Grubhub will pay $25 million to settle a lawsuit from the Federal Trade Commission and Illinois Attorney General Kwame Raoul over unlawful practices, including misleading customers about delivery costs, deceiving drivers about potential earnings, and listing restaurants on its platform without their permission. The agencies claim that Grubhub hid the true cost of its delivery […]
The U.S. Federal Trade Commission passed a rule on Tuesday banning hidden “junk fees” for live events, hotels, and vacation rentals. The agency says the new rule prohibits “bait-and-switch pricing,” and other practices that hide total prices and bury junk fees in the live-event ticketing and short-term lodging industries, noting that these “unfair and deceptive” […]
U.S. Sen. Elizabeth Warren (D-MA) speaks on stage during the final day of the Democratic National Convention at the United Center on August 22, 2024 in Chicago, Illinois. Delegates, politicians, and Democratic Party supporters are gathering in Chicago, as current Vice President Kamala Harris is named her party's presidential nominee. The DNC takes place from August 19-22.
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Sen. Elizabeth Warren led over 20 colleagues in requesting the CFPB and FTC investigate student-loan company Navient.
They said they're concerned that Navient might be improperly denying defrauded borrowers debt relief.
Navient said it's committed to getting relief to borrowers, but the discharge process is still in its early stages.
A group of Democratic lawmakers said that a major student-loan company is denying some student-loan borrowers relief that they might qualify for.
Sen. Elizabeth Warren led over 20 of her Democratic colleagues, including Rep. Alexandria Ocasio-Cortez and Sen. Ron Wyden, in sending a letter Wednesday to the Consumer Financial Protection Bureau and the Federal Trade Commission urging an investigation into thestudent-loan company Navient.
In theletter, viewed exclusively by Business Insider, the lawmakers wrote that Navient's process to cancel student loans for borrowers who said their schools defrauded them is "flawed, convoluted, and opaque," and it may have resulted in borrowers being "improperly" denied relief they qualified for.
A process known as the borrower defense to repayment allows borrowers with federal student loans to apply for debt cancellation if they believe their schools defrauded them. If approved, the government would wipe out their balances.
However, borrowers with private loans held by Navient cannot access the federal process. Instead, they can request a school misconduct application from Navient, and Navient would then decide whether to approve it.
The company previously said it's committed to addressing all "valid" misconduct claims.
The issue, the lawmakers wrote, is that Navient has denied relief for the majority of borrowers who applied. Navient wrote to Warren and her colleagues in a September letter, viewed by BI, that the company services about 65,000 borrowers who attended for-profit schools. As of September, Navient has sent 4,233 borrowers a school-misconduct discharge application, and 1,801 borrowers have submitted applications. Of the 1,061 applications Navient fully reviewed, 238 borrowers have been approved for relief, and 823 have been denied.
Navient wrote to the lawmakers that borrowers' applications are "carefully reviewed" by a legal team to determine eligibility for debt cancellation, and to date, it has approved over $8 million in relief. Still, the lawmakers said that the denials do not contain sufficient explanations, "leaving a fraction of Navient's borrowers who attended predatory, for-profit colleges with the relief that they deserve."
BI previously spoke to some borrowers who have attempted to navigate Navient's school misconduct application process. Nick Eucker, 38, said he received an application from Navient, and after submitting 200 pages worth of paperwork in support of his claim he was defrauded, Navient denied his application. The only reasoning he was provided was: "You do not meet the requirements for discharge based on misconduct by your school."
A Navient spokesperson previously said that the discharge process is still in its early stages, and the company expects more borrowers to see relief as it rolls out.
Still, the lawmakers said that Navient has the authority to cancel the loans of impacted borrowers without requiring a lengthy application process.
"Navient should cancel all of the private fraudulent debts for borrowers who have been harmed by its misconduct," they wrote, "all of whom the company is able to identify without an application."
Google reportedly wants the US Federal Trade Commission (FTC) to end Microsoft's exclusive cloud deal with OpenAI that requires anyone wanting access to OpenAI's models to go through Microsoft's servers.
Someone "directly involved" in Google's effort told The Information that Google's request came after the FTC began broadly probing how Microsoft's cloud computing business practices may be harming competition.
As part of the FTC's investigation, the agency apparently asked Microsoft's biggest rivals if the exclusive OpenAI deal was "preventing them from competing in the burgeoning artificial intelligence market," multiple sources told The Information. Google reportedly was among those arguing that the deal harms competition by saddling rivals with extra costs and blocking them from hosting OpenAI's latest models themselves.
Andrew Ferguson, one of two Republican FTC commissioners appointed by U.S. President Joe Biden, will be the country’s next FTC chair, incoming president Donald Trump announced Tuesday on social media. The news is being met with relief in some circles. Current FTC Chair Lina Khan was blamed by many in Silicon Valley for a dearth […]
Kroger's acquisition of Albertsons was blocked by a federal judge.
Charles Bertram/Lexington Herald-Leader/Tribune News Service/Getty Images
Kroger's proposed $24.6 billion acquisition of Albertsons was blocked by a federal judge.
The judge agreed with the FTC that the merger would weaken competition for US grocery shoppers.
The acquisition would be the largest supermarket merger in US history.
Kroger's $24.6 billion proposed acquisition of Albertsons was blocked by a federal judge on Tuesday, marking a win for the Federal Trade Commission that could ultimately sink the deal.
US District Judge Adrienne Nelson in Oregon found the acquisition would weaken competition for US consumers, agreeing with the FTC's arguments that it would violate anti-trust laws.
In statements provided to Business Insider following the ruling, Kroger and Albertsons said they were disappointed by the decision.
Kroger said the evidence it presented in court showed a merger between the two companies would be "in the best interests of customers, associates, and the broader competitive environment in a rapidly evolving grocery landscape."
"We believe we clearly outlined during the proceedings how the proposed merger would expand competition, lower prices, increase associate wages, protect union jobs, and enhance customers' shopping experience," the statement from Albertsons said.
The companies said they were evaluating their options following the court's decision.
Lawyers for the companies previously said the deal would likely be called off if the judge ruled against it.
"This merger will not occur if this injunction is in place," Matthew Wolf, an attorney for Kroger, previously said in court.
The acquisition would be the largest supermarket merger in US history. In its efforts to block the acquisition the FTC said the deal would reduce competition as well as lead to higher prices for US grocery shoppers and lower wages for workers.
"Kroger and Albertsons are two of the largest supermarket chains in thousands of local communities throughout the country," the FTC lawsuit said. "In hundreds of those communities, the proposed acquisition would create a single supermarket with market shares so high as to be presumptively unlawful under the antitrust laws."
The companies argued the acquisition would allow Kroger to compete with retail giants like Walmart, Costco, and Amazon. They also said the deal would lead to lower prices for some consumers, citing higher prices at Albertsons stores compared to Kroger.
The judge's decision also marked a win for FTC Chair Lina Khan, who has led aggressive anti-trust efforts against large corporations.
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A new paper from the Federal Trade Commission found that many smart device makers fail to disclose to consumers how long they will provide software updates for their products. The agency looked at 184 different smart devices, ranging from hearing aids to security cameras, and found that nearly 89% of them don’t provide buyers with […]
DOJ officials, in a filing, proposed that Judge Amit Mehta force Google to sell its Chrome browser to remedy antitrust violations in the tech giant's search business.
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Judge Amit Mehta found in August that Google holds an illegal monopoly in its search business.
On Wednesday, DOJ officials in the antitrust division filed their proposal for remedies in the case.
The DOJ wants Judge Mehta to force Google to sell its Chrome browser.
Officials from the Department of Justice, in a Wednesday filing, urged District Judge Amit Mehta to force Google to sell its Chrome browser.
The recommendations are the finalized proposal by the DOJ's antitrust division for remedies in Google's landmark antitrust case, in which Mehta ruled that the tech giant created an illegal monopoly with its search business by paying Apple and other smartphone makers billions to be the default search engine on their devices.
Mehta will consider the DOJ's proposal before he makes a final ruling regarding remedies in this case.
"The playing field is not level because of Google's conduct, and Google's quality reflects the ill-gotten gains of an advantage illegally acquired. The remedy must close this gap and deprive Google of these advantages," the filing states.
Representatives for Google and the Department of Justice did not immediately respond to requests for comment from Business Insider after the filing was made public.
"The DOJ continues to push a radical agenda that goes far beyond the legal issues in this case," Lee-Anne Mulholland, the vice president of Google's regulatory affairs, previously told BI in a statement following a Bloomberg report on Monday that included limited details of the proposal. "The government putting its thumb on the scale in these ways would harm consumers, developers and American technological leadership at precisely the moment it is most needed."
What selling Chrome would look like for Google
Because of Google's size, the popularity of Chrome, and the profits its search wing drives for the company, it would be a historic development if they were ultimately required to divest themselves of Chrome, Eric Chaffee, a business and tech law professor at Case Western Reserve University, told BI.
Such a sale would be a multibillion-dollar proposal, and it's not immediately clear who a potential buyer would be.
"Google could receive proceeds in the range of $15 billion to $20 billion," Peter Cohan, an associate professor of management practice at Babson College, told BI. "But if Google is able to control the company that buys Chrome, the impact of selling the business would be minimal. What matters most to Google is all the data Google collects and uses for advertising."
Neil Chilson, a former acting chief technologist at the FTC, told BI that asking Mehta to force Google to sell Chrome is the DOJ's way of swinging for the fences — but he expects the final remedies to land somewhere short of complete divestment.
"It's a pretty fantastical ask," Chilson said. "I don't think that this remedy really tackles the area in which Judge Mehta found liability, which is for these exclusive contracts, and so this seems like a very aggressive ask — one that doesn't really fix the problem that the judge said was creating the competitive problem in the first place."
'Google is a monopolist'
The DOJ's proposal is meant to remedy antitrust violations stemming from Google's search business, which BI previously reported pulled in $279.8 billion of its nearly $400 billion annual revenue in 2022.
The DOJ's case was filed against the company in 2020, and the subsequent trial revealed Google paid smartphone developers $26 billion in 2021 to become the default search engine on their devices — including $18 billion to Apple alone.
"After having carefully considered and weighed the witness testimony and evidence, the court reaches the following conclusion: Google is a monopolist, and it has acted as one to maintain its monopoly," Mehta wrote in his August decision ruling against the tech giant.
Google has faced additional antitrust cases this year, including another loss in federal court after a judge found the company acted in anti-competitive ways through its Android Play Store by limiting the reach of competitors' apps and charging high fees for processing in-app purchases.
Expect delays ahead
Mehta has set a two-week hearing in April 2025 to hear arguments over what remedies Google must take to address the antitrust violations, with plans to make a final ruling by the following August.
But multiple antitrust experts told BI to expect delays, especially as President Joe Biden's administration, and with it his DOJ officials, make way for the second Donald Trump administration.
Biden's administration developed a reputation for strong antitrust enforcement. While this case was filed against Google by the first Trump administration, the President-elect is generally regarded as more friendly to big corporations than Biden is, so his DOJ may revisit the requests for remedies set forth in Wednesday's filing.
Google can also appeal any ruling to try to delay the final outcome or request the case be dismissed, Cohan, the Babson College professor, said.
Chilson, the former FTC technologist, agreed it's likely Google will try to delay the final ruling but added that antitrust cases have momentum, so he wouldn't expect things to change substantially for the tech giant as soon as Trump takes office.
"Ultimately, in this case, it's going to be one of those things where Google ends up fighting — and fighting very vociferously, fighting very strenuously — to ultimately keep Chrome within its company," Chafee, the Case Western law professor, said.
