Auto Workers Aren't Striking Only For Higher Wages. They Want Their Pensions Back, Too

WAGE THEFT BY ANY OTHER NAME

Jo Constantz and Josh Eidelson
Wed, September 27, 2023 

(Bloomberg) -- On picket lines around the country, auto workers aren’t just demanding higher wages. They want to get back their once-sacred retirement pensions.

While United Auto Workers members who were hired prior to the 2008 financial crisis have pensions, those brought on since have received 401(k) plans instead. The union is demanding the auto companies provide pensions for new employees and those who currently lack them.

“We need to do something, because right now, if you came in after ’07, you don’t have a pension,” said Ryan Ashley, a Ford engine plant worker in Cleveland. “You could retire, and the economy tanks. Whereas at least a pension is guaranteed money.”

Ford Motor Co., General Motors Co. and Stellantis NV are determined to consign pensions to the past even as striking UAW members are just as keen to revive them. The fight has resonance well beyond the auto industry: With inflation persisting as the US enters another fraught presidential election cycle, the plight of the middle class — and the financial condition of millions of retirees — is front and center.

Labor experts don’t see a return to a system of full-fledged pensions happening anytime soon, if ever, because of the massive cost associated with them. Even so, demanding pensions is a smart strategy, some say, because it reminds both sides how far behind auto workers have fallen since their heyday.

“The UAW jobs used to be seen as the best jobs and working for the auto company, you’re making big money — buy boats, buy houses, do whatever you want to do,” said Arthur Wheaton, director of Labor Studies at Cornell University’s School of Industrial and Labor Relations who teaches contract negotiations. “If you’re a new hire hired in the last four years, you’re not buying anything, you may be renting and you may be working two jobs. It’s a very different scenario.”

Using pension demands as a bargaining chip could lead to other sweeteners, such as more generous matching contributions to 401(k) funds.

“The UAW might end up settling for something less, but they might say, ‘We’re not giving up on these issues, we’re going to push harder,’” said John Logan, chair of the Labor and Employment Studies department at San Francisco State University.

Up until the 1980s, the most common retirement plans were defined-benefit pensions, under which employees typically get a guaranteed set monthly income in retirement and employers took on the cost and the risk. Nowadays traditional pensions are rare in the US outside of the public sector.

A full-scale shift in almost every industry in the US began in the 1980s, as companies undergoing a wave of restructuring moved from pensions to so-called defined contribution plans, like 401(k)s, where employees decide how much to contribute and companies often match funds up to a set amount. Under this model, the employee assumes most of the cost and all of the risk: There are no guarantees for what an individual’s monthly income will look like in retirement, since that depends on how much money they contribute and how their investments perform.

Now that the major Detroit auto companies are raking in record profits and CEO pay is soaring, striking workers say they deserve to get back the benefits they sacrificed to help the auto companies skirt financial collapse in the 2008 financial crisis.

“The pension part, members who don't have that, they want to be able to retire with dignity,” said Jay Makled, financial secretary of UAW Local 600. For new employees who want to build a career, he said, “it’s top priority.”

What’s at Stake as US Autoworkers’ Strike Drags On: QuickTake

This isn’t the first time autoworkers have tried to get pensions back. A return to pensions was among the demands put forth in 2019, but the debate was sidelined and pensions were left out of a final deal following a 40-day strike against GM. Under current financial accounting standards, the cost of offering a defined benefit plan is prohibitive.

GM’s pension liability could more than double to $129 billion if the automaker were to agree to reinstate a defined benefit pension plan for hourly employees, according to Bloomberg Intelligence analyst Steve Man.

According to people familiar with the companies’ estimates, restoring pensions and granting the UAW’s other original demands — including a more than 40% wage increase, cost-of-living increases, a four-day work week and a boost to retiree benefits — would add more than $80 billion to each of the biggest US automakers’ labor costs. Ford Chief Executive Jim Farley said that proposal, which has since been revised downward slightly by the union, could bankrupt the company.

Perhaps the biggest challenge to bringing back pensions is how they’re baked into financial accounting standards as a cost without any consideration given to the value of human capital, according to Peter Cappelli, director of the Center for Human Resources at the Wharton School of the University of Pennsylvania. Since pensions and other benefits and costs associated with employees, like training, are considered liabilities rather than investments, workers are more often seen as costs to be cut rather than valuable assets. Save any major rewrite of the financial accounting standards and reporting rules, it’s unlikely pensions will be seen as anything other than a huge liability for companies.

Freezing and offloading pensions, for instance offering a lump-sum payout, has allowed companies to jettison what is sometimes their largest expense. When GM froze pensions for salaried workers in 2006, for example, the company reportedly slashed its pension costs that year by $1.6 billion.

“You eliminate those liabilities on your books and suddenly you're much more valuable,” says Cappelli. “The way that game is played, I just can't imagine them wanting to bring it back.”

Still, the UAW’s pension demand, or some version of it, may spread to other unions, reigniting a conversation about a benefit that many thought was long gone, Logan said. From United Parcel Service Inc. to Hollywood, “what you’ve seen in the last year or so, especially,” he said, “is unions are definitely feeling emboldened in many industries right now.”

Bloomberg Businessweek

MONOPOLY CAPITALI$M
Apple is ordered to face Apple Pay antitrust lawsuit

Jonathan Stempel
Wed, September 27, 2023 

The Apple Inc logo is seen at the entrance to the Apple store, in Brussels

By Jonathan Stempel

(Reuters) - Apple was ordered on Wednesday to face a private antitrust lawsuit by payment card issuers accusing the company of thwarting competition for its Apple Pay mobile wallet.

U.S. District Judge Jeffrey White said the plaintiffs could try to prove that Apple violated the federal Sherman antitrust law by enforcing a 100% monopoly over the domestic market for tap-and-pay wallets for iPhones, iPads and Apple Watches.

The Oakland, California-based judge also dismissed a "tying" claim, which accused Apple of requiring purchasers of iOS devices to buy Apple Pay or forego purchases of competing wallets.

Apple, based in Cupertino, California, did not immediately respond to requests for comment.

"We are happy with this ruling," Steve Berman, a lawyer for the plaintiffs, said in an email. "There are billions at stake so getting by the motion (to dismiss) largely intact was huge for the class."

The proposed class action is led by Illinois' Consumers Co-op Credit Union, and Iowa's Affinity Credit Union and GreenState Credit Union.

They said Apple "coerces" people who use its smartphones, tablets and smart watches into using its own wallet for tap-and-pay transactions, unlike makers of Android-based devices that let people choose wallets such as Google Pay and Samsung Pay.

According to the complaint, Apple's conduct forces more than 4,000 banks and credit unions that use Apple Pay to pay at least $1 billion of excess fees, and harms consumers by minimizing the incentive to make Apple Pay safer and easier to use.

White said the plaintiffs plausibly alleged that Apple allow alternatives to Apple Pay, and that more competition would spur innovation and reduce prices.

In seeking a dismissal, Apple said it charged "nominal" fees to even smaller card issuers, and that the plaintiffs ignored the "competitive reality" that consumers could still pay with cash, credit and debit cards, and other means.

European Union antitrust regulators accused Apple in May 2022 of abusing its dominance in iOS devices and mobile wallets. The regulators have since continued their investigation.

The case is Affinity Credit Union et al v Apple Inc, U.S. District Court, Northern District of California, No. 22-04174.

(Reporting by Jonathan Stempel in New York; Additional reporting by Mike Scarcella; Editing by David Gregorio)

PLAYING HIDE THE SAUSAGE

Apple, Google Agreed to ‘Defend’ Search Deal From Regulators

Emily Birnbaum, Mark Gurman, Leah Nylen and Sabrina Willmer
Tue, September 26, 2023 

(Bloomberg) -- Apple Inc.’s lucrative agreement to use Alphabet Inc.’s Google as the default search engine for the iPhone includes a provision that the two tech giants will “support and defend” the deal against government scrutiny, a top Apple executive said at an antitrust trial.

Their longtime contract was renegotiated in 2016 to include the provision, Apple’s Senior Vice President of Services Eddy Cue disclosed Tuesday in a Washington federal court, where the US government is pressing its claim that Google operates a monopoly in the search business.

Cue, the architect of the most recent version of the agreement, said the provision for a joint defense was added at Google’s request. He said it was handled by company lawyers so he couldn’t speak directly to why it was included. Around that time, the European Union was investigating Google’s dominance in online search.

During his testimony, the executive defended Apple’s arrangement with its tech rival, saying it was the best choice for customers to have Google as the default search engine.

“There certainly wasn’t a valid alternative we would have gone to at the time,” Cue said. “I don’t know what we would have done” if the deal had collapsed, he said.

Google first became the default option in the Safari browser in 2002. That deal has been revised several times. Cue said the contract was extended in 2021, after the Justice Department filed its initial case against Google’s search dominance the year before.

Google pays Apple billions of dollars for this prominent position on products like the iPhone, making the agreement of particular interest to the government. The question before the judge in the antitrust trial is whether the search giant pushed its way onto Apple devices at the expense of competitors.

In his testimony, Cue stressed that Apple sees no need to develop its own search tool because Google clearly is the best option. That differs from the company’s approach in other areas: It competes with Google in mapping software and voice assistants, as well as operating systems for phones and computers.

The Justice Department displayed an email from 2016 in which Cue told Apple Chief Executive Officer Tim Cook that Google CEO Sundar Pichai was not agreeing to Apple’s proposed revenue share. When the Justice Department’s attorney asked Cue whether Apple would have walked away from the negotiation, Cue said he didn’t seriously consider it, but Apple might have created its own search engine.

Read More: What’s at Stake in Google Trial on Antitrust Charges: QuickTake

Part of Cue’s testimony Tuesday was closed to the public because it involved internal company information that Apple and Google want to keep secret.

Cue was expected to testify behind closed doors about Apple’s search arrangements with other companies, which provide the non-default options built into the Safari internet browser, according to a person familiar with the planned testimony. That includes Microsoft Corp.’s Bing, Yahoo, DuckDuckGo and Ecosia. Similar to its agreement with Google, Apple gets a slice of the advertising revenue generated when users select those search engines as their main option in Safari.

Last week, Apple machine learning chief John Giannandrea testified as well. The executive, who led search at Google before joining Apple in 2018, pointed to a new feature in iOS 17 and iPadOS 17 — the latest software that runs iPhones and iPads — that lets users assign a different default search engine for private browsing.

That means Apple users can switch between Google and another option more easily, according to Cue. “We like our products to come out of the box and work where it feels like magic,” he said. However, Apple doesn’t track how many customers actually make the change to a non-Google search engine, because of privacy concerns, Cue said.

The case is US v. Google, 20-cv-3010, US District Court, District of Columbia.

(Updates with testimony from Apple executive.)

Apple exec defends the decision to make Google its default search engine on iPhones and Macs

PAUL WISEMAN
Tue, September 26, 2023

The iPhone 15 phones are shown during an announcement of new products on the Apple campus in Cupertino, Calif., Tuesday, Sept. 12, 2023. On Tuesday, Sept. 26, a top Apple executive defended the tech giant’s decision to make Google the default search engine on Apple iPhones and Macs, saying there was no “valid alternative.’’ (AP Photo/Jeff Chiu, File)

WASHINGTON (AP) — A top Apple executive defended the tech giant’s decision to make Google the default search engine on Apple iPhones and Macs, saying there was no “valid alternative.’’

Testifying in the biggest antitrust trial in a quarter century, Eddy Cue, Apple’s senior vice president of services, said Tuesday that there wasn’t “anybody as good’’ as Google at helping phone and computer users search the internet.

The U.S. Department of Justice has accused Google – a company whose very name is synonymous with scouring the web — of smothering competition by paying Apple, Verizon and other tech companies to make its search engine the first users see when they open their devices.

Google counters that it dominates the market because its search engine is better than the competition, a position Cue supported in his testimony. Google also argues that users can, in any event, switch to other search engines with a couple of clicks.

The antitrust case, the biggest since the Justice Department went after Microsoft and its dominance of internet browsers 25 years ago, was filed in 2020 during the Trump administration. The trial began Sept. 12 in U.S. District Court in Washington D.C.

Mikhail Parakhin, Microsoft’s head of advertising and web services, testified Tuesday that Google’s dominance feeds on itself. The more searches Google processes, the more data it collects that can be used to improve future searches.

“The more data you have, the better the results are,’’ he said, echoing one of the government’s arguments.

Dominating the market helps in other ways, Parakhin said. For example, restaurants are more likely to make sure their location and hours are accurate in results on the leading search engine, while they are far less likely to bother correcting information on smaller search engines.

Experience shows, he said, that search engines need 20% market share to survive. Otherwise, “their quality degrades rapidly, and they disappear.’’’

Parakhin also recounted his experience battling Google in his previous job as chief technology officer at the Russian search engine Yandex. After Russian regulators required Android phones to let users choose their search engine – instead of letting Google hold the default position – Yandex’s market share rose from 30% to 55%, he said.

Earlier in the proceedings, the government called a behavioral economist, who testified that Google's default status discourages users from switching search engines, partly because they are reluctant to change ingrained habits. Last week, the founder of the search engine DuckDuckGo, which has about 2.5% of the search market, testified that his company struggled to compete because of Google's revenue-sharing agreements with Apple and other companies.

U.S. District Judge Amit Mehta likely won’t issue a ruling until early next year. If he decides Google broke the law, another trial will determine how to rein in its market power. The Mountain View, California-based company could be stopped from paying Apple and other companies to make Google the default search engine

MONOPOLY CAPITALI$M
Amazon deprives competitors of critical mass: FTC Chair Lina Khan

Amazon’s antitrust suit culmination of years of work from FTC’s Khan


Alexis Keenan
·Reporter
Wed, September 27, 2023 

A day after the US Federal Trade Commission and 17 states filed a landmark antitrust case against online retail giant Amazon (AMZN), the agency’s chair Lina Khan said Amazon.com is depriving online superstore competitors of the critical mass needed to compete.

“In short, Amazon has a policy that punishes sellers or retailers that lower their price anywhere other than Amazon,” Khan said in an interview Wednesday with CNBC. “At the same time, Amazon is also steadily hiking the fees the seller pays. Sellers have to inflate their price not just on Amazon, but also across the rest of the internet.”

The novel argument is expected to be a tough one for the agency.

FTC filed an antitrust case against Amazon on Tuesday. (Paul Sakuma/AP Photo)

Antitrust law, designed to protect consumers through open competition, regards low prices as evidence that consumers' interests are served. While the agency admits that Amazon's policies push sellers to offer their products at the lowest prices on Amazon, it argues Amazon’s prices never dip as low as they would in a genuinely competitive market.

The company’s scale, the FTC claims, ensures that some sellers must sell on Amazon.com to survive. And with the market cornered, it slowly increased fees charged to sellers for each sale, according to the agency.

“The consequences of that are very serious for sellers who now pay one out of every $2 to Amazon,” Khan told CNBC. “So this is effectively a 50% tax that businesses pay to Amazon to reach shoppers. And that, in turn, leads prices and it inflates prices across the internet.”

The FTC says Amazon is illegally monopolizing two markets: online superstore retail — where consumers shop for products — and online superstore retail services — where sellers list, sell, and ship their items.

Amazon responded to the FTC’s complaint saying the agency's theory is wrong.

“The practices the FTC is challenging have helped to spur competition and innovation across the retail industry, and have produced greater selection, lower prices, and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store," David Zapolsky, Amazon senior vice president of global public policy and general counsel, said in a statement.

"If the FTC gets its way, the result would be fewer products to choose from, higher prices, slower deliveries for consumers, and reduced options for small businesses — the opposite of what antitrust law is designed to do.”

At Amazon's request, portions of the FTC's claims were redacted from the publicly filed version of its lawsuit. In her interview on Wednesday, Khan said the complaint contains direct evidence of Amazon hiking prices and steadily increasing fees charged to its third-party sellers.

Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on Twitter @alexiskweed.

Judge assigned to US antitrust case against Amazon recuses himself

Reuters
Wed, September 27, 2023 



(Reuters) - The judge assigned to the U.S. Federal Trade Commission's antitrust lawsuit against Amazon.com has recused himself from the case, according to a court document filed on Wednesday.

Senior Judge John Coughenour was assigned to the case on Tuesday, when the antitrust lawsuit was filed against Amazon in federal court in Seattle. Coughenour, an appointee of Republican former President Ronald Reagan, did not cite a reason for dropping off the case in the court filing.

The case has been re-assigned to U.S. District Judge John Chun based on rotation, according to the document.

Chun was nominated by President Joe Biden last year. He was previously a judge for the Washington State Court of Appeals.

The FTC in its lawsuit accused Amazon of abusing its power in the retail market as an ecommerce giant by unfairly giving preference to its own products and punishing merchants that want to sell products for lower prices on other platforms.

Amazon is facing a series of similar but smaller private consumer cases filed in recent years that are pending in the same U.S. federal court with Judge Ricardo Martinez and the FTC has argued its case should be assigned to the same judge to avoid duplication or conflict.

(Reporting by Abhirup Roy and Mike Scarcella; Editing by Leslie Adler)

Factbox-Amazon antitrust lawsuit latest in US efforts to rein in big firms' clout

Reuters
Wed, September 27, 2023 


(Reuters) - U.S. antitrust regulators on Tuesday filed a lawsuit against Amazon.com accusing the online retailer of harming consumers with higher prices, the latest in a long history of tough action against monopolies that can be traced back to the breakup of Standard Oil.

More recently, Federal Trade Commission (FTC) regulators have targeted Big Tech including Alphabet's Google and Meta Platforms' Facebook.

Here is a list of attempts by regulators to split up big companies:

Standard Oil (1911)- Regulators alleged John Rockefeller's Standard Oil held the monopoly in the oil business by using aggressive pricing to eliminate competition. Standard Oil was broken up into 34 companies. Some of these independent firms now include ExxonMobil and Chevron.

Aluminum Company of America (Alcoa) (1945)- The Justice Department charged Alcoa with illegally monopolizing the aluminum market and demanded the company be dissolved. The case lasted years and the government sold aluminum production plants built during the war to Reynolds Aluminum and Kaiser Aluminum, creating a competitive market.

Paramount Pictures (1948) - The U.S. Supreme Court ruled in a landmark antitrust case, also known as "Paramount case" or the "Hollywood antitrust case," that film studios could not legally own their own theaters, hitting the vertical integration of companies. It forced Paramount to cleave theaters from the studios.

IBM (1982) - The U.S. government initiated an antitrust investigation into the dominance of IBM that lasted for 13 years. The case was later withdrawn and the IT software and services provider remained intact.

AT&T (1984) - In 1974, the U.S. government filed an antitrust lawsuit against AT&T because it had a monopoly on telephone lines. After eight years of litigation, the two sides reached a settlement that led to AT&T giving up control of its regional operating companies, or "Baby Bells".

Microsoft (2001) - A U.S. District Judge ordered a breakup of the company over antitrust claims but appellate judges rejected it. The Justice Department and Microsoft reached a settlement in November 2001.

Meta Platforms (2023) - An appeals court ruled in favor of Meta by refusing to revive a lawsuit filed by states against its Facebook unit over alleged antitrust law violations.

Both the FTC and the states had asked the court in 2020 to order Facebook to sell Instagram, which it bought for $1 billion in 2012, and WhatsApp, which it bought for $19 billion in 2014.

(Reporting by Jaspreet Singh and Zaheer Kachwala in Bengaluru; Editing by Sriraj Kalluvila and Josie Kao)

Factbox-FTC's Amazon complaint zeros in on seller prices, logistics

Reuters
Wed, September 27, 2023 


WASHINGTON (Reuters) - The U.S. Federal Trade Commission filed a lawsuit against Amazon.com that accused the online retail giant of overcharging customers and independent sellers on its platforms as the $1 trillion company sought to illegally maintain monopoly power.

These are the specific allegations included in the FTC's 172-page complaint:

ONLINE SUPERSTORE, SERVICES MONOPOLIES

*The agency alleged that Amazon had a monopoly in an online superstore market. In 2021, Amazon had 77% of the market, Walmart had 13% and Target 2%.

*The agency also said that Amazon had a monopoly in the online marketplace for services, where Amazon has more than 70% of the market. The FTC said that more than 160 million people in the United States visit Amazon's website each month.

PUNISHES SELLERS FOR LOWER PRICES ELSEWHERE

* The complaint alleged Amazon uses a sophisticated network of web crawlers that identify which of its sellers offer their products more cheaply on other platforms. Amazon allegedly punishes those sellers, who make up about 60% of Amazon's sales, by making them harder to find on its platform.

"Because Amazon's anti-discounting conduct punishes sellers who offer lower prices at rival online stores with lower fees, many sellers set their price on Amazon- high fees and all - as the price floor across the internet," the FTC said in the complaint.

REQUIRES USING AMAZON LOGISTICS

* Amazon requires sellers under Amazon's Prime feature to use the company's logistics and delivery services even though many would allegedly prefer to use a cheaper service or one that would also service customers from other platforms where they sell.

CHARGES HIGH FEES

*The complaint alleges Amazon raised average fulfillment fees to sellers about 30% between 2020 and 2022, as well as requiring them to pay for referrals and advertising. The FTC alleged that between sellers paying for search placement, fulfillment and other charges that Amazon takes nearly half of what sellers make on their sales.

MONITORING PRICES

* Amazon used the Project Nessie pricing system as an unfair method of competition. A description of Project Nessie was heavily redacted. An Amazon blog described it as "a system used to monitor spikes or trends on Amazon.com."

(Reporting by Diane Bartz; Editing by Jamie Freed)

The FTC just hit Amazon with a major antitrust lawsuit


Taylor Hatmaker
Tue, September 26, 2023

Image Credits: Sheldon Cooper/SOPA Images/LightRocket / Getty Images

The Federal Trade Commission made its big move against online shopping giant Amazon on Tuesday, accusing the company of illegally stifling competition on its way to becoming a ubiquitous retail presence and one of the world's most valuable companies.

Attorneys general from 17 states joined the FTC in the lawsuit, alleging that Amazon leverages a "set of interlocking anticompetitive and unfair strategies" to maintain a monopoly. The states that signed onto the FTC's action are Connecticut, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Hampshire, New Mexico, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island and Wisconsin.

"The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them," FTC Chair Lina M. Khan said. "Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition."

Amazon predictably pushed back against the FTC's allegations, which could amount to an existential threat to the company's market dominance.

"If the FTC gets its way, the result would be fewer products to choose from, higher prices, slower deliveries for consumers and reduced options for small businesses — the opposite of what antitrust law is designed to do," Amazon General Counsel David Zapolsky said. "The lawsuit filed by the FTC today is wrong on the facts and the law, and we look forward to making that case in court.”

The FTC and its state partners allege that Amazon has violated antitrust law in two distinct areas: its vast online storefront for shoppers and its seller-side marketplace. Amazon's practice of punishing sellers that offer lower prices away from Amazon and its strategy of aggressively funneling sellers toward obtaining Prime status for their goods are among the anti-competitive tactics the FTC named in the lawsuit.

"Amazon is a monopolist that uses its power to hike prices on American shoppers and charge sky-high fees on hundreds of thousands of online sellers," Deputy Director of the FTC Bureau of Competition John Newman said. "Seldom in the history of U.S. antitrust law has one case had the potential to do so much good for so many people."

The FTC accuses Amazon of 'monopolistic practices' in long-expected antitrust suit

It claims the retailer prevented vendors from selling products for less elsewhere.

Will Shanklin
·Contributing Reporter
Tue, September 26, 2023


The Federal Trade Commission (FTC) filed an antitrust lawsuit against Amazon today in Western Washington district court, with 17 states joining the federal agency. The case isn’t surprising (the FTC was reportedly nearly ready to file in late August), but its specifics weren’t yet known.

The FTC accuses the online retailer of monopolistic practices, including preventing merchants from offering lower prices on other platforms and forcing them to use Amazon’s logistics service if they wanted to be included in customers’ Prime shipping perks. Those anticompetitive practices allegedly led to higher prices and an inferior shopping experience.

The suit describes “Amazon's one-two punch of seller punishments and high seller fees” that forces vendors to “use their inflated Amazon prices as a price floor everywhere else.” The complaint reads, “Amazon's punitive regime distorts basic market signals: one of the ways sellers respond to Amazon's fee hikes is by increasing their own prices off Amazon.”

“Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition,” said FTC chair Lina Khan, according to The New York Times.



“Amazon is a monopolist,” the lawsuit reads. “It exploits its monopolies in ways that enrich Amazon but harm its customers: both the tens of millions of American households who regularly shop on Amazon's online superstore and the hundreds of thousands of businesses who rely on Amazon to reach them.”

The 17 states joining the FTC include New York, Connecticut, Pennsylvania, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Hampshire, New Jersey, New Mexico, Oklahoma, Oregon, Rhode Island and Wisconsin.

The FTC has had its eye on Amazon for several years. This is the fourth action the agency has taken against the company this year. Amazon settled a previous lawsuit (for $30.8 million) filed in May over Alexa children’s privacy concerns and snooping with Ring cameras. In June, the FTC sued the retailer again, claiming the company tricked customers into signing up for Prime subscriptions and then made it hard to cancel them.

Amazon claimed that the FTC’s actions are out of line. “Today’s suit makes clear the FTC’s focus has radically departed from its mission of protecting consumers and competition,” said David Zapolsky, Amazon's Senior Vice President of Global Public Policy and General Counsel. “The lawsuit filed by the FTC today is wrong on the facts and the law, and we look forward to making that case in court.”

The media’s narrative about the suit will likely frame it as a long-awaited title bout between Khan and Amazon. The FTC chair gained prominence by publishing a 2017 Yale Law Journal paper arguing US antitrust laws fell short of adequately reining in the tech giant. That helped begin a national conversation about whether the nation’s anti-monopoly laws were prepared to handle modern Silicon Valley behemoths.

But more important than one-on-one championship fight framing, the showdown will serve as a test for Washington regulators and Amazon, as the federal agency tests its authority and the retailer faces its most consequential political fight to date.

FTC, 17 states file antitrust suit against Amazon

Clarissa Hawes

FreightWaves
Tue, September 26, 2023 


The Federal Trade Commission and 17 state attorneys general filed suit against Amazon.com on Tuesday, alleging the e-commerce giant used its monopoly power to “inflate prices, degrade quality and stifle innovation for consumers and businesses.”

The 172-page complaint, filed in the U.S. District Court for the Western District of Washington, alleges Amazon (NASDAQ: AMZN) engages in a course of exclusionary conduct that prevents current competitors from growing and new competitors from emerging.”

The FTC lawsuit, which follows a four-year investigation into the Seattle-based company, states that it’s not the size of Amazon that violates the law, but the the company’s alleged “anticompetitive conduct” — which includes its “online superstore market that serves shoppers and the market for online marketplace services purchased by sellers.”

“Our complaint lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies,” FTC Chair Lina M. Khan said in a statement on Tuesday.

“The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them.”

In the suit, the FTC alleges Amazon has harmed its competition by requiring sellers who want their products to be Prime-eligible to use its logistics platform, Fulfillment by Amazon, which it claims makes it substantially more expensive for sellers on Amazon to also offer their products on other platforms.

Another issue outlined in the FTC suit alleges that Amazon engages in anti-discounting conduct, which “algorithmically punishes sellers” if Amazon discovers they are offering lower-priced goods elsewhere.

“Amazon can bury discounting sellers so far down in Amazon’s search results that they become effectively invisible,” the FTC said.
Amazon responds to FTC suit

In a statement, Amazon denied the allegations outlined in the FTC’s lawsuit.

“Today’s suit makes clear the FTC’s focus has radically departed from its mission of protecting consumers and competition,” David Zapolsky, Amazon’s senior vice president of global public policy and general counsel, said in a statement. “The practices the FTC is challenging have helped to spur competition and innovation across the retail industry, and have produced greater selection, lower prices and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store.”

In his statement, Zapolsky said: “If the FTC gets its way, the result would be fewer products to choose from, higher prices, slower deliveries for consumers and reduced options for small businesses — the opposite of what antitrust law is designed to do. The lawsuit filed by the FTC today is wrong on the facts and the law, and we look forward to making that case in court.”

The company has about 500,000 independent businesses selling goods on its platform in the U.S., which have created 1.5 million jobs, Zapolsky said.

He said that since Amazon opened its business model nearly 20 years ago to include third-party sellers, more than 60% of the company’s sales are from independent sellers, consisting mostly of small and medium-size businesses.

“The FTC’s allegation that we somehow force sellers to use our optional services is simply not true,” Zapolsky said. “Sellers have choices and many succeed in our store using other logistics services or choosing not to advertise with us.”

The states included in the lawsuit are Connecticut, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Hampshire, New Mexico, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island and Wisconsin.

Click here to read more articles by Clarissa Hawes.


Amazon has deep bench of defense lawyers to fight US FTC lawsuit

Amazon faces FTC antitrust suit alleging anticompetitive practices


Tue, September 26, 2023 
By Andrew Goudsward and Mike Scarcella

WASHINGTON (Reuters) - The U.S. Federal Trade Commission’s monopoly lawsuit against Amazon.com filed on Tuesday poses perhaps the biggest legal test so far for the platoons of lawyers who have defended the technology giant for years against allegations of antitrust and consumer protection violations.

The long-awaited FTC case against Amazon, joined by 17 state attorneys general, accuses the company of abusing its dominance as an online retailer to thwart competitors and harm sellers and customers that rely on its platform. The company vowed to fight the lawsuit, saying its practices have spurred competition and innovation.

Kevin Hodges, a partner at law firm Williams & Connolly, was the first member of Amazon's defense team identified in a court document in the case. His partner Heidi Hubbard will lead the team, which also includes attorneys from law firm Covington & Burling, according to a person familiar with the hires.

Hubbard and Hodges, who is a former managing partner of the Washington-headquartered firm, are also representing Amazon in an ongoing antitrust lawsuit by California's attorney general accusing the company of forcing artificially high prices on consumers.

Williams & Connolly, known for its focus on litigation, in April successfully defeated a separate private lawsuit accusing the company of curbing competition for shipping and fulfillment services.

Hodges represented state attorneys general who joined the U.S. Justice Department's historic antitrust case against Microsoft in the 1990s and defended BP in lawsuits following the 2010 Gulf of Mexico oil spill, according to court records and his firm's website. He did not respond to a request for comment.

Williams & Connolly is also a lead defense firm in another major antitrust case targeting Big Tech. Partner John Schmidtlein heads a team comprised of several big law firms defending Alphabet's Google in an ongoing landmark trial over the company’s alleged monopoly power in online search.

An Amazon spokesperson did not immediately respond to questions about its legal team. The company is likely to rely on multiple law firms to defend the FTC case.

Amazon General Counsel David Zapolsky, a 24-year veteran of the company's legal department, can turn to a stable of top outside law firms that already represent it.

Covington & Burling, another major Washington firm, worked with Williams & Connolly in 2021 in an unsuccessful attempt to force FTC Chair Lina Khan, a vocal critic of Amazon, to recuse from matters involving the company. Thomas Barnett, co-chair of the firm’s antitrust practice and a former senior Justice Department official, was involved in the effort.

Covington is also representing Amazon in another pending lawsuit brought by the FTC accusing the company of enrolling customers into its paid Amazon Prime service without their consent and making it difficult for them to cancel. The company has denied the allegations.

Covington advised Amazon in two consumer privacy settlements with the FTC in May related to the company’s Alexa voice assistant and Ring home security service.

A Covington spokesperson did not respond to a request for comment on whether the firm is defending Amazon in the FTC antitrust case.

Amazon has also turned to U.S. law firm Paul, Weiss, Rifkind, Wharton & Garrison to navigate government scrutiny. Paul Weiss secured the dismissal of an antitrust lawsuit brought by Washington, D.C.’s attorney general. An appeal remains pending.

The firm joined Covington in negotiating a $25 million Alexa child privacy settlement with the FTC.

(Reporting by Andrew Goudsward and Mike Scarcella in Washington; Editing by David Bario, Matthew Lewis and Marguerita Choy)

CRIMINAL CAPITALI$M

DOJ says eBay sold thousands of illegal, poisonous, and polluting products

Harri Weber
Wed, September 27, 2023 

Image Credits: Sean Gallup / Getty Images


The Department of Justice raked eBay over the proverbial coals today, accusing the online retailer of "unlawfully selling and distributing hundreds of thousands" of products that threaten the environment and public health.

In a statement on Wednesday, the DOJ said it's suing eBay for distributing restricted and mislabeled pesticides, defeat devices that mess with vehicles' emissions controls, and paint thinners that contain methylene chloride.

The agency's lawsuit alleges that eBay did so in violation of the Clean Air Act and other laws that regulate toxic substances. It was filed on behalf of the Environmental Protection Agency.

The DOJ's statement on the suit is chock full of specific figures, alleging that eBay sold, "offered for sale," or distributed more than 343,000 defeat devices and 23,000 restricted, mislabeled or restricted pesticides.

In response, eBay said it "intends to vigorously defend itself" against the lawsuit. The retailer did not immediately respond to an email requesting more information on how it moderates the types of listings cited by the DOJ.

U.S. sues eBay over sale of harmful products


Wed, September 27, 2023 

The eBay app is seen on a smartphone in this illustration taken

By Jonathan Stempel

NEW YORK (Reuters) -The U.S. government on Wednesday sued eBay, accusing the online platform of violating the Clean Air Act and other environmental laws by allowing the sale of several harmful products, including devices that defeat automobile pollution controls.

EBay could face billions of dollars in penalties, including up to $5,580 for each Clean Air Act violation, according to the government's complaint filed in the federal court in Brooklyn, New York.

The Department of Justice said eBay illegally allowed the sale of at least 343,011 aftermarket "defeat" devices that help vehicles generate more power and get better fuel economy by evading emissions controls.

EBay was also accused of allowing the sale of at least 23,000 unregistered, misbranded or restricted-use pesticides, violating a 2020 "stop sale" order from the U.S. Environmental Protection Agency.

The San Jose, California-based company also allegedly distributed 5,614 paint and coating removal products containing methylene chloride, a potentially lethal chemical linked to brain and liver cancer and non-Hodgkin lymphoma.

"EBay has the power, the authority, and the resources to stop the sale of these illegal, harmful products on its website," the complaint said. "It has chosen not to; instead, it has chosen to engage in these illegal transactions."

In a statement, eBay called the lawsuit "entirely unprecedented" and said it would defend itself vigorously.

"Maintaining a safe and trusted marketplace for our global community of sellers and buyers is a fundamental principle of our business," it said. "Indeed, eBay is blocking and removing more than 99.9% of the listings for the products cited by the DOJ, including millions of listings each year."

EBay shares were down 1.6% at $42.79 in late morning trading.

(Reporting by Jonathan Stempel in New York; Editing by Sharon Singleton and Bill Berkro)


DOJ sues eBay for selling environmentally hazardous products

Vehicle emissions ‘defeat devices’ and illegal pesticides allegedly appeared for sale on the site.


Will Shanklin
·Contributing Reporter
Wed, September 27, 2023 

picture alliance via Getty Images


The US Department of Justice sued eBay on Wednesday for its role in the sale of products that harm the environment. It accused the online retailer of selling or distributing hundreds of thousands of products that violated the Clean Air Act (CAA), the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) and the Toxic Substances Control Act (TSCA). The complaint was filed in a federal court in Brooklyn, NY.

The DOJ’s complaint accuses eBay of selling, offering for sale or causing the sale of over 343,000 aftermarket “defeat devices,” which bypass vehicle emission controls. The devices, familiar to many from Volkswagen’s “Dieselgate” scandal, allow vehicles to cheat emissions tests, making them appear up to par on EPA standards when they aren’t — all in the name of a little performance boost.

“Aftermarket defeat devices significantly increase pollution emissions – including carbon monoxide, nitrogen oxides, particulate matter and nonmethane hydrocarbons – that harm public health and impede efforts by the EPA, states, Tribes and local agencies to plan for and attain air quality standards,” the DOJ wrote today.

The complaint says eBay also unlawfully distributed or sold at least 23,000 pesticide products that were unregistered, misbranded or restricted-use. The DOJ says the EPA issued a “stop sale” order in 2020 (amended in 2021), after which eBay continued to violate it. “Examples include a high toxicity insecticide banned in the United States, restricted use pesticides that only certified applicators may apply and products fraudulently claiming to protect users against the SARS-CoV-2 virus,” the DOJ wrote.

The filing adds that eBay distributed over 5,600 products violating the TSCA Methylene Chloride Rule, a banned (potentially deadly) chemical used in paint and coating removers.

In a statement, eBay said it blocks and removes more than 99.9% of listings for products cited by the DOJ. “And eBay has partnered closely with law enforcement, including the DOJ, for over two decades on identifying emerging risks and assisting with prevention and enforcement,” the online retailer wrote. “The Government’s actions are entirely unprecedented and eBay intends to vigorously defend itself.”

The DOJ asserted that EPA standards will be enforced. “Our nation’s environmental laws protect public health and the environment by prohibiting the unlawful sale of defeat devices; unregistered, misbranded and restricted use pesticides; and unsafe products containing toxic chemicals such as methylene chloride,” said David M. Uhlmann from the EPA’s Office of Enforcement and Compliance Assurance. “The complaint filed today demonstrates that EPA will hold online retailers responsible for the unlawful sale of products on their websites that can harm consumers and the environment.”

CRIMINAL CAPITALI$M
Lawsuit claims H&R Block, Meta, Google used spyware to illegally share consumers' financial data

Alexis Keenan
·Reporter
Wed, September 27, 2023

Google (GOOG, GOOGL), Meta (META), and H&R Block (HRB) are facing a proposed class-action lawsuit alleging they illegally coordinated to use spyware to collect and share taxpayers’ sensitive financial information.

A similar lawsuit was brought against Google and H&R Block in July, on the heels of a congressional investigation into a data collection technology known as "tracking pixels" used to generate lucrative targeted ads. The case alleges the companies conspired to collect and exploit data on hundreds of H&R Block customers without their consent.

Tracking pixels operate quietly in the background of millions of websites, some tracking visitors’ entries in real time. Companies like H&R Block that handle entries containing sensitive financial information are required by law to refrain from sharing that data with third parties unless they’ve obtained their customers' consent.

Accounting offices of H&R Block in New York. (Newscast/Universal Images Group via Getty Images)

According to the suit, H&R Block tried to circumvent federal racketeering and other laws by misleading consumers using vague language in their customer consent agreements and programming agreements with Meta and Google. Meta and Google for their part, the plaintiffs claim, conspired with H&R Block and misled consumers about the types of information that website developers like H&R Block could access.

“Defendants knew that by concealing their involvement with one another … [they] could acquire and share [personal tax data] in contravention of the law for defendants’ own financial gains,” the complaint states.

Google spokesperson José Castañeda said in a statement that the company has "strict policies and technical features that prohibit Google Analytics customers from collecting data that could be used to identify an individual."

"Site owners - not Google - are in control of what information they collect and must inform their users of how it will be used. Additionally, Google has strict policies against advertising to people based on sensitive information,” the statement said.

H&R Block and Meta did not immediately respond to Yahoo Finance's request for comment.

Data scooped up in the alleged operation included taxpayers' names, Social Security numbers, addresses, adjusted gross incomes, filing statuses, refund amounts, deductions, dependents, income properties, birthdates, health savings account contributions, education expenses, and other information in their prepared returns.

The complaint filed in US District Court for the Northern District of California alleges the companies also violated federal privacy and wiretapping laws, and the Internal Revenue Code.

"The suit seeks to hold the three firms accountable for using pixels that tracked virtually all information submitted by customers through HRBlock.com,” lawyers for the plaintiffs said. The group is seeking an injunction to stop the companies from collecting the sensitive information using pixels, as well as punitive damages, and to disgorge the defendants of value gained from their use.

Meta’s pixels

In their complaint the plaintiffs said H&R Block illegally deployed Meta’s Pixel software, which tracks in real time the information that tax preparers enter into their online tax preparation portal. Every H&R block online tax software user, they said, is assigned a unique digital identifier that allows the spyware to track their activity both on the H&R Block website, and on every other website they visit containing Meta Pixel.

For example, when an H&R Block customer logs into Meta's Facebook or Instagram, their unique identifier is delivered to the user’s device with a “dossier” containing the user’s online activities. The technology, the suit says, allows Meta to provide its marketing partners with "deep insights" into the user’s online activities.

Google's pixels

Google’s separate pixel system, Google Analytics, which is installed on H&R Block and more than 70% of online websites, the plaintiffs say, allows companies that are less tech savvy to collect and send back to Google default user information, such as a user’s closest city, gender, and general interests. For more sophisticated companies like H&R Block, they allege, Google offers another pixel product, Google Tag, that collects more intimate details about a web page visitor.

According to the complaint, H&R Block illegally collected and sent to Google taxpayers’ names and certain health savings account contribution information, as well as their inquiries on H&R Block into scholarships, and education expenses, and visits to web pages related to dependents, certain types of income, and certain tax credits or reductions.

The plaintiffs say e-commerce industry players like H&R Block, Meta, and Google understand that the type of highly sensitive personal financial data such as the data entered into H&R Block’s site is a form of currency.

In 2022, Meta’s annual advertising revenue of $113.6 billion made up almost all of the company’s total revenue of more than $116 billion.

Google's search advertising generated more than $160 billion in revenue for Google in 2022. That's more than half of the company's $280 billion in total revenue for the year.

Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on Twitter @alexiskweed.

Ex-coach of Spain women's team under investigation over World Cup kiss 

SEXUAL ASSAULT scandal

Graham Keeley
Wed, 27 September 2023 

Jenni Hermoso (left) with ex-manager Jorge Vilda - Alex Pantling/Getty Images

The former manager of Spain’s women’s football team has been placed under investigation for allegedly forcing Jenni Hermoso to sign a statement supporting Luis Rubiales over the World Cup kiss scandal.

Jorge Vilda must now appear at the Audiencia Nacional court in Madrid, Spain’s top criminal court, on Oct 10 over the case.

Mr Vilda, who was sacked in the wake of the controversy, has previously denied reports he pressured Ms Hermoso to put out a statement exonerating Mr Rubiales, the ex-president of the Spanish Football Federation (RFEF).

But Judge Francisco De Jorge, who is investigating the Aug 20 incident, expanded the scope of a sexual assault probe on Wednesday to include Mr Vilda over the claims.

Judge De Jorge also said he was investigating Albert Luque, the director of the men’s squad, and Rubén Rivera, the RFEF’s head of marketing. The pair had initially been summoned as witnesses in the case.

THE SEXUAL ASSAULT

Luis Rubiales kissing Jenni Hermoso - Noemi Llamas/Eurasia Sport Images

Mr Rubiales is facing sexual assault charges over last month’s allegedly non-consensual kiss at the World Cup final in Sydney, which sparked an international debate over sexism in football and a revolt by the national team.

He was RFEF head at the time but has since resigned, making his first appearance in court on Sept 15, when Judge De Jorge imposed a restraining order on him.

The order forbade Mr Rubiales from communicating with or coming within 200 metres of Ms Hermoso.

Ms Hermoso had initially added her name to a statement supporting Mr Rubiales but later said she did not consent to the kiss and it left her feeling “vulnerable and a victim of an aggression”.

Mr Rubiales insists the kiss was consensual.

Judge De Jorge’s investigation will determine if a trial should be held.

Under new legislation introduced last year, Mr Rubiales could face a fine or a prison sentence of up to four years if found guilty of sexual assault.

Mr Rubiales is also facing coercion charges after Hermoso said she “had suffered constant ongoing pressure by Luis Rubiales and his professional entourage to justify and condone” his actions, court documents show.

Mr Rubiales initially attempted to brush off the scandal provoked by the kiss after the team’s 1-0 victory over England.

But as pressure increased football’s world governing body Fifa moved to suspend him, prompting his mother to embark on a short-lived hunger strike at what she called the “inhumane and bloodthirsty” persecution of her son.

In the wake of the scandal, 39 Spanish players went on strike demanding changes in the RFEF including “zero tolerance” for anyone infringing on the dignity of women’s football.

 

Judge says ex-women's World Cup coach Vilda under investigation

AFP
Wed, 27 September 2023 

Jorge Vilda (R) is known for being close to Luis Rubiales (L) (Saeed Khan)

Spain's controversial former women's coach Jorge Vilda is being investigated as part of the legal probe into Luis Rubiales over the World Cup kiss scandal, court documents showed Wednesday.

Vilda and two others have been "summoned as suspects" to appear before investigating judge Francisco de Jorge on October 10, said a statement from Spain's Audiencia National court.

It identified the other two as Albert Luque, director of the men's national team, and Ruben Rivera, marketing director for the Spanish football federation (RFEF).


The court did not clarify precisely the nature of the suspicion surrounding Vilda.

Rubiales is facing sexual assault charges after kissing midfielder Jenni Hermoso on the lips after Spain beat England in the final on August 20.

He was RFEF head at the time but has since resigned, making his first appearance in court on September 15.

Rubiales is also facing coercion charges after Hermoso said she "had suffered constant ongoing pressure by Luis Rubiales and his professional entourage to justify and condone" his actions, court documents show.

Luque and Ribera had initially been summoned as witnesses but the judge has since named them as being under investigation.

- Judge changes tack -

The change came after the judge heard testimony from Hermoso's brother and one of her friends, who confirmed the midfielder's statements that she did not consent to the kiss and had been under pressure to justify Rubiales' actions.

According to Spanish media reports, her brother told the judge she had also been pressured by Vilda, who was sacked on September 6.

Vilda was known for being close to Rubiales.

At his court hearing on September 15, Rubiales once again maintained the kiss was consensual, a judicial source said.

But Hermoso's lawyer Carla Vall said it was clear to everyone that it was not.

"Thanks to this video, everyone can see there was no consent whatsoever and that is what we will demonstrate in court," she told reporters outside the court.

The kiss sparked a global backlash, and a major crisis within Spanish football, with most of the World Cup winners demanding more heads roll at the scandal-hit RFEF.

The judge will on Thursday hear testimony from Patricia Perez, head of public relations for the women's squad, and from Miguel Caba, the recently-sacked head of transparency for the RFEF.

On Monday, two-time Ballon d'Or winner Alexia Putellas and two other Spain players, defender Irene Paredes and goalkeeper Misa Rodriguez, will also give testify before the judge.

str-gr/hmw/ds/bsp

US surgeons are killing themselves at an alarming rate. One decided to speak out

Christina Frangou

THE GUARDIAN
Updated Wed, September 27, 2023

LONG READ

Carrie Cunningham puffed out her cheeks and exhaled. She looked out at the audience filled with 2,000 of her peers, surgeons who were attending the annual meeting of the Association of Academic Surgery, a prestigious gathering of specialists from universities across the United States and Canada.

Cunningham, president of the organization, knew what she was about to reveal could cost her promotions, patients and professional standing. She took a deep breath.

“I was the top junior tennis player in the United States,” she began. “I am an associate professor of surgery at Harvard.

“But I am also human. I am a person with lifelong depression, anxiety, and now a substance use disorder.”

The room fell silent.

Cunningham knew others in the room were struggling, too. Doctors are dying by suicide at higher rates than the general population. Somewhere between 300 to 400 physicians a year in the US take their own lives, the equivalent of one medical school graduating class annually.

Surgeons have some of the highest known rates of suicide among physicians. Of 697 physician suicides reported to the CDC’s national violent death reporting system between 2003 and 2017, 71 were surgeons. Many more go unreported.

For years, no one in surgery talked publicly about mental distress in the profession; surgeons have long experienced a culture of silence when it comes to their personal pain. They have a reputation as stoic, determined and driven. They are taught, throughout a decade of grueling training, to dissociate themselves from their body’s natural cues, telling them that it is time to rest, eat or urinate.

The patient’s needs always come first – that’s part of what makes a good surgeon. But this approach can have consequences for a surgeon’s own mental health.

Cunningham had already lost one friend to suicide. She decided that if her job was to save lives, she would begin with her own and those of her colleagues.

She started to tell her story.

•••

When Cunningham was seven, her stepfather put a tennis racket in her hand and discovered a prodigy. She quickly became a star, competing in international tournaments barely three years after she’d first hit a ball.

By 12, she had her own psychologist and nutritionist. She was put on a 3,330-calorie-a-day diet, aiming to gain 3lbs each month on her 4ft 7in frame. She’d run so hard that she’d hyperventilate. Her legs bore constant bruises from banging her racket against them.

She was praised for being scrappy and mentally tough, for being a perfectionist.

Carrie Cunningham at the US Open in 1992. Photograph: colaimages/Alamy

In 1987, when she was 16, World Tennis Magazine named her the top junior female player of the year. The next year, she made her debut as a professional player. In one of her first major tournaments, the teenage Cunningham faced the top-ranked Steffi Graf in the Australian Open and lost, but barely.

A psychologist taught her to hide her feelings from her opponents. Never let them know you are struggling, went the mantra. So Cunningham mastered the art of disguising her emotions. An outside observer would see a determined athlete; inside, Cunningham felt riddled with anxiety.

When she was 18, she lost in the French Open. The defeat sent her into her first major depressive episode. She sat in a Paris hotel room, alone with shades drawn, and hardly ate for a week.

After graduating high school, she climbed to No 32 in the world. She appeared to be thriving, but she was racked with loneliness. She did not earn the kind of income that allowed her to travel with family or friends. In an era before cellphones and widespread email, she was on her own. Her closest friends were her fellow competitors – people who understood what her life was like, but not people she could talk to about her struggles or doubts.

Just after she turned 20, she injured her wrist and took six months off to rehabilitate and take university courses. By the time she was healthy enough to return to play, she did not want to go back on the road and decided to retire.

She spiraled into another bout of depression – again, undiagnosed. She’d lost her identity. Cunningham dealt with her feelings the only way she knew how: busying herself with everything but her distress.

She moved to Ann Arbor to study at the University of Michigan, loaded her schedule with extra classes and began training for a marathon.

“I was awake for weeks,” she says. “I don’t remember sleeping at all. But yet, I would still work out in the day.”

She does not believe her depression was perceptible to anyone else. She got high marks, dated and went to parties. But she often felt that she was separated from the rest of the world. “It’s like being alone in a room full of people.”

She was drawn to medicine, with its intellectual challenge and the satisfaction that came from making a difference. She graduated in 2001 and married one of her classmates. The same skills that made her a tennis phenom made her an excellent doctor. Together, she and her husband were accepted for residency training at one of the country’s most prestigious programs, at Weill Cornell Medicine in New York City. After that, they moved to Harvard Medical School in Boston to do fellowships.

Cunningham was on her way to becoming an endocrine surgeon who could care for patients with diseases affecting their thyroid, parathyroid or adrenal glands. She loved the action of the operating room and working with her hands; she thrived in the long hours and fraternity of people who were taking on the seemingly impossible.

On the outside, Cunningham was winning.

Inside was another story.

•••

In medical school and residency, doctors in training work around the clock. They eat or sleep when they can. Often, they are pushed to their limits.

“They feel miserable,” says Jessica Gold, a psychiatrist at Washington University in St Louis School of Medicine who specializes in physician wellness. “We basically think that feeling bad is part of medicine, and we can’t identify that we’re doing poorly, or that we should take time for ourselves and figure out that we actually might be depressed.”

Surgery, especially, has always been cruel to its practitioners, who suffer high rates of burnout, ergonomic injuries, miscarriages and infertility. They are trained in an apprenticeship model that lasts a minimum of five years, but usually seven or eight. Residents begin as juniors and progress up the hierarchy, adopting the skills and behaviors of those who came before them.

See one, do one, teach one is shorthand for this system. It’s how surgeons develop their technical skillset, but also how they conform to the cultural norms of the profession.

The training system was developed by William Halsted, a pioneering surgeon who worked at Johns Hopkins hospital in the late 19th and early 20th century. Halsted battled addiction throughout his career, even as he revolutionized surgery by developing new surgical techniques, advancing anesthesia and promoting infection control. He became hooked on cocaine in 1884 while conducting experiments with the drug. Using morphine to help wean himself off cocaine, he developed a new addiction that plagued him until his death at 69. He became erratic and withdrawn, sometimes disappearing for weeks at a time. His oddities, though, were tolerated because of the enormity of his achievements.

“This man created a culture where you lived in the hospital,” says Michael Maddaus, a retired surgeon who developed a narcotics addiction while working as a professor of surgery at the University of Minnesota. “Part of the ethos of that is you don’t complain … You just do your work and shut up and have discipline to be strong and pretend you’re OK when everything’s not.”

In 2003, the Accreditation Council for Graduate Medical Education, which oversees medical training in the US, ruled that trainees could work a maximum of 80 hours a week in clinical care. The first time that any national limit had been set on trainee work hours, it cut into the 100-hour-plus weeks that were often the norm for surgical trainees. But many surgeons protested that the reduced schedule did not leave enough time to adequately train surgical residents. (When an 80-hour workweek for residents was first rolled out in New York state in 1989, surgical trainees were exempt.) In response, most surgical trainees now add one or two extra years of fellowship training after residency in order to get in more hours in the operating room before embarking on their own practice.

Surgery is a high-stakes endeavor; patients’ lives hang in the balance. Small mistakes have catastrophic outcomes. One of the first lessons of surgery is that surgeons are expected to take responsibility for what happens to their patients. The American College of Surgeons, in a document for medical students that outlines the skills needed to become a surgeon, says: “At the core, surgeons must be able to accept responsibility.”

The heightened sense of responsibility comes at a personal cost. Surgeons often fall into a trap of feeling like what they do “needs to be superhuman because they are the last line of defense, if you will, for a patient”, says Colin West, a professor of medicine at Mayo Clinic who specializes in physician wellbeing. When a patient does poorly after an operation – especially when there has been a mistake in their care – surgeons suffer emotional turmoil, anxiety, sadness, guilt and shame. In a 2017 study, an anonymous surgeon described the aftermath of an error: “We all hide our grief, suffer in silence. The pain can be close to debilitating.”

On Cunningham’s first night as an intern, three of her patients died. Their deaths were expected, but the losses still hurt. “I didn’t know how to call out a death certificate or even pronounce someone dead,” she recalls. “And I was like, ‘I’ll guess I’ll get used to it.’”

•••

Then, in 2012, death hit very close to home.

Cunningham first met Christina Barkley during medical school at the University of Michigan, where Barkley was a few years behind. They met up again at Harvard, when Barkley arrived to start a surgical residency. Their partners were good friends and they became friends.

In her last year of residency, Barkley had a mental health breakdown. She saw a psychiatrist at her hospital who started her on medication, and Barkley quickly returned to work. “She felt pressured by everyone around her to just finish her residency program,” says her sister Jill Barkley Roy. “That was the resounding message from everyone in her life – probably me included.”

Six months later, a neighbor found Barkley at home with a self-inflicted wound. Barkley’s colleagues believe she’d tried to take her life, but her sister is convinced that Barkley’s intention then was not to die. She says Christina told her that she’d just wanted to end her surgical career.

For the next two years, Barkley cycled in and out of hospitals, oscillating between depression and mania. In April 2012, three days after being discharged from hospital, she ended her life.

“I felt very angry for a very long time at the medical field,” says Barkley Roy. “My sister was so fearful about ramifications to her career and ramifications to her job and her reputation.”

Cunningham was shocked by Barkley’s death. “We imagined a lifetime of incredible things she’d continue to do not only as not only as a surgeon, but a wife, and a daughter, a sister and a friend,” she says.

Over the next decade, Cunningham’s career soared. She became an associate professor of surgery at Harvard Medical School and received a grant from the National Institutes of Health to investigate thyroid cancer. She was appointed to the executive council of national surgical organizations. She gave birth to two children and also had a terrible miscarriage, which led to thoughts of suicide. Depression came and went, repeatedly. She saw therapists off and on, but didn’t always have time.

When her mental health was bad, she buried herself a little more deeply in work.

“But the busier I was, the better,” she says. “Going on vacation was just torture for me … because when I sat still, all the internal stuff just percolated.”

Then the pandemic brought upheaval. After 25 years of marriage, Cunningham moved out of the family home. She and her ex-husband, also a surgeon, remain good friends. But the split was crushing. She felt like she was failing as a mom. She had frequent panic attacks, which she hid from her colleagues. A few friends questioned her about her mental health, but she pushed them off.

At night, she’d come home from work and open a bottle of wine. She looked forward to the way alcohol could prevent her from dwelling on the things that hurt. She drank to escape her anxiety and depression, but alcohol worsened both. So she drank more, and then more.

On a Friday night in spring 2022, Cunningham joined some colleagues at a local bar for a friend’s birthday. After a few drinks, Cunningham started openly talking about her depression. “I don’t even know exactly what I said, but I was talking about feeling suicidal,” she says.

The next day, a co-worker called Cunningham’s boss and told him that they were concerned. Her boss called her immediately and said he was coming to visit her at home. He told her that she needed help and she could take time out if she needed. The department would stand by her. She listened without protest. “It didn’t surprise me,” she says. “It was time.”

The following day, she flew to Orlando to take the helm as president of the Association of Academic Surgeons. That week, she white-knuckled her way through her talks, feeling awkward every time she saw one of her colleagues.

When she got home, she volunteered for a five-day professional evaluation from the Massachusetts Medical Society’s physician health services, which provides confidential assessments, referrals and monitoring of physicians. She expected to be connected with resources that would set her back on track. She was ready to throw all her willpower into recovery.

The results stunned her: Cunningham, who’d never had a DUI or any problems at work, was deemed unfit to practice medicine. She would have to participate in rehabilitation and then a monitoring program in order to return to work.

•••

Fifty years ago, in a landmark report called The Sick Physician, the American Medical Association declared physician impairment by psychiatric disorders, alcoholism and drug use a widespread problem. Even then, physicians had rates of narcotic addiction 30 to 100 times higher than the general population, and about 100 doctors a year in the US died by suicide.

The report called for better support for physicians who were struggling with mental health or addictions. Too many doctors hid their ailments because they worried about losing their licenses or the respect of their communities, according to the medical association.

Following the publication, state medical societies in the US, the organizations that give physicians license to practice, created confidential programs to help sick and impaired doctors. Physician health programs have a dual purpose: they connect doctors to treatment, and they assess the physician to ensure that patients are safe in their care. If a doctor’s condition is considered a threat to patient safety, the program may recommend that a doctor immediately cease practice, or they may recommend that a physician undergo drug and alcohol monitoring for three to five years in order to maintain their license. The client must sign an agreement not to participate in patient care until their personal health is addressed.

In rare and extreme cases, the physician health program will report the doctor to the state medical board to revoke their license.

Physician health programs are designed to address the myth that illness automatically means impairment, says Chris Bundy, the executive medical director of the Washington Physicians Health Program and the immediate past president of the national federation that oversees the state programs. An addiction or mental illness may require a physician to take time off, but does not justify an automatic revoking of someone’s license.

“People can function at high levels within their profession very expertly with depression, with anxiety, with substance use issues,” he says. He says the key is to get a physician to treatment early before their condition becomes severe enough to affect patient care.

A psychiatrist, Bundy developed a severe alcohol use disorder and was in monitoring for five years, during which time he joined the VA system as chief of mental health. He approached his state physician health program for help. He likes to quip: “I’m not only the hair club president, I’m also a client.” He has now been sober for 15 years.

But these programs remain shrouded in stigma. Doctors worry that, if they seek help, they will lose their license or the trust of their communities – so much so that they often stay away from treatment.

Lorna Breen, an emergency room doctor in New York, died by suicide in April 2020, after telling her family that she worried she would lose her medical license, or be ostracized by her colleagues, because she was suffering anguish from her work on the front lines of the Covid-19 crisis. Her family and friends started the Lorna Breen Foundation, which wants to see changes to the medical licensure process. The foundation wants licensing bodies to limit their questions on physicians’ health to current issues and not previous mental health diagnoses.

So far, only 21 states meet this standard. Meanwhile, physicians continue to suffer. In Medscape’s Physician Suicide Report 2023, 9% of male physicians and 11% of female physicians said they had suicidal thoughts. The study authors noted that they felt that physicians were under-reporting their distress because of privacy concerns.

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Cunningham was shocked and furious at the results of her evaluation.

“I wanted to throw up when I read that the first time,” she says. “I was angry because I hadn’t done anything that was illegal or harmed a patient or anything.” The one consolation was that her license was not revoked. The program recommended that she undergo rehab, and then return to work with routine monitoring including breathalyzer tests and random drug testing. She’d never even tried the drugs she was being tested for, she says.

Cunningham decided she was going to recover with the same drive she’d once poured into tennis and surgery. She’d check the recovery box and back to work. “I was still in that fierce mode of ‘I’m gonna prove everyone wrong. Screw you.’”

She spent four weeks in rehab, the first time in 20 years that she’d taken more than a week off. She thought about her to-do list: research projects waiting for her attention, and lectures that she was supposed to deliver at universities around the world. She finished the rehab program a day early to rush back to Harvard, where she interviewed candidates for fellowships in the coming year.

At the end of the day, she sat in her car in the parking lot and cried.

One week later, she relapsed. She called the physician health program and told them. Then, she left for a seven-week intense rehab program in Illinois designed for physicians and other professionals.

She calls recovery the hardest thing she has ever done. “It felt like being forced through a wall of fire, terrified of walking through it and having no idea what was on the other side,” she says.

She kept her illness and rehab secret to all but a few. When she returned to work, she did so slowly. In order to maintain her license, she needs to prove her sobriety three times a day with a breathalyzer test for three years. She participates in multiple recovery meetings and goes to therapy every week. It’s been excruciatingly hard, but worth it, she says.

“I’m a better doctor now. I’m more connected with my patients,” she explains. “And look, if you feel badly enough, if you’re not alive, you can’t be a surgeon anyway.”

As her year as president came to a close, Cunningham started to think about what she would say in her outgoing speech to her colleagues. She knew the potential consequences of revealing what she’d been through in her year as president. Patients might refuse to see her. Her colleagues might be afraid to refer patients to her. She was a strong contender to become a chair of surgery one day, and she’d be putting that at risk, too.

But she felt that she could make a difference. And she’d be honoring Barkley, whose name had disappeared from conversations after her death, like many who die by suicide.

“I could not stand up there and act like everything was fine,” she says. “If there was a reason I [am] on this planet, it is for me to give that speech.”

With Barkley’s sister in the front row, Cunningham told her story in full, describing her tennis career and depression, and showed an image of the online message saying she’d been found temporarily unfit for practice.

She urged the audience to put their health first. Surgeons should encourage colleagues to seek help before they become so sick that they are reported to a medical licensing board or they end up taking their lives, she said.

“I will never know what would have happened if those friends had not intervened. But I am sure I would have spiraled further with much worse consequences,” she said.

“I wish I could get those of you in this room that are struggling the courage it takes to seek help. But I can’t. I can promise you that people will show up for you as you would for anyone else who asked for help,” she said.

“I have to accept that I will always have tough days. I can expect recurrent bouts of depression throughout my life,” she said. “It is a disease, not a character flaw. It does not define me.”

Surgeons in the audience gave her a standing ovation, and her talk has been watched 29,000 times – nearly 30 times the figure for most lectures posted by the same organization.

“It’s a real watershed moment in that particular profession to be able to say it’s OK for us to talk about these things, and let’s change the subculture of surgery,” says Bundy, who was in the audience.

Since then, none of the terrible consequences Cunningham feared about going public have come to fruition. The only negative effect has been that she was turned down for life insurance.

Cunningham’s phone has been ringing off the hook since her talk. Surgeons from around the globe call her to share their stories and thank her for speaking out. She tells them what she told the audience: “I do not have all the answers. I do know that it won’t get better unless we talk about it openly and honestly.”

• In the US, you can call or text the National Suicide Prevention Lifeline on 988, chat on 988lifeline.org, or text HOME to 741741 to connect with a crisis counselor. In the UK and Ireland, Samaritans can be contacted on freephone 116 123, or email jo@samaritans.org or jo@samaritans.ie. In Australia, the crisis support service Lifeline is 13 11 14. Other international helplines can be found at befrienders.org