A career Justice Department official named John Elias will testify today that Attorney General William Barr conducted inappropriate antitrust reviews of marijuana industry mergers, due to his personal zest for cannabis.
Because it is important: This is not the first time that President Trump’s Justice Department has been accused of allowing bias to drive antitrust decisions. But it is the first time that a Justice Department attorney has been making the allegations, and it could have consequences for antitrust investigations in other industries.
Resume: John Elias joined the Justice Department in 2006 under President Bush, and served as chief of staff for the Antitrust Division between January 2017 and October 2018. He is currently a prosecutor in the Antitrust Division.
- He is one of three federal prosecutors who testify before the House Judiciary Committee today as whistleblowers, alleging abuses of power (among other things).
What Elijah says, according to his opening statement:
“Under the direction of Attorney General Barr, the Antitrust Division launched ten large-scale reviews of merger activity taking place in the marijuana or cannabis industry. These mergers involve companies with low market shares in a fragmented industry; they do not meet the established criteria for antitrust investigations … The reason for doing so focused not on an antitrust analysis, but because [Barr] he didn’t like the nature of his underlying business. “
Details: Elias says that marijuana-related investigations accounted for 29% of full-review merger investigations in fiscal year 2019.
- Among the mergers reviewed was one between MedMen and PharmaCann.
- In one case, the merged companies would have a combined market share of 0.35%.
- In another, the merged companies operated in different geographies and did not compete at all.
- Elias will also allege political interference related to a car maker deal on carbon emissions.
The bottom line: Home audiences often turn into partisan speeches, rather than candid searches for the truth. But what is said today will be shelved by the companies and their attorneys, particularly at Big Tech, as long as their future mergers are challenged by the Trump Department of Justice.
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