming consumers’ interests. The Food and Drink Federation (FDF) told the BBC the government had not yet confirmed whether companies would be able to work together to direct food supplies to the areas of greatest need if there were delays as a result of crashing out of the EU.
Many trade experts, from the government’s own analysts to the Bank of England, expect a no-deal Brexit to cause severe disruption at ports, potentially delaying food imports. Boris Johnson has committed to leaving the EU on 31 October whatever the implications, and has put Michael Gove in charge of preparing to exit without a deal.
FDF members, including large companies such as Associated British Foods, Mondelēz and Nestlé, risked incurring large fines from the Competition and Markets Authority (CMA) if they collaborated, the industry body said.
“Competition law is important, but in the event of no-deal disruption, if the government wants the food supply chain to work together to tackle likely shortages – to decide where to prioritise shipments – they will have to provide cast-iron written reassurances that competition law will not be strictly applied to those discussions,” FDF’s chief operating officer, Tim Rycroft, said.
Full article: https://www.theguardian.com/business/2019/aug/07/no-deal-brexit-call-to-suspend-competition-law-to-avert-food-shortages
Klobuchar press release:
Klobuchar Introduces Legislation to Crack Down on Monopolies that Violate Antitrust Law
August 2, 2019
WASHINGTON – U.S. Senator Amy Klobuchar (D-MN), Ranking Member of the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights, introduced new legislation to crack down on monopolies that violate antitrust law. The Monopolization Deterrence Act would give the Justice Department and the Federal Trade Commission (FTC) the authority to seek civil penalties for monopolization offenses under the antitrust laws, a power they currently do not have. The bill was introduced with Senator Richard Blumenthal (D-CT) and cosponsored by Senators Dianne Feinstein (D-CA) and Ed Markey (D-MA).
“We have a major monopoly problem in this country. So when federal enforcers uncover illegal monopolistic conduct, they need to act decisively to make sure it stops. But the threat of an injunction isn’t always enough to deter this unlawful conduct from happening in the first place. Dominant companies need to be put on notice that there will be serious financial consequences for illegal monopolistic behavior,” Klobuchar said. “Our legislation will increase the ability of the Justice Department and the FTC to deter companies from engaging in monopolistic practices that hurt competition, consumers, and innovation in our economy.”
Specifically, the Monopolization Deterrence Act would:
“We need to make sure we have effective enforcement tools to deter dominant corporations from engaging in anti-competitive, monopolistic practices that harm the marketplace and consumers,” said George Slover, senior policy counsel at Consumer Reports. “Senator Klobuchar’s legislation will put new teeth into our antitrust laws by empowering enforcers and courts to impose significant financial penalties when a corporation abuses its dominance in the marketplace.”
“Section 2 monopolization cases are more difficult to bring than other cases, and if the government wins at court, it usually can do no more than stop the offending company from engaging in the same anticompetitive behavior in the future,” said Charlotte Slaiman, Competition Policy Counsel at Public Knowledge. “Adding monetary penalties as a percentage of a company’s U.S. revenue could help deter anticompetitive conduct and give the antitrust enforcement agencies more leverage to promote competition in these types of cases.”
“Senator Klobuchar has been a leader in smart and constructive legislative antitrust reforms. Her proposed bill to strengthen U.S. monopolization law provides for needed expansion of federal remedies to help deter anticompetitive abuses. This initiative should garner strong bipartisan support,” said American Antitrust Institute President Diana Moss.
In her role as Ranking Member of the Senate Judiciary Committee Subcommittee on Antitrust, Competition Policy and Consumer Rights, Klobuchar has championed efforts to protect consumers, promote competition, and fight consolidation in several industries including the telecommunications, agriculture, and pharmaceutical industries. In June, she led efforts to obtain details about possible FTC antitrust investigations into Amazon and Facebook and possible Justice Department antitrust investigations into Google and Apple. In the letters, the senators requested information regarding the existence and scope of the potential investigations. In April, Klobuchar and Senator Marsha Blackburn (R-TN) sent a letter to the FTC to take action in response to concerns regarding potential privacy, data security, and antitrust violations involving online platforms. They also called on the FTC to provide additional transparency into its ongoing investigations to ensure that consumers are protected from harmful conduct relating to digital markets.
Klobuchar has also been an outspoken voice in opposing anticompetitive mergers and has introduced legislation to help prevent them. In June, Klobuchar and Senator Chuck Grassley (R-IA) introduced new bipartisan legislation to ensure that antitrust authorities have the resources they need to protect consumers. The Merger Filing Fee Modernization Act would update merger filing fees for the first time since 2001, lower the burden on small and medium-sized businesses, ensure larger deals bring in more income, and raise enough revenue so that taxpayer dollars aren’t required to fund necessary increases to agency enforcement budgets.
Klobuchar leads the Consolidation Prevention and Competition Promotion Act to restore the original purpose of the Clayton Antitrust Act to promote competition and protect American consumers. The bill would strengthen the current legal standard to help stop harmful consolidation that may materially lessen competition. It would clarify that a merger could violate the statute if it gives a company “monopsony” power to unfairly lower the prices it pays or wages it offers because of lack of competition among buyers or employers. The bill further strengthens the law to guard against harmful “mega-mergers” and deals that substantially increase market concentration, shifting the burden to the merging companies to prove that their consolidation does not harm competition. She also introduced the Merger Enforcement Improvement Act which would update existing law to reflect the current economy and provide agencies with better information post-merger to ensure that merger enforcement is meeting its goals. This bill would modernize antitrust enforcement by improving the agencies’ ability to assess the impact of merger settlements, requiring studies of new issues, adjusting merger filing fees to reflect the 21st century economy, and providing adequate funding for antitrust agencies to meet their obligations to protect American consumers. She introduced both bills in February.
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Permalink: https://www.klobuchar.senate.gov/public/index.cfm/2019/8/klobuchar-introduces-legislation-to-crack-down-on-monopolies-that-violate-antitrust-law
Klobuchar Introduces Legislation to Crack Down on Monopolies that Violate Antitrust Law
August 2, 2019
WASHINGTON – U.S. Senator Amy Klobuchar (D-MN), Ranking Member of the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights, introduced new legislation to crack down on monopolies that violate antitrust law. The Monopolization Deterrence Act would give the Justice Department and the Federal Trade Commission (FTC) the authority to seek civil penalties for monopolization offenses under the antitrust laws, a power they currently do not have. The bill was introduced with Senator Richard Blumenthal (D-CT) and cosponsored by Senators Dianne Feinstein (D-CA) and Ed Markey (D-MA).
“We have a major monopoly problem in this country. So when federal enforcers uncover illegal monopolistic conduct, they need to act decisively to make sure it stops. But the threat of an injunction isn’t always enough to deter this unlawful conduct from happening in the first place. Dominant companies need to be put on notice that there will be serious financial consequences for illegal monopolistic behavior,” Klobuchar said. “Our legislation will increase the ability of the Justice Department and the FTC to deter companies from engaging in monopolistic practices that hurt competition, consumers, and innovation in our economy.”
Specifically, the Monopolization Deterrence Act would:
- Enable the Department of Justice and the FTC to seek civil monetary penalties, in addition to existing remedies, for violations of section 2 of the Sherman Act (15 U.S.C. 2);
- Deter future violations by providing for penalties of up to 15 percent of the violator’s total U.S. revenues or 30 percent of the violator’s U.S. revenues in the affected markets; and
- Ensure that the two agencies work together to create guidelines for how they would exercise their penalty authority considering a number of relevant factors.
“We need to make sure we have effective enforcement tools to deter dominant corporations from engaging in anti-competitive, monopolistic practices that harm the marketplace and consumers,” said George Slover, senior policy counsel at Consumer Reports. “Senator Klobuchar’s legislation will put new teeth into our antitrust laws by empowering enforcers and courts to impose significant financial penalties when a corporation abuses its dominance in the marketplace.”
“Section 2 monopolization cases are more difficult to bring than other cases, and if the government wins at court, it usually can do no more than stop the offending company from engaging in the same anticompetitive behavior in the future,” said Charlotte Slaiman, Competition Policy Counsel at Public Knowledge. “Adding monetary penalties as a percentage of a company’s U.S. revenue could help deter anticompetitive conduct and give the antitrust enforcement agencies more leverage to promote competition in these types of cases.”
“Senator Klobuchar has been a leader in smart and constructive legislative antitrust reforms. Her proposed bill to strengthen U.S. monopolization law provides for needed expansion of federal remedies to help deter anticompetitive abuses. This initiative should garner strong bipartisan support,” said American Antitrust Institute President Diana Moss.
In her role as Ranking Member of the Senate Judiciary Committee Subcommittee on Antitrust, Competition Policy and Consumer Rights, Klobuchar has championed efforts to protect consumers, promote competition, and fight consolidation in several industries including the telecommunications, agriculture, and pharmaceutical industries. In June, she led efforts to obtain details about possible FTC antitrust investigations into Amazon and Facebook and possible Justice Department antitrust investigations into Google and Apple. In the letters, the senators requested information regarding the existence and scope of the potential investigations. In April, Klobuchar and Senator Marsha Blackburn (R-TN) sent a letter to the FTC to take action in response to concerns regarding potential privacy, data security, and antitrust violations involving online platforms. They also called on the FTC to provide additional transparency into its ongoing investigations to ensure that consumers are protected from harmful conduct relating to digital markets.
Klobuchar has also been an outspoken voice in opposing anticompetitive mergers and has introduced legislation to help prevent them. In June, Klobuchar and Senator Chuck Grassley (R-IA) introduced new bipartisan legislation to ensure that antitrust authorities have the resources they need to protect consumers. The Merger Filing Fee Modernization Act would update merger filing fees for the first time since 2001, lower the burden on small and medium-sized businesses, ensure larger deals bring in more income, and raise enough revenue so that taxpayer dollars aren’t required to fund necessary increases to agency enforcement budgets.
Klobuchar leads the Consolidation Prevention and Competition Promotion Act to restore the original purpose of the Clayton Antitrust Act to promote competition and protect American consumers. The bill would strengthen the current legal standard to help stop harmful consolidation that may materially lessen competition. It would clarify that a merger could violate the statute if it gives a company “monopsony” power to unfairly lower the prices it pays or wages it offers because of lack of competition among buyers or employers. The bill further strengthens the law to guard against harmful “mega-mergers” and deals that substantially increase market concentration, shifting the burden to the merging companies to prove that their consolidation does not harm competition. She also introduced the Merger Enforcement Improvement Act which would update existing law to reflect the current economy and provide agencies with better information post-merger to ensure that merger enforcement is meeting its goals. This bill would modernize antitrust enforcement by improving the agencies’ ability to assess the impact of merger settlements, requiring studies of new issues, adjusting merger filing fees to reflect the 21st century economy, and providing adequate funding for antitrust agencies to meet their obligations to protect American consumers. She introduced both bills in February.
###
Permalink: https://www.klobuchar.senate.gov/public/index.cfm/2019/8/klobuchar-introduces-legislation-to-crack-down-on-monopolies-that-violate-antitrust-law
From Digital Music News:
In a rapid jury deliberation, Katy Perry, Capitol/UMG, Dr. Luke, Max Martin, Juicy J, and others have been hit with a $2.7 million fine.
That was fast.
After just two days of deliberations, a federal jury in California has ordered damages of $2.7 million against Katy Perry, her label, associated songwriters, and other collaborators on “Dark Horse”. The fine was calculated from a top-line figure of $41 million, with Capitol Records arguing that a large percentage of that revenue was utilized for promotional, marketing, production, and other costs.
The defending party of Katy Perry, Dr. Luke, Max Martin, Cirkut, Sarah Hudson, guest performer/rapper Juicy J, and Capitol Records (UMG) were saddled with the fine. Additionally, the jury ruled that publishing company Kasz Money Inc., Kobalt Music Publishing America Inc. and Warner Bros. Music Corp. would also share in the damages assessment.
The $2.7 million penalty amounts to roughly 6.5% of the initial $41 million ask. Still, that’s little consolation to Perry and the defendants, especially given the controversial nature of the infringement ruling.
The ruling, handed down earlier this week, found substantial, willing infringement involving the 2008 Christian rap song, “Joyful Noise,” as performed by Flame (aka Marcus Gray). The ruling was unanimous, despite testimony from multiple experts and musicologists that called the similarities ‘coincidental’ and involving ‘the basic building blocks of music’.
A quick comparison of the tracks reveals some striking similarities, though it’s entirely unclear if the ‘infringement’ was merely coincidental. The melodic loop shared by both tracks is relatively simple, and the resulting decision is heightening fears of increased music copyright trolling ahead.
In terms of who pays what, Katy Perry was ordered to pay roughly $550,000 of the $2.7 million fine, while Dr. Luke was ordered to pay nearly $61,000. Capitol Records was ordered to pay $1.2 million, while Warner was charged a relatively paltry $29,000.
The remaining fine would be distributed among the other defendants.
The 15-page damages decision was entered into the broader Gray et al. v. Perry et al., case number 2:15-cv-05642, deliberated in the U.S. District Court for the Central District of California.
From https://www.digitalmusicnews.com/2019/08/01/katy-perry-millions-damages/
In a rapid jury deliberation, Katy Perry, Capitol/UMG, Dr. Luke, Max Martin, Juicy J, and others have been hit with a $2.7 million fine.
That was fast.
After just two days of deliberations, a federal jury in California has ordered damages of $2.7 million against Katy Perry, her label, associated songwriters, and other collaborators on “Dark Horse”. The fine was calculated from a top-line figure of $41 million, with Capitol Records arguing that a large percentage of that revenue was utilized for promotional, marketing, production, and other costs.
The defending party of Katy Perry, Dr. Luke, Max Martin, Cirkut, Sarah Hudson, guest performer/rapper Juicy J, and Capitol Records (UMG) were saddled with the fine. Additionally, the jury ruled that publishing company Kasz Money Inc., Kobalt Music Publishing America Inc. and Warner Bros. Music Corp. would also share in the damages assessment.
The $2.7 million penalty amounts to roughly 6.5% of the initial $41 million ask. Still, that’s little consolation to Perry and the defendants, especially given the controversial nature of the infringement ruling.
The ruling, handed down earlier this week, found substantial, willing infringement involving the 2008 Christian rap song, “Joyful Noise,” as performed by Flame (aka Marcus Gray). The ruling was unanimous, despite testimony from multiple experts and musicologists that called the similarities ‘coincidental’ and involving ‘the basic building blocks of music’.
A quick comparison of the tracks reveals some striking similarities, though it’s entirely unclear if the ‘infringement’ was merely coincidental. The melodic loop shared by both tracks is relatively simple, and the resulting decision is heightening fears of increased music copyright trolling ahead.
In terms of who pays what, Katy Perry was ordered to pay roughly $550,000 of the $2.7 million fine, while Dr. Luke was ordered to pay nearly $61,000. Capitol Records was ordered to pay $1.2 million, while Warner was charged a relatively paltry $29,000.
The remaining fine would be distributed among the other defendants.
The 15-page damages decision was entered into the broader Gray et al. v. Perry et al., case number 2:15-cv-05642, deliberated in the U.S. District Court for the Central District of California.
From https://www.digitalmusicnews.com/2019/08/01/katy-perry-millions-damages/
State lawsuit charging generic pharma price fixing
In May, Connecticut Attorney General William Tong led a 44-state coalition in a lawsuit against Teva Pharmaceuticals and 19 of the nation's largest generic drug manufacturers alleging a broad conspiracy to artificially inflate and manipulate prices, reduce competition and unreasonably restrain trade for more than 100 different generic drugs. The lawsuit, filed in U.S. District Court for the District of Connecticut, also names 15 individual senior executive defendants at the heart of the conspiracy who were responsible for sales, marketing, pricing and operations. The drugs at issue account for billions of dollars of sales in the United States, and the alleged schemes increased prices affecting the health insurance market, taxpayer-funded healthcare programs like Medicare and Medicaid, and individuals who must pay artificially-inflated prices for their prescriptions drugs.
The complaint alleges that Teva, Sandoz, Mylan, Pfizer and 16 other generic drug manufacturers engaged in a broad, coordinated and systematic campaign to conspire with each other to fix prices, allocate markets and rig bids for more than 100 different generic drugs. The drugs span all types, including tablets, capsules, suspensions, creams, gels, ointments, and classes, including statins, ace inhibitors, beta blockers, antibiotics, anti-depressants, contraceptives, non-steroidal anti-inflammatory drugs, and treat a range of diseases and conditions from basic infections to diabetes, cancer, epilepsy, multiple sclerosis, HIV, ADHD, and more. In some instances, the coordinated price increases were over 1,000 percent.
The complaint lays out an interconnected web of industry executives where these competitors met with each other during industry dinners, "girls nights out", lunches, cocktail parties, golf outings and communicated via frequent telephone calls, emails and text messages that sowed the seeds for their illegal agreements. Throughout the complaint, defendants use terms like "fair share," "playing nice in the sandbox," and "responsible competitor" to describe how they unlawfully discouraged competition, raised prices and enforced an ingrained culture of collusion.
The lawsuit seeks damages, civil penalties and actions by the court to restore competition to the generic drug market.
The lawsuit complaint is here:
https://portal.ct.gov/-/media/AG/Downloads/GDMS%20Complaint%2051019%20FINAL%20REDACTED%20PUBLIC%20VERSIONpdf
In May, Connecticut Attorney General William Tong led a 44-state coalition in a lawsuit against Teva Pharmaceuticals and 19 of the nation's largest generic drug manufacturers alleging a broad conspiracy to artificially inflate and manipulate prices, reduce competition and unreasonably restrain trade for more than 100 different generic drugs. The lawsuit, filed in U.S. District Court for the District of Connecticut, also names 15 individual senior executive defendants at the heart of the conspiracy who were responsible for sales, marketing, pricing and operations. The drugs at issue account for billions of dollars of sales in the United States, and the alleged schemes increased prices affecting the health insurance market, taxpayer-funded healthcare programs like Medicare and Medicaid, and individuals who must pay artificially-inflated prices for their prescriptions drugs.
The complaint alleges that Teva, Sandoz, Mylan, Pfizer and 16 other generic drug manufacturers engaged in a broad, coordinated and systematic campaign to conspire with each other to fix prices, allocate markets and rig bids for more than 100 different generic drugs. The drugs span all types, including tablets, capsules, suspensions, creams, gels, ointments, and classes, including statins, ace inhibitors, beta blockers, antibiotics, anti-depressants, contraceptives, non-steroidal anti-inflammatory drugs, and treat a range of diseases and conditions from basic infections to diabetes, cancer, epilepsy, multiple sclerosis, HIV, ADHD, and more. In some instances, the coordinated price increases were over 1,000 percent.
The complaint lays out an interconnected web of industry executives where these competitors met with each other during industry dinners, "girls nights out", lunches, cocktail parties, golf outings and communicated via frequent telephone calls, emails and text messages that sowed the seeds for their illegal agreements. Throughout the complaint, defendants use terms like "fair share," "playing nice in the sandbox," and "responsible competitor" to describe how they unlawfully discouraged competition, raised prices and enforced an ingrained culture of collusion.
The lawsuit seeks damages, civil penalties and actions by the court to restore competition to the generic drug market.
The lawsuit complaint is here:
https://portal.ct.gov/-/media/AG/Downloads/GDMS%20Complaint%2051019%20FINAL%20REDACTED%20PUBLIC%20VERSIONpdf
Senator Mark Warner on concern about Chinese dominance of 5G telecom technology and other tech, and global security
On June 17, 2019, Senator Mark Warner (D-VA), vice chair of the Senate Intelligence Committee, spoke with PBS' Judy Woodruff about China’s 5G technological advances, and global security. Video is at https://www.c-span.org/video/?461800-1/senator-mark-warner-discusses-china-5g-technology-global-security&start=171
At approximately 3 minutes into the video, Senator Warner begins discussion of the national security and commercial threat posed by China and its centralized government control over technology and technology investment. The Senator uses 5G telecom as an example of the danger that the Chinese government will be able to use Chinese telecom equipment for spying in the US. Also, he uses 5G telecom as an example that the Chinese might take control of world-wide technological standards for telecom and other high tech products that have been the province of the US and other Western countries since the days of Kennedy and Sputnik.
Warner suggests several policy approaches for the US Government and industry. Warner’s proposals suggest a US government industrial policy – investing in technology research and supporting and protecting US and other Western companies rather than Chinese companies. That is quite different than a policy of supporting free global competition and letting the chips fall where they may with regard to which companies win and which companies lose competitive battles, without government intervention. Of course, Warner may be right about the need for US government support for US companies to counter the malign role of the Chinese government in support of Chinese companies. But the consequences of his proposals for usual competition policies are enormous.
Following are a few somewhat corrected excerpts from the machine made transcript, which contains lots of errors. The results are rough, and an imperfect substitute for listening to Warner in the video:
At 00:03:03
I HAVE TO SAY THAT IN THE LAST THREE OF FOUR YEARS AND MANY CLASSIFIED BRIEFINGS LATER, I HAVE FUNDAMENTALLY SHIFTED MY VIEWPOINTS. I BELIEVE THE PRESIDENT XI STARTED WITH THE MAJOR CONSOLIDATION OF POWER IN 2015 AND 2016 AND WE HAD COMMUNIST PARTY DOMINANCE IN CHINA ACROSS ALL BUSINESS SOCIETY, AND MILITARY. AND HE IS NOW USING THE CONSOLIDATED POWER TO BRING ABOUT BOTH STATE AND CIVIL SOCIETY TO ACTUALLY PROPOSE A ROLE FOR CHINA THAT WOULD DOMINATE THE WORLD. THAT DOMINATION WOULD LEAD TO DIMINISHMENT OF U.S. POWER AND INFLUENCE. THE CHINESE GOVERNMENT USES ALL THE TRADITIONAL TOOLS OF THE STATE TO EXERT INFLUENCE.
THERE IS tAGGRESSIVE DEPLOYMENT OF ESPIONAGE TO STEAL SECRETS. WE’VE ALSO SEEN FROM CHINA MORE CREATIVE MECHANISMS. IT TAKES ADVANTAGE OF THE AUTHORITARIAN MODEL TO FORCE CHINESE COMPANIES, RESEARCHERS AND OTHERS TO HACK ON BEHALF OF THE COMMONEST PARTY. ALL OF THIS HAS SET THE STAGE FOR THE CHINESE GOVERNMENT TO AGGRESSIVELY DISPLAY EVERY LEVER OF POWER TO SERVICE THE STATE AND THE SAME TIME EXPLOIT THE OPENNESS OF OUR SOCIETY TO TAKE AN ECONOMIC ADVANTAGE.
I BELIEVE OUR BEEF IS WITH THE COMMUNIST PARTY IN CHINA.
WHERE DO WE GO FROM HERE. FIRST WITH A FOCUS ON TECHNOLOGY. I WOULD ARGUE THAT SPUTNIK WAS THE LAST MOMENT WHEN AMERICA'S TECHNOLOGICAL PRIMACY WAS REALLY QUESTIONED. AND IT JOLTED AMERICA INTO ACTION AND KENNEDY TO PUT A MAN ON THE MOON. AND WE CHANGED OUR ACADEMIC INSTITUTIONS, WE CHANGED OUR RESEARCH AREAS, WE CHANGED THE MILITARY-INDUSTRIAL COMPLEX. AND WE WERE SUCCESSFUL. AND I WOULD ARGUE THAT THAT MOMENT IN TIME EVERY BIG MAJOR TECHNOLOGICAL ADVANCEMENT WITH THE TRANSISTOR, COMPUTING, TILT COMMUNICATIONS, WHETHER IT WAS AROUND THE INTERNET, WHETHER IT IS AROUND SOCIAL MEDIA, ALL OF THESE INNOVATIONS HAVE BEEN AMERICAN. OR WE ENDED UP SETTING THE STANDARDS AND BY SETTING THE STANDARDS AND BY HAVING THE WORLD'S LARGEST ECONOMIC POWER WE HAD A DEFAULT POSITION. WE HAD A SINGLE GOVERNANCE ROLE AROUND A LOT OF THE TECHNOLOGY.
I DON'T THINK IN MANY WAYS THAT WE AS A NATION APPRECIATED ALL OF THE ECONOMIC POLITICAL AND SOCIAL BENEFITS THAT OUR COUNTRY ENJOYED BY BEING A TECHNOLOGY CENTER AND A STANDARD SETTER. IN MANY WAYS, THAT IS ALL UP FOR GRABS NOW. I SEE THIS FIRSTHAND IN THE COMPETITION FOR 5G. AND THOSE OF YOU WHO ARE NOT TECHNOLOGY NERDS IN THE ROOM, IT IS EQUIVALENT IN THE WIRELESS WORLD OF MOVING FROM RADIO TO TELEVISION, AN ENORMOUS OPPORTUNITY.
CHINA IS PROVIDING EQUIPMENT VENDORS WITH 120% MORE FINANCING, FLOODING THE ZONE WITH ENGINEERS IN TERMS OF THE STANDARD-SETTING. AND IN MANY WAYS WHAT IS HAPPENING IN 5G COULD VERY WELL HAPPEN IN ARTIFICIAL INTELLIGENCE AND IN QUANTUM COMPUTING AND OTHERS. IF AMERICA DOES NOT TRY TO REASSERT INVESTMENT AND TECHNOLOGY LEADERSHIP AND WILLINGNESS TO SET THE STANDARDS.
WE NEED TO SOUND THE ALARM, OVER THE LAST YEAR BECAUSE I'VE HAD SO MUCH EVIDENCE AND IT'S BECOME OVERWHELMING. WE ARE NOT DOING OUR JOB IF WE DON'T FIND WAYS TO DECLASSIFY THIS INFORMATION AND GET IT OUT.
SECOND, WE NEED A SHORT-TERM STRATEGY. I WOULD ACKNOWLEDGE THAT THE TRUMP ADMINISTRATION HAS DONE THE RIGHT THING IN SAYING THE STATUS QUO IS NOT WORKING. I WOULD ARGUE THAT THE CHALLENGES OF EMERGING CHINA HAVE BEEN NOT ONLY COUNTER TO THE UNITED STATES BUT FRANKLY COUNTER TO ALL THE WEST. THERE WAS A MOMENT IN TIME WHERE WE COULD'VE BUILT A GRAND INTERNATIONAL COALITION. YOU GOTTA PLAY BY THE RULES AND THINK OF BUILDING THE GRAND COALITION.
FINALLY WE NEED A LONG-TERM STRATEGY. THE LONG-TERM STRATEGY REALLY GOES BACK TO WHAT KIND OF INVESTMENT WE ARE PREPARED TO MAKE IN THIS COUNTRY IN RESEARCH AND DEVELOPMENT. THAT IS $500 BILLION CHINA IS INVESTING IN 5G ARTIFICIAL INTELLIGENCE, AND A HOST OF OTHER AREAS. AGAIN, UNDER PRESIDENT XI JINPING, THE TREND IS THEY WILL DOMINATE. WE NEED TO MAKE THE RESEARCH INVESTMENTS. IF YOU GO BACK, THE US ACCOUNTED FOR 69% OF ANNUAL GLOBAL R&D AND WERE NOW DOWN TO 29%, CHINA IS ON AN UPWARD TREND, AND ON THAT TREND CHINA WILL PASS THE UNITED STATES AND ALL EXPECTATIONS BY 2020. I THINK WE CAN GET THIS RIGHT.
Posting by Dn Allen Resnikoff, who is fully responsible for the content
Chinese competition in quantum mechanics, an important future technology
In the global race to develop quantum technology, the U.S. is competing in an increasingly crowded field. China is a leader . See PBS NewsHour segment at https://www.youtube.com/watch?v=IJijqF8tkTU
In the global race to develop quantum technology, the U.S. is competing in an increasingly crowded field. China is a leader . See PBS NewsHour segment at https://www.youtube.com/watch?v=IJijqF8tkTU
WSJ on the political swamp and MiMedx
MiMedx drove sales of its tissue grafts through improper means to the Department of Veterans Affairs and other clients, according to former employees. Gretchen Morgenson of The Wall Street Journal investigates the alleged fraud and the help the company got from its friends in government.
https://www.wsj.com/articles/va-bans-injectable-wound-care-products-from-mimedx-and-other-companies-for-many-uses-11560529012#
MiMedx drove sales of its tissue grafts through improper means to the Department of Veterans Affairs and other clients, according to former employees. Gretchen Morgenson of The Wall Street Journal investigates the alleged fraud and the help the company got from its friends in government.
https://www.wsj.com/articles/va-bans-injectable-wound-care-products-from-mimedx-and-other-companies-for-many-uses-11560529012#
Erik Hovenkamp explains FTC v. Qualcomm
TC v. Qualcomm: New Frontiers in the Antitrust-IP InterfaceBy Erik Hovenkamp (Harvard)
The Federal Trade Commission recently scored a substantial victory in its antitrust suit against Qualcomm. The case represents a novel confluence of standard-setting and IP licensing issues with bedrock antitrust subjects: tying and exclusive dealing. It also takes a surprising turn in resuscitating the long-dormant doctrine of the antitrust “duty to deal.” In this short essay, I review and evaluate the court’s decision in FTC v. Qualcomm. The analysis of Qualcomm’s exclusive dealing is sound and very likely correct. However, the court’s duty-to-deal analysis sits on shakier ground, omitting consideration of potential immunity under the Patent Act and sidestepping thorny questions on the appropriate source of law.
Continue Reading…https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3397312
TC v. Qualcomm: New Frontiers in the Antitrust-IP InterfaceBy Erik Hovenkamp (Harvard)
The Federal Trade Commission recently scored a substantial victory in its antitrust suit against Qualcomm. The case represents a novel confluence of standard-setting and IP licensing issues with bedrock antitrust subjects: tying and exclusive dealing. It also takes a surprising turn in resuscitating the long-dormant doctrine of the antitrust “duty to deal.” In this short essay, I review and evaluate the court’s decision in FTC v. Qualcomm. The analysis of Qualcomm’s exclusive dealing is sound and very likely correct. However, the court’s duty-to-deal analysis sits on shakier ground, omitting consideration of potential immunity under the Patent Act and sidestepping thorny questions on the appropriate source of law.
Continue Reading…https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3397312
In case you hadn't noticed: This past December the USDA released the first national disclosure requirements for foods that have been altered in a way that doesn’t occur naturally.
https://s3.amazonaws.com/public-inspection.federalregister.gov/2018-27283.pdf
The federal statute that authorizes the requirements also precludes competing State requirements.
CNBC explains that he guidelines, which use the term “bioengineered” instead of the more commonly used “genetically modified,” allow disclosure of bioengineered ingredients in several formats: in text, a symbol, a digital link printed on packaging or text message.
Companies can use a QR code with a statement like: “Scan here for more food information.” After scanning the code, consumers will be brought to a website where genetically modified foods will be disclosed. If a company provides a digital link disclosure, it must also provide a telephone number consumers can call for information. Critics say companies that use the QR code should be required to include the word “bioengineered” in their statement.
Advocates of multiple labeling options say it will be easier for companies to comply with the guidelines, but opponents fear it will confuse consumers or restrict access for those without smartphones.
https://www.cnbc.com/2018/12/20/usda-lays-out-the-rules-for-labeling-for-genetically-modified-foods.html
https://s3.amazonaws.com/public-inspection.federalregister.gov/2018-27283.pdf
The federal statute that authorizes the requirements also precludes competing State requirements.
CNBC explains that he guidelines, which use the term “bioengineered” instead of the more commonly used “genetically modified,” allow disclosure of bioengineered ingredients in several formats: in text, a symbol, a digital link printed on packaging or text message.
Companies can use a QR code with a statement like: “Scan here for more food information.” After scanning the code, consumers will be brought to a website where genetically modified foods will be disclosed. If a company provides a digital link disclosure, it must also provide a telephone number consumers can call for information. Critics say companies that use the QR code should be required to include the word “bioengineered” in their statement.
Advocates of multiple labeling options say it will be easier for companies to comply with the guidelines, but opponents fear it will confuse consumers or restrict access for those without smartphones.
https://www.cnbc.com/2018/12/20/usda-lays-out-the-rules-for-labeling-for-genetically-modified-foods.html
From the Commonwealth Fund
Can Germany’s Approach to Pricing New Drugs Work in the U.S.?
June 13, 2019
The German and U.S. health insurance systems are similar in many ways, but Germany has substantially lower drug prices. In a new To the Point post, James C. Robinson of the University of California, Berkeley, and colleagues look at how Germany prices drugs and consider whether its method could work here.
Prices for new drugs in Germany are negotiated between an umbrella organization representing insurers and the drug maker, and there is strong public and political pressure for the two parties to reach agreement.
For such a system to work in the U.S., the authors say assessments of new drugs’ incremental clinical benefits would be essential. That information would in turn be used to negotiate prices, with a “recognition by both buyers and sellers that the process is fair, financially sustainable, and supportive of continued investments in pharmaceutical innovation.”
Read the post https://www.commonwealthfund.org/blog/2019/how-drug-prices-are-negotiated-germany
Can Germany’s Approach to Pricing New Drugs Work in the U.S.?
June 13, 2019
The German and U.S. health insurance systems are similar in many ways, but Germany has substantially lower drug prices. In a new To the Point post, James C. Robinson of the University of California, Berkeley, and colleagues look at how Germany prices drugs and consider whether its method could work here.
Prices for new drugs in Germany are negotiated between an umbrella organization representing insurers and the drug maker, and there is strong public and political pressure for the two parties to reach agreement.
For such a system to work in the U.S., the authors say assessments of new drugs’ incremental clinical benefits would be essential. That information would in turn be used to negotiate prices, with a “recognition by both buyers and sellers that the process is fair, financially sustainable, and supportive of continued investments in pharmaceutical innovation.”
Read the post https://www.commonwealthfund.org/blog/2019/how-drug-prices-are-negotiated-germany
State AGs File to Block Merger of T-Mobile and Sprint
CA press release:
SACRAMENTO - California Attorney General Xavier Becerra, co-leading with New York a coalition of 10 attorneys general, today filed a lawsuit to block the proposed merger of telecommunications companies T-Mobile and Sprint. The companies – two of only four national wireless providers – offer wireless phone services to over 13 million California consumers. The lawsuit challenges the acquisition of Sprint by T-Mobile because it would lead to higher prices and fewer choices for consumers, particularly low-income subscribers of the companies’ services.
“Although T-Mobile and Sprint may be promising faster, better, and cheaper service with this merger, the evidence weighs against it,” said Attorney General Becerra. “This merger would hurt the most vulnerable Californians and result in a compressed market with fewer choices and higher prices. Today, along with New York and eight other partner states, we’ve filed a lawsuit to block this merger and protect the residents of our state.”
“When it comes to corporate power, bigger isn’t always better,” said Attorney General James. “The T-Mobile and Sprint merger would not only cause irreparable harm to mobile subscribers nationwide by cutting access to affordable, reliable wireless service for millions of Americans, but would particularly affect lower-income and minority communities here in New York and in urban areas across the country. That’s why we are going to court to stop this merger and protect our consumers, because this is exactly the sort of consumer-harming, job-killing megamerger our antitrust laws were designed to prevent.”
The current market includes four national network providers: T-Mobile, Sprint, Verizon and AT&T. Sprint and T-Mobile’s proposed union would consolidate these four provider options into three, by combining T-Mobile and Sprint’s market shares. In certain areas of California, the market share of the merged firm would be over 50 percent. Moreover, Sprint and T-Mobile have high market shares among low-income populations.
They would become the dominant network provider for prepaid mobile services, which are available without a credit check. Any merger would significantly hurt these communities by diminishing competition and increasing costs to consumers.
This is T-Mobile’s third merger attempt. Each previous attempt has been blocked or abandoned due to opposition from the government based on the same concerns laid out in the lawsuit filed today. In this attempt, T-Mobile and Sprint argue that the merger would allow them to more quickly roll out a next-generation 5G network and more broadly increase service to rural customers. However the companies are already planning to roll out 5G networks, and T-Mobile is already planning increased rural coverage, even without the merger.
A copy of the complaint can be found here, https://oag.ca.gov/system/files/attachments/press-docs/t-mobile-sprint-complaint-redacted-case-19-cv-5434.pdf
CA press release:
SACRAMENTO - California Attorney General Xavier Becerra, co-leading with New York a coalition of 10 attorneys general, today filed a lawsuit to block the proposed merger of telecommunications companies T-Mobile and Sprint. The companies – two of only four national wireless providers – offer wireless phone services to over 13 million California consumers. The lawsuit challenges the acquisition of Sprint by T-Mobile because it would lead to higher prices and fewer choices for consumers, particularly low-income subscribers of the companies’ services.
“Although T-Mobile and Sprint may be promising faster, better, and cheaper service with this merger, the evidence weighs against it,” said Attorney General Becerra. “This merger would hurt the most vulnerable Californians and result in a compressed market with fewer choices and higher prices. Today, along with New York and eight other partner states, we’ve filed a lawsuit to block this merger and protect the residents of our state.”
“When it comes to corporate power, bigger isn’t always better,” said Attorney General James. “The T-Mobile and Sprint merger would not only cause irreparable harm to mobile subscribers nationwide by cutting access to affordable, reliable wireless service for millions of Americans, but would particularly affect lower-income and minority communities here in New York and in urban areas across the country. That’s why we are going to court to stop this merger and protect our consumers, because this is exactly the sort of consumer-harming, job-killing megamerger our antitrust laws were designed to prevent.”
The current market includes four national network providers: T-Mobile, Sprint, Verizon and AT&T. Sprint and T-Mobile’s proposed union would consolidate these four provider options into three, by combining T-Mobile and Sprint’s market shares. In certain areas of California, the market share of the merged firm would be over 50 percent. Moreover, Sprint and T-Mobile have high market shares among low-income populations.
They would become the dominant network provider for prepaid mobile services, which are available without a credit check. Any merger would significantly hurt these communities by diminishing competition and increasing costs to consumers.
This is T-Mobile’s third merger attempt. Each previous attempt has been blocked or abandoned due to opposition from the government based on the same concerns laid out in the lawsuit filed today. In this attempt, T-Mobile and Sprint argue that the merger would allow them to more quickly roll out a next-generation 5G network and more broadly increase service to rural customers. However the companies are already planning to roll out 5G networks, and T-Mobile is already planning increased rural coverage, even without the merger.
A copy of the complaint can be found here, https://oag.ca.gov/system/files/attachments/press-docs/t-mobile-sprint-complaint-redacted-case-19-cv-5434.pdf
Sprint and T-Mobile Merger Approval, Said to Be Near, Could Undercut Challenge by States
The Justice Department is pushing Sprint and T-Mobile to sell Boost Mobile and wireless frequencies, people familiar with a potential agreement said.CreditBrittainy Newman/The New York Times
By Cecilia Kang
If such an arrangement is approved, it could weaken an effort by attorneys general from nine states and the District of Columbia to halt the blockbuster deal with a suit that they filed this week.
From:https://www.nytimes.com/2019/06/14/technology/t-mobile-sprint-merger.html?searchResultPosition=3
The Justice Department is pushing Sprint and T-Mobile to sell Boost Mobile and wireless frequencies, people familiar with a potential agreement said.CreditBrittainy Newman/The New York Times
By Cecilia Kang
- June 14, 2019
If such an arrangement is approved, it could weaken an effort by attorneys general from nine states and the District of Columbia to halt the blockbuster deal with a suit that they filed this week.
From:https://www.nytimes.com/2019/06/14/technology/t-mobile-sprint-merger.html?searchResultPosition=3
Sports gambling raises possible antitrust issues concerning league control of sports data
Excerpt from Forbes:
Now, with the rapid advent of new U.S. markets for sports gambling, certain U.S. professional sports leagues may find themselves facing yet another antitrust challenge, this one related to the centralization of purported “game data rights” and efforts to foreclose non-league parties from competing to collect and resell game-related data.
There are two sections of antitrust law under which the U.S. professional sports leagues have historically faced challenges. Section 1 of the Sherman Act, in pertinent part, states that “every contract, combination … or conspiracy, in the restraint of trade … is declared to be illegal.” Meanwhile, Section 2 of the Sherman Act states that “every person who shall monopolize, or attempt to monopolize …. shall be deemed guilty of a felony.”
The recent practices of Major League Baseball and the National Basketball Association to centralize “ownership” of sports league data on the league (rather than team) level and then attempt to require their business partners to use only their data (and not data collected by any third party) raises novel legal questions under both sections of the Sherman Act.
Continue Reading…
Excerpt from Forbes:
Now, with the rapid advent of new U.S. markets for sports gambling, certain U.S. professional sports leagues may find themselves facing yet another antitrust challenge, this one related to the centralization of purported “game data rights” and efforts to foreclose non-league parties from competing to collect and resell game-related data.
There are two sections of antitrust law under which the U.S. professional sports leagues have historically faced challenges. Section 1 of the Sherman Act, in pertinent part, states that “every contract, combination … or conspiracy, in the restraint of trade … is declared to be illegal.” Meanwhile, Section 2 of the Sherman Act states that “every person who shall monopolize, or attempt to monopolize …. shall be deemed guilty of a felony.”
The recent practices of Major League Baseball and the National Basketball Association to centralize “ownership” of sports league data on the league (rather than team) level and then attempt to require their business partners to use only their data (and not data collected by any third party) raises novel legal questions under both sections of the Sherman Act.
Continue Reading…