Both houses of state government are not in agreement about overhauling the state's antitrust laws as they prepare to leave Albany.

Senators on Wednesday passed Deputy Senate Majority Leader Mike Gianaris' 21st Century Antitrust Act in a split 36-25 vote. The proposed law would criminalize business practices that establish a monopoly within any New York labor market, and would make it illegal for business owners to abuse market dominance.

The measure also tasks the state attorney general's office to establish an "abuse of dominance" standard for legal enforcement, and authorizes class-action lawsuits for the state to take action against large commercial businesses working to dominate an industry and undercut competition.

But the measure lacks sufficient support in the Assembly to make it to the governor's desk.

"On the Assembly side, there needs to be more work to get it done this year," said Assemblymember Harvey Epstein, a Manhattan Democrat who co-sponsors the measure in the lower house. "It's unfortunate. It's an important piece of legislation. From what I've heard, it doesn't have the support it needs to get over the finish line this session."

Assembly sponsor Jeffrey Dinowitz, a Democrat from the Bronx, could not be reached for comment Wednesday after multiple attempts.

The attorney general will issue guidance and regulations about how to interpret the specifics of the state marketplace, and specify conditions that indicate an industrial abuse of dominance. The Legislature will oversee the regulations.

The bill does not change how courts define a market's scope or size. 

Epstein said his colleagues in the majority have demonstrated "real support" to reform the state's antitrust laws, but remain skeptical of potential consequences.

"There are general concerns around the bill and potential federal issues," Epstein said. "[They] just need to understand the bill and get comfortable with it."

Gianaris defended his antitrust overhaul to Sen. George Borrello, a Republican from Sunset Bay, on the floor Wednesday.

Borrello expressed concern the ability for companies to file class-action lawsuits over squeezing out competition could harm small- and medium-sized businesses. His own business was targeted by a frivolous class-action lawsuit, he said.

Gianaris replied protecting small- and medium-sized businesses from commercial players unilaterally manipulating the market is the point of reforming state antitrust statute. The state's antitrust law, known as the Donnelly Act, was enacted in 1899 before the federal antitrust Sherman Act.

"We are changing the standard because it needs changing," Gianaris said. "...The big-tech companies are completely suffocating the small- and medium-sized players to the point where they can't operate and they can't succeed.

"What's in here to protect small- and medium-sized businesses? The entire bill."

Epstein cited the ongoing national shortage of baby formula as a prime example of why stronger antitrust laws are needed in the state and across the U.S. Four manufacturers control 90% of the U.S. baby formula market, meaning

"If one company controls 46% of all baby formula in the United States and that becomes a crisis in our country, don't tell me the antitrust laws are meaningless," he said. "We need to, at least in New York, strengthen our antitrust laws."

Lawmakers are expected to pass legislative packages to strengthen state gun regulations and access to abortion in New York in wake of recent national conversations. Legislators have a full plate for the last three scheduled days of legislative session for the year, and eager to leave Albany as they juggle campaigning for two state primaries in newly drawn elective districts. 

Senators passed the antitrust measure and two other bills Wednesday to improve transparency in the online marketplace and increase penalties for disruption-related fraud. The three bills were part of a Senate legislation package targeting inflation, price gouging and improving market competition.

“New York has always prided itself on a robust economy where everyone can participate and prosper," Senate Majority Leader Andrea Stewart-Cousins said Wednesday. "In order for this to happen, we must maintain careful regulations and strict oversights that prevent bad actors from spoiling our free market. This legislation addresses new barriers in the digital age, strengthens necessary penalties, and fine-tunes our legal accountability measures so that no harm goes unpunished. This package will allow us to protect the best interests of New York consumers, and better uphold the integrity of our marketplace."

Gianaris joined the Senate Committee on Consumer Protection and held New York’s first-ever hearing into corporate monopolies in antitrust policy in fall 2020.