Borrowing from an earlier tradition first developed in American law by the courts, Congress has a long history of granting express enforcement authority to state attorneys general to bolster the enforcement mechanisms of intended reforms. This article catalogs existing grants to state attorneys general of express “parens patriae” authority, or functionally similar authority, in federal statutes, comments on discernible trends, and opines that the inclusion of “parens patriae” authority in several of the much-discussed “tech” competition bills introduced in the current Congress is highly appropriate given the tendency to reserve such grants for matters of trade regulation and, especially, for those unique to the digital age.
By Matthew Michaloski[1]
Ambrose Bierce quite cleverly defined “reform” as a “thing that mostly satisfies reformers opposed to reformation.”[2] Like all cynics, he was always somewhat but never entirely correct in his observations, and, in this case, a superior definition is to be found in Dr. Johnson’s succinct and felicitous take that to reform is simply “[t]o change from worse to better.”[3]
And that word is on the minds of many lately who think they see a lot of worse in antitrust law that they would like to change for better. Take, for instance, the much-discussed House report on digital markets, concluding that the 18-month investigation of dominant online platforms had “demonstrate[d] the pressing need for legislative action and reform.”[4]
The word also appears in sweeping legislative proposals like the Competition and Antitrust Law Enforcement Reform Act (S.225) whose caption declares its purpose “[t]o reform the antitrust laws to better protect competition in the American economy.” Consider too the Tougher Enforcement of Monopolies Act (S.2039) whose sponsors expressly aim “to reform our nation’s antitrust laws”[5] or Rep. Ken Buck’s recent declaration that passage of the State Antitrust Enforcement Venue Act (S.1787) in the Senate heralds “the beginning of a new era of antitrust reform and proof-of-concept for a bipartisan reform coalition.”[6]
The public square is now filled with speeches, articles, open letters, panegyrics, diatribes, and even TV ad buys opining on the wisdom of the various pieces of antitrust legislation currently pending in the 117th Congress, and the author will not add to the commentary on the substantive merits of these potential reforms. But he does wish to draw attention to one feature common to several bills: the inclusion of an express grant of authority to state attorneys general to bring enforcement actions as “parens patriae” on behalf of their residents. Lawmakers employing this language are drawing on a well-established practice of invoking that doctrine in federal statutes.
The parens patriae concept has long roots in our law though its history and contours are, in the words of one commentator, somewhat “ill-defined.”[7] But, as cultivated in its modern form by the Court over the course of the 20th century, the concept today stands for the reasonably clear — if broad — proposition that state governments have standing to bring actions to vindicate their “quasi-sovereign” interests in protecting their residents’ health and prosperity.[8]
That power has been called an inherent incident of sovereignty, and potentially embraces any number of areas of law and specific causes of action.[9] But, there are also over a dozen federal statutes on the books that expressly permit suits as “parens patriae” and as many more that permit functionally the same thing with different phrasing.
A review of these statutes reveals several trends: express congressional grants of parens patriae authority have overwhelmingly been reserved for matters of trade regulation and have very frequently concerned the unique challenges raised by new technologies (areas typically ripe for “reform” and calling out for effective means of enforcement). It is, then, no surprise that reformers in the legislature have frequently invoked the public-spirited concept of the sovereign’s power to act as parens patriae for its residents when granting enforcement authority to state governments to aid in the execution of their reforms.
Mindful that another gem from Bierce defined “history” as “[a]n account mostly false, of events mostly unimportant,”[10] the author will now attempt both an interesting and a true recounting of Congress’ initial invocation of parens patriae standing in statutory text, the conditions preceding that initial enactment, and Congress’ subsequent use of that language in other statutes.
I. PARENS PATRIAE ENFORCMENT IN THE HART-SCOTT-RODINO ACT
Section 4C of the Clayton Act, 15 U.S.C. § 15c, authorizes state attorneys general to pursue damages “as parens patriae” on behalf of citizens injured by violations of the Sherman Act. The provision was added by Title III of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 shortly after two decisions denying the states’ ability to seek damages under Section 4 of the Clayton Act for injury to the general economy[11] and for injuries suffered by individual citizens.[12]
The HSR Act’s inclusion of an express grant of parens patriae enforcement authority seems to have been the first such instance in any federal statute and was practically invited by the Ninth Circuit’s encouragement in the latter opinion which stated that in bringing suit as parens patriae for residents who had not themselves sued to pursue damages for a price-fixing scheme, “the state is on the track of a suitable answer . . . to problems bearing on antitrust deterrence and the class action as a means of consumer protection,” and further that “if the state is to be empowered to act in [such] fashion . . . that authority must come not through judicial improvisation but by legislation.”[13]
The Supreme Court had earlier made clear that a state may sue as parens patriae for injunctive relief under Section 16 of the Clayton Act, the text of which lacks any reference to parens patriae authority.[14] And the Ninth Circuit in Frito-Lay credited the state’s assertions both that its damages action would “serve a valid public purpose by providing the injured citizens with the closest equivalent of the recovery which, individually, is beyond their reach” and also that it was “essential that this sort of proceeding be made available if antitrust violations of the sort here alleged are to be rendered unprofitable and deterred,[15]” but the court also doubted that recovery for individual citizens could be squared with the “scope of parens patriae authority” as it had been thus far developed in American law as a means “to halt injury to a quasi-sovereign state interest,” i.e. an interest separate and apart from the private interests of the state’s individual residents but related to the conditions necessary for securing its residents’ wellbeing generally.[16] To “halt injury” — it seems — did not entail remediating an injury already past or deterring potential future injuries from other sources as might be accomplished by awarding damages. [17]
With this backdrop, standalone bills expressly empowering state attorneys general to pursue actions for damages as parens patriae for antitrust violations were introduced in the 93rd and 94th Congress, eventually being combined with amendments to the Antitrust Civil Process Act of 1962 and premerger notification requirements as part of the three-title Hart-Scott-Rodino Antitrust Improvements Act of 1976 that would become law after President Ford signed it, publicly doubting that the parens patriae provision was really a change from worse to better but expressing hope in his signing statement that, “if responsibly enforced,” it could “contribute to deterring price-fixing violations, thereby protecting consumers.”[18]
The House Judiciary Committee majority that advanced the measure certainly thought they were changing from worse to better, claiming that they would “employ an ancient concept of our basic English common law — the power of the sovereign to sue as parens patriae on behalf of the weak and helpless of the realm — to solve a very modern problem in antitrust enforcement”[19] — that problem being judicial rejection of the states’ ability to use the parens power to seek damages for antitrust violations. Sponsor Peter Rodino of New Jersey (also the then-chair of the Committee) asserted in a hearing that “States’ attorneys general had similar powers and duties at common law, but judicial interpretation of existing statutory language presently bars such suits in the antitrust field.”[20]
Thus, express grants of authority for the states to exercise their long-established and very broad (albeit somewhat nebulous)[21] power to pursue actions as parens patriae entered federal statutory law as a response to judicial reluctance to extend recognition of that power to one particular, desired application of it, viz., damages actions for antitrust violations.
II. PARENS PATRIAE ENFORCEMENT IN SUBSEQUENT FEDERAL STATUTES
But the concept has the potential for broader application, and lawmakers have continued the practice of expressly authorizing parens patriae enforcement, choosing to include a dozen such enforcement provisions in statutes from the mid-1990’s to as recently as 2018. In order of passage of the relevant laws or amendments, and with the relevant enforcement provisions’ current codifications, express parens authority is given for enforcement of the following federal statutes: violations of the Freedom of Access to Clinic Entrances Act of 1994, 18 U.S.C. § 248(c)(2); deceptive or abusive telemarketing acts or practices proscribed under FTC rulemaking, 15 U.S.C. § 6103; HIPAA compliance, 42 U.S.C. § 1320d-5(d); the Children’s Online Privacy Protection Act, 15 U.S.C. § 6504(a)(1); professional boxing safety standards under the Professional Boxing Safety Act as amended, 15 U.S.C. § 6309(c); prohibited practices under the CANSPAM Act, 15 U.S.C. § 7706(f); consumer protection provisions related to the interstate transportation of household goods, 49 U.S.C. § 14711(a); unfair or deceptive acts or practices in mortgage lending proscribed under CFPB rulemaking, 12 U.S.C. § 5538(b)(1); prohibited practices under the Telephone Consumer Protection Act, 47 U.S.C. § 227(e)(6); unlawful limitations on consumer reviews in violation of the Consumer Review Fairness Act of 2016, 15 U.S.C. § 45b(e)(1); circumvention of online ticket purchasing controls, 15 U.S.C. § 45c(c)(1); and civil actions in connection with human trafficking crimes under the Trafficking Victims Protection Act as amended, 18 U.S.C. § 1595(d).
Several trends are discernible in this list. First, in keeping with the motivation of the HSR Act’s prior use, nearly every one of these provisions expressly authorizes state attorneys general to seek damages or expressly authorizes some other form of monetary relief (whether “fines” or “civil penalties”). Second, most (but not all) of these statutes are concerned principally with the regulation of trade in some fashion, and especially with consumer protection,[22] also consistent with the antitrust laws’ purpose and with the general nature of parens patriae authority.[23] Third, at least half of these statutes appear to concern challenges of trade regulation connected to new digital and telecom technologies and technological innovation of the bad kind, i.e. people or businesses engaging in mischief through previously unavailable technological means — new forms of mischief that lawmakers apparently feared might be insufficiently deterred through federal enforcement or private damages actions alone.
Additionally, there are at least a dozen federal statutes similarly authorizing actions by state attorneys general without express reference to the states’ acting as “parens patriae” but with reference to their acting “on behalf” of their “residents” (or very similar wording) which is precisely what it means for states to act as parens patriae.
This group includes violations of the Commodity Exchange Act or implementing rules, 7 U.S.C. § 13a-2; restrictions on debt relief agencies, 11 U.S.C. § 526; violations of requirements for credit repair organizations, 15 U.S.C. § 1679h; violations of the Fair Credit Reporting Act, 15 U.S.C. § 1681s(c); unfair and deceptive acts and practices in connection with agents representing college athletes, 15 U.S.C. § 7804; failing Consumer Product Safety Commission standards for special packaging for household substances harmful to children, 15 U.S.C. § 1477; online dispensing of controlled substances without valid prescriptions, 21 U.S.C. § 882(c); enforcement of consumer product safety rules, 15 U.S.C. § 2073(b); violations of the Federal Hazardous Substances Act, 15 U.S.C. § 1264(d); violations of the Federal Odometer Act, 49 U.S.C. § 32709 (d); violations of the Flammable Fabrics Act, 15 U.S.C. 1194(a); and certain unfair and deceptive internet sales practices, 15 U.S.C. § 8405.
Clearly these too are concerned with the regulation of trade, and primarily with consumer protection, and many — though not all — also authorize the states to seek damages.
It is not readily apparent why lawmakers would invoke the power of “parens patriae” by name in the HSR Act and nearly a dozen other statutes while also choosing in just as many other cases to authorize a similar power without direct reference to the doctrine. There are no apparently different trends in terms of the specific topics addressed by each group. Nor does it seem to be the case that a more formal method of statutory wording faded in favor of a less formal one over time, the on-behalf-of-residents method appearing as early as 1978 with the amendments to the Commodities Exchange Act referenced above[24] and the express “parens” method having continued to the present.[25] These methods thus appear functionally identical (and identically functional).
There are yet more federal statutes that authorize enforcement by state attorneys general but without any reference at all either to parens authority, by name, or otherwise to the states’ acting on behalf of their citizens or residents.[26] These do, again, tend all to be concerned with the regulation of trade, though not uniformly with consumer protection, and they tend not to authorize damages.
Thus, it might be said that the more explicitly a federal statute granting enforcement authority to states draws on the existing concept of “parens patriae” power and, further, the more consumer-oriented it is, then the more likely it will be to provide for the recovery of damages expressly as an available remedy, thus returning to the point of lawmakers’ first use of that phrase in statutory text, but this is no firm rule (for instance, the Restore Online Shoppers’ Confidence Act is unquestionably a consumer protection statute and authorizes only injunctive relief, 15 U.S.C. § 8405(a)).
From all this a few more firm generalizations about Congress’ grants of explicit enforcement authority to the states can be distilled: building on the existing judicial development of parens patriae standing in American law, Congress has seen fit (especially since the beginning of the internet age) to grant statutory enforcement authority to the states as representatives of their citizens for various actions, usually (but not always) doing so under the name of that doctrine, or something equivalent, and usually (but not always) identifying damages as a remedy, and overwhelmingly (but not quite always) for the purpose of regulating trade and quite often for purposes of consumer protection. And if this seems like a rather wordy summarization, it is at least a very accurate one and illustrates that lawmaking is a practical and not a theoretical science.
III. PARENS PATRIAE ENFORCEMENT PROVISIONS IN CURRENT ANTITRUST LEGISLATION
Having now led the patient reader on a circuitous course through nearly a dozen different titles of the United States Code and half a century of lawmaking, this article will bring that knowledge to bear on present-day attempts at reform in antitrust law.
Four unique competition-related bills in the current Congress contain express parens patriae enforcement provisions for state attorneys general.[27] In order of their introduction, the list begins with the coyly-titled Bust Up Big Tech Act (S.1204) introduced by Sen. Hawley in April of 2021. Broadly, the bill would ban the vertical integration of platform owner/participants in the provision of several specific digital services. The bill provides for a private right of action and expressly provides for actions by state attorneys general as parens patriae on behalf of injured residents for recovery of damages and other relief.[28] Per a press release, the bill would “[e]nsure the antitrust laws are actually enforced, by authorizing state attorneys general and private citizens to bring civil actions to ensure compliance.”[29]
The American Choice and Innovation Online Act (H.R.3816), introduced in June of 2021 as one member of a prominent group of “tech” bills in the House,[30] prohibits large digital platforms from engaging in any of a dozen “discriminatory” forms of conduct and includes an express authorization for actions by state attorneys general as parens patriae on behalf of injured “natural person” residents to pursue existing remedies available under the Clayton Act (including damages) as well as for civil penalties authorized by the Act itself.[31] Notwithstanding differences in the substantive prohibitions, a Senate version rumored to be nearing a floor vote and diabolically titled the American Innovation and Choice Online Act (S.2992) contains an identical grant of parens enforcement power for the same remedies.[32] In a July 29, 2021, letter to the Director of the Administrative Office of the United States Courts co-authored by the sponsors of the bills in both chambers, they note “the statute permitting states to bring parens patriae actions for damages was passed as a response to under-enforcement of the antitrust laws.”[33]
Another of the original “tech” bills introduced together in the summer of 2021, the Platform Competition and Opportunity Act, contains the same parens patraie enforcement provision. Nearly identical versions in both chambers (H.R.3826 and S.3197) would render most acquisitions by large digital platforms presumptively unlawful.[34]
And the same enforcement provision appears once more in the Open App Markets Act, introduced late in the summer of 2021 (as S.2710[35] and subsequently in the House as H.R.5017).[36] The bill would, among other things, prohibit requiring mobile app developers to use default in-app payment systems as a condition of distribution through an app store.
Another bill, the State Antitrust Enforcement Venue Act (H.R.3460 and S.1787) affects state enforcement as parens patriae under Sec. 4C of the Clayton Act very directly but presents no occasion for providing a new grant of such authority, intended instead to bolster existing state enforcement authority by removing eligibility for state actions for damages as parens patriae under the Clayton Act to be transferred to multidistrict litigation — a feature imposed from the beginning by the HSR Act,[37] but now thought to be an obstacle to optimal enforcement.[38]
Each of these bill’s use of (or relation to) express parens patriae authority for damages actions is consistent with the generalizations described above and continues the now half-century practice of supplementing the enforcement efforts of federal and private actions with those of the states and thereby augmenting the deterrent potential of the intended reforms, choosing — here — to do so by express invocation of that doctrine and its long connection to the states’ protection of residents’ economic wellbeing (see Snapp, supra at 607).
Testifying on a predecessor bill to the HSR Act in 1974, the then-Attorney General of Virginia remarked that the inclusion of a parens enforcement action for damages offered “tools, both procedural and remedial” for the “effective enforcement and deterrence of antitrust violations” to be enhanced.[39]
Clearly many lawmakers from then to now have been similarly convinced of the utility of this enforcement mechanism, and — to quote once more the ever pithy and uncynical Dr. Johnson — enforcement is “that which gives force to a law,”[40] law itself being those “rule[s] of action”[41] that order human action toward our collective wellbeing and prosperity, the very ends the states are meant to pursue when acting as parens patriae . . . and to preserve that hopeful note, the author will leave the reader to discover on his or her own what foul things Bierce had to say about “law.”
[1] Matt is a Deputy Attorney General in the Office of Indiana Attorney General Todd Rokita. The opinions expressed are those of the author and do not necessarily reflect the views of the Attorney General or his Office. This article is for general information purposes and is not intended to be and should not be taken as legal advice.
[2] Ambrose Bierce, The Devil’s Dictionary (1911).
[3] “reform, v.a.” A Dictionary of the English Language, by Samuel Johnson. 1755.
[4] U.S. HOUSE OF REPRESENTATIVES, 116TH CONG., REPORT ON INVESTIGATION OF COMPETITION IN DIGITAL MARKETS: MAJORITY STAFF REPORT AND RECOMMENDATIONS (2020) at p. 7. https://perma.cc/L63X-LWKF.
[5] https://www.grassley.senate.gov/news/news-releases/lee-grassley-introduce-team-act-to-reform-antitrust-law.
[6] https://buck.house.gov/media-center/press-releases/buck-statement-senate-passage-state-ag-venue-bill.
[7] Margaret S. Thomas, Parens Patriae and the States’ Historic Police Power, 69 SMU L. Rev. 759 (2016).
[8] Alfred L. Snapp & Son, Inc. v. Puerto Rico, ex rel., Barez, 458 U.S. 592, 601–02 (1982)
[9] U.S. v. Thompson, 98 U.S. 486, 489–90 (1878). See 42 A.L.R. Fed. 23 (Originally published in 1979) for a catalog of the various kinds of actions states have attempted to bring under such authority.
[10] Bierce, supra note 2.
[11] Hawaii v. Standard Oil Co., 405 U.S. 251 (1972).
[12] California v. Frito-Lay Inc., 474 F.2d 774 (9th Cir. 1973), cert. denied, 412 U.S. 908 (1973).
[13] Id. at 777.
[14] Georgia v. Penn. R.R. Co., 324 U.S. 439 (1945)
[15] Frito-Lay at 776–77.
[16] It did not engage with one very recent district court opinion endorsing a state’s suit as parens patriae to recover damages for pollution to her coastal waters. State of Maine v. M/V Tamano, 357 F. Supp. 1097 (D. Me. 1973). Id. at 775 (citing Hawaii v. Stand. Oil Co. at 257–59) (emphasis added).
[17] Cf. Exxon Ship. Co. v. Baker, 554 U.S. 471, 492–93 (2008).
[18] Gerald Rudolph Ford, Statement by the President on Signing H.R. 8532 Into Law. (Sept. 30, 1976).
[19] H.R. REP. 94-499(VI) at 8–9.
[20] Antitrust Parens Patriae Amendments, Subcomm. on Monopolies and Commercial Law of the Comm. on the Judiciary (Feb. 20 and March 6, 1975).
[21] See Alfred L. Snapp & Son, Inc. v. Puerto Rico, ex rel., Barez, 458 U.S. 592, 601 (1982) (the “quasi-sovereign” interest necessary to support parens standing “does not lend itself to a simple or exact definition.”).
[22] As used several times throughout this article, I mean by “consumer protection” those measures that protect the interests of the end consumer (or user) as is the case with many federal and state statutes focused on addressing the unique vulnerabilities of the consumer as compared with other buyers upstream in the supply chain.
[23] And even those statutes not clearly related to the regulation of trade appear to bear at least some putative connection to protecting residents’ health, thus covering the other half of the Court’s formulation that the state holds a quasi-sovereign interest “in the health and well-being — both physical and economic — of its residents in general.” Snapp, supra at 607 (emphasis added).
[24] PL 95–405 (S 2391), PL 95–405, SEPTEMBER 30, 1978, 92 Stat 865.
[25] In fact there are many current bills covering a broad range of topics that invoke it: https://www.congress.gov/search?q=%7B%22congress%22%3A%5B%22117%22%5D%2C%22source%22%3A%22all%22%2C%22search%22%3A%22%5C%22parens%20patriae%5C%22%22%7D.
[26] See, e.g., 12 U.S.C. § 2614; 15 U.S.C. § 1640(e); 21 U.S.C. § 337; 27 U.S.C. § 122a(b); 31 U.S.C. § 5365(b)(2).
[27] Interestingly, one additional statue (S.3410) would amend the Clayton Act to grant the federal government a power to act as parens patriae in a way analogous to that of the states by authorizing the U.S. Dept. of Justice to act as “parens patriae” to seek damages for unfair methods of competition found to violate the FTCA upon referral from the FTC (following AMG Capital Management, LLC v. FTC’s preclusion of equitable monetary relief under Section 13(b) of the FTCA. 141 S.Ct. 1341 (2021)). See Late Corp. of the Church of Jesus Christ of Latter-Day Saints v. U.S., 136 U.S. 1 (1890) (applying the power to act as parens patriae to the federal government); see also Thomas, supra note 7 at 783–86.
[28] Sec. 2(d), S.1204 – 117th Congress (2021-2022): Bust Up Big Tech Act, S.1204, 117th Cong. (2021), https://www.congress.gov/bill/117th-congress/senate-bill/1204.
[29] https://www.hawley.senate.gov/senator-hawley-introduces-bust-big-tech-act.
[30] https://www.cnbc.com/2021/06/24/house-committee-passes-broad-tech-antitrust-reforms.html.
[31] Sec. 2(h)(4), Text – H.R.3816 – 117th Congress (2021-2022): American Choice and Innovation Online Act, H.R.3816, 117th Cong. (2021), http://www.congress.gov/.
[32] Sec. 3(c)(3), Text – S.2992 – 117th Congress (2021-2022): American Innovation and Choice Online Act, S.2992, 117th Cong. (2022), http://www.congress.gov/..
[33] https://www.klobuchar.senate.gov/public/_cache/files/d/9/d9fa03da-0d55-4b30-8f40-aa633df1aceb/EDDAE8FE2D9B89B0CD29E5BDA668A44A.07.28.2021-letter-to-hon.-roslynn-mauskopf-re-state-antitrust-enforcement-venue-act.pdf.
[34] Sec. 5(d), Text – H.R.3826 – 117th Congress (2021-2022): Platform Competition and Opportunity Act of 2021, H.R.3826, 117th Cong. (2021), http://www.congress.gov/; Sec. 5(d), S.3197 – 117th Congress (2021-2022): Platform Competition and Opportunity Act of 2021, S.3197, 117th Cong. (2021), http://www.congress.gov/.
[35] Sec. 5(a)(3), Text – S.2710 – 117th Congress (2021-2022): Open App Markets Act, S.2710, 117th Cong. (2022), http://www.congress.gov/.
[36] Sec. 5(a)(4), Text – H.R.5017 – 117th Congress (2021-2022): Open App Markets Act, H.R.5017, 117th Cong. (2021), http://www.congress.gov/. Each version also authorizes private treble damages actions for injured developers.
[37] Sec. 303, PL 94–435 (HR 8532), PL 94–435, September 30, 1976, 90 Stat 1383.
[38] https://buck.house.gov/media-center/press-releases/rep-buck-introduces-state-antitrust-enforcement-venue-act; see also https://1li23g1as25g1r8so11ozniw-wpengine.netdna-ssl.com/wp-content/uploads/2021/06/Final-State-Antitrust-Enforcement-Venue-Act-Endorsement.pdf (letter from 52 state (and territorial) attorneys general asserting that eliminating the possibility of transfer will promote “more efficient, effective, and timely adjudication” of enforcement actions).
[39] Antitrust Parens Patriae Amendments, Subcomm. on Monopolies and Commercial Law of the Comm. on the Judiciary (Mar. 18 and Mar. 25, 1974).
[40] “enforcement, n.s.” A Dictionary of the English Language, by Samuel Johnson. 1755.
[41] “law, n.s.” A Dictionary of the English Language, by Samuel Johnson. 1755.
