Law Commons^™

Tying And Bundled Discounts: An Equilibrium Analysis Of Antitrust Liability Tests, Melanie S. Williams

Melanie S. Williams

Courts have struggled with determining when bundled discounts constitute unlawfully anticompetitive behavior. The current circuit split reflects an absence of consensus. This lack of legal guidance creates uncertainty in the market, with firms being given inconsistent – and sometimes contradictory - standards on how to avoid antitrust liability.

For the most part, we consider a standard paradigm for analyzing bundled discounts. Suppose that there are two firms. Firm 1 produces a monopoly product, A, and also another product, B, which competes with another version of B produced by Firm 2. The concern is the extent to which the price paid …

Transatlantic Perspective On Judicial Deference In Administrative Law, Maciej Bernatt

Maciej Bernatt

The U.S. concept of judicial deference in administrative law limits the scope of judicial review of administrative agencies’ actions in the light of agencies’ superior expertise and separation of powers arguments. It may serve as an interesting point of reference for the European discussion about adequate institutional balance between administration and courts. The paper analyzes whether there are grounds for the validity of the concept of judicial deference in Continental Europe and in what areas (law, facts or both). As a starting point it is observed that it remains generally accepted in Europe that it is a role of courts …

Puzzles In Controlling Shareholder Regimes And China: Shareholder Primacy And (Quasi) Monopoly, Sang Yop Kang

Sang Yop Kang

Professor Mark Roe explained that the shareholder wealth maximization norm (“the norm”) is not fit for a country with a (quasi) monopoly, because the norm encourages managers to maximize monopoly rents, to the detriment of the national economy. This Article provides new findings and counter-intuitive arguments as to the tension created by the norm and (quasi) monopoly by exploring three key corporate governance concepts that Roe did not examine—(1) “controlling minority structure” (CMS), where dominant shareholders hold a fractional ownership in their controlled-corporations, (2) “tunneling” (i.e., illicit transfer of corporate wealth to controlling shareholders), and (3) Chinese state-owned enterprises (SOEs). …

Recognizing The Limits Of Antitrust: The Roberts Court Versus The Enforcement Agencies, Thomas A. Lambert, Alden F. Abbott

Thomas A. Lambert

As Judge Frank Easterbrook famously explained three decades ago, antitrust is an inherently limited body of law. In crafting and enforcing liability rules to combat market power and encourage competition, courts and regulators may err in two directions: they may wrongly forbid output-enhancing behavior or wrongly fail to condemn output-reducing conduct. The social losses from false convictions and false acquittals, taken together, comprise antitrust’s “error costs.” While it may be possible to reduce error costs by making liability rules more nuanced, added complexity raises the “decision costs” incurred by business planners (ex ante) and adjudicators (ex post …

The "Uberization" Of Healthcare: The Forthcoming Legal Storm Over Mobile Health Technology's Impact On The Medical Profession, Fazal Khan

Fazal Khan

The nascent field of mobile health technology is still very small but is predicted to grow exponentially as major technology companies such as Apple, Google, Samsung, and even Facebook have announced mobile health initiatives alongside influential healthcare provider networks. Given the highly regulated nature of healthcare, significant legal barriers stand in the way of mobile health’s potential ascension. I contend that the most difficult legal challenges facing this industry will be restrictive professional licensing and scope of practice laws. The primary reason is that mobile health threatens to disrupt historical power dynamics within the healthcare profession that have legally enshrined …

Worlds Colliding: Competition Policy And Bankruptcy Fire Sales, Max Huffman

Max Huffman

Modern business bankruptcies commonly involve mergers and acquisitions pursued as “fire sales.” The bankruptcy forum and the unique incentives bankruptcy creates allow those acquisitions to take place with reduced constituent involvement and regulatory oversight. Those fire sale transactions may present antitrust concerns where they lead to undue concentration in the relevant marketplace. This paper studies the poorly explored tension between bankruptcy law, which favors mergers and acquisitions as value-maximizing propositions and creates opportunity for fire sales, and antitrust law, which disfavors combinations leading to undue concentrations of economic power. The substantial tension manifests both as a matter of substantive law …

Essential Facilities Doctrine And China’S Anti-Monopoly Law, Yong Huang, Elizabeth Xiao-Ru Wang, Xin Roger Zhang

Elizabeth Xiao-Ru Wang

No abstract provided.

What Do We Worry About When We Worry About Price Discrimination? The Law And Ethics Of Using Personal Information For Pricing, Akiva A. Miller

Akiva A Miller

New information technologies have dramatically increased sellers’ ability to engage in retail price discrimination. Debates over using personal information for price discrimination frequently treat it as a single problem, and are not sufficiently sensitive to the variety of price discrimination practices, the different kinds of information they require in order to succeed, and the different ethical concerns they raise. This paper explores the ethical and legal debate over regulating price discrimination facilitated by consumers’ personal information. Various kinds of “privacy remedies”—self-regulation, technological fixes, state regulation, and legislating private causes of legal action—each have their place. By drawing distinctions between various …

The Commons, Capitalism, And The Constitution, George Skouras

George Skouras

Thesis Summary: the erosion of the Commons in the United States has contributed to the deterioration of community and uprooting of people in order to meet the dynamic demands of capitalism. This article suggests countervailing measures to help remedy the situation.

Patent Trolls Among Us, Kent R. Acheson

Kent R Acheson

As Acheson (2012) suggested in A Study of the Need to Change United States Patent Policy, software should not be patented, but the Intellectual Property Rights should be protected in another manner that does not entail a Copyright, Trademark, or secrecy. A new form of protection should be created based on certain criteria, such as useful life of a patent, incremental innovation, value to society, and or value to life.

Fixing Frand: A Pseudo-Pool Approach To Standards-Based Patent Licensing, Jorge Contreras

Jorge L Contreras

Technical interoperability standards are critical elements of mobile telephones, laptop computers, digital files, and thousands of other products in the modern networked economy. Most such standards are developed in so-called voluntary standards-development organizations (SDOs) that require participants to license patents essential to the standard on terms that are “fair, reasonable and non-discriminatory” (FRAND). FRAND commitments are thought to avoid the problem of patent hold-up: the imposition of excessive royalty demands after a standard has been widely adopted in the market. While, at first blush, FRAND commitments seem to assure product vendors that patents will not obstruct the manufacture and sale …

Transaction Cost-Benefit Analysis, With Applications To Financial Regulation, D. Bruce Johnsen

D. Bruce Johnsen

As Coase convincingly showed, transaction costs inhibit the ability of market participants to achieve first-best outcomes. This paper proposes a novel and relatively simple alternative to traditional cost-benefit analysis when regulated parties face sufficiently low transaction costs that they can bargain directly or rely on competitive markets to set efficient terms of trade. In these settings, the only informational burdens financial market regulators need bear to assess corrective rules is to identify the relevant parties, the “good” they hope to exchange, and the transaction costs that inhibit them from maximizing joint gains from trade. A rule is justified only if …

The Economics Of Payment Cards, Marc Rysman, Julian Wright

Marc Rysman

We review the law and economics of payment cards. We focus on the recent economics literature on two-sided markets, and discuss the antitrust and regulatory treatment of interchange fees, card surcharging, and other issues.

Lessons From At&T'S Flop: How To Grow In The Technology Industry While Avoiding Section 7 Antitrust Obstacles, John T. Soma

JOHN T SOMA

This article is one of the first to provide a comprehensive analysis of AT&T’s attempted merger with T-Mobile USA, and the Oracle/PeopleSoft successful merger. As seen from these two mergers, the outcome of Section 7 cases is no longer predictable. Our article reviews these two mergers, and concludes with a discussion of the lessons learned and outlines the future trends expected in tech mergers. This article is significant and timely because we believe that the risk of failure in a large scale tech merger is large enough, that other approaches need to be taken to achieve the desired merger goals, …

Can The Supreme Court Be Fixed? Lessons From Judicial Activism In First Amendment And Sherman Act Jurisprudence, Warren S. Grimes

Warren S Grimes

The Supreme Court has become an unelected superlegislature that, instead of narrowly deciding cases or controversies, tends to issue sweeping policy decisions that deprive democratic institutions at federal, state and local levels of their appropriate democratic role. Part I of this paper describes content-neutral measures of judicial activism, most repeatedly acknowledged by the Court. Part II addresses specific examples of judicial activism in Supreme Court decisions involving the Sherman Act and First Amendment election law cases. Part III concludes by urging a public debate on possible reforms of the Court, some easily implemented, others more involved, that could constrain judicial …

Can The Supreme Court Be Fixed? Lessons From Judicial Activism In First Amendment And Sherman Act Cases, Warren S. Grimes

Warren S Grimes

The Court has strayed from its role as a decider of cases or controversies to become an unelected policy board that undermines democratic institutions at the federal, state, and local levels. Part I of this paper describes content-neutral measures of judicial activism, most repeatedly acknowledged by the Court. Part II addresses specific examples of judicial activism in Supreme Court decisions involving the Sherman Act and First Amendment election law cases. Part III concludes by urging a public debate on possible reforms of the Court, some easily implemented, others more involved, that could constrain judicial activism and restore the Court’s primary …

Clarifying State Action Immunity Under The Antitrust Laws: Ftc V. Phoebe Putney Health System, Inc., Angela Diveley

Angela Diveley

The tension between federalism and national competition policy has come to a head. The state action doctrine finds its basis in principles of federalism, permitting states to replace free competition with alternative regulatory regimes they believe better serve the public interest. Public restraints have a unique ability to undermine the regime of free competition that provides the basis of U.S.- and state-commerce policies. Nevertheless, preservation of federalism remains an important rationale for protecting such restraints. The doctrine has elusive contours, however, which have given rise to circuit splits and overbroad application that threatens to subvert the state action doctrine’s dual …

Search, Essential Facilities, And The Antitrust Duty To Deal, Marina Lao

Marina Lao

The core of the gathering antitrust case against Google seems to be that it favors its own or its affiliates’ content over that of its competitors in ancillary markets in the unpaid search results. Seeking the competitive advantages inherent in integration, which is what preferential treatment of one’s own property is about, is usually not unlawful. This paper examines whether “essential facilities” and the duty-to-deal nonetheless provide a basis for prohibiting this practice, as some have suggested, and concludes that they do not.

On the threshold monopoly power issue, most assume, based on Google’s high percentage of general search queries, …

Search, Essential Facilities, And The Antitrust Duty To Deal, Marina Lao

Marina Lao

The core of the gathering antitrust case against Google seems to be that it favors its own or its affiliates’ content over that of its competitors in ancillary markets in the unpaid search results. Seeking the competitive advantages inherent in integration, which is what preferential treatment of one’s own property is about, is usually not unlawful. This paper examines whether “essential facilities” and the duty-to-deal nonetheless provide a basis for prohibiting this practice, as some have suggested, and concludes that they do not.

On the threshold monopoly power issue, most assume, based on Google’s high percentage of general search queries, …

Search, Essential Facilities, And The Antitrust Duty To Deal, Marina Lao

Marina Lao

The core of the gathering antitrust case against Google seems to be that it favors its own or its affiliates’ content over that of its competitors in ancillary markets in the unpaid search results. Seeking the competitive advantages inherent in integration, which is what preferential treatment of one’s own property is about, is usually not unlawful. This paper examines whether “essential facilities” and the duty-to-deal nonetheless provide a basis for prohibiting this practice, as some have suggested, and concludes that they do not.

On the threshold monopoly power issue, most assume, based on Google’s high percentage of general search queries, …

The New News: Challenges Of Monetization, Engagement, And Protection Of News Organizations' Online Content, Christine Katherine Lesicko

Christine K Lesicko

As news organizations continue to struggle with their business models and ways to best employ new technology, advertising and subscription revenues continue to fall or remain stagnant and layoffs continue to rise. This study examines potential ways for news organizations to both protect their content from unwanted piracy and monetize content in order to continue to produce quality and timely news. This paper explores the history of news and protections given to news content by Congress and the courts. The study goes on to examine court cases that influenced the current legal landscape of content protection for news organizations. The …

Regulators As Market-Makers: Accountable Care Organizations And Competition Policy, Thomas L. Greaney

Thomas L. Greaney

Of the many elements animating structural change under health reform, Accountable Care Organizations have drawn the greatest attention. The ACO strategy entails regulatory interventions that at once aim to reshape the health care delivery system, improve outcomes, promote adoption of evidence based medicine and supportive technology, and create a platform for controlling costs under payment system reform. Ambitious aims to be sure. Implementation, however, has proved a wrenching process. This article looks at the intersection of markets and regulation under the Affordable Care Act. Specifically, it analyzes regulatory interventions under the Medicare Shared Savings Program designed to foster commercial market …

Grounding Into A Double Standard: Understanding & Repealing The Curt Flood Act, Brett J. Butz

Brett J Butz

This article calls for an end to Major League Baseball’s statutory exemption from antitrust regulation for acts that are considered part of the “business of baseball.” The Curt Flood Act, as it is colloquially called, was a Congressional mistake; the product years of faulty analysis and absurd holdings by the Supreme Court. This article will explain how the exemption came to fruition, outline the various problems with its inception, and conclude by proposing that Major League Baseball should be subject to antitrust regulations, just like all other professional sports leagues.

Labor Disputes In Professional Sports: How Federal Judges Referee Antitrust Lawsuits-- False Starts And Technical Fouls, Michael Leroy

Michael H LeRoy

Using a database of 83 published court opinions from 1970-2011, I show that players have utilized conflicting federal laws to improve their labor market mobility. They formed unions under the National Labor Relations Act, and bargained collectively with leagues. Often, however, they lacked bargaining power to modify the draft or reserve clause, which bound them to a team. Players sued, therefore, under the Sherman Act to challenge these practices as restraints of trade. Thus, players have used a dual engagement strategy of bargaining with leagues under the NLRA while holding identical negotiations under the threat of Sherman Act treble damages. …

Echostar-Directv In The 2011 Technological And Competitive Climate, Peter J. White

Peter J White

The birth of satellite television took place in the late 1970s, and since then, the Direct Broadcast Satellite (DBS) industry has grown to over 30 million subscribers. In 2008, DirecTV and EchoStar—the leaders in the DBS market—had 20.1 million and 13.8 million subscribers respectively. DBS networks work by broadcasting digital signals from medium- and high-power satellites (100 to 400 watts per transponder) to receiver dish antennas as small as 18 inches. These satellites are placed in geosynchronous orbits, which means that they are always in the same position relative to the rotating earth. In the United States, the Federal Communications …

Alliance Compliance: The Divergence In Us–Eu Airline Alliance Review Policies, Peter J. White Jd

Peter J White

Throughout the late twentieth century and into recent years, the airline industry has been characterized by a vast increase in global airline alliances. However, due to strict ownership restrictions, air carriers cannot take advantage of international mergers or takeovers. As a result, many air carriers enter into alliances with other air carriers in order to create an extensive international network, allowing them to benefit from economies of scope and density. An alliance also may allow an air carrier to operate more efficiently by eliminating duplication of costs, thereby allowing the air carrier to perform a better service for its customers. …

Novel "Neutrality" Claims Against Internet Platforms: A Reasonable Framework For Initial Scrutiny, Jeffrey Jarosch

Jeffrey Jarosch

This Article examines a recent trend in which the Federal Trade Commission and other enforcement agencies investigate internet platforms for behavior that is insufficiently “neutral” towards users or third parties that interact with the platform. For example, Google faces a formal FTC investigation based on allegations that it has tinkered with search results rather than presenting users with a “neutral” result. Twitter, too, faces a formal investigation after the social media service restricted the ways in which third party developers could interact with Twitter through its application programming interface (API). These investigations represent a new attempt to shift the network …

Prohibiting Discriminatory Cross-Licensing, Christopher Paul Schaffer

Christopher Paul Schaffer

Two of the key objectives of standards setting organizations are to produce “unified” technology and to engender fairness among competitors. Although most of these organizations require the participants to agree to reasonable and non-discriminatory license terms, it is surprising that most fail to address cross-licensing. In this paper two discriminatory cross-licensing scenarios are provided, demonstrating the adverse effects this practice can have on competition. Subsequent analysis shows the licensor may be in breach of the licensing contract, liable for violation of antitrust, and potentially with an unenforceable patent due to patent misuse. To improve the equity of these scenarios, a …

The Ftc’S Proposal For Regulating Ip Through Ssos Would Replace Private Coordination With Government Hold-Up, F. Scott Kieff, Richard Epstein, Daniel Spulber

F. Scott Kieff

In its recent report entitled “The Evolving IP Marketplace,” the Federal Trade Commission (FTC) advances a far-reaching regulatory approach (Proposal) whose likely effect would be to distort the operation of the intellectual property (IP) marketplace in ways that will hamper the innovation and commercialization of new technologies. The gist of the FTC Proposal is to rely on highly non-standard and misguided definitions of economic terms of art such as “ex ante” and “hold-up,” while urging new inefficient rules for calculating damages for patent infringement. Stripped of the technicalities, the FTC Proposal would so reduce the costs of infringement by downstream …

The Narcotic Effect Of Antitrust Law In Professional Sports: How The Sherman Act Subverts Collective Bargaining, Michael Leroy

Michael H LeRoy

Using textual analysis and data from federal court opinions, I explore the relationship between collective bargaining and antitrust litigation in baseball, football, basketball, and hockey. Since collective bargaining began in these sports in the 1960s, there have been 21 strikes or lockouts. Baseball and football have had the most labor strife, with 8 work stoppages apiece—but their experiences have been very different. Because the Supreme Court ruled that baseball is completely exempt from antitrust law, players have had to use the strike weapon under the National Labor Relations Act (NLRA) to liberalize free agency and increase team competition for their …