On January 14, 2025, the 21st Century Antitrust Act—which would enact sweeping changes to New York’s Donnelly Act—was introduced in the New York Assembly for the fourth time. After three aborted attempts, will the 21st Century Antitrust Act get the Governor’s signature this time?
In broad strokes, the 21st Century Antitrust Act would create a Sherman Act Section 2 analogue in New York state law for the first time and would introduce a European-style “abuse of dominance” standard to New York antitrust law. In addition, the law would introduce a pre-merger notification regime, create a private right of action, authorize class actions, and empower the Attorney General to promulgate rules regarding abuses of dominance. Supporters of the bill hail it as a lifeline for struggling small businesses in the Empire State, while critics contend that it will discourage job creation and business investment.[1]
The bill has a long and somewhat tortured history. The 21st Century Antitrust Act was first introduced by Senator Michael Gianaris in 2020, but the bill failed to make it out of committee. In 2021 and 2023, Senator Gianaris reintroduced the bill, where it passed the Senate, but died in committee in the Assembly. Most recently, the 21st Century Antitrust Act was reintroduced in the Senate on January 8, 2025, and in the Assembly on January 14, 2024.
Although the bills’ chances at clearing the Assembly and Senate are uncertain, what is certain is that the proposed amendments to the Donnelly Act have morphed considerably since their first introduction in 2020. This article highlights some of the key changes in this year’s 21st Century Antitrust Act.
The core provisions of the 21st Century Antitrust Act remain the same as they have been throughout: monopolization and monopsonization are outlawed, abuse of one’s dominant position is unlawful, the Attorney General is empowered to write rules governing abuse of dominance, and class actions are still in. However, the 2025 bill addresses some of the concerns that were voiced about its prior incarnations while introducing new provisions that are likely to draw criticism.
As a threshold matter, it is worth pointing out that the 21st Century Antitrust Act is a substantial departure from the common law development of the antitrust laws: Section 2 of the Sherman Act proscribes monopolization in very general terms and is merely 82 words (of which roughly 40 are operative); the Donnelly Act runs a similarly parsimonious 137 words.[2] As such, courts have largely been free to fashion their own interpretations of these statutes.[3] The 21st Century Antitrust Act, for its part, is roughly 4,000 words and contains, among other things, detailed provisions regarding presumptions about market power and provides instructions to courts about what constitutes direct and indirect evidence of market power.[4] The bill’s specificity may signal legislative intent to circumscribe some of the interpretive discretion once afforded to the courts.
Against this backdrop, changes to three aspects of the 21st Century Antitrust Act warrant discussion:
First, while legislative findings often involve hollow rhetoric, they can be illuminating. Both the 2021 and 2025 versions express “great concern” with “the growing accumulation of power” by corporations.[5] That concern now includes “harms” to democracy, and that dominant firms “undermine[] . . . workers, consumers, and small businesses.” According to the legislative findings, it is no longer the “time to update, expand and clarify our laws to ensure that these large corporations are subject to strict and appropriate oversight by the state;” rather, the “laws . . . should be updated . . . to adequately address abuses of power by dominant firms embodied in coercive vertical restraints on small businesses, workers, and consumers.” Although “strict . . . oversight by the state” was cut from the legislative findings, the 2025 bill’s new presumptions about dominant behavior are likely to subject covered entities to even more strict oversight by the courts.
Second, the 2021 bill eliminated a procompetitive justifications defense to monopolization. This provision was roundly criticized for creating a per se offense of monopolization.[6] Now, the 2025 bill is silent on the issue of defenses. While some courts may continue to utilize the burden-shifting framework created by the D.C. Circuit in United States v. Microsoft,[7] other courts may look to European Commission law to interpret how to implement an abuse of dominance standard.[8]
Third, and most significantly, the 2025 bill defines “restraints [that] are presumed to be illegal when engaged in by dominant firms.” Presumptively illegal restraints include exclusivity clauses, tying arrangements, non-compete clauses, agreements that effect the prices or wages offered by other firms, and any other restraints determined by the Attorney General to “pose[ ] a substantial risk of harming competition” or that “serve[ ] no legitimate business purpose that cannot be achieved in some less restrictive way.” The bill further provides that a defendant can only rebut the presumption through clear and convincing evidence that the pro-competitive benefits of the challenged conduct outweigh the harms to competition. These additions to the 21st Century Antitrust Act are likely to draw the most scrutiny and criticism. For example, it is common in the financial industry to pay departing executives six months’ severance prior to joining a competing financial firm (a practice referred to as “gardening leave”).[9] Under the employment presumption—“any restraint on a person’s ability to engage in a profession, trade, or business of any kind, including any restraint on a person’s ability to employ another person”—gardening leave agreements are likely to be presumed illegal. Contrary to the legislative findings, however, six-figure gardening leave packages do not appear to threaten democracy, materially harm competition, or undermine the power of workers.
While it remains to be seen whether these changes to the 21st Century Antitrust Act will survive committee and gain further legislative traction, the legislation in any shape would undoubtedly change the landscape of antitrust enforcement in New York and will likely result in a sharp increase in Donnelly Act claims.
[1] See, e.g., “New York Small Businesses and Independent Business Groups Applaud New York for Reining in Monopoly Power,” Small Business Rising (May 21, 2024), https://www.smallbusinessrising.net/updates/new-york-antitrust-2024 (“Governor Hochul should immediately sign the legislation to give a much needed lifeline to New York’s small businesses.”); Katy Milani & Ron Knox, “Why the 21st Century Antitrust Act is Critical for New York Small Businesses,” Institute for Local Self-Reliance (May 19, 2022), https://ilsr.org/articles/report-why-the-21st-century-antitrust-act-is-critical-for-new-york-small-businesses/ (“[A]cross many industries, small businesses are imperiled by highly concentrated markets and rampant market power abuse by dominant corporations .”); “Oppose the New York State 21st Century Antitrust Act: It’s Bad for Business and Consumers!,” Partnership for New York City, https://pfnyc.org/wp-content/uploads/2022/04/Antitrust-Response-4_25.pdf
[2] See 15 U.S.C. § 2; New York Gen. Bus. L. § 340(1).
[3] See Jay B. Sykes, “Antitrust Law: An Introduction,” Congressional Research Service (July 25, 2024) (“Sections 1 and 2 of the Sherman Act and Section 7 of the Clayton Act . . . are succinct and vague, effectively granting the federal courts common law authority to fashion competition policy based on prevailing economic theories.”); Leegin Creative Leather Prod., Inc. v. PSKS, Inc., 551 U.S. 877, 899 (2007) (“From the beginning the Court has treated the Sherman Act as a common-law statute.” (citing Nat’l Soc’y of Prof. Eng’rs v. United States, 435 U.S. 679, 688 (1978))); Nw. Airlines, Inc. v. Transp. Workers, 451 U.S. 77, 98 n.42 (1981) (“In antitrust, the federal courts . . . act more as common-law courts than in other areas governed by federal statute.”). But see Alexander J. Kraszewski, Comment, “. . . No, the Other Common Law”: Antitrust as Equity Jurisprudence, 29 Geo. Mason L. Rev. 1149 (2022) (arguing that “antitrust jurisprudence is rooted in equity and not common law”).
[4] S335, 2025–2026 Leg. Sess. (N.Y. 2025).
[5] This article compares the 2025 version of the 21st Century Antitrust Act to the 2021 bill because the 2021 bill was the first to pass the Senate.
[6] See, e.g., Yee Wah Chin & Rachel Webb, “Twenty-First Century Anti-Trust Act,” New York City Bar (June 2022), https://www.nycbar.org/reports/twenty-first-century-anti-trust-act/ (“[The bill] effectively renders an abuse of dominant position a per se violation, in sharp contrast to federal antitrust law.”).
[7] United States v. Microsoft Corp., 253 F.3d 34, 58–60 (D.C. Cir. 2001) (outlining burden-shifting framework for proving monopolization under § 2); see also FTC v. Qualcomm Inc., 969 F.3d 974, 991 (9th Cir. 2020) (citing Microsoft for the proposition that “the three part burden-shifting test under the rule of reason is essentially the same” as the standard to be applied in § 2 cases).
[8] European Commission law employs a two-step test to determine whether conduct by dominant entities constitutes exclusionary abuse. See, e.g., Francesca Miotto, Janek Nowak, & Maria Markou, “From Effects to Presumptions? The EC Draft Guidelines on Exclusionary Abuse,” A&O Shearman (Aug. 12, 2024), https://www.aoshearman.com/en/insights/from-effects-to-presumptions-the-ec-draft-guidelines-on-exclusionary-abuse.
[9] See, e.g., Matt Levine, “Money Stuff: Take the Gardening Leave,” Bloomberg (Aug. 28, 2019), https://www.bloomberg.com/opinion/newsletters/2019-08-28/money-stuff-take-the-gardening-leave; Matt Levine, “The FTC Comes for Noncompetes,” Bloomberg (June 14, 2024), https://www.bloomberg.com/opinion/articles/2024-04-24/the-ftc-comes-for-noncompetes.
