The DOJ and FTC's Misguided Attack on Mergers
![handle is hein.journals/jcorl49 and id is 295 raw text is: The DOJ and FTC's Misguided Attack on Mergers
Richard A. Epstein*
This Article reviews two recent joint statements by the DOJ and FTC. The first was
their request for information on their proposals to strengthen the antitrust laws on
mergers. The second was the July 2023 release ofnew draft guidelines which were subject
to many comments, often critical of the new regime. The difficulties with both documents
start with the initial premise of their inquiries, which falsely posit that any improvement
of the antitrust laws requires imposing new sanctions on private activities when in many
cases a relaxation of current restrictions may be best. But both agencies write as if the
efficiencies inherent in many mergers are largely illusory. Consequently, they understate
the social losses that come from blocking or modifying mergers under the Clayton Act. In
addition, they underestimate the efficiencies ofvertical mergers and overstate the risks of
downstream foreclosure, as exemplified by the FTC's unwise attack on the Ilumina-Grail
merger. Both documents also overstate the risk ofmonopoly power in labor markets, which
bear little to no relationship to product markets. In light of their recent judicial defeats,
both agencies should rethink their premature departure from traditional antitrust policies
and redraft the proposed 2023 Guidelines from scratch.
BACKGROUND .................................................................................................................. 276
I. SCOPE OF MERGER REVIEW .......................................................................................... 281
II. ANTICOMPETITIVE PRESUMPTIONS ..............................................................................284
III. MARKET DEFINITION.................................................................................................. 285
IV. NASCENT COMPETITION............................................................................................. 286
V. FORECLOSURE ............................................................................................................. 287
VI. LABOR MONOPSONY .................................................................................................. 293
CONCLUSION.................................................................................................................... 296
* The Laurence A. Tisch Professor of Law, the Director of the Classical Liberal Institute, the Peter and
Kirsten Bedford Senior Fellow, The Hoover Institution, The James Parker Hall Distinguished Professor of Law,
Emeritus, and Senior Lecturer, the University of Chicago. This Article is a revised version of a paper for a
conference organized by the Classical Liberal Institute on The New Age ofAntitrust, held via Zoom on Friday,
November 4, and Saturday, November 5, 2022. This Article is an extensive revision and expansion of a statement
that I wrote on behalf of a number of academic lawyers and economists in response to a request for information
issued by the DOJ and FTC on the need to modernize the antitrust law. Richard A. Epstein, Comments on the
FTC and DOJ Request for Information with Proposals to Strengthen Enforcement Against Illegal Mergers (Apr.
21, 2022), https://www.regulations.gov/comment/FTC-2022-0003-0828 [https://perma.cc/UJ8X-UFJ9]. Given
the passage of time, this Article has been updated to reflect the latest major development in the field, the issuances
by the DOJ and FTC of their revised merger guidelines on July 19, 2023. See ANTITRUST DIV., U.S. DEP'T OF
JUST. & FED. TRADE COMM'N., 2023 DRAFT MERGER GUIDELINES (2023), https://www.justice.gov/d9/2023-
07/2023-draft-merger-guidelines_0.pdf [https://perma.cc/X5KH-BRQQ]. My thanks to Joseph Kieron, Matt
Philipps, Matt Rittman, and Elle Rogers of the University of Chicago, for the initial round of research assistance,
and to Ben Chesler, Will Danielson-Lanier, David Leynov, and Cade Mallett of NYU Law School for the second
round of revisions.](ViewImageLocal?handle=hein.journals/jcorl49&div=16&collection=&method=preview&ext=.png&size=3)
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The DOJ and FTC's Misguided Attack on Mergers
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