The Corner Newsletter: California Takes Antitrust Leadership Role ( July 14th, 2026)
Welcome to The Corner. In this issue, we explore how California’s COMPETE Act sets the stage for California to become a global superpower in antitrust, as the Trump administration all but suspends federal enforcement.
California’s Push to Become an Anti-Monopoly Superpower
Karina Montoya
The California legislators behind a plan to strengthen and expand the state’s antitrust regime overcame a key hurdle June 30 as the Senate Judiciary Committee voted 9-2 to advance the bill to a full vote. At a time when the Trump Administration has all but suspended traditional federal antitrust enforcement, the COMPETE Act (bill AB 1776) sets the stage for California to take over antitrust leadership in the U.S., with nationwide and international effects.
Introduced by assemblymember Cecilia Aguiar-Curry, the COMPETE Act prohibits monopolistic behavior by single firms, preserves California courts’ independence from federal precedent that weakens the state’s existing antitrust law, and makes it more difficult for monopolists to argue that the effects of their dominance in one market can be offset in another market. The bill also expressly exempts independent businesses (up to 100 employees with and $10 million in annual revenue) from the single-firm prohibition, which would make it easier for them to enter new markets to challenge incumbents.
California’s current antitrust law, the Cartwright Act restricts antitrust prosecution to instances where two or more firms conspire to monopolize markets, such as through price-fixing or cartel-like conduct. This limits the state’s ability to charge corporations in state courts for violations such as abuse of market power to crush small competitors, suppress wages, increase prices, or foreclose competition through mergers and acquisitions. Adding a single-firm prohibition will bring California into alignment with the Sherman Act.
Even though 45 other states allow prosecution of single-firm conduct, such a reform of California law could result in much stronger antitrust enforcement across the nation. California’s economy is the fifth largest economy in the world, behind only the U.S. as a whole, China, the European Union, and Germany. This means that a California antitrust case against a single firm that orders a breakup or behavioral changes would have enormous impact on a corporation.
In fact, many smaller law enforcers already have a similar effect. For instance, after the UK competition authority ordered Google to change how the corporation treats publishers in AI Overviews within the UK market, Google chose to implement the policy globally. Similarly, a recent decision by the French authority regarding Google’s anticompetitive behavior in digital advertising also led to global changes.
Since its introduction in February 2026, the COMPETE Act has faced fierce opposition from pro-big business groups, including Big Tech’s direct lobbying. Collectively, these corporations spent more than $6 million in lobbying against this bill and related matters, The Lever reported. The California Chamber of Commerce (CalChamber) alone spent almost $2 million so far this year, while Google spent almost $300,000.
Despite these efforts, the California Assembly approved the bill passed in late May with a 44-17 vote. At the June 30 hearing, Aguiar-Curry gave compelling testimony on how the COMPETE Act would address everyday problems of Californians, such as access to medication. “In my community I had three pharmacies. They went away. My residents live 10 to 15 miles away from the nearest CVS. We struggle with that,” said the assemblymember, who represents the Napa, Lake, Yolo and Colusa counties, with a population of about 500,000.
Much of the ongoing debate around the bill is now centered on an effort to eliminate the Cartwright Act provision that grants private parties the right to sue for antitrust violations. Eric Enson, partner at Crowell & Moring and a representative of CalChamber, argues that the bill’s new exemption of small businesses from antitrust enforcement will lead some to overuse the private right of action. The CalChamber representative contends that only the state attorney general should be able to bring cases under the California legislation, contrary to both federal legislation and many state laws.
In response, Abiel Garcia, partner at the law firm Kesselman Brantly Stockinger and a former prosecutor at the California attorney general’s Office, said eliminating this right would make of California an odd outlier among other states and federal law. He also noted that the bill does not protect the right of private parties—small businesses included—from starting frivolous lawsuits against single firms. “The burden of proof is still on the plaintiff,” he said.
The last step for the bill before it goes to the Senate floor is the Appropriations Committee, which has scheduled a hearing for August 3. Even as support for the bill has grown, governor Gavin Newsom and attorney general Rob Bonta have yet to signal whether they support it.
📝 WHAT WE'VE BEEN UP TO:
Open Markets industrial policy program manager Audrey Stienon spoke on a panel discussing the risks of private equity to consumers alongside Connecticut attorney general William Tong at the National Association of Attorneys General 2026 Presidential Summit earlier this month.
Open Markets Institute food systems program director Claire Kelloway published an article in the Washington Monthly describing how a recent settlement by major egg producers with the Department of Justice and the states confirms an argument she made in a 2025 Washington Monthly piece that concentrated market power and greedflation, not bird flu, caused a spike in egg prices.
Open Markets EU policy lead Giorgos Verdi argued in Project Syndicate that Europe’s Tech Sovereignty Package, aimed at reducing its dependence on U.S. Big Tech corporations, will only succeed if coupled with equally ambitious efforts to curb market concentration. “Even if the Tech Sovereignty Package succeeds beyond expectations and helps create a new generation of fast-growing European startups, Big Tech could still use its market dominance to acquire or otherwise eliminate these challengers,” Verdi warned.
Open Markets welcomed the European Commission’s draft merger guidelines as an overdue modernization of EU competition rules, while warning that loopholes around “efficiency,” “scale,” and “dynamic efficiencies” could allow dominant firms to justify harmful consolidation. OMI urged the Commission to treat scale arguments with skepticism, strengthen scrutiny of mergers involving powerful incumbents, and flip the burden of proof so dominant firms must show that further consolidation will not harm competition, innovation, workers, resilience, or democracy. Open Markets Europe director Max von Thun and research fellow Claire Lavin published an op-ed in ProMarket warning against the new bias toward efficiency and large corporations. “Research shows how mergers often fail to benefit market competition and competitive outcomes like lower prices or worker wages,” they wrote. Read the full submission here.
OMI senior legal analyst Daniel Hanley argued in an article in Competition Policy International that lower courts are obligated to order structural relief when it is reasonable, writing, “Judges and enforcers must recenter effective remedies as the core of antitrust law and resist the urge to issue or seek favorable judgments that merely identify violations and restrain the conduct at issue.”
Food Program Manager Claire Kelloway appeared on Vermont Public Radio to discuss dairy consolidation and the decision to idle a major local processing plant by the dominant cooperative, Dairy Farmers of America. “It’s the accumulation of a decades-long trend of consolidation in dairy writ large, both at the farm level and processing level,” Kelloway said.
Open Markets Institute’s Center for Media and Digital Governance welcomed the French competition authority’s decision compelling Meta to negotiate with the French media transparently and in good faith after recognizing that the corporation was likely abusing its dominant position. “This decision is about European sovereignty and democracy as much as competition or bargaining power,” Courtney Radsch, CMDG@OMI director said. “American Big Tech has the power to break Europe’s news industry and reshape how an entire continent gets its information — undermining the foundations of its democracy.”
CMDG@OMI director Courtney Radsch represented CMDG at three events in Geneva — the UN Global Dialogue on AI Governance, the International Telecommunications Union’s AI for Good Summit, and World Summit on the Information Society forum at which she discussed who should govern AI and whether global AI policy will prioritize public interest, rights, and democratic accountability over corporate control.
Open Markets chief economist Brian Callaci spoke on a panel at the Comparative Organizational Inequality Network conference, held last month at Sciences Po in Paris. Callaci discussed the predatory franchising model, the topic of his recent book Chains of Command: The Rise and Cruel Reign of the Franchise Economy.
The Financial Times quoted Open Markets senior fellow Matt Scherer in a piece questioning the economics of the AI boom as saying the generative AI industry is producing 11 digits of annual revenue to cover 13 digits of annual spending.
WebProNews highlighted Open Markets’ report on the emerging AI content licensing market in coverage of Cloudflare’s move to make AI firms pay publishers or face blocked access. The piece cited OMI’s estimate that Cloudflare could take around 30 percent of revenue from its pay-per-crawl marketplace.
🔊 ANTI-MONOPOLY RISING:
Apple lost its challenge against a ruling under the EU’s Digital Markets Act that designated its app stores and operating system as gatekeepers. The EU Court of Justice rejected Apple’s attempt to argue that the DMA was illegal under EU law, which opens the door to the European Commission imposing interoperability obligations on Apple. (Reuters)
Getty Images will terminate its planned $3.7 billion merger with rival Shutterstock due to conditions imposed by the UK’s Competition Markets Authority, which mandated that Shutterstock sell its editorial business in order to gain approval for the merger. The canceled agreement between the two stock photo giants shows that U.S. approval isn’t necessarily all that’s needed to get a deal done and that making vague claims that AI threatens business is not going to fly as a defense against consolidation. (Wall Street Journal)
John Deere reached a right-to-repair settlement with the Federal Trade Commission over a lawsuit filed against the farm equipment manufacturer last year. The settlement enables farmers to fix their own tractors and farm equipment without having to purchase proprietary tools from authorized dealers. (New York Times)
SAP agreed to a binding package of commitments with the European Commission to resolve antitrust concerns over the software company’s policies for its on-premises enterprise resource planning (ERP) software. The commitments to give customers greater flexibility to select third-party maintenance providers, discontinue support for unused software licenses, and avoid contractual practices that could limit competition in the aftermarket will remain in effect worldwide for a decade. (Competition Policy International)
📈 VITAL STAT:
5,000
The number of pharmacies suing two pharmacy benefit managers — Blue Cross Blue Shield’s Prime Therapeutics and Cigna’s Express Scripts — for price-fixing. An umbrella group representing the pharmacies filed the lawsuit in federal court alleging that Prime adjusted its higher reimbursement rates and lower fees to match Express Scripts’s rates. (Fierce Healthcare)
📚 WHAT WE'RE READING:
The Reverse Centaur’s Guide to Life After AI: How to Think About Artificial Intelligence Before It’s Too Late: In Cory Doctorow’s book on AI — released less than eight months after his seminal book Enshittification — the prolific tech critic exposes the financial shenanigans behind the corporations shoveling trillions of dollars into AI even while he acknowledges the transformational potential of the technology.