It’s all talk: No trust in antitrust

February 14, 2013

A recent New York Times headline whetted the proverbial whistle: “Justice Dept.’s Fight Against Modelo Brings in Familiar Face.”Modelo, the name of a lovely Mexican beer, drew me into a brief story that related how the company’s outside counsel, Christine Varney, is “squarely at odds” with the U.S. Department of Justice in its lawsuit to stop Anheuser-Busch InBev from buying control of Grupo Modelo, the beer’s parent company.

Varney is the “familiar face.” From Jan. 2009 to July 2011 she was DOJ’s antitrust boss that, the Times reported, is “credited with a revival of the team after years of dormancy under the Bush administration.”

Now, however, she’s reviving her bank account as an attorney in InBev’s antitrust fight with the DOJ to knock back the remaining part of Modelo that InBev hasn’t already swallowed. By the way, there’s $20.1 billion on the bar for Modelo.

Bursting appearance.

To many in agriculture, Varney burst on the antitrust scene like Joan of Arc in the first Obama Administration. Most saw her charging into battle with subpoenas and injunctions to sweep farm fields and feedlots of market colluders, price fixers and deck sackers.

Farmers and ranchers believed it because Varney and her chief deputy, Philip Weiser, spent most of 2009 reassuring ag buyers and sellers that the government’s antitrust swords were drawn and, soon, anti-competitive heads would roll.

In a speech to the Organization for Competitive Markets in Aug. 2009, Weiser called the Sherman Antitrust Act the “Magna Carta of free enterprise” and vowed that Varney and DOJ would use it to address “both traditional markets and the challenges to competition in our modern, high technology economy.”

The Wall Street Journal was so taken aback by the tough antitrust talk that it called one 2009 Varney speech “the Beltway version of a large fish wrapped in a newspaper” about to dropped on Big Biz’s front stoop.

Moving slowly

But government moves slowly and justice moves even more slowly so little — in truth, nothing — happened in 2009. In early 2010, however, the klieg lights were lit and agriculture was put center stage in a series of “joint DOJ/USDA workshops to … discuss competition and regulatory issues in the agriculture industry,” announced DOJ.

One of meetings’ key goals, the agency claimed, was “to listen and learn from parties with real-world experience…”

So, off to Iowa, Alabama, Wisconsin and Colorado flew Attorney General Eric Holder, Secretary of Agriculture Tom Vilsack, antitrust chief Varney and other assorted D.C. ducks “to listen and learn” about market competition, vertical integration, market transparency and “buyer power” in the seed, poultry, dairy, hog and cattle sectors.

At the gatherings, however, quacking politicians and defensive Agbiz Boys used most of the time and all the oxygen to ensure that nothing was put on any table other than lunch.So, after a year of jets, jabber and jockeying, nothing happened. In mid-2011, Varney left DOJ for New York and a corporate law partnership at Cravath, Swaine & Moore at a salary several times her Justice pay.

Ten months later, in May, 2012, DOJ released its 2010 ag workshop findings in a 24-page report titled “Competition and Agriculture… Thoughts on the Way Forward” that only three people — its writer, some snowed-in guy in a cabin in Idaho and me — read. (Read at http://www.justice.gov/atr/public/reports/283291.pdf. Please.)

And, to absolutely no one’s surprise, nothing happened. But all this nothingness wasn’t Varney’s fault; by every account and action, she tried.

Each try, however, found little support from Holder and even less from the White House. In his second inaugural address Jan. 21, 2013, President Obama once again committed his administration to antitrust enforcement by noting that “a free market only thrives when there are rules to ensure competition and fair play.”