Federal Antitrust Policy, The Law of Competition and Its Practice
Author:
Hovenkamp, Herbert
Edition:
5th
Copyright Date:
2016
32 chapters
have results for Federal Antitrust Policy
Chapter 20. Antitrust Federalism and the “State Action” Doctrine 125 results (showing 5 best matches)
- One could take a variety of approaches to the problem of allocating decision making affecting competition between state government and federal antitrust. One approach is an efficiency test: efficient, or competitive state or local regulation should be permitted, but harmful regulation should be found inconsistent with federal antitrust policy. Such a rule has an intuitive appeal. First, it furthers a general federal policy of making efficiency the principal goal of antitrust enforcement. At the same time, it ensures that federal and state policy will be harmonious.
- State and local governments are not free to regulate without any restraint whatsoever. Nevertheless, the mere fact that state law is inconsistent with federal antitrust policy is generally not enough to preempt the state or local law. This is often the case where the state or local law regulates more intensively than federal antitrust law does. For example, upheld a state statute forbidding vertical integration by petroleum refiners into retailing, notwithstanding that federal antitrust law generally permits vertical ownership and regards most of it as efficient. state antitrust statute with no effective statute of limitation, even though this may have permitted an antitrust action to survive longer than permitted by the federal four year statute. Finally, state antitrust laws that permit indirect purchasers to sue for damages have been upheld, notwithstanding that federal law limits damage recoveries to direct purchasers. ...held that the federal Natural Gas Act did not preclude...
- Questions concerning the relation between state antitrust policy and federal law implicate the Supremacy Clause relatively more often. The easy case concerns the state law that purports to permit something that federal antitrust prohibits. The great railroad case first established that the fact that a merger was legal and had been approved under the law of a particular state had nothing to do with its legality under federal antitrust law—to that extent, state law was preempted.
- The “State Action” doctrine exempts qualifying state and local government regulation from federal antitrust, even if the regulation at issue compels an otherwise clear violation of the federal antitrust laws. The term “state action” should not be confused with the same term as it is used in Constitutional cases interpreting the Fourteenth Amendment and the Bill of Rights. In such cases, the term “state action” is interpreted broadly. Many actions that would be constitutional “state action” for Fourteenth Amendment purposes would not qualify for the “state action” antitrust exemption because they were insufficiently articulated as state policy or insufficiently supervised by a state agency. For example, a state regulatory agency that simply authorized private collusion in violation of its own statutory mandate would certainly be engaged in “state action” for Fourteenth Amendment purposes. But such an agency rule would not qualify for the “state action” antitrust exemption because the...
- See Herbert Hovenkamp & John MacKerron, Municipal Regulation and Federal Antitrust Policy, 32 UCLA L. Rev. 719 (1985); Einer Elhauge, The Scope of Antitrust Process, 104 Harv. L.Rev. 667, 730 (1991).
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Chapter 1. The Basic Economics of Antitrust 143 results (showing 5 best matches)
- Those who make antitrust policy are consumers, not usually creators, of economic theory. Further, antitrust policy makers are quite stodgy about adopting new theory. The economics applied in antitrust decision making is quite conventional, “applied” economics. The economics literature as a whole is more technical, more venturesome and speculative, much more stylized, and at the margins much more controversial than most of the economics that is applied by the antitrust policy maker. What follows is a brief presentation of relatively orthodox economics that forms the basis of federal antitrust policy.
- The important policy implication of monopsony is that it often rather than increases output in the monopsonized market. Many federal judges have failed to see this. The consumer welfare principle in antitrust, or the notion that the central goal of antitrust policy should be low prices, has often suggested to courts that monopsony is not all that important an antitrust policy concern. For example, in case, the First Circuit refused to condemn as monopolistic a health insurer’s policy of setting the maximum price it was willing to pay for health care services used by its insureds.
- See Erik Hovenkamp and Herbert Hovenkamp, Exclusionary Bundled Discounts and the Antitrust Modernization Commission, 53 Antitrust Bull. 517 (2008); Erik Hovenkamp & Herbert Hovenkamp, Complex Bundled Discounts and Antitrust Policy, 57 Buffalo L.Rev. 1227 (2009).
- TCE has served to limit antitrust analysis from the structuralist expansionism of the 1970s and earlier, but also as a corrective for those inclined to see the movement of resources as essentially costless. Both are extremes that antitrust policy should avoid.
- See Charles A. Holt and David T. Scheffman, “Strategic Business Behavior and Antitrust,” in Economics and Antitrust Policy (Robert J. Larner & James W. Meehan, Jr., eds. 1989), at 39.
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Chapter 19. Antitrust and Federal Regulatory Policy 122 results (showing 5 best matches)
- This chapter is concerned with the relationship between federal antitrust policy and other forms of federal regulation. Then chapter 20 on the “state action” doctrine considers the relation between federal antitrust and the regulatory policies of state and local government. At first glance, the questions raised in these two chapters seem quite different from one another. After all, federal regulation and the federal antitrust laws are passed by the same level of government, and Congress has the authority to repeal, amend or create exceptions to the antitrust laws any time it wishes. By contrast, the relationship between federal statutes and state and local government regulation is which demands that state and local law give way to valid, inconsistent federal law.
- The case for limiting the role of antitrust in the regulated industries is strongest when the federal regulatory statute exempts firms from antitrust liability. For example, the Shipping Act of 1984 contains a set of antitrust-like provisions that apply to common carriers regulated by the Federal Maritime Commission, and expressly prohibits private antitrust actions based on activities within the jurisdiction of that agency. Likewise, federal statutes regulating railroads and trucking permit firms to engage in joint rate making without running afoul of the antitrust policy against collusion. By contrast, in other cases, the federal regulatory statute may contemplate concurrent federal or even state authority. For example, in ...of the Natural Gas Act had been “meticulously“ drafted in order to protect the authority of individual states to engage in regulation of natural gas transactions within their territory. Further, this included application of state antitrust law to gas sellers...
- But ultimately these differences are more apparent than real. The “state action” doctrine was developed at a time when sensitivity toward federalism in our constitutional system was very high. As a result, the Supreme Court was reluctant to run roughshod over legitimate and clearly articulated state interests. Indeed, as we shall see in the next chapter, states and their subdivisions do have a broad power to “repeal” the antitrust laws within regulated industries, provided that they express their designs carefully and carry them out with sufficient attentiveness. As a result, the main differences between the relationship of federal antitrust and federal regulatory policy on the one hand, and federal antitrust and state and local regulation on the other, has to do with the way the doctrines are articulated. The substance is most generally quite similar.
- 19.7b. Antitrust and Federal Labor Policy.
- 19.7b. Antitrust and Federal Labor Policy
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Chapter 5. Joint Ventures of Competitors, Concerted Refusals, Patent Licensing, and the Rule of Reason 218 results (showing 5 best matches)
- The third complicating factor is that patents, as well as copyrights and trademarks, are governed by detailed federal statutes that create numerous potential conflicts with antitrust policy. As a result, the antitrust laws and the federal intellectual property laws must be interpreted so as to accommodate one another. Importantly, the United States has both a patent policy and an antitrust policy, and neither should be interpreted in such a way as to disregard the other. One may therefore dispute the conclusion that if a “patent has been lawfully acquired, subsequent conduct permissible under the patent laws cannot trigger any liability under the antitrust laws.” Simple legality under the patent laws cannot be decisive of an antitrust question, although
- In 1995 the Antitrust Division of the Department of Justice and Federal Trade Commission jointly issued Antitrust Guidelines for the Licensing of Intellectual Property. These Guidelines state the enforcement policies of the two antitrust agencies and also serve as a useful summary of the law.
- For discussion of these issues, see Christina Bohannan & Herbert Hovenkamp, Creation Without Restraint: Promoting Liberty and Rivalry in Innovation (2011); Herbert Hovenkamp, Mark D. Janis, Mark A. Lemley, & Christopher R. Leslie, IP and Antitrust: an Analysis of Antitrust Principles Applied to Intellectual Property Law, chs. 1 & 2 (2d ed. 2009 & 2015 Supp.); William E. Kovacic, Antitrust in High-Tech Industries: Improving the Federal Antitrust Joint Venture, 19 Geo.Mason L.Rev. 1097 (2012); Dan L. Burk and Mark A. Lemley, Policy Levers in Patent Law, 89 Va.L.Rev. 1575 (2003); Thomas M. Jorde & David J. Teece, Rule of Reason Analysis of Horizontal Arrangements: Agreements Designed to Advance Innovation and Commercialize Technology, 61 Antitrust L.J. 579 (1993).
- Claims of patent misuse might initially be tested by antitrust principles, but that cannot be the end of the story. After all, “misuse” is a creature of IP law, which protects values that are distinct from the competition values protected by antitrust. One value is protection of access to the public domain. Another is protection against practices that serve to restrain rather than promote innovation, even though they may not be technical antitrust violations. That rule, the Supreme Court observed, emanated from patent law, not antitrust law. While antitrust analysis might have compelled a different outcome, such as treatment under the rule of reason, in this case counseled for adherence. Three dissenting Justices (Alito, Thomas, and Chief Justice Roberts) protested that not only did antitrust policy not compel the rule against post-expiration royalty payment extensions, but nothing in the Patent Act did so either. In any event, a simple contract calling for royalty payments would...
- See, e.g., Richard J. Gilbert, Antitrust for Patent Pools: A Century of Policy Evolution, 2004 Stan. Tech. L. Rev. 3. On royalty “stacking, see Herbert Hovenkamp, Antitrust and the Patent System: A Reexamination, 76 OSU L.Rev. 467 (2015); Erik N. Hovenkamp & Herbert Hovenkamp, “Tying Arrangements,” Oxford Handbook of International Competition Policy (2015).
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Chapter 2. History and Ideology in Antitrust Policy 197 results (showing 5 best matches)
- As noted in § 2.1b, great early antitrust opinions such as Taft’s decision effectively freed the antitrust laws from both Congressional intent and the substantive rules of the common law. From that point the federal courts forged their own antitrust policy, taking advantage of the best applied economics of the day. One of the great myths about American antitrust policy is that courts first began to adopt an “economic approach” to antitrust problems in the relatively recent past. This belief has led some to argue that antitrust could escape from ever-changing, indeterminate economic theories by looking to its common law heritage.
- But such a characterization considerably overstates the case. Chicago School arguments notwithstanding, federal courts deciding antitrust cases have not eliminated noneconomic concerns from antitrust policy. Indeed, one must doubt whether such concerns can ever be eliminated from policy making in a democratic society. The public purpose of economics is not to eliminate political concerns from policy making. Rather, it is to enable policy makers to make judgments about the costs or effectiveness of a particular policy. The relative weight to be given to efficiency concerns varies with the ability of the relevant economic model to identify efficient policies in the real world. If the efficient solution is clear, and the degree to which alternative solutions deviate from the efficient solution is also quite clear, then policy makers are likely to weigh efficiency concerns heavily.
- The classic, highly factual account is Hans B. Thorelli, The Federal Antitrust Policy: Origination of an American Tradition (1955). A few of the others are Rudolph J.R. Peritz, Competition Policy in America, 1888–1992: History, Rhetoric, Law (1996); William Letwin, Law and Economic Policy in America: The Evolution of the Sherman Antitrust Act (1981); Martin J. Sklar, The Corporate Reconstruction of American Capitalism, 1890–1916: The Market, the Law, and Politics (1988); Herbert Hovenkamp, Enterprise and American Law: 1836–1937 (1991); Tony Freyer, Regulating Big Business: Antitrust in Great Britain and America, 1880–1990 (1992); Herbert Hovenkamp, The Opening of American Law: Neoclassical Legal Thought, 1870–1970, chs. 11–12 (2015). The legislative history of the antitrust laws is collected in Earl W. Kintner, The Legislative History of the Antitrust Laws (1978).
- The issue of economics’ appropriate role in antitrust actually evokes two questions. , should economic efficiency be the only goal of antitrust policy, or should it share that role with other values or perhaps even other disciplines? , what economic criteria should antitrust policy use?
- What is the student of antitrust to make of this inconsistency and complexity in economic analysis? Two extremes seem particularly ill-advised. The first is to throw up one’s hands and simply abandon any effort to develop a coherent antitrust policy driven by economic assumptions. The second is to leap at every new economic theory that sounds plausible and attempt to incorporate it into antitrust policy analysis.
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Chapter 11. Intrabrand Restraints on Distribution 89 results (showing 5 best matches)
- The policy question is complicated by the fact that policy is not the only kind of policy that counts in a democracy. Although many people believe that economic efficiency should be the exclusive goal of antitrust, most members of the Congresses that have passed the federal antitrust statutes did not share these views. Although the Supreme Court has cited economic concerns as relevant, it has never said that economic efficiency is all that counts, not even in its interpretation of the antitrust laws. Today
- See Frank Easterbrook, Vertical Arrangements and the Rule of Reason, 53 Antitrust L.J. 135, 163–164 (1984) (advocating such an approach); Herbert Hovenkamp, Antitrust Policy After Chicago, 84 Mich. L. Rev. 213, 256–259 (1985) (criticizing it).
- On consumers’ surplus, see § 1.1a. See Frederic M. Scherer, The Economics of Vertical Restraints, 52 Antitrust L.J. 687 (1983); William S. Comanor, Vertical Price-Fixing, Vertical Market Restrictions, and the New Antitrust Policy, 98 Harv. L. Rev. 983 (1985); William S. Comanor & John B. Kirkwood, Resale Price Maintenance and Antitrust Policy, 3 Contemp. Policy Issues 9 (1985). See also William S. Comanor, The Two Economics of Vertical Restraints, 21 Sw. U.L.Rev. 1265 (1992); Lawrence White, Resale Price Maintenance and the Problem of Marginal and Inframarginal Customers, 3 Contemp. Policy Issues 17 (1985). The basic theory of the inframarginal consumer comes from Michael Spence, Monopoly, Quality, and Regulation, 6 Bell J. Econ. 417 (1975). See also Warren S. Grimes, A Dynamic Analysis of Resale price maintenance; Inefficient Brand promotion, Higher Margins, Distorted Choices, and Retarded Retailer Innovation, 55 Antitrust Bull. 101 (2010) (finding greater possibilities of...
- 11.4d. The Agreement Requirement and Antitrust Policy Respecting Vertical Restraints; Restraints Initiated by Powerful Dealers.
- Developing such models is essential to the policy enterprise of antitrust, and few questions—particularly not this one—should be regarded as settled. But most of the other anticompetitive explanations for vertical restraints are either excessively conjectural, excessively complex, or else not sufficiently robust to cover a wide range of circumstances. To be sure, some suppliers’ predictions about the consequences of vertical restraints may be wrong, and output may go down rather than up. But antitrust policy is generally not intended to protect firms from their own self-deterring errors.
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Chapter 21. The Reach of the Federal Antitrust Laws 96 results (showing 5 best matches)
- This section is concerned with the power of the federal courts to use the federal antitrust laws to reach activities that occur abroad, that contain a measure of foreign government involvement, or that raise actual or potential conflicts with the law of a foreign sovereign. Such conflicts pose significant problems for United States antitrust policy for two reasons. , American antitrust policy is more aggressive than the policy of many other countries, often condemning activities that other sovereigns regard as legal. That aggressiveness also applies to its system of remedies; in other countries treble damages are virtually unheard of and United States law is far more tolerant of private actions. , where antitrust is concerned, American enforcers and courts have been quite willing to assert American authority over activities occurring abroad, and not particularly accommodating of the conflicting policies of foreign nations. As a result, scholars of conflict of laws and international...
- See generally Herbert Hovenkamp, Personal Jurisdiction and Venue in Private Antitrust Actions in the Federal Courts: A Policy Analysis, 67 Iowa L.Rev. 485 (1982).
- Comity is sometimes described in jurisdictional language. But judges have at least some discretion in determining whether comity considerations require dismissal of an antitrust suit, and at least some suits are dismissed when basic jurisdictional requirements have been met. the Supreme Court held that concerns of comity did not require dismissal of an antitrust suit where there was no actual conflict between American antitrust and the domestic policy of the foreign sovereign. Under a long standing tradition of self-regulation, insurance agreements reached at Lloyds of London were legal even if they were collusive and, at least arguably, even if they excluded other non-parties from participating in the market. However, nothing in British policy such agreements. As a result, there was no conflict between American antitrust policy and British policy respecting the regulation of its insurance ...the states, as our federal system often invites it to do, it is not necessarily...
- 28 U.S.C.A. §§ 1602 et seq. See Herbert Hovenkamp, Sovereign Immunities Act Jurisdiction and Antitrust Policy, 15 U.C. Davis L. Rev. 839 (1982); Herbert Hovenkamp, Can a Foreign Sovereign Be an Antitrust Defendant? 32 Syracuse L. Rev. 879 (1981).
- Filetech S.A. v. France Telecom, S.A., 304 F.3d 180 (2d Cir. 2002) (finding immunity). See Herbert Hovenkamp, Antitrust as Extraterritorial Regulatory Policy, 48 Antitrust Bull. 629 (2003).
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Preface 4 results
- This book seeks to give a full, although brief, accounting of United States antitrust law. Today the union of antitrust and economics is so complete that one cannot study antitrust seriously without at least minimal exposure to economics.
- Federal Antitrust Policy: the Law of Competition and its Practice
- Law school antitrust curricula vary considerably, with some classes focusing only on questions of substance, some involving many questions of enforcement and procedure, and some being quite creative in their application of economics. I have tried to accommodate all of these to one degree or another. I have also attempted to provide a level of detail and analysis that makes this book a useful resource for the practitioner, judge or other antitrust scholar.
- I chose the word “policy” for the title, since this book attempts both to state the “black letter” law and to present policy arguments for alternatives. Although I frequently disagree with court decisions, in all cases I have tried to state clearly what the legal rule is, and then give the reasons for my disagreement. Of course, I have my own ideological views. But here I have tried to present alternative views fairly, and to uncover the premises upon which they rely.
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Chapter 15. Public Enforcement of the Federal Antitrust Laws 55 results (showing 5 best matches)
- See also 14 Antitrust Law, Ch. 24 (3d ed. 2012), which surveys and updates state antitrust law and compares it with federal law; ABA Antitrust Section, State Antitrust Practice and Statutes (4th ed. 2009); Herbert Hovenkamp, State Antitrust in the Federal Scheme, 58 Ind. L.J. 375 (1983); ABA Antitrust Section, Monograph No. 15, Antitrust Federalism: the Role of State Law (1988).
- These Guidelines are somewhat more aggressive against mergers than the corresponding federal Guidelines. For example, the NAAG Guidelines generally define markets more narrowly than do the federal guidelines. Further, they recognize some goals other than efficiency as legitimate parts of antitrust enforcement policy. For example, mergers that transfer wealth away from consumers can be condemned under the NAAG Guidelines even if the merger itself creates efficiency savings larger than the monopoly price increase. A problematic aspect of the NAAG Merger Guidelines is that under them the states can effectively impose a policy concerning the of interstate industries that is inconsistent with federal policy—provided, of course, that the federal courts will cooperate. For example, a single state could seek divestiture or injunction against an acquisition where most of the productive assets of the acquiring and acquired firms are located in different states. ...but now withdrawn) federal...
- FTC v. Sperry & Hutchinson Co., 405 U.S. 233, 239, 92 S.Ct. 898, 903 (1972). For exploration of this principle, see Jan M. Rybnicek and Joshua D. Wright, Defining Section 5 of the FTC Act: the Failure of the Common Law Method and the Case for Formal Agency Guidelines, 21 Geo. Mason L.Rev. 1287 (2014); Herbert Hovenkamp, The Federal Trade Commission and the Sherman Act, 62 Fla.L.Rev. 871 (2010); William E. Kovacic & Marc Winerman, Competition Policy and the Application of Section 5 of the Federal Trade Commission Act, 76 Antitrust L.J. 929 (2010); Robert H. Lande, Revitalizing Section 5 of the FTC Act Using “Consumer Choice” Analysis, 8 Antitrust Source 1 (Feb. 2009).
- Finally, of course, the states’ attorneys general are heavily involved in enforcing the antitrust laws of their particular states, most of which are similar to federal antitrust law. These statutes are generally beyond the scope of this volume, but a brief discussion focusing on issues of federalism is contained in § 20.8.
- In addition to the public agencies, states’ attorneys general have authority to enforce the federal antitrust laws. The states are considered private persons when they seek enforcement of the federal antitrust laws, however. As a result, they act in a dual role. Insofar as the relationship between the state attorneys general and federal law is concerned, the states are simply a special case of the private plaintiff, and most of the restrictions on private enforcement apply to them.
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Chapter 18. Antitrust and the Process of Democratic Government 82 results (showing 5 best matches)
- This chapter, the following chapter on federal regulation, and chapter 20 on state and local regulation (the “state action” doctrine) all deal with variations of the same question: Given that the democratic process often produces anticompetitive results, when should the federal antitrust laws intervene in either the process or the result itself? Although the technical rules differ from one area to the next, the conclusions in these three chapters converge on the same principle: Antitrust intervention is not appropriate when the wrong being challenged is the policy choice of a sovereign government. Rather, antitrust applies when private parties are able to evade or manipulate the democratic process in such a way as to give themselves effective, unsupervised control over a market. Whether the antitrust dispute arises in the context of petitions to the ...chapter), federal regulation (chapter 19) or regulation by state and local government (chapter 20), this underlying principle is...
- The approach that antitrust takes in these areas is clearly not a solution to the problem of regulatory “capture,” or even an attempt at a solution. The democratic process contains many flaws, but curing them is not antitrust’s assignment. Congress never intended the antitrust laws to be used for this purpose, and they are very poorly designed for it. For example, the antitrust laws are concerned mainly with competition and economic efficiency. Although government policy is also concerned with competition and efficiency, governmental concerns range far wider, and governments constantly balance distributive, moral, and economic concerns. So if Congress wanted to draft “anticapture” legislation it could do so, but one would hardly imagine that this legislation would forbid “monopoly” or “combinations in restraint of trade” while explicitly saying nothing about abuses of governmental process.
- One additional consideration is important. The antitrust laws are concerned mainly with preserving competition and economic efficiency in the production and distribution process. By contrast, economic efficiency is almost never the exclusive goal of government process. Indeed, in many cases it is not even an articulated goal. An antitrust policy that condemned regulation too readily merely because it was inefficient might undermine legitimate, alternative goals of regulation.
- To the extent regulatory capture occurs, it represents a clear shortcoming in democratic policy making. The government might serve its citizens well if it compensated for capture or corrected for the biases it produces. But to conclude that the State should do something about regulatory capture does not entail using the antitrust laws to get the job done. The antitrust laws are concerned about the regulation of economic, or private, markets. Regulatory capture occurs in the political market, and the two markets are much more different than they are similar.
- So the appeal to the government buyer or seller has to be calculated to invoke a policy decision of the government. Further, as the Supreme Court noted, the antitrust injury caused by the trial lawyers’ boycott resulted from the boycott itself, a private act, and not from the government’s response:
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Table of Contents 87 results (showing 5 best matches)
Summary of Contents 11 results (showing 5 best matches)
Chapter 12. Mergers of Competitors 175 results (showing 5 best matches)
- The Bainian definition is generally more consistent with antitrust policy, and most antitrust tribunals continue to use it. High entry barriers are not themselves an antitrust violation. If we had a rule of “no fault” monopolization, under which dominant firms could be penalized simply for having their dominant market positions, then a rule such as Stigler’s makes sense. We should not use antitrust policy to punish a firm simply for attaining substantial scale economies. Although they can make entry difficult, scale economies are good for consumers.
- In one important sense, economists and antitrust policy makers generally have different conceptions of barriers to entry. For the economist a true entry “barrier” is a market factor that prevents entry from occurring in the long run. That is, the economist is generally interested in determining whether there is an By contrast, the antitrust policy maker generally thinks of entry barriers as factors that permit definite periods of monopoly pricing. Thus the antitrust policy maker’s interest is not limited to those situations where the social loss caused by monopoly is infinite (that is, where monopoly pricing will last indefinitely), but where it is too large by some measure which is entirely a function of policy. This book generally uses the antitrust policy maker’s definition: a barrier to entry exists if entry is deterred indefinitely as incumbents earn monopoly profits,
- For the antitrust policy maker, the problem of entry barriers revolves around three different issues: , what kinds of evidence in addition to the bare presence of these characteristics suggest that entry barriers are high enough to warrant antitrust intervention?
- Today the great majority of merger cases are brought by the Antitrust Division of the Department of Justice (Division) and the Federal Trade Commission (FTC). In 2010 the Division and the FTC jointly issued revised Guidelines outlining their enforcement policies respecting horizontal mergers. These Guidelines, which replaced previous Guidelines issued in 1968, 1982, 1984, and 1992, serve as a useful starting point for assessing the competitive effects of mergers. Importantly, federal merger policy is still governed by the statute and judicial law interpreting it. The Merger Guidelines are only Guidelines and they are not binding on courts. Nonetheless, over the years the courts have paid close attention to the Guidelines, generally giving the government the benefit of the doubt.
- Decision, Antitrust Source (Oct. 2007), available at http://www.abanet.org/antitrust/at-source/07/10/Oct07–Varner.pdf; and Joseph Farrell and Carl Shapiro, Improving Critical Loss Analysis, Antitrust Source (Feb. 2008), available at http://faculty.haas.berkeley.edu/shapiro/critical2008.pdf. See also Kevin Murphy and Robert Topel, Critical Loss Analysis in the Whole Foods Case, Global Competition Policy (March 17, 2008).
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Chapter 17. Damages 144 results (showing 5 best matches)
- 21 Cong. Rec. 2569 (1890). Senator Sherman originally proposed double damages. After a few amendments, the final proposal for treble damages was modeled largely after the English Statute on Monopolies. Hans B. Thorelli, The Federal Antitrust Policy 212 (1955); Herbert Hovenkamp, Antitrust’s Protected Classes, 88 Mich. L. Rev. 1 (1989).
- These countervailing considerations—the poor profit prospects and problems of proof on the one hand, and the easy susceptibility of unestablished businesses to antitrust violations on the other—suggest two premises for any antitrust damages policy concerning the unestablished business: 1) unestablished businesses should be able to enforce the antitrust laws by means of damages actions; however 2) lost anticipated profits is not the best measure of damages.
- The basic economic ideology of antitrust policy today is that antitrust should maximize the wealth of society by condemning practices when they permit inefficient output reductions and price increases, and by approving practices when they are competitive. With respect to damages, however, economists have offered antitrust policy makers a far more difficult proposition: that the damages for a particular offense should be calculated so as to make the offense unprofitable if it is inefficient, but not if it is efficient. The “antitrust injury” doctrine developed by the Supreme Court in Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc.
- For example, William F. Shughart II, Private Antitrust Enforcement: Compensation, Deterrence, or Extortion, 13 Regulation 53 (1990). A somewhat more moderate position is Robert H. Bork, The Antitrust Paradox: A Policy at War With Itself (1978; rev. ed. 1993).
- The marriage between economics and federal antitrust policy becomes rocky when it reaches the law of damages. With the exception of market definition issues, most of the economics applied in substantive antitrust analysis is conceptual and written by academics who were not contemplating litigation. By contrast, an economically sophisticated law of damages requires empirical studies to be made within the context
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Chapter 7. Exclusionary Practices in Monopolization and Attempt Cases 188 results (showing 5 best matches)
- the Federal Circuit held that a firm that acquired but did not use a patent could obtain an injunction shutting down a competitor who infringed the plaintiff’s unused patent but not any patent that the plaintiff actually practiced. decision has generally been interpreted to deny injunctions to non-practicing patentees, the court created an exception for a firm that is actually competing with the infringement defendant, although not infringing any patent that the plaintiff was actually using. This rationale excessively subordinates competition policy to a poorly articulated value in patent law—effectively permitting a dominant firm to acquire patents on competing technologies and thus deny entry to competitors, even if it is not practicing these particular patents itself. The purpose of the Patent Act is to facilitate innovation, not to permit people to withdraw it from the market altogether. The decision highlights an ongoing concern about patent-antitrust policy: antitrust...
- That creates a conflict to the extent that the policies of the antitrust laws may be inconsistent with those expressed in other bodies of law, such as trademark or unfair competition. For example, an Internet marketing company might enable pop-up advertisements for a competitor’s goods to appear when the computer user is viewing the competitor’s Web site. search engine firm such as Google might sell “sponsored” links that appear in a search for a competitor’s brand. In many cases the conflicts with competition policy are best met by adhering to a narrow construction of the Lanham Act and requiring a strict trademark “use” requirement that refuses to find infringement simply because information about the competing good is made available to the searcher as well. As the Second Circuit has observed, “the Lanham Act must be construed in light of a strong federal policy in favor of vigorously competitive markets, which is exemplified by the Sherman Act and other antitrust laws.”
- See Richard A. Posner, Antitrust Law 230–235 (2d ed. 2001); Robert Bork, The Antitrust Paradox: A Policy at War with Itself 309 (1978).
- Jonathan Baker & Judith A. Chevalier, The Competitive Consequences of Most-Favored-Nation Provisions, 27 Antitrust 20 (Spring, 2013); Steven C. Salop & Fiona Scott Morton, Developing an Administrable MFN Enforcement Policy, 27 Antitrust 15 (Spring, 2013); Aaron S. Edlin, Do Guaranteed-Low-Price Policies Guarantee High Prices, and Can Antitrust Rise to the Challenge?, 111 Harv. L. Rev. 528 (1997).
- The fact that a market is a network does not entail that it be controlled by a monopolist. Some networks, such as the local electric power grid, are price regulated by the government. Others, such as the telecommunications network, were once regulated monopolies but have now been opened to competition. Yet other networks, such as bank ATMs, sports leagues, and real estate multiple listing services, contain significant amounts of competition. A distinctive achievement of competition policy in recent decades has been throwing networked markets open to competition. Perhaps the most famous example is the telephone company monopoly, which was broken up by antitrust litigation to open the computer platform market to substantial competition, notwithstanding a significant antitrust victory on the merits, must be regarded as one of the bigger disappointments of recent United States antitrust policy.
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Chapter 4. Antitrust Policy Toward Collusion and Oligopoly 127 results (showing 5 best matches)
- Donald F. Turner, The Definition of Agreement Under the Sherman Act: Conscious Parallelism and Refusals to Deal, 75 Harv.L.Rev. 655 (1962); see also Carl Kaysen & Donald F. Turner, Antitrust Policy 110–119, 266–272 (1959). On the role of this structural approach in the antitrust policy of this era, see Herbert Hovenkamp, United States Competition Policy in Crisis, 1890–1955, 94 Minn.L.Rev. 311 (2009).
- Cf. Louis Kaplow, Competition Policy and Price Fixing (2013) (minimizing traditional conspiracy requirements); and Malcolm B. Coate, Should economic theory Control Price fioxing Analysis (FTC Working Paper April 10, 2014), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2103359. See also 6 In re High Fructose Corn Syrup Antitrust Litigation 295 F. 3d 651, 654 (7th Cir. 2002), where Judge Posner opined that while the Sherman Act was broad enough to cover tacit agreements, the case law was far more resistant. On Posner’s recent modification of his position, see his review of Kaplow, Competition Policy and Price Fixing, 79 Antitrust L.J. 761 (2014); and In re Text Messaging Antitrust Litig.,782 F.3d 867 (7th Cir. 2015).
- For a good discussion of the difference between non-cooperative and cooperative game theory, and its relevance to antitrust policy, see Louis Kaplow, An Economic Approach to Price Fixing, 77 Antitrust L.J. 343 (2011); Dennis A. Yao & Susan S. DeSanti, Game Theory and the Legal Analysis of Tacit Collusion, 38 Antitrust Bull. 113, esp. at 122–126 (1993). See also Douglas R. Bair, Robert H. Gertner, & Randal C. Picker, Game Theory and the Law (1994).
- 4.4 Antitrust Policy Toward Oligopoly and Tacit Collusion.
- § 4.4 Antitrust Policy Toward Oligopoly and Tacit Collusion
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Chapter 14. Price Discrimination and the Robinson-Patman Act 49 results (showing 5 best matches)
- All forms of persistent price discrimination transfer wealth away from consumers and toward sellers. If antitrust policy is concerned with such wealth transfers, then price discrimination presents an antitrust problem.
- 14.5 Price Discrimination and Antitrust Policy.
- § 14.5 Price Discrimination and Antitrust Policy
- For example, Robert H. Bork, The Antitrust Paradox: A Policy at War With Itself 394–98 (1978; rev. ed. 1993).
- The question is more complex if economic efficiency is the exclusive goal of the federal antitrust laws. Some commentators have argued that price discrimination should not be an antitrust concern because it does not produce losses in output as other monopolistic practices do.
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Chapter 10. Tie-Ins, Reciprocity, Exclusive Dealing and Most Favored Nation Agreements 105 results (showing 5 best matches)
- See, e.g., 3 Antitrust Law ¶ 721 (4th ed. 2015); Robert Bork, The Antitrust Paradox: A Policy at War With Itself 394–98 (1978; rev. ed., 1993).
- Stephen C. Salop & Fiona Scott Morton, Developing an Administrable MFN Enforcement Policy, 27 Antitrust 15 (Spring 2013); Fiona Scott-Morton, Contracts that Reference Rivals (U.S. Dep’t of Justice, Antitrust Div., Apr 5, 2012), available at http://www.justice.gov/atr/speech/contracts-reference-rivals; Jonathan B. Baker & Judith A. Chevalier, The Competitive Consequences of Most-Favored-Nation Provisions, 27 Antitrust 20 (Spring 2013); W. Stephen Smith, When Most-Favored is Disfavored: A Counselor’s Guide to MFNs, 27 Antitrust 10 (Spring 2013).
- See Ian MacNeil, Contracts: Adjustment of Long-Term Economic Relations Under Classical, Neoclassical, and Relational Contract Law, 72 Nw.U.L.Rev. 854 (1978); Dennis Carlton Vertical Integration in Competitive Markets Under Uncertainty, 27 J.Indus. Econ. 189 (1979); and, most importantly, the work of Oliver Williamson cited throughout Ch. 9. On antitrust policy and relational contracting, see Herbert Hovenkamp, Harvard, Chicago and Transaction Cost Economics in Antitrust Analysis, 55 Antitrust Bull. 613 (2010).
- Brantley v. NBC Universal, Inc., 675 F.3d 1192, 1201 (9th Cir. 2012). For further discussion see Herbert Hovenkamp, Antitrust and the Patent System: A Reexamination, 76 OSU L.J. 467 (2015), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2486633; Herbert Hovenkamp, Antitrust and Nonexcluding Ties, 8 Competition Policy International Journal (2012), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2143869 (2012).
- Developing an antitrust policy for tie-ins that takes collusion into account is not easy, given that tie-ins can be efficient. Nevertheless, a few generalizations are possible. First of all, a horizontal agreement among competitors to use tie-ins is probably illegal
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Chapter 16. Private Enforcement 255 results (showing 5 best matches)
- that is the main focus of federal antitrust policy.
- In antitrust litigation as in any other federal litigation a plaintiff seeking to get an antitrust trial must first get over two rather high procedural hurdles. First, the plaintiff must file an antitrust complaint that shows its entitlement to relief; successful resistance to a motion to dismiss entitles the plaintiff to discovery and development of a record. Second, prior to trial today virtually every private antitrust plaintiff must also withstand a motion for summary judgment, which examines the record to that point and determines whether a trial is justified.
- Consumers have always been antitrust’s preferred plaintiffs. Even critics whose notions of appropriate private enforcement are most restrictive recognize the value of consumer suits. An important goal of antitrust policy is low prices and high quality output for consumers; the ideological dispute is mainly between those who believe that consumer welfare is the goal of antitrust policy, and those who believe other goals should be included as well.
- This chapter is concerned mainly with enforcement of the federal antitrust laws by private persons. It also includes a few issues, such as statute of limitation, that may be relevant to both public and private enforcement of the antitrust laws. These discussions are placed here for convenience, and because most questions have risen in the context of private antitrust litigation.
- Historically, the courts refused to enforce contracts requiring the parties to arbitrate antitrust claims. However, in Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, the Supreme Court enforced an obligation in an international contract to submit an antitrust dispute to arbitration. Since then, the courts have routinely enforced compulsory arbitration agreements in the domestic context as well, construing the Federal Arbitration Act broadly to compel arbitration even when it made antitrust As the Court interpreted the policy of the Act, such a clause served to prohibit the covered claims to be arbitrated as class actions, but also to be brought in court as class actions. A more sensible reading would be that arbitration clauses can cover or exclude what they do, but the impact of not making a particular and essential procedure available in arbitration is that it may then be used in court. Of course, arbitration clauses must still be interpreted.
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Chapter 3. Market Power and Market Definition 121 results (showing 5 best matches)
- See Herbert Hovenkamp, Market Power in Aftermarkets: Antitrust Policy and the Case, 40 UCLA L. Rev. 1447 (1993); and see Benjamin Klein, Market Power in Antitrust: Economic Analysis After Kodak, 3 Sup. Ct. Econ. Rev. 43 (1993); Carl Shapiro, Aftermarkets and Consumer Welfare: Making Sense of Kodak, 63 Antitrust L.J. 483 (1995).
- This range of concerns quickly shades from “antitrust” to “consumer protection.” As a general premise, the goal of the antitrust laws is competitive pricing and output consistent with the nature and (legal) structure of the market at hand. Competition in concentrated markets for durable goods is inherently imperfect, however, and so the policy question becomes one of degree: how many and what kinds of deviations should be tolerated?
- The size of the price increase presents a question of policy, not one of economics It all depends on how much market power we want to squeeze out of markets, given our capabilities and the costs of antitrust enforcement. A few considerations must be kept in mind:
- I = the percentage price increase supposed by the policy maker to warrant antitrust concern.
- Also advocating a 10% rule is Lawrence J. White, Antitrust and Merger Policy: Review and Critique, 1 J.Econ. Perspectives 13, 15 (1987).
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Chapter 8. Predatory and Other Exclusionary Pricing 71 results (showing 5 best matches)
- , 127 S.Ct. at 1075–1076, citing Herbert Hovenkamp, The Law of Exclusionary Pricing, 2 Competition Policy Intl., No. 1, pp. 21, 35 (Spring 2006); John B. Kirkwood, Buyer Power and Exclusionary Conduct, 72 Antitrust L.J. 625, 652 (2005); Roger D. Blair & Jeffrey Harrison, Antitrust Policy and Monopsony, 76 Cornell L. Rev. 297 (1991); and Thomas A. Piraino, Jr., A Proposed Antitrust Approach to Buyers’ Competitive Conduct, 56 Hastings L.J. 1121, 1125 (2005).
- Even an act of pure malice by one business competitor against another does not, without more, state a claim under the federal antitrust laws; those laws do not create a federal law of unfair competition or “purport to afford remedies for all torts committed by or against persons engaged in interstate commerce.”
- For example, Robert H. Bork, The Antitrust Paradox: A Policy at War With Itself 144–55 (1978; rev. ed. 1993); Frank Easterbrook, Predatory Strategies and Counterstrategies, 48 Univ.Chi.L.Rev. 263 (1981).
- Erik Hovenkamp & Herbert Hovenkamp, Complex Bundled Discounts and Antitrust Policy, 57 Buffalo L. Rev. 1227 (2009).
- Few antitrust allegations are more sensitive or difficult for courts to assess than predatory pricing claims. Low prices are a principle if not the primary goal of antitrust policy. In a predatory pricing case, however, a court must consider a charge that a price is unlawful because it is too low. Further, the relationship between any firm’s prices and its costs is ambiguous and difficult to compute. If the judge uses an overdeterrent rule the result will be inefficiently high prices. This in turn will permit less efficient firms to stay in the market. Small wonder that some commentators argue that courts should
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Chapter 9. Vertical Integration and Vertical Mergers 46 results (showing 5 best matches)
- Notwithstanding extraordinary potential for creating efficiency and limited threat of economic harm, vertical mergers historically did not fare well under the antitrust laws. Most of the law of vertical mergers was written at a time when protection of small businesses rather than encouragement of efficiency was the underlying antitrust policy. Efficiency-creating vertical mergers invariably injure smaller, unintegrated rivals. Decisions since the 1960’s exhibit a dramatic shift in judicial policy.
- For arguments that the preferred rule for most vertical practices should be legality, see Richard Posner, Antitrust Law 225–228 (2d ed. 2001); F. Easterbrook, Vertical Arrangements and the Rule of Reason, 53 Antitrust L.J. 135 (1984). For an argument that all vertical mergers should be legal, see Robert Bork, The Antitrust Paradox: A Policy At War With Itself 226 (1978; rev. ed. 1993). On Bork’s position, see Herbert Hovenkamp, Robert Bork and Vertical Integration: Leverage, Foreclosure, and Efficiency, 79 Antitrust L.J. 983 (2014).
- See U.S. Dept. of Justice, Antitrust Division Policy Guide to Merger Remedies 4–5 (June 2011), available at http://www.justice.gov/sites/default/files/atr/legacy/2011/06/17/272350.pdf. On RRC as a monopolistic device, see § 7.10 See also Michael H. Riordan & Steven Salop, Evaluating Vertical Mergers: A Post-Chicago Approach, 63 Antitrust L.J. 513 (1995).
- Antitrust policy has traditionally been hostile toward vertical integration, particularly when one of the market levels involved is subject to monopoly.
- See Volker Nocke & Lucy White, Do Vertical Mergers Facilitate Upstream Collusion?, 97 AM. ECON. REV. 1321 (2007); Jeffrey Church, Vertical Mergers, in 2 Issues in Competition Law and Policy 1455, 1489–1490 (ABA Section of Antitrust Law 2008).
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Chapter 6. Exclusionary Practices and the Dominant Firm: The Basic Doctrine of Monopolization and Attempt 40 results (showing 5 best matches)
- Intent has often been antitrust’s ghost in the machine. Courts use it to help them make sense of conduct that they do not fully understand. Problematically, however, the essence of competition is the intent to triumph over one’s rivals. One of the most perplexing problems in antitrust policy is discerning between illegitimate and legitimate intent—a problem that looms distressingly large if intent is the only thing we have to help us characterize ambiguous conduct.
- The definition comes from 3A Antitrust Law ¶ 651a (4th ed. 2015). See also Herbert Hovenkamp, The Harvard and Chicago Schools and the Dominant Firm, in Conservative Economic Influences on U.S. Antitrust Policy (Robert Pitofsky ed., 2008); Herbert Hovenkamp, Exclusion and the Sherman Act, 72 Univ. Chi.L.Rev. 147 (2005).
- Case: Antitrust, High Technology, and Consumer Welfare (2007); Harry First & Andrew I. Gavil, Microsoft and the Globalization of Competition Policy: A Study in Antitrust Institutions (2008).
- The offense of attempt to monopolize is one of the most complex of federal antitrust violations. On the one hand, many acts alleged to be illegal attempts may also be illegal monopolization or violations of another antitrust law. In such cases a separate “attempt” offense is superfluous. On the other, expansive use of the attempt offense to reach conduct not condemned by the other antitrust laws may do more harm than good to the competitive process. If attempt analysis focuses too heavily on unfair conduct and too little on market power the offense can operate to protect inefficient businesses from their more efficient rivals.
- 3 Phillip E. Areeda & Donald F. Turner, Antitrust Law ¶ 623d (1978). The current edition, written by this author, largely rejects the proposal. See 3 Antitrust Law ¶ 630a (4th ed. 2015).
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Index 85 results (showing 5 best matches)
Chapter 13. Conglomerate Mergers 25 results (showing 5 best matches)
- The separate standard for potential competition mergers developed at a time when antitrust policy makers equated “competition” with a large number of firms in a market. Within that paradigm, “competition” did not exist in a market with only one producer, even though the producer had absolutely no power to raise price above marginal cost without causing substantial new entry. Today antitrust law has generally adopted the economist’s more useful definition of competition as that set of market conditions that
- Potential competition doctrines have greater vitality in European competition law. See Jeffrey Church, Conglomerate Mergers, 2 Issues in Competition Law and Policy 1503 (ABA Section of Antitrust Law 2008); Damien J. Neven, Analysis of Conglomerate Effects in EU Merger Control, in Handbook of Antitrust Economics 183 (Paolo Buccirossi ed., 2008); Jeremy Grant & Damien J. Neven, The Attempted merger Between General Electric and Honeywell: A Case Study of Transatlantic Conflict, 1 J. Competition L. & Econ. 595 (2005).
- 104 F.T.C. at 926–928; in the Justice Department, see U.S. Dept. of Justice, Antitrust Division, Antitrust Enforcement Guidelines for International Operations § 3.3 (1988), reprinted in 4 Trade Reg. Rep. (CCH) ¶ 13109.
- The important question for the antitrust policy maker is, Why § 7? Both § 3 of the Clayton Act and § 1 of the Sherman Act reach actual tying arrangements with substantial overdeterrence to spare. Should a merger be condemned simply because it increases the probability that a firm will engage in tying? As Chapter 10 notes, Supreme Court decisions since the late 1970’s have been far less hostile toward tying arrangements than earlier decisions, and have acknowledged their potential to create efficiencies.
- 13.5 Conglomerate Mergers and the Antitrust Division Guidelines.
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Table of Cases 66 results (showing 5 best matches)
- Aggrenox Antitrust Litigation, In re......124
- Air Cargo Shipping Services Antitrust Litig., In re...........................................964
- Airport Car Rental Antitrust Litigation, In re..............................................925, 926
- Aluminum Phosphide Antitrust Litigation, In re.......................................................895
- Antibiotic Antitrust Actions, In re..........865
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Table of Rules 11 results (showing 5 best matches)
- Federal Rules of Civil Procedure 4.......1033
- Federal Rules of Civil Procedure 4(c)......................................................1033
- Federal Rules of Civil Procedure 4(e)......................................................1033
- Federal Rules of Civil Procedure 8(a)(2)...........................................244, 245
- Federal Rules of Civil Procedure 11..................................................931, 933
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- Publication Date: November 2nd, 2015
- ISBN: 9780314290366
- Subject: Antitrust Law
- Series: Hornbooks
- Type: Hornbook Treatises
- Description: Nearly all of the aspects of federal antitrust policy are covered in this treatise. And it’s written so you don’t need a background in economics to understand it. Expert narration states the “black letter” law and presents policy arguments for alternatives. Text also includes an analysis of recent Supreme Court and lower-court decisions.
