The Federal Trade Commission’s (FTC) recent complaint challenging the proposed merger of the supermarkets Kroger Co. and Albertsons Companies Inc. has important implications for antitrust enforcement in labor markets. Central to the FTC’s case is how it chooses to define the relevant markets, and particularly the commission’s focus on unionized grocery workers. The complaint alleges that the combined firm would dominate these markets, substantially lessening competition for unionized labor.

Read the full piece here.

ICLE Academic Affiliate Liya Palagashvili was a guest on the Free the Economy podcast to discuss  jobs, full- and part-time jobs, contractors, gig work, California’s Assembly Bill 5, recent U.S. Labor Department rules, and flexible workplace benefits. Video of the full interview is embedded below.

Abstract

As bans on noncompete agreements (NCAs) become more frequent, commentators are increasingly concerned that costly trade secret litigation will rise. The logic underlying this claim is that bans on NCAs will spur worker mobility, resulting in more secret sharing, and thus opportunities for trade secret litigation. We test this claim leveraging the many state-level NCA bans for high- and low-wage workers, alongside data from Westlaw and the Courthouse News Service on trade secret filings. We find that the number of trade secret claims filed falls in the long run after NCAs are banned, even as mobility rises. This long-term drop in the number of filed trade secret claims is not driven by a decline in dual NCA and trade secret filings. It is also not driven by a decline in reliance on trade secrecy by firms. Instead, it appears firms rely more on trade secrets after NCAs are banned. Finally, we find that endorsing the inevitable disclosure doctrine causes a rise in both NCA and trade secret claims. Taken in sum, this evidence suggests that NCA and trade secret litigation are complements, and not substitute approaches to protecting valuable firm knowledge.

Read at SSRN.

The big news from the agencies may be the lawsuit filed today by the U.S. Justice Department (DOJ) and 16 states against Apple alleging monopoly maintenance in violation of Section 2 of the Sherman Act. It’s an 86-page complaint and it’s just out. I’ll write more about it next week.

Two quick observations: First, the complaint opens with an anecdote from 2010 that suggests lock-in (a hard case under antitrust law), but demonstrates nothing. Second, the anecdote is followed by a statement that “[o]ver many years, Apple has repeatedly responded to competitive threats… by making it harder or more expensive for its users and developers to leave than by making it more attractive for them to stay.” 

Read the full piece here.

This week, the Department of Labor’s new rule on independent contracting goes into effect. It will now be more difficult to engage in freelancing, gig work or certain types of independent work — a Biden administration labor-agenda standard that is far stricter than it was under the Trump or Obama administrations.

Read the full piece here.

Abstract

Physician non-compete agreements may have significant competitive implications, and effects on both providers and patients, but they are treated variously under the law on a state-by-state basis. Reviewing the relevant law and the economic literature cannot identify with confidence the net effects of such agreements on either physicians or health care delivery with any generality. In addition to identifying future research projects to inform policy, it is argued that the antitrust “rule of reason” provides a useful and established framework with which to evaluate such agreements in specific health care markets and, potentially, to address those agreements most likely to do significant damage to health care competition and consumers.

The press is abuzz with news about the Federal Trade Commission’s (FTC) Feb. 26 announcement that it would challenge the proposed Kroger/Albertsons mega-supermarket merger, which had been in the works since the fall of 2022. If the FTC succeeds in obtaining a temporary restraining order and preliminary injunction in Oregon federal district court (a big if), it plans to review the transaction in an administrative hearing beginning in late July.

Read the full piece here.

ICLE Academic Affiliate Liya Palagashvili joined the She Thinks podcast episode to discuss harms and threats to independent contracting stemming from a new U.S. Labor Department rule. Video of the full episode is embedded below.

ICLE Senior Scholar Daniel J. Gilman took part in a virtual panel convened by the Federalist Society on the Federal Trade Commission (FTC) and U.S. Justice Department’s (DOJ) recent moves to put labor issues at the center of antitrust enforcement and policy making. Video of the full event is embedded below.