Why Baltimore And 2 Other Cities Sued America’s Largest Body Camera Maker

🌈 Abstract

The article discusses the rise of Axon, the largest manufacturer of police body-worn cameras in the United States, and the antitrust lawsuit filed against the company by a group of cities alleging anticompetitive practices.

🙋 Q&A

[01] The Rise of Axon

1. What led to the increased demand for police body-worn cameras?

• The police killing of Michael Brown, an unarmed 18-year-old Black man in Ferguson, Missouri, in 2014 galvanized an effort to expand the use of police body-worn cameras nationwide to bring clarity to dynamic and dangerous law enforcement situations.

2. How has Axon capitalized on this demand?

• Axon, formerly known as Taser International, has become the nation's largest manufacturer of body-worn cameras, with eight states now requiring their use.
• Axon acquired one of its key competitors, VieVu, to secure major contracts that had eluded it previously, such as New York City, Oakland, Miami-Dade, and Phoenix.
• Under its new Axon brand, the company aggressively raised prices for its body cameras, with prices increasing by 50% within a year and nearly tripling by 2022, reaching $490 per camera.
• Axon has captured a dominant market share, estimated at 60-70% in North America.

[02] The Antitrust Lawsuit

1. What are the key allegations made by the cities in the antitrust lawsuit against Axon?

• The cities of Baltimore, Maryland; Augusta, Maine; and Howell, New Jersey allege that Axon has committed antitrust violations, abused its market power, and forced cities to pay exorbitant fees for body-worn cameras.
• The lawsuit claims that Axon's acquisition of VieVu was anticompetitive and that the company has used its dominant position to raise prices significantly, leaving cities with few other options.
• The cities believe they have overpaid for the body cameras and are receiving lower-quality devices due to the lack of competition.

2. What are the potential implications if the cities succeed in their lawsuit?

• If the cities are able to successfully argue their case, it could pose a significant financial threat to Axon, as antitrust law allows plaintiffs to recover triple damages.
• The sharp rise in Axon's prices, as outlined in the complaint, is seen as a potential indicator of anticompetitive behavior that could be proven in court.
• However, the lawsuit's success is not a sure thing, and Axon has previously won legal battles against the Federal Trade Commission's attempt to challenge its acquisition of VieVu.