COVERING PRYING EYES WITH AN INVISIBLE HAND: PRIVACY, ANTITRUST, AND THE NEW BRANDEIS MOVEMENT.

• Author: Sipe, Matthew

TABLE OF CONTENTS I. INTRODUCTION 360 II. PRIVACY, PERSONAL DATA, AND MARKETS 365 A. The Privacy Paradox and Consumer Demand 367 B. Further Economics of Personal Data 371 III. ANTITRUST THEORY, FROM BRANDEIS TO BORK AND BACK 379 IV. WHERE ANTITRUST MEETS PRIVACY 389 A. The Problem of Smallness 389 B. The Problem of Haphazardness 399 C. The Problem of Lopsidedness 414 V. CONCLUSION 417 EVERY PERSON WHO SHALL MONOPOLIZE... ANY PART OF THE TRADE OR COMMERCE AMONG THE SEVERAL STATES... SHALL BE DEEMED GUILTY OF A FELONY. --SHERMAN ANTITRUST ACT OF 1890 (1) IT IS OUR PURPOSE TO CONSIDER WHETHER THE EXISTING LAW AFFORDS A PRINCIPLE WHICH CAN PROPERLY BE INVOKED TO PROTECT THE PRIVACY OF THE INDIVIDUAL; AND, IF IT DOES, WHAT THE NATURE AND EXTENT OF SUCH PROTECTION IS. --SAMUEL D. WARREN & LOUIS D. BRANDEIS, THE RIGHT TO PRIVACY (1890) (2) I. INTRODUCTION

Public interest in antitrust law has resurged after a long period of relative indolence in enforcement--and all eyes are on the digital giants that define the modern era. Google (3) and Facebook (4) are squaring off against the Antitrust Division of the Department of Justice ("DOJ"), the Federal Trade Commission ("FTC"), and state attorneys general in litigation of historic scale. Amazon (5) and Apple (6) face myriad private suits brought by consumers and competitors alike. Meanwhile, Congress recently concluded comprehensive fact-finding efforts--arguably the first of their kind in more than fifty years (7)--to determine how competition law should "address market power and anticompetitive conduct in digital markets." (8) Various antitrust legislation focused on Big Tech is now under consideration by Congress, (9) though its fate after the recent midterm elections remains uncertain.

As part of this new antitrust push, regulators, legislators, and commentators alike have emphasized the connection between competition in these digital markets and consumer privacy. (10) There is a widely shared hope that robust antitrust enforcement, an area where the United States was historically a leader, (11) can help offset the lack of more direct and comprehensive privacy regulation. It is possible the invisible hand of competition may be able to block Big Tech's prying eyes.

The nature of competition in these modern digital markets presents novel conceptual challenges for antitrust law, to be sure. (12) The central statutory texts were first written to counter the old trusts of steel, oil, and rail; with only "some revisions" since the "time of horse and buggies," they have remained essentially unchanged by legislation for more than a century. (13) Instead, due to the courts adopting an evolving, almost "common-law" approach to the statutes' text, (14) it is the adoption (or rejection) of political and economic theories through precedent that has determined the course of antitrust. Today, a major force behind the renewed interest in antitrust is the "New Brandeis" movement, (15) a growing intellectual coalition that believes the best way to resolve antitrust law's modern challenges is by looking back, drawing on an earlier era of theory and caselaw.

Like their namesake, (16) the neo-Brandeisians argue that antitrust law should focus primarily on market structure--especially market concentration. (17) This school of thought is now strongly represented among antitrust regulators, with figures like Lina Khan (Chair of the FTC) and Jonathan Kanter (Assistant Attorney General for the Antitrust Division of the DOJ) staffing the most important competition policy positions. (18) But the neo-Brandeisians' emphasis on structuralism stands in some opposition to the consumer welfare standard that is actually reflected in contemporary caselaw. (19) Focusing on consumer welfare prioritizes high output and low prices, permitting even overwhelming market concentration so long as it serves (or at least does not undermine) those ends. (20) Critics of the New Brandeis movement's structuralism accordingly argue that it "harm[s] consumers and prop[s] up inefficient corporations," relying on "economics... long [since] discarded to the dustbin of history." (21) Its supporters, on the other hand, argue that the aggregation of economic power itself poses threats that the consumer welfare standard systematically fails to recognize--including threats to democracy writ large. (22)

Can the neo-Brandeisian vision of antitrust law improve consumer privacy as is hoped? This Article takes a skeptical view. Somewhat counterintuitively, the structuralism and interventionism that define the New Brandeis movement risk undermining consumer privacy as much as they promise to enhance it. To some extent, this is a privacy-specific problem, but it also suggests broader issues with the neo-Brandeisians' intentions of using authority over competition to pursue broader social goals.

The Article proceeds as follows. Part II provides a brief primer on privacy in general and the area of personal data in particular, an area where the literature presents an unusual disconnect between stated and revealed preferences among consumers. Despite strong stated preferences for privacy, most consumers readily exchange access to personal information for almost trivial monetary gains--intrinsically complicating the relationship between privacy and market competition. Additional features of personal data, ranging from consumer-side externalities to firm-side economies of scale, further suggest that privacy and market competition are not necessarily linked. Turning to antitrust theory, Part III explains the history behind--and key differences between--the approach advocated by the New Brandeis school and the consumer welfare standard currently represented in caselaw. In brief, the New Brandeis school focuses strongly on firm size and market concentration, including a particular emphasis on removing barriers to entry. In contrast to the consumer welfare standard, this structuralism is more skeptical of efficiency-based justifications for large firms or concentrated markets, like lower prices or enhanced quality. With this in mind, Part IV identifies three major problems for the New Brandeis school in using antitrust law as a privacy policy lever. First, there is a problem of smallness: personal data privacy is likely not better served by a multiplicity of small, independent firms. Second, there is a problem of haphazardness: leveraging authority over competition to pursue freestanding goals like privacy is apt to create issues regarding clarity, uniformity, and competence in antitrust law. Finally, there is a problem of lopsidedness: market competition over privacy, to the extent that it can exist, will further legitimize low privacy protections for poor and marginalized groups.

2. PRIVACY, PERSONAL DATA, AND MARKETS

   Privacy is far from a unitary concept. Samuel Warren and Louis Brandeis's groundbreaking article--generally considered the foundation of American privacy law (23)--defines the core of privacy as "the right to be let alone." (24) This relatively simple formulation would later animate Brandeis's famous dissent in Olmstead v. United States, (25) in turn leading not only to the "reasonable expectation of privacy" test for Fourth Amendment searches and seizures, (26) but also the protection of reproductive autonomy previously established in Griswold v. Connecticut (27) and Roe v. Wade. (28) Looking beyond constitutional rights, federal and state statutes further complicate the idea of privacy. Laws prohibiting employers from requiring HIV testing for applicants, (29) laws creating data fiduciary obligations for the federal government (30) or private companies, (31) and even laws preventing the unauthorized use of someone's likeness in commerce (32) are all nominally aimed at the same thing, however nebulously defined: safeguarding privacy.

   Many scholars have attempted to weave these distinct threads into a useful and coherent tapestry. Focusing exclusively on privacy torts, William Prosser offered a frequently cited four-part taxonomy: (1) intrusion upon seclusion or solitude, (2) public disclosure of embarrassing facts, (3) publicity that creates a false light, and (4) appropriation of name or likeness. (33) Jerry Kang, with considerable influence as well, organized the whole of privacy law along three broad dimensions: (1) physical space, (2) choice, and (3) personal information. (34) More recently, Daniel Solove has divided privacy concerns into four distinct areas, a model centered on data subjects and the flow of their information: "(1) information collection, (2) information processing, (3) information dissemination, and (4) invasions." (35) While the usefulness of these classifications depends on the particular context, their divergence further highlights the "chameleon-like" (36) or "constantly shifting" (37) nature of privacy.

   When discussing Google, Facebook, and the rest of Big Tech, however, the most relevant area of privacy seems clear: collecting, using, and transferring personal data. Personal data is "any information relating to an identified or identifiable natural person" (38)--in other words, everything from a person's shopping tendencies to their phone number to their blood type. The growth and dominance of Big Tech have coincided with an unprecedented increase in the acquisition and monetization of consumers' personal information. (39) It is this area of privacy that antitrust intervention is being proposed to address and on which this Article focuses. It is also, however, an area where the literature on consumer preferences gives cause for skepticism.

   1. The Privacy Paradox and Consumer Demand

      Although heterogenous, consumers typically state a high preference for privacy. For example, surveys from the Pew Research Center show that more than 90% of American adults consider it "important" who can get what information about them, with supermajorities considering it "very important." (40) Comparable...