The vital role consumer protection plays in antitrust enforcement is being put at risk by the actions of both federal regulators and the courts. Within a week, we will learn whether the U.S. Supreme Court will step in to reaffirm that consumer welfare is—and must always be—at the heart of antitrust.

Here’s the backstory: President Biden and his firebrand progressive Federal Trade Commission Chair, Lina Khan, stripped the consumer welfare standard as an antitrust principle from their regulatory actions. The Court had adopted this standard in 1979 because it brought clarity to antitrust enforcement. It judges business deals by their measurable impacts on market efficiency—the only way to protect a competitive economy capable of delivering the best prices, choices, and innovation to American consumers.

The standard’s simplicity is its virtue, based on calculable effects on consumers. But it has long been resented by progressives because it restrains the scope of action by politicians and regulators, limiting their ambitions.

Since her days at Yale Law School, Lina Khan has made the erasure of the consumer welfare standard from American law her personal mission. When Biden’s FTC and Justice Department antitrust revised their merger guidelines in 2023, they shifted the traditional emphasis from protecting consumers to judging business deals by their impacts on workers, “creators,” and suppliers. This empowers regulators with justifications to do practically anything they want to do.

If ever there was a likely champion of restoring the consumer welfare standard, it would be Donald Trump, who campaigned on paring down government and expanding the economy to the benefit of the average American. So what did President Trump’s new antitrust enforcers do? One of the first acts of incoming FTC Chairman Andrew Ferguson and DOJ antitrust chief Gail Slater was to adopt the Biden-era merger principles in their entirety.

These guidelines are meant to advise the courts, which until now have remained bulwarks against the removal of the consumer welfare standard. If the courts were to abandon it as well, enforcers would be unrestrained. Now, a ruling from the Ninth Circuit Court of Appeals threatens to weaken the judiciary’s embrace of the consumer welfare standard just as it is being abandoned by regulators in both parties.

This case involves an antitrust lawsuit by the Real Estate Exchange (REX) against Zillow. REX was an upstart digital disruptor that set out to bring competition to the 5-6 percent real estate commissions imposed by the National Association of Realtors (NAR). When Americans buy homes, they are maneuvered into paying a high commission to their agents, along with a payment to the sellers’ agents.

NAR mandates that high-commission properties on its Multiple Listing Service be segregated from properties offered with lower commissions. This gives buyer’s agents the ability to steer clients away from lower-commission listings, depriving low-fee entrants like REX the ability to compete. As a consequence, according to economists Jordan M. Berry, Will Fried, and John William Hatfield, “low-commission listings receive less attention, take longer to sell, and face much greater risk of not selling at all.”

The continued existence of these high commissions is an oddity at a time when technology has slashed fees for purchases of everything from stocks to airline tickets. Digital technology now allows consumers to do much of the work of a realtor themselves. And in the midst of a housing affordability crisis, consumers would certainly benefit from commissions reduced by tens of thousands of dollars.

But NAR exercised its power, and Zillow adopted its rule. REX’s clicks fell by 90 percent, destroying the company and depriving consumers of the benefits of competition.

Here’s where the consumer welfare standard comes in. The Ninth Circuit Court of Appeals ruled against REX, superseding precedents that “optional” rules can be coercive when backed by market power. The court insisted on evidence of a binding agreement between Zillow and NAR, as if cartels would put collusion in writing. The Ninth Circuit ignored that for over a century, antitrust law has recognized informal agreements as conspiracies without specification that they are binding (handshakes, parallel conduct with plus factors, etc.). In short, the Ninth Circuit threatens the consumer welfare standard by legalizing tacit collusion against the consumer if it is labeled or considered optional.

This now leaves a split between the Ninth and 10th circuits, which have held that an association of competitors making a rule or practice “optional” provides immunity from the Sherman Act, and the 1st, 3rd, and 5th circuits, which have held that an association rule can be a conspiracy, even if it is optional.

The Supreme Court should review REX’s cert appeal to consider whether trade associations can immunize themselves from antitrust laws simply by calling their rules “optional” and not enforcing compliance. This is a matter of urgent concern for millions of Americans who are locked out of the dream of homeownership.

No less important is the survival of the consumer welfare standard as the guiding principle of antitrust enforcement. Abandoned by regulators of both parties, the consumer welfare standard only exists today as a judicial doctrine. If the Ninth Circuit ruling stands, consumer welfare will have been further abandoned by both regulator and judge.

Robert H. Bork Jr. is the president of the Antitrust Education Project.