A Textualist Justice Makes Folks Uncomfortable

Apple v Pepper is an antitrust case in which the plaintiffs argue that Apple’s requirement that all iPhone apps must be sold through Apple’s app store is a monopoly that Apple abuses by charging excessive commissions on app sales.

The Wall Street Journal has its editorial knickers in a twist because Justice Brett Kavanaugh, writing for the majority, rejected Apple’s plaint that the case be dismissed. The result is that the case continues in trial court.  Yet the editors are upset that Kavanaugh’s ruling “gutted four decades of precedent,” as though precedent cannot be erroneous and so must be unchanging for the ages.

Justice Kavanaugh [opined] based on the text of the Clayton Act, but the Court has long interpreted antitrust statutes alongside common law principles of proximate causation.

How shocking that a textualist ruled on the basis of the text and disagreed with judges imposing personal views of “common law principles” on what a law actually says.

Contrary to the editors’ thrust, all that has happened at this point is that the suit is allowed to proceed in a lower court. This actually represents a golden opportunity to apply the text of antitrust law to the likes of Alphabet, Facebook, Twitter, Apple, et al., which have capabilities of which Clayton could not conceive. In what ways might tech giants exercise monopoly power (legal) or abuse it (illegal)?

At bottom, as the case itself makes it way to the Supremes, it would be a golden opportunity for that Court to tell the Congress to do its political job. Bleatings about “common law” and judges’ perceived principles inhering in “common law” notwithstanding, everything that Clayton means is contained in the text of that law.  Everything that that century-old Congress intended when it enacted that law is contained in the text of that law and nowhere else.  If the law needs updating to address today’s digitally-oriented monopolies, that’s the political task of today’s Congress, not the judicial task of any era’s Justices.

A Shift May Be Beginning

As the tariff volleys in the People’s Republic of China’s years-old economic war (of which trade is just one component) against us begin to grow, some potential changes in international trade and production for trade are becoming visible.  If these apparent changes represent the beginning of a solid trend, the changes and the trend will not be to the PRC’s benefit.

It’s true that consumer prices might start to rise in both our nation and in the PRC, but as a population—and as a people—we’re better able to absorb those increases than is the population of the PRC.  Our per capita GDP is $62,500, more than three times the PRC’s $19,520.

It might get worse from there.

  • Sweden-based telecom gear-maker Ericsson AB is preparing to shift some manufacturing from the PRC to the US, Estonia, Brazil, and Mexico
  • Republic of China-based AsusTek Computer Inc has been moving some production bases domestic facilities and Vietnam from the PRC
  • Foxconn, which assembles a huge share of iPhones, has been considering producing the devices in India and Vietnam
  • The 25% tariff on PRC-made lithium batteries means PRC producers will have difficulties competing with Korea’s LG Chem and Japan’s Panasonic Inc, both of which already have lithium battery production facilities in the US

If that sort of thing spreads and grows, and if US exporters find other markets (as US farmers are doing for next year’s crops, while others change the crops they grow for export), it won’t be good for the PRC’s economy—or for PRC President Xi Jinping’s political standing in his Party.