The International Alliance of Theatrical Stage Employees (IATSE) and the Directors Guild of America (DGA) issued joint comments to Federal Trade Commission (FTC) Chairwoman Lina M. Khan on Thursday in support of FTC and U.S. Department of Justice (DOJ) proposed changes to the agencies’ Merger Guidelines. The FTC-DOJ Merger Guidelines describe and guide the agencies’ review of mergers and acquisitions to determine compliance with federal antitrust laws.
“Open, competitive, resilient markets have been a bedrock of America’s economic success and dynamism throughout our nation’s history. Faithful and vigorous enforcement of the antitrust laws is key to maintaining that success,” said FTC Chair Lina M. Khan.
“Unchecked consolidation threatens the free and fair markets upon which our economy is based,” said Attorney General Merrick B. Garland. “These updated Merger Guidelines respond to modern market realities and will enable the Justice Department to transparently and effectively protect the American people from the damage that anticompetitive mergers cause.”
Both agencies encouraged the public to review the draft and provide feedback through a public comment period, concluding on September 18, 2023. The agencies will use the public comments to evaluate and update the draft before finalizing the guidelines.
The joint letter, signed by IATSE International President Matthew D. Loeb and DGA National Executive Director Russell Hollander, commented:
The draft merger guidelines represent an important course correction that will once again allow the Government to review the impact of consolidation and vertical integration in the entertainment industry on our members and other workers in the in film and television industry. The rapid growth of online streaming and the influence of a few dominant technology companies have pushed most of the major studios to withhold sales of feature films and television programs from the open market in a race to build their own subscription streaming platforms that offer exclusive access to their self-produced content. These practices have negatively impacted DGA and IATSE members, and other workers by endangering jobs, competitive wages and benefits, residual or re-use payments, working conditions, and opportunities to create a wide range of movies, and television shows.
Despite Congress’ explicit intent that, under the original Sherman Act of 1890, the government consider the impact monopolies and anti-competitive behaviors have on labor markets, regulators focused on the ineffective and short-sighted consumer welfare standard that only considers allocative efficiency and the cost and quality of products and services. The proposed guideline number 11 makes clear that the agencies may, in fact, challenge a transaction on the ground that it substantially lessens competition in a labor market.
The proposed merger guidelines are a step forward for American workers and the labor unions that represent them.
