Law Commons^™

Is A Ban On Non-Competes Supported By Empirical Evidence?, Sarah Oh Lam, Thomas Lenard, Scott Wallsten

Fordham Journal of Corporate & Financial Law

The U.S. Federal Trade Commission (FTC) has proposed a rule to declare virtually all non-compete agreements unfair methods of competition under Section 5 of the FTC Act and therefore, illegal. However, the empirical literature on non-compete agreements cited by the FTC in its Notice for Proposed Rulemaking (“NPRM”) shows mixed results on earnings, job creation, firm formation, entrepreneurship, training, investment, and firm value. Evidence in other current studies also does not support an economy-wide ban. The FTC concludes that the proposed rule would yield net benefits even though by its own admission it lacks the information necessary to conduct a …

The Public’S Companies, Andrew K. Jennings

Fordham Journal of Corporate & Financial Law

This Essay uses a series of survey studies to consider how public understandings of public and private companies map into urgent debates over the role of the corporation in American society. Does a social-media company, for example, owe it to its users to follow the free-speech principles embodied in the First Amendment? May corporate managers pursue environmental, social, and governance (“ESG”) policies that could reduce short-term or long-term profits? How should companies respond to political pushback against their approaches to free expression or ESG?

The studies’ results are consistent with understandings that both public and private companies have greater public …

Divined Comity: Assessing The Vitamin C Antitrust Litigation And Updating The Second Circuit’S Prescriptive Comity Framework, William Weingarten

Fordham Journal of Corporate & Financial Law

In re Vitamin C Antitrust Litigation, recently decided by the Second Circuit, sets a grave precedent for American plaintiffs seeking redress for antitrust injuries wrought by foreign defendants. The case involved a group of Chinese manufacturers and exporters of vitamin C, who conspired to fix prices and restrict output in the export market, injuring American consumers in import commerce. The foreign manufacturers conceded that they had colluded in fixing prices and restricting output, in flagrant violation of U.S. antitrust law. And yet, with the assistance of the Chinese government—intervening as amicus curiae—the defendants were successfully able to argue, on appeal …

Renewing Faith In Antitrust: Unveiling The Hidden Network Behind Pharmaceutical Product Hopping, Victoria Field

Fordham Journal of Corporate & Financial Law

Patents grant time-limited market exclusivity to drug manufacturers, meaning that other companies are prohibited from copying and selling the patented pharmaceutical. This allows manufacturers to lawfully charge monopoly prices. Generic competition starts at the expiration of the patent. To maintain coveted monopoly power, manufacturers often release an alternative formulation of the drug with a fresh patent that enjoys continued market exclusivity. Manufacturers who can convert their consumer base to the new formulation can continue charging peak prices. This process, called “product hopping,” has been the target of significant antitrust inquiry, with mixed results.

A product hop may be the result …

The Battle With Big Tech: Analyzing Antitrust Enforcement And Proposed Reforms, Youngjae Lee, Morgan Hagenbuch

Fordham Journal of Corporate & Financial Law

No abstract provided.

Returning To The Statutory Text: Why The Language Of Section 13(B) Requires Courts To Narrowly Construe The Ftc’S Ability To Obtain Injunctive Relief, Christopher Halm

Fordham Journal of Corporate & Financial Law

The Federal Trade Commission (FTC) enforces over 70 laws in the areas of antitrust and consumer protection, and one valuable tool to support their enforcement is Section 13(b) of the Federal Trade Commission Act (“Section 13(b)”). Section 13(b), among other features, grants the FTC authority to seek an injunction in district court against any defendant that is “about to violate” one or more of those laws. For the past three decades, courts have adopted a permissive judicial interpretation of that language, authorizing injunctions against defendants when the allegedly impending violations were only “likely to recur” based on past misconduct. This …

Output Effect Of Private Antitrust Enforcement, Sinchit Lai

Fordham Journal of Corporate & Financial Law

A growing body of literature evaluates the impact of antitrust laws on economic growth. Most of these empirical studies identify a positive impact; however, the existing literature only studies the effect of the existence of antitrust laws, but not their enforcement. To fill this gap in the literature, this Article uses private antitrust case filing numbers to examine the growth effect. Employing U.S. data and, after addressing endogeneity, using a two-stage least squares (2SLS) regression analysis, I identify a negative and robust association between private enforcement and output on a national level in the short run over the period from …

Is Baseball Shrouded In Collusion Once More? Assessing The Likelihood That The Current State Of The Free Agent Market Will Lead To Antitrust Liability For Major League Baseball's Owners, Connor Mulry

Fordham Journal of Corporate & Financial Law

This Note examines how Major League Baseball’s (MLB) current free agent system is restraining trade despite the existence of the league’s non-statutory labor exemption from antitrust. The league’s players have seen their percentage share of earnings decrease even as league revenues have reached an all-time high. This reality is due to the players’ inability to “cash-in” when their market value hits its apex. Once these players enter the open market, their value has greatly deteriorated and consequently, they are unable to generate earnings commensurate with their value to the league.

This Note first explores the progression of MLB’s exemption from …

Sailing A Sea Of Doubt: A Critique Of The Rule Of Reason In U.S. Antitrust Law, Jesse W. Markham Jr.

Fordham Journal of Corporate & Financial Law

“It is true that there are some cases in which the courts, mistaking . . . the proper limits of the relaxation of the rules for determining the unreasonableness of restraints of trade, have set sail on a sea of doubt . . . .” William Howard Taft1 “Without further elaboration, reasonableness is too vague a standard to guide the businessman’s actions or the judge’s discretion. Such openness is a mixed blessing. Unbounded by technical limitations, it reaches every evil. But unless disciplined by the purposes of antitrust laws, it is a vagrant standard.” Phillip E. Areeda2

Lessons From The Flash Crash For The Regulation Of High-Frequency Traders, Edgar Ortega Barrales

Fordham Journal of Corporate & Financial Law

Are equity markets vulnerable to a sudden collapse if the traders who account for about half of the volume have no regulatory obligations to stabilize prices? After the “Flash Crash” of May 6, 2010, policymakers have resoundingly answered this question in the affirmative. During the worst of the crash, some of the so-called high-frequency trading firms that dominate equity markets stopped trading and prices collapsed, momentarily wiping out almost $1 trillion in market value. In response, the U.S. Securities and Exchange Commission is considering whether high-frequency trading firms should be required to act as the traders of last resort. This …

Burning Down The House Or Simply Rolling The Dice: A Comment On Section 621 Of The Dodd-Frank Act And Recommendation For Its Implementation, Joshua R. Rosenthal

Fordham Journal of Corporate & Financial Law

Section 621 of the Dodd-Frank Wall Street Reform and Consumer Protection Act modifies the Securities Act of 1933 to prohibit the underwriter, placement agent, initial purchaser, or sponsor, or any affiliate or subsidiary of any such entity of an asset-backed financial product from betting against that very product for one year after the product’s initial sale. The rule prohibits anyone who structures or sells an asset-backed security or a product composed of asset-backed securities from going short, in the specified timeframe, on what they have sold, and labels such transactions as presenting material conflicts of interest. This Comment discusses traces …