February 7, 2025
Moderator:
Kellie Lerner
Managing Partner at Shinder Cantor Lerner LLP
Panelists:
Adam Gitlin
Chief, Antitrust and Nonprofit Enforcement Section, Office of the Attorney General for the District of Columbia
David Sonnenreich
Director, Antitrust and Data Privacy Division, Utah Attorney General’s Office
Elizabeth Odette
Manager, Antitrust Division, Minnesota Attorney General’s Office
Lauren Weinstein
Partner at MoloLamken LLP
Kellie Lerner: Welcome to today’s roundtable, where we will be discussing all aspects of working with state attorneys general. I am delighted to introduce our panel.
We have Elizabeth Odette, who serves as Assistant Attorney General on behalf of the State of Minnesota, and as manager of the Antitrust Division. She also serves as chair of the Antitrust Taskforce for the National Association of Attorneys General (NAAG) and previously worked in private practice as a partner at the Minneapolis-based law firm of Lockridge Grindal.
We also have with us Lauren Weinstein. Lauren is a partner at MoloLamken, where she represents clients on both sides of the v. in antitrust and other commercial matters. She was appointed Special State Attorney General to prosecute antitrust and consumer protection claims on behalf of thirty-nine states in the In re: Google Play Store antitrust litigation, where she obtained a historic $800 million settlement on behalf of her clients, and we will be talking a lot about that work later on today.
We also have Adam Gitlin, who is chief of the Antitrust and Nonprofit Enforcement Section of the Attorney General’s Office of the District of Columbia. Adam was previously a trial attorney with the Antitrust Division of the United States Department of Justice. He was a counsel at the Brennan Center for Justice and a partner in private practice at the Law Firm of Lieff Cabraser.
Also with us is David Sonnenreich, who is the Director of the Antitrust and Data Privacy Division of the Utah Attorney General’s office. He has worked in both government and private practice and has tried numerous antitrust and other matters, from the perspectives of prosecutor, plaintiff’s counsel, and defense counsel. More recently he has been involved with data privacy issues and has overseen the enforcement of the Utah Protection of Personal Information Act. He is also an active member of the National Association of Attorneys General Multistate Antitrust Task Force and has partnered in numerous antitrust enforcement and merger cases.
With that, I will begin our discussion in what I think is probably the beginning of most matters, which is the pitch. Let’s start with how cases come to the attention of our panel, whether it is through pitches from private counsel, from third parties, or internal investigations. I imagine it varies somewhat.
With that I will start with Adam.
Adam Gitlin: Thanks, Kellie, to you and the ABA for organizing this. The standard disclaimer applies that my views are my own.
I think you are right that in many ways our approach, much like that of certain federal agencies, both those that do antitrust and that don’t do antitrust, is somewhat similar in that, for many of the investigations and litigations that we initiate, we do so whether it is because of third parties bringing a complaint to our attention of some practice they are concerned about. If it is a conduct matter or a merger matter, it may be a situation in which we are partnering with federal agencies looking at something that may have nationwide impact or may have a very localized impact, and we will work with them in looking at the potential effects of either conduct or a proposed transaction.
Because you mentioned the pitch I will note that one way that matters come to our office’s attention is because the District of Columbia—this isn’t true of all jurisdictions—can bring cases with outside counsel paid on a contingency basis essentially. There are instances in which either outside counsel pitch us on a case and try to make the argument that this is a case that should really matter to District residents and that they should be brought in to help us seek relief, or there are other instances in which, and this goes beyond antitrust as well, we have done some pursuit investigation potentially or we have otherwise identified a concern and essentially seek bids from different firms that might be interested in representing the District, and select one to advance investigation and possibly litigation.
Kellie Lerner: For any of the other state enforcers on the call, is your process any different from that? Is your experience different?
David Sonnenreich: In Utah we probably do less work in terms of accepting people coming to us with a proposal. Generally, we are very skeptical of that. Our legislature allows us to do contingent fees, but there is a very restrictive statute that sets limits as to how much you can recover and requires us to be directly involved in the supervision of the case. You do not actually save a lot of time and effort by hiring a contingent fee attorney versus working cases with other states, so if it is a good case, I would prefer to work in a multistate and then, if necessary, hire outside counsel on an hourly basis to assist with trial preparation.
Just for the record, the case you mentioned was also Utah v. Google originally and we hired Lauren to work with us on that case, specifically because we needed trial counsel who could focus on preparing for trial. We hired her at an hourly rate and not on a contingent fee, and that is generally our preference. We will rarely agree to a contingent fee in antitrust litigation. Most antitrust cases we bring we find out about from other sources, frequently the people who claim to be harmed by the practice.
Kellie Lerner: I would like to hone in on the skepticism that you mentioned for outside parties reaching out to pitch a case. If you could share, what are some of the indicators that someone is bringing you a case that merits real scrutiny from your offices? Is there an approach that you consider more frequently than others? Are there any hallmarks of an approach that you think merits your further scrutiny?
Elizabeth Odette: The Minnesota Attorney General’s Office has to go through an RFP process, so for those who do come to us and make a pitch they have to know that that pitch may mean that someone else could get the work if it is a good pitch, but I think we have many, many cases on our docket, as many private counsels do as well. If a firm has a particular focus and specialty and they are bringing something to us, to me that adds merit to what they are bringing to us because they have steep knowledge in, for example, healthcare, and they are bringing to us a particular healthcare matter or other areas similar, that really helps us understand that they do know this industry, these markets, and have identified a specific issue within those markets, and have the context as well that may help to bring to light some antitrust concerns.
Kellie Lerner: Does it help if a private lawyer comes to you with a potential case with either an injured client, an economist, or some other third party that adds more heft to what they are purporting is a problem in the market?
David Sonnenreich: Sure. In that instance what we are dealing with is an injured party primarily, who is represented by counsel, as opposed to a lawyer looking for a case to bring in general.
By the way, I should add the same disclaimer as Adam did. These are my own views, and not necessarily those of our new Attorney General. We have been practicing for over a decade with the prior Attorney General, so everything I say here today might change once he gets through his first legislative session and can more fully consider and articulate his antitrust priorities.
With that understanding, what Elizabeth said is absolutely right. We are going to have to look at it in terms of hiring that particular firm, but we frequently will have a situation where we will litigate alongside a private party.
Again, the case we were just referring to, Epic, had its own case against Google, which we went to trial on, but we were MDL’d for purposes of discovery, et cetera, and they of course were well represented by private counsel. It is very common for us to work with class counsel in MDLs that have been formed.
Adam Gitlin: Before we head to perhaps something more related to that different enforcement dynamic, I just want to note that I am sure David was not insinuating that states that are open to more contingency arrangements are not carefully overseeing the work being done. I will note that supervision of the legal work being done is always a concern for the states, particularly because we deal with rather significant resource constraints, and that means time spent on one matter is time not spent on another.
It is true you will see states pursue different approaches in terms of how directly they are involved in day-to-day litigation. When I describe the way I get involved in our contingency litigation, I am told that my approach is a lot closer to—maybe so not much what the plaintiff’s bar usually has with respect to some of their named plaintiffs who, as the law has held, do not even really need to have a deep understanding of the theory of harm, but rather maybe more like what one sees in the defense bar where if you have a large company that is not entirely unused to being sued for antitrust violations or at least having to consider those issues. They may have specialized in-house antitrust counsel and may take a very active role in determining the litigation strategy and even some of the more minute issues. That is probably more akin to the experience that the lawyers working for us in a contingency sphere face.
In that sense, to bring us back to where David brought us to, with these sort of multistate matters we consider that every approach will have a certain amount of transactions costs. David is right that overseeing others doing litigation for you in the way we do in contingency litigation has its costs, but, as David can tell you probably even better than I can, having to work in the models that we do in the multistate certainly has its transaction costs.
David Sonnenreich: Absolutely, Adam, and I was not for a moment implying that you are not supervising the cases. What I was saying is we have very specific rules in Utah by statute that include, for example, the phrase that the contingent fee counsel “shall acknowledge the government attorney retains complete control over the course of conduct of the case and the government attorney retains final authority over any pleading or other document,” meaning if we do not agree with another state, they have to file it Utah’s way.
That creates an obvious problem. If our attorney general or another attorney general are on a contingent fee case, now they have to either file two briefs themselves or file a brief that says, “Utah takes this position; these people take this position.”
Our legislature actually watches that because we have had some bad experiences, so we know that I am going to be on The Hill explaining it if something goes wrong. That is what I was suggesting, not that we do not both watch what is going on, read the pleadings, and have input, but in a multistate, at some point, the multistate has to come to an agreement and the leadership team on the multistate does it, and we all file. At the end of the day the contingent fee counsel is responsible to Utah.
Kellie Lerner: In the next stage in the process, after someone comes to you, however that happened, and you look under the hood, and say: “Okay, this is something I am interested in.” When do you decide to reach out to other states? I want to get us to the multistate framework, and then we can go back to David’s point.
Adam Gitlin: I think it is actually responsive to the question, Kellie, because I am not aware of at least the District ever doing contingency litigation with other states in antitrust cases; that sounds much like in Utah in practice.
Our agreements with contingency counsel are public contracts. They are like procurement contracts. It is not really something we think of as an attorney-client relationship so much as one where we are essentially procuring assistance to do the work we are already doing. It has to be eventually approved by the D.C. Council and it is very much something we think of as work that is being done on behalf of the District on a contingency basis. I do not know of an instance where we have brought in other states on a contingency case when bringing antitrust claims.
David Sonnenreich: I believe that we have done it in consumer protection cases. We have also had the situation where a number of states already have hired outside contingent fee counsel because, as Elizabeth said, we cannot go through the procurement process we would otherwise go through. We basically have to say: “That’s fine. You represent those states. We are not being represented by you. We are going to represent ourselves in this case, but we will all join in the same case,” so there will be a contingent fee counsel representing some states, and Utah and other states will be representing themselves through their attorney general’s office and if necessary hiring outside counsel on a fee basis to assist us. It can get kind of complicated.
Kellie Lerner: Just thinking through those complications, are there concerns when there is an ultimate recovery in the case, like a tremendous recovery in the Google Play case, which I hope to get to soon? Are there any mechanical concerns in carving out the recovery attributed to Utah from the contingent fee recovery?
David Sonnenreich: The multistate case there was not a contingent fee case. There was an MDL going on separately that included a private class action that settled with the states at the same time, and a case by Epic that later went to trial. Our outside counsel was hired strictly on an hourly basis, so no, we shared a pool according to an agreed-upon formula in that case, as we do in most cases.
When you form a multistate, you decide who is going to take leadership. Obviously not every state will participate equally in every case. There will be a few leadership states if you have thirty states in a case and other states that are only helping in specific ways. Generally that is reflected in part, along with other variables like population and impact of the particular behavior on the state, in deciding how we split up any settlement recovery internally.
Kellie Lerner: Elizabeth, how do you decide when to investigate something strictly within Minnesota or when do you decide to reach out to your peers in other states to join forces?
Elizabeth Odette: I can answer this too in the context of your question of how it gets to a multistate. For example, from Minnesota’s perspective we may hear from a constituent or from a private counsel about a matter, or we may just be thinking about it ourselves because it is a chronic issue. Minnesota or other states can bring that to the NAAG group, which meets twice a month. They can also reach out to colleagues in general, but NAAG is a great resource for us to be able to connect together and identify issues. Identifying those issues for the group does not mean that we are necessarily saying we have to collaborate with each other. We can just have conversations about the issues, our resources, and our thoughts in general.
If we have a specific state statute that is unique to the particular issue or industry that might cause us to think that it would be better suited for an individual or it might just have very local market issues, that might be more suited to Minnesota taking that on itself and maybe talking with other states who are doing something similar but not investigating and litigating alongside our colleagues.
If it is something that has broad interest in the multistate, it is our preference to work with our state colleagues because of the resources and expertise, all the different things that make a multistate really successful. It is a multitude of factors, but that is the process. Like David said, once a group forms, then there is a discussion about leadership. I think we do not look for the glory because we all are limited in our resources and so it really is a discussion of who has the resources right now, who has the experience running a multistate, a cost share, or other things that are required for us to be successful, and then we work together to make that a success.
Kellie Lerner: You started to touch on this, but could you share a little bit more on the benefits and the challenges of working in such a large coalition to prosecute an antitrust violation?
Elizabeth Odette: I would say the benefit of working solo is that you can make those decisions yourself and you do not need to involve other states. You can make that decision in your front office, take the recommendation, and move forward. In a multistate there is a lot of consensus building. It is not that they have a vote; they have a decision, both feet in or both feet out on strategic decisions.
I think you come to a good decision in the end because everybody has a say in deciding that that is the decision that is being made by the group of states. The larger you are the longer it might take to get to that consensus. That is one challenge, but like I said, that challenge comes with all of the resources and expertise as well.
Kellie Lerner: That makes sense. I want to turn to Lauren as someone who is here with her unique perspective, representing the states and representing thirty-nine states in massive litigation. Could you tell us a little bit about the process of how you were brought into that matter, Lauren, and what that experience was like for you, especially relative to some of your other representations?
Lauren Weinstein: Absolutely. Thanks, Kellie, for organizing this panel and inviting me and thank you to the ABA. It is really a delight to be here with two of my former clients from the Google Play case, David and Adam, who will stop me if I say anything that I should not.
In terms of how I ended up getting retained, a question that I get a lot, and it is really one of those things where business development efforts pay off in big and unexpected ways. Many years ago, 2017 or something like that, I did an amicus brief in the Apple v. Pepper case. I represented a group of scholars in that case, and we wound up being on the same side of the issue as the Supreme Court.
A friend of mine I knew from debate who had been hired as, I believe—David can correct me if I am wrong—a special assistant for the Google Play case by Utah, had followed my career, was familiar with my brief, and the states were looking for a second chair trial counsel at the time. This was at least a year or more into the litigation and had developed a need.
My friend said: “Well, you should check out Lauren, She wrote on this Illinois Brick issue in Apple v. Pepper.” The states expected correctly that similar antitrust standing issues would come up for them in the case, and I had relevant experience managing large-scale antitrust cases primarily on the plaintiff side from my private practice.
I was thankful to my friend for throwing my name in the ring, and then I got an email from Sarah Boyce, formerly of the North Carolina Attorney General’s office—I think she has moved on—and she asked if I was interested in interviewing for the position. I met with a smaller group that included David, as well as others at other states’ attorneys general’s offices, and those were the colloquially known “lead states,” the ones that were most involved in the day-to-day litigation.
I met with the representatives from the antitrust offices of those states for an interview and then moved on to an interview with the broader multistate, which was really more a presentation of me by David and others who had interviewed me and less an interview. I did not get many questions; I might have gotten a few.
Then I was hired. It was a remarkable experience in terms of my own professional development and the opportunity to work on this incredible cutting-edge antitrust case on behalf of the states without having to leave my private practice. It was nice to be in this role as a government lawyer while not upending my life for my career in certain ways. I have been at my firm for ten years now and was very happy and did not want to leave, but I got this great opportunity.
It was similar in certain ways to the kind of work I do in my private practice and different in others, similar in that it was a very large antitrust case that I was prosecuting, which is a lot of what I do in my private practice, a lot of stakeholders, difficult legal issues, very important issues in the case, and the day-to-day preparation of cases for trial, which is what I do at my law firm, so that was not all too different.
What was different was that all my clients were lawyers to a person. That was great in many ways in that we had access to many more really smart, really focused lawyers. These are people who have devoted their entire careers, or at least many years of their lives, to antitrust law and really know the issues inside and out, but it was a little bit different than just going to a general counsel’s office where you’ve got two, maybe three attorneys you are running strategic decisions by; here there were at least ten on the core team and then the broader multistate when it came to issues like whether to retain a certain expert, for example.
That had its challenges, but you had to be more prepared than I think you would be in even your everyday work because you are going to face the gauntlet of all these knowledgeable antitrust lawyers. I think that would be the major difference between a plaintiff-side civil antitrust case and representation of the states, at least in my experience.
Kellie Lerner: It sounds like David and Adam, you and your colleagues kept Lauren on her toes. I am curious to know from your perspective how it all worked out.
David Sonnenreich: I was on the leadership committee in the case, and actually Utah initiated the investigation that led to the case, so we were sort of the first ones to deal with this particular issue and then brought in other states in the way that Elizabeth suggested.
Basically we reached a point where we asked what additional resources we needed. The vast majority of the work in the case was done by AAGs around the country. We were still taking depositions, reviewing millions of documents, and we were still helping to write briefs, although Lauren did a great deal of the work in terms of things that actually went to court, and we were thrilled to have her.
We decided we needed help in the form of a dedicated team of lawyers who were getting ready for trial. That is very difficult for us in our jobs, not because some of us do not have a lot of trial experience, which I do, but rather because in other contexts I have had the ability to say, “Okay, I am going to focus on this trial for the next two months.” Here, I don’t have that opportunity. Right now we are in a legislative session. I can’t tell the Legislature: “I’m sorry, I’m really busy right now. I can’t look at those bills in order to determine their fiscal impact.” The nature of the job does not permit that.
One of the best uses for us of outside counsel is to hire a trial team that is focused and whose members can be thinking strategy from day one. Lauren did a great job of organization and structure for the case, but we could still take depositions, we could still do work of various sorts, and in fact we knew that there was so much of that work that Utah also hired three internal Special Assistant Attorneys General, including the one that Lauren referenced. Those people were outside counsel hired to work directly as Special Assistant Attorneys General inside the State of Utah on this particular case doing discovery. They focused a lot on some expert issues and things of that sort, but they were working for us while Lauren and her colleague were working for the multistate. That is how it worked in this case to get the dynamics and the momentum we needed to take on one of the largest companies in the world, in one of the most complex areas in the world.
That differential is something we look at quite a bit: “Do we need this person be in-house for Utah or do we need somebody who can work for the multistate as a whole?”
Lauren Weinstein: That is a good point, David, and I appreciate the kind words. The way that it worked is very interesting in that not only were all the clients’ lawyers, but all the lawyers working on the case with me were not associates that I have known for many years at my law firm; these were attorneys at the various Attorneys General’s offices that comprised mostly the leadership team but sometimes attorneys from other states as well.
At my firm one of the things that we like to do is work collaboratively with others, and when we need a resource from outside the firm for a case we partner up with someone, whether that is an expert or another firm. We do a lot of co-counsel arrangements and call it “building a virtual law firm.” This was like a virtual law firm on steroids because you had AAGs from New York, California, Utah, North Carolina, D.C., and so on, all working together to prepare for depositions, review the documents, write nastygrams for discovery, brief issues, and prepare for the hot tub that we had before Judge Donato for our experts. It was incredible to see how all these states’ attorneys general, pulled together to achieve something that was historic in the way we prosecuted the case and the settlement that the states achieved.
Kellie Lerner: It sounds like a real success story.
I want to talk about the other scenario that we touched on earlier, which is a situation where you have a state AG, possibly a multistate AG enforcement action happening in parallel with private litigation, either competitor or class actions happening at the same time. Each of you have your own clients to represent and advocate on behalf of, which may have interests that are mostly aligned, but there could be slight divergences. I would love to hear how you navigate the challenges of that dynamic.
Adam Gitlin: The differences in various litigations will often determine different approaches for the states. For example, if there is a case like Google Play that involves multiple plaintiffs and multiple types of plaintiffs—all of whom have the same interest both in terms of wanting to hold the defendant liable, wanting to make sure that there is good injunctive relief, and making sure that there is good monetary relief—then we will often be working very collaboratively, and that can make a lot of sense for us. I think we did it fairly successfully in Google Play.
I think it can be a little bit more challenging at times, for example, if there are parallel criminal proceedings brought by the Department of Justice. It is not that the broad interest in justice is not shared, but the where and the how may be something about which things have to be approached pretty delicately to make sure that we are all advancing in tandem and that no one is unnecessarily making life difficult for anybody else.
Kellie Lerner: Elizabeth, you have a big role in coordinating all the AGs through your role in NAAG, but also when you have to coordinate with private counsel. As someone who is working in such a focused way on building consensus and collaborating do you see any best practices for how to collaborate effectively when there are so many moving parts?
I will focus my question specifically on forty-eight AAGs prosecuting an action and then you have three separate tracks of class actions happening at the same time. Are there any best practices that you think we should all be thinking about to make that collaboration go smoothly?
Elizabeth Odette: One thing I will note at the outset that I have seen change in recent years is that with the passing of the State Antitrust Venue Act it is not necessarily that a parallel private action will be in the same jurisdiction. That is something to consider.
It was very clear in the Kroger/Albertsons case. Minnesota was not part of it, but obviously many of my state colleagues were, and there were three different actions going on including one that had a private action as part of it, but they also continued to work collaboratively where they could.
I would say for best practices one thing to understand is that states and the federal government, if we are working with the federal government on a case, may not be able to do certain things in collaboration. We have limitations, unfortunately, on how we can share and what we can share. We can establish common interest agreements, but each state may be dealing with their own processes for that. They are dealing with their own data practices. A state has to know that a state group might be a little more conservative in the way in which it is going to work on collaborating with a private action and not to take it personally. It is an often an impact that is a representation of just the diversity within the state AGs and how they have to manage that.
One thing I do see a lot of collaboration on, because it is just necessitated by what the courts expect when it comes to efficiency, is with depositions and you have witnesses, especially third parties for whom this litigation is not something that they have a stake in. Third parties are becoming increasingly more important in cases where we really do need to work together in order to uphold Rule 45.
Kellie Lerner: Lauren, from your perspective on the private side, to the extent that you’ve had cases where there were also parallel government enforcement actions, have you found any tricks of the trade or special tools that help in that collaboration?
Lauren Weinstein: I would like to go back to Google Play, which I think is a good example because we did so much collaboration with the Epic team, the class counsel, and the Match team. Although I do not think there was ever an order formally MDLing us, Judge Donato said, “We are all going to trial together,” so we were functionally in an MDL and we got very far down the road to trial before the states inked their settlement with Google. The case settled I think Labor Day weekend and we were set for a trial at the beginning of November.
Putting together the exhibit list for trial, for example, is something that we worked many hours with the Epic, Match, and class counsel teams to do. We literally got in rooms for full days and had boxes and boxes of every document that any team theoretically might want as an exhibit to the case, someone from each team had eyes on every document, and we decided collectively what was going on our exhibit list for depositions. Adam can speak to this too because he took some of these depositions. We had our prep calls where we decided who was taking which witness and then on those teams who was going to examine on what and sometimes negotiating time allotment was difficult and sometimes it was more straightforward.
One thing that it took me a little bit of adjustment to understand but was extremely important, is that every client is exceptionally important, but the states are not just a client; the states are representing their citizens. These are the American people that we have the honor to represent. You are always vigorous in your defense of your client and your prosecution of a case on behalf of your client, but there is something somewhat unique where the states sit in that they do not just have clients; they have obligations as elected representatives to advocate on behalf of their clients. That was something I had to learn as a private lawyer moonlighting on behalf of the states, but it is something that you have to also convey to the private practitioners, and I think that can be difficult to wrap your head around at first.
Then there is just the other piece of it, which is: “Well, I have thirty-nine clients I need to run this strategic decision by,” right? It is not just getting signoff from one client. So you, my co-counsel, please give me a little bit of grace as I try to navigate that. I will say that we had great working relationships with all the counsels in the Google Play case, not to say that we did not have our moments of butting heads, but I think we worked through it extremely effectively to a great result in the end in both the Epic trial and the settlement that was due.
Kellie Lerner: All helpful reminders.
David Sonnenreich: I think there are two touchpoints that are really important in this relationship and you have to deal with them early on. The first is the question of who is representing the citizens of which states because if you have a class action going, you have class counsel, and it is a national thing, and now all of a sudden you have thirty states asserting that they are going to use their parens patriae authority to represent the same people, that has to be negotiated. That is one of the very first touchpoints that often comes up, although sometimes, especially if there are only a couple of states involved, the states might say: “We are just interested in worrying about the injunctive relief. You have the consumers covered.” Other times, and probably more frequently, it is, “No, we want to represent our consumers, thank you very much,” and that discussion has to go on.
The second one is witnesses, in particular expert witnesses. It is one thing to take a deposition together; it is another to rely on each other’s expert witnesses. The reality is that sometimes we will insist on our own experts and sometimes we can work together collaboratively and agree to use the same experts, but in terms of what practitioners who practice as class counsel need to know, those are things you are going to have to discuss with us right upfront, and they will define the relationship, how we work together, and how we break up the workload too.
Kellie Lerner: Those are important points. The expert point is tricky because when you want your own experts, you also want to make sure they are not stepping on each other’s toes. I understand why everyone may want their own experts for strategic reasons, but we also have to keep in mind that that could backfire.
We have been talking primarily about plaintiffs’ collaboration, but there are times where a target of an investigation or an impacted party that would be more akin to a defendant wants to appear in front of a state AG and talk through some antitrust issues. This takes us back to the topic of best practices: Do you have any tips for how that process can go as smoothly as possible?
Adam Gitlin: This is something that certainly happens quite a lot. There are folks who come in as David described, also sort of third-party complainants, sometimes represented by counsel, sometimes not. I should say, getting represented by counsel when you are coming in as a third-party plaintiff, if you have got the wherewithal and you can retain antitrust counsel, that is probably a good thing. It is not that we do not try to spot issues as best we can, but it is certainly going to be easier if you have folks who have been able to look at your fact pattern and helped you frame it in a way that comports with the way antitrust thinkers are going to evaluate it as falling in one of the boxes or more familiar fact patterns that we see.
With respect to folks who are potentially being investigated in some capacity, like you said, Kellie, that likens them more to a defendant, and I would say two things: One, if you understand that you are being investigated by the antitrust function of a state AG’s office, come prepared to talk to antitrust lawyers; the other is assume they have done a fair bit of reading to prepare themselves.
One thing that we see a little too often is folks who bring in what I might call a “generalist” attorney general counseling person, perhaps somebody who previously held a high position in a state AG’s office or even was a state AG. In certain situations and for certain kinds of subject matter, that might be very effective.
I have not found it to be effective in antitrust matters, simply because I think we have a fairly niche practice in some ways: If you come in to tell us about why a particular practice is good for the world but you are not prepared to talk about competitive effects and how one might think about defining markets, it may end up backfiring on you, particularly because you may request a meeting with someone fairly high up, you may get it, and that might be your only opportunity to try to persuade them that what your client has done is aboveboard. And you should assume—to the second point I made about having done one’s homework—that if you are receiving a meeting with an AG or someone from their front office, they have at least been briefed on the antitrust matters, enough to be dangerous, by their staff who specialize in the subject. Sending your antitrust lawyers is probably the best advice I can provide, and that applies equally to both merger matters and conduct matters.
Kellie Lerner: I encourage our readers who have this type of practice to heed Adam’s advice.
Anyone else want to weigh in on this topic?
David Sonnenreich: I will just say that it is not futile to approach us. If we are doing an investigation—you may not even know if Utah is involved but you know there is something going on—and you ask to talk to us about the problem, it is not a futile exercise. We do listen very carefully. We have determined not to join cases based upon those presentations, but, as Adam says, please come prepared to discuss antitrust and not to discuss how this is good for your constituents or something in a general, broad sense.
Know your AGs also. Attorney General Reyes actually tried antitrust cases in private practice; he did not need us to tell him the fundamentals.
Adam Gitlin: One quick addition to David’s point here, on constituents and what is best for them, one thing that I think AGs’ offices do appreciate is, as part of your doing your homework, if you have looked at the particular impact or not on a given state. Obviously, there are some kinds of products that simply have nationwide geographic markets, where it is not going to make much sense to talk about greater impact upstream or downstream on the particular state.
However, if you have looked at it with respect to that particular state that you are coming in to talk to, that can be helpful on multiple fronts: with respect to the substantive merits of the arguments and also because frankly it shows that you have taken seriously this opportunity that you are going to have to talk to regulators about how the matter at hand is actually going to affect their particular residents, which is also going to help with any internal advocacy that then happens between antitrust staff lawyers and their more generalist supervisors.
Elizabeth Odette: I am glad you mentioned that, Adam, because that is a threshold question for almost every state AG’s office: What is the state interest here—the state impact? I am glad you brought that up.
I would add that you should anticipate preparing for a type of meeting like we are describing like you would prepare for an argument before a panel of people where there are not any questions. You need to anticipate the questions that might have been asked and be prepared to answer them if you do not get any questions. If you come in asking, “What are your questions about our company and the potential things have you heard,” you might not get anything because there is concern that the type of questions that are asked could reveal whether and to what extent there might even be an investigation, and that is not something that most state AG’s offices are prepared to do in a meeting where we are interested, like David said, to hear from people, but we want you to be telling us why you should not be a target and be prepared to tell us and explain in detail, like Adam and David said, from an antitrust perspective but don’t expect to get the questions that will help guide you through that meeting.
David Sonnenreich: One last point I will make that is very important is to be aware of the confidentiality rules and the FOIA rules that apply to the state you are meeting with. In some states you can hand us things; in other states, if you hand it to us, you are just giving us something that becomes public because we did not have an agreement with you in advance. You need to know what those rules are. You should talk to a staff-level attorney who is knowledgeable about them.
In Utah, you can talk directly to me as the director and I am happy to work through those issues, but if you ignore those issues, and particularly if you choose to meet only with the attorney general or maybe one of the chiefs of staff who may not be an attorney, you may be having a political meeting that is open to complete disclosure as opposed to a legal meeting concerning the merits of a case. You need to be very aware of that distinction.
Lauren Weinstein: I was going to make the same point about sending in any written materials. They may be discoverable under a state’s FOIA law or equivalent or an agreement with a party if there is already ongoing litigation. Be forewarned.
Kellie Lerner: There are so many other questions I would love to ask, but in the interest of time I would just like to end with each of you on trends. It’s always a dangerous game to predict, but let’s just go around and say what you think the trends are going to be on antitrust enforcement in the coming years.
David, do you have any predictions on what trends we might be seeing in enforcement in the coming years? I start with you because of your earlier comment about your AG just getting up to speed and that your answer today may be different than tomorrow. Is there anything that overrides that that you think will occur regardless?
David Sonnenreich: First of all, I really defer to Elizabeth on trends because she runs our group and to a very substantial degree helps figure out where those trends are and what to do about them, and we are very grateful for her leadership.
I think that what we see definitely is that long-term, state antitrust enforcement—I am talking long term because I go back to 1990 with some breaks in private practice—has never been stronger. We are players both at the national level in terms of enforcement actions and increasingly merger actions. The Uniform Law Commission has just put out a uniform pre-merger notification law, which, if it is adopted widely, will make state AGs much more important players in the merger field than we are currently because we will learn about mergers earlier, be able to react to them quicker, and have a bigger seat at the table. I see state involvement continuing.
I think that bipartisan involvement will continue at a strong level. Staffs across the country are committed to working together well and I think increasingly you will see that we have our areas of particular interest amongst the states and in those areas we are going to be very aggressive in enforcing the law and maintaining free markets.
Kellie Lerner: My plan is to go to Elizabeth last as the closer on this topic since she does have her leadership position there, but I will go to Lauren just on the private enforcement side. Do you have any predictions on trends we will see in the future?
Lauren Weinstein: I think there has been strong private enforcement in the last decade or so. I think that trend is going to continue. To the extent that there is strong state and federal enforcement, I would expect to see follow-on actions. My expectation, and David nodded to this as well, is that antitrust enforcement is going to continue both at the federal and state levels at the rates that it has been going at.
The current administration is difficult to predict, but the new head of the Antitrust Division seems to have a reputation for being a strong enforcer, so I do not expect this is going to be a dormant Antitrust Division. Private plaintiffs are entrepreneurial in their own right but also like to take a cue from governments in terms of the cases that they bring, but I think the states are going to become increasingly more important.
We have seen many firms starting practices aimed at states and managing relationships with state enforcers. I think that will continue and I would say there will be more of the same with perhaps changes in subject areas depending on what the federal government does in terms of Big Tech and healthcare, which have been areas of scrutiny.
Kellie Lerner: Building on that, Adam, there has been some prioritization on areas that were somewhat outside antitrust enforcement in areas like noncompetes, no-poach agreements, and even looking to the federal government’s successful rollout of the Procurement Collusion Strike Force. Do you see state enforcers picking that up in any way? Do some of those federal enforcement priorities impact or trickle to states in your enforcement priorities?
Adam Gitlin: I think the states have always considered themselves enforcers of the antitrust laws. Some of our antitrust laws, if anything, predate federal antitrust legislation, and certainly state legislation banning or limiting noncompetes, for example, well predates the FTC’s rule. Those bans not only are going to continue to be enforced, but I would note that for states like ours, where there is already a noncompete statutory ban on the books, it is an excellent source for complaints, some of which can implicate traditional antitrust concerns as well and may go back even farther in time than the statutory bans themselves.
I do not see that there would be any reason for us to be doing any less enforcement. I think, if anything—and this probably echoes what David and Elizabeth said—there is much greater popular appreciation of the importance of antitrust enforcement today than there was a decade ago, and that has trickled down to the state level. I think last year was the first time in anyone’s recollection that, in oversight hearings of the D.C. Council examining the work of the Office of the Attorney General, anyone ever had a question about an antitrust case. It was all encouraging, but it was not something that people remembered having answered questions about before, and I expect that is going to continue, and the states are going to enforce, even if some of the federal priorities change.
One example that I have heard raised about an area where folks do expect continued, vigorous antitrust enforcement on the federal level is with respect to the Big Tech space. If that is true, in many of those cases, a lot of the defenses raised relate to the fact that there is ostensibly lots of innovation in the space, that entry is easy, And if the federal enforcers are nevertheless successful in cases like that that, states will not hesitate to use that case law to achieve results in maybe less technologically dynamic industries as well.
Kellie Lerner: Elizabeth, I give it to you to close us out.
Elizabeth Odette: So just to level set and remind folks, at state AG’s offices we have phone calls, we have report and complaint forms that we get on a daily basis, and often what we are hearing is about budgetary issues, housing, healthcare, and food. If the past is a predictor of the future, state AG’s offices will continue to focus on those areas. We want to respond to the needs of our community, so that is something we expect to happen. As I mentioned before, even with the State Antitrust Venue Act giving states more choice in venue we still have the resource limitations that exist and so I think how and when to exercise that ability to be in your own venue is going to be determinant on specific factors.
Similarly, we have noticed in the last couple of years that state AG’s offices are increasing their numbers in antitrust divisions. Some have created new divisions. In some who had one person wearing three hats—consumer protection, charities, and antitrust—that person is no longer having to wear three hats but maybe gets to wear the one hat and has a colleague that also wears that hat.
I find that encouraging and anticipate that will continue because, as Adam mentioned, antitrust is something that is in common discourse today. Legislators want to prioritize it, which then could translate hopefully to providing higher budgets to state AG’s offices to facilitate that. I think you will continue to see states doing good work. Look to what states have been doing in the last decades and then also look to those issues that you would anticipate a state AG’s office to continue to hear about that might be more local; that is where you will probably see them.
Kellie Lerner: Great. I feel so fortunate to get to hear your perspectives today and I know our readers are going to be equally appreciative of your insights. I want to thank everyone again for your time and your wisdom today. We will all be closely watching antitrust enforcement from each of your respective offices in the coming months and years ahead.
Thank you again.
