Law Commons^™

Other Markets, Other Costs: Modernizing Antitrust, Jeffrey L. Harrison

UF Law Faculty Publications

Today’s antitrust law is characterized by stagnation and indeterminacy. The failure is so thorough that it is not clear that U.S. competition law actually leads to any outcomes that are defendable except at the most superficial level. Moreover, when enforcement does result in a desirable outcome, it not clear that it is the best outcome. The principal reason for this state of affairs is that antitrust scholars and courts cling to misguided goals and theories that have not evolved despite an avalanche of information now available that can modernize the discipline.

This Article has two main sections that necessarily overlap. …

The Role Of Design Choice In Intellectual Property And Antitrust Law, Stacey Dogan

Faculty Scholarship

When is it appropriate for courts to second-guess decisions of private actors in shaping their business models, designing their networks, and configuring the (otherwise non-infringing) products that they offer to their customers? This theme appears periodically but persistently in intellectual property and antitrust, especially in disputes involving networks and technology. In both contexts, courts routinely invoke what I call a “non-interference principle” — the presumption that market forces ordinarily bring the best outcomes for consumers, and that courts and regulators should not meddle in the process. This non-interference principle means, for example, that intermediaries need not design their networks to …

The Failed Superiority Experiment, Christine P. Bartholomew

Journal Articles

Federal law requires a class action be “superior to alternative methods for fairly and efficiently adjudicating the controversy.” This superiority requirement has gone unstudied, despite existing for half a century. This Article undertakes a comprehensive review of the superiority case law. It reveals a jurisprudence riddled with inconsistency as courts adopt diametrically opposed interpretations of the requirement. Originally crafted to encourage predictable, consistent class action decisions, superiority has mutated over the years into a dangerous wild card—subjectively used to stymie aggregate litigation. The solution is not adding a new requirement to the already onerous rules for class certification. Instead, judges …

Modifying Merger Consent Decrees To Improve Merger Enforcement Policy, Steven C. Salop

Georgetown Law Faculty Publications and Other Works

This article analyzes my short proposal for reviewing and modifying merger consent decrees to permit additional relief if the provisions of the initial consent merger are found to fail to preserve or restore competition in a reasonable period of time after the merger was consummated. My proposal also would involve more frequent reviews of consummated mergers that have been cleared without challenge, particularly those that were close calls. While “Don't Look Back” might be the best anthem for artists, economic decision theory would not support that approach to merger policy.

Predicting the impact of proposed mergers and remedies on consumers …

Antitrust And Intellectual Property: A Brief Introduction, Keith N. Hylton

Faculty Scholarship

Intellectual property law and antitrust have been described as conflicting bodies of law, and the reason is easy to see. Antitrust law aims to protect consumers from the consequences of monopolization. Intellectual property law seeks to enhance incentives to innovate by granting monopolies in ideas or expressions of ideas. The purpose of this chapter is to explore the purported conflict between antitrust and intellectual property. The chapter is largely descriptive, and focuses on current or developing litigation rather than historical controversies. Many of the modern examples of conflict can be attributed to problems of classification.

Big Data And Competition Policy, Maurice Stucke, Allen Grunes

College of Law Faculty Scholarship

From the Publisher: Big Data and Big Analytics are a big deal today. Big Data is playing a pivotal role in many companies' strategic decision-making. Companies are striving to acquire a 'data advantage' over rivals. Data-driven mergers are increasing. These data-driven business strategies and mergers raise significant implications for privacy, consumer protection and competition law. At the same time, European and United States' competition authorities are beginning to consider the implications of a data-driven economy on competition policy. In 2015, the European Commission launched a competition inquiry into the e-commerce sector and issued a statement of objections in its Google …

Big Data And Competition Policy, Maurice Stucke, Allen Grunes

UTK Law Faculty Publications

From the Publisher: Big Data and Big Analytics are a big deal today. Big Data is playing a pivotal role in many companies' strategic decision-making. Companies are striving to acquire a 'data advantage' over rivals. Data-driven mergers are increasing. These data-driven business strategies and mergers raise significant implications for privacy, consumer protection and competition law. At the same time, European and United States' competition authorities are beginning to consider the implications of a data-driven economy on competition policy. In 2015, the European Commission launched a competition inquiry into the e-commerce sector and issued a statement of objections in its Google …

Is Your Digital Assistant Devious?, Maurice Stucke, Ariel Ezrachi

College of Law Faculty Scholarship

Who wouldn’t want a personal butler? Technological developments have moved us closer to that dream. The rise of digital personal assistants has already changed the way we shop, interact and surf the web. Technological developments and artificial intelligence are likely to further accelerate this trend. Indeed, all of the leading online platforms are currently investing in this technology. Apple’s Siri, Amazon’s Alexa, Facebook’s M, and Google Assistant can quickly provide us with information, if we so desire, and anticipate and fulfill certain needs and requests. Yet, could they also reduce our welfare? Could they limit competition and transfer our wealth …

Is Your Digital Assistant Devious?, Maurice Stucke

UTK Law Faculty Publications

Who wouldn’t want a personal butler? Technological developments have moved us closer to that dream. The rise of digital personal assistants has already changed the way we shop, interact and surf the web. Technological developments and artificial intelligence are likely to further accelerate this trend. Indeed, all of the leading online platforms are currently investing in this technology. Apple’s Siri, Amazon’s Alexa, Facebook’s M, and Google Assistant can quickly provide us with information, if we so desire, and anticipate and fulfill certain needs and requests. Yet, could they also reduce our welfare? Could they limit competition and transfer our wealth …

Monopoly Power With A Short Selling Constraint, Robert Baumann, Bryan Engelhardt, David L. Fuller

Economics Department Working Papers

We show if a speculator can benefit from reducing a monopoly’s rents through short selling, then a speculator may take a short position in a monopoly, overcome the barriers to entry, and compete with the monopoly. The competition drives down the monopoly’s rents, and as a result, the short position becomes profitable and covers the cost of entry. If entry is impossible, then the speculator may coordinate and pay the firm’s counter-parties to stop trading with the monopoly rather than entering. Either way, increasing a speculator’s ability to short a firm’s rents results in a constraint on the monopoly and …

Antitrust And Wealth Inequality, Daniel Crane

Articles

In recent years, progressive public intellectuals and prominent scholars have asserted that monopoly power lies at the root of wealth inequality and that increases in antitrust enforcement are necessary to stem its rising tide. This claim is misguided. Exercises of market power have complex, crosscutting effects that undermine the generality of the monopoly regressivity claim. Contrary to what the regressivity critics assume, wealthy shareholders and senior corporate executives do not capture the preponderance of monopoly rents. Such profits are broadly shared within and dissipated outside the firm. Further, many of the subjects of antitrust law are middle-class professionals, sole proprietors, …

California Fair Trade: Antitrust And The Politics Of “Fairness” In U.S. Competition Policy, Laura Phillips Sawyer

Scholarly Works

In the decades before World War II, U.S. antitrust law was anything but settled. Considerable pressure for antitrust revision came from the states. A perhaps unlikely leader, Edna Gleason, organized California’s retail pharmacists and coordinated trade networks to monitor and enforce Resale Price Maintenance (RPM) contracts, a system of price-fixing, then known as “fair trade.” Progressive jurists, including Louis Brandeis and institutional economist E. R. A. Seligman, supported RPM as a protection to independent proprietors. The breakdown of legal and economic consensus regarding what constituted “unfair competition” allowed businesspeople to act as intermediaries between heterodox economic thought and contested antitrust …

Antitrust Balancing, Herbert J. Hovenkamp

All Faculty Scholarship

Antitrust litigation often confronts situations where effects point in both directions. Judges sometimes describe the process of evaluating these factors as “balancing.” In its e-Books decision the Second Circuit believed that the need to balance is what justifies application of the rule of reason. In Microsoft the D.C. Circuit stated that “courts routinely apply a…balancing approach” under which “the plaintiff must demonstrate that the anticompetitive harm…outweighs the procompetitive benefit.” But then it decided the case without balancing anything.

The term “balancing” is a very poor label for what courts actually do in these cases. Balancing requires that two offsetting effects …

Patent Exhaustion And Federalism: A Historical Note, Herbert J. Hovenkamp

All Faculty Scholarship

This essay, written as a response to John F. Duffy and Richard Hynes, Statutory Domain and the Commercial Law of Intellectual Property, 102 VA. L. REV. 1 (2016), argues that the patent exhaustion (first sale) doctrine developed as a creature of federalism, intended to divide the line between the law of patents, which by that time had become exclusively federal, and the law of patented things, which were governed by the states. Late nineteenth and early twentieth century courts were explicit on the point, in decisions stretching from the 1850s well into the twentieth century.

By the second half of …

Assembled Products: The Key To More Effective Competition And Antitrust Oversight In Health Care, William M. Sage

Faculty Scholarship

This Article argues that recent calls for antitrust enforcement to protect health insurers from hospital and physician consolidation are incomplete. The principal obstacle to effective competition in health care is not that one or the other party has too much bargaining power, but that they have been buying and selling the wrong things. Vigorous antitrust enforcement will benefit health care consumers only if it accounts for the competitive distortions caused by the sector’s long history of government regulation. Because of regulation, what pass for products in health care are typically small process steps and isolated components that can be assigned …

Class Warfare: Why Antitrust Class Actions Are Essential For Compensation And Deterrence, Robert H. Lande

All Faculty Scholarship

Recent empirical studies demonstrate five reasons why antitrust class action cases are essential: (1) class actions are virtually the only way for most victims of antitrust violations to receive compensation; (2) most successful class actions involve collusion that was anticompetitive; (3) class victims’ compensation has been modest, generally less than their damages; (4) class actions deter significant amounts of collusion and other anticompetitive behavior; and (5) anticompetitive collusion is underdeterred, a problem that would be exacerbated without class actions. Unfortunately, a number of court decisions have undermined class action cases, thus preventing much effective and important antitrust enforcement.

Evaluating Joint Ventures: Economic Analysis Checklist, Steven C. Salop

Georgetown Law Faculty Publications and Other Works

This short article (for a symposium on joint ventures) provides practitioners and law professor with a 20 question checklist to guide the competitive effects analysis of the formation of a joint venture and the specific restraints and conduct of the venture. The questions mainly focus on ventures among actual or potential competitors, though some of the questions also are relevant for ventures involving complementary product firms. The questions concern potential competitive harms, potential competitive benefits, and the determination of net competitive effects. While this sequencing follows the standard burden-shifting formulation of the rule of reason decision process, the article notes …

The Law Of The Platform, Orly Lobel

Faculty Scholarship

New digital platform companies are turning everything into an available resource: services, products, spaces, connections, and knowledge, all of which would otherwise be collecting dust. Unsurprisingly then, the platform economy defies conventional regulatory theory. Millions of people are becoming part-time entrepreneurs, disrupting established business models and entrenched market interests, challenging regulated industries, and turning ideas about consumption, work, risk, and ownership on their head. Paradoxically, as the digital platform economy becomes more established, we are also at an all-time high in regulatory permitting, licensing, and protection. The battle over law in the platform is therefore both conceptual and highly practical. …

Hospital Mergers And Economic Efficiency, Roger D. Blair, Christine Piette Durrance, D. Daniel Sokol

UF Law Faculty Publications

Consolidation via merger both from hospital-to-hospital mergers and from hospital acquisitions of physician groups is changing the competitive landscape of the provision of health care delivery in the United States. This Article undertakes a legal and economic examination of a recent Ninth Circuit case examining the hospital acquisition of a physician group. This Article explores the Saint Alphonsus Medical Center-Nampa Inc. v. St. Luke’s Health System, Ltd. (St. Luke’s) decision—proposing a type of analysis that the district court and Ninth Circuit should have undertaken and that we hope future courts undertake when analyzing mergers in the …

Antitrust And Information Technologies, Herbert J. Hovenkamp

All Faculty Scholarship

Technological change strongly affects the use of information to facilitate anticompetitive practices. The effects result mainly from digitization and the many products and processes that it enables. These technologies of information also account for a significant portion of the difficulties that antitrust law encounters when its addresses intellectual property rights. In addition, changes in the technologies of information affect the structures of certain products, in the process either increasing or decreasing the potential for competitive harm.

For example, digital technology affects the way firms exercise market power, but it also imposes serious measurement difficulties. The digital revolution has occurred in …

Telecommunications: Competition Policy In The Telecommunications Space, Gene Kimmelman, Maureen K. Ohlhausen, Michael O’Rielly, Christopher S. Yoo, Stephen F. Williams

All Faculty Scholarship

In today’s rapidly evolving telecommunications landscape, the development of new technologies and distribution platforms are driving innovation and growth at a breakneck speed across the Internet ecosystem. Broadband connectivity is increasingly important to our civil discourse, our economy, and our future. What is the proper role of government in facilitating robust investment and competition in this critical sector? When technology companies constantly have to reinvent themselves and adapt to survive – what role should government play? This panel of experts at the Federalist Society’s 2014 National Lawyers Convention discussed the current regulatory environment and how government policies – particularly regarding …

Overlapping Financial Investor Ownership, Market Power, And Antitrust Enforcement: My Qualified Agreement With Professor Elhauge, Jonathan Baker

Articles in Law Reviews & Other Academic Journals

As is well known among financial economists but not previously recognized within the antitrust community, large and diversified institutional investors such as BlackRock, Fidelity, State Street, and Vanguard collectively own roughly two-thirds of the shares of publicly traded U.S. firms overall, up from about one-third in 1980. Recent economic research involving airlines and banking raises the possibility that overlapping ownership of horizontal rivals by diversified financial institutions facilitates anticompetitive conduct throughout the economy, and that the problem has been growing for decades, unnoticed until now. This response to an article by Professor Einer Elhauge, explains why it may be more …

Evaluating Appropriability Defenses For The Exclusionary Conduct Of Dominant Firms In Innovative Industries, Jonathan Baker

Articles in Law Reviews & Other Academic Journals

In response to antitrust cases challenging the exclusionary conduct of dominant firms, some dominant firms offer an “appropriability defense.” This defense is the claim that prohibiting the challenged conduct would lessen the dominant firm’s return to investment in research and development (R&D), undermine that firm’s incentive to innovate, and harm the prospects for industry innovation. An appropriability defense should be questioned, and often rejected, if the dominant firm would be expected to increase its own R&D effort in response to increased R&D by its rivals after liability on a dominant firm is imposed. An analytical framework for determining whether a …

Antitrust And Regulating Big Data, D. Daniel Sokol, Roisin E. Comerford

UF Law Faculty Publications

The collection of user data online has seen enormous growth in recent years. Consumers have benefited from this growth through an increase in free or heavily subsidized services, better quality offerings, and rapid innovation. At the same time, the debate about Big Data, and what it really means for consumers and competition, has grown louder. Many have focused on whether Big Data even presents an antitrust issue, and whether and how harms resulting from Big Data should be analyzed and remedied under the antitrust laws. The academic literature, however, has somewhat lagged behind the policy debate, and a closer inspection …

A Socio-Economic Approach To Antitrust: Unpacking Competition, Consumer Surplus, And Allocative Efficiency, Jeffrey L. Harrison

UF Law Faculty Publications

This Article demonstrates the relationship between socio-economics and antitrust law. It uses socio-economics to both deconstruct the current economic foundation of antitrust policy and to suggest ways to improve that policy. There are four steps in this presentation. Part II examines the core elements of the economic approach to antitrust and its shortcomings, if any. For those even moderately versed in economics, it will note that the analysis begins at the most basic level. Obviously, antitrust is designed to make markets more competitive. But that goal is merely a means to the end of greater consumer surplus and allocative efficiency. …

A Profile Of Bio-Pharma Consolidation Activity, Jordan Paradise

Faculty Publications & Other Works

No abstract provided.

The Law Of 180-Day Exclusivity, Erika Lietzan, Julia Post

Faculty Publications

In 1984, Congress created a statutory pathway for approval of generic drug applications and included an incentive for generic applicants to challenge the patents claiming the reference drugs on which they based their applications. The first generic applicant to file an ANDA with a patent challenge is eligible for 180 days of generic market exclusivity. This article is the fourth in a series of articles describing the resulting body of law, as interpreted and applied by FDA (in regulations, guidances, citizen petition responses, and individual decisions awarding and denying exclusivity) and the courts. The heart of the article is section …

Antitrust Scrutiny For The Occupations: "North Carolina Dental" And Its Impact On U.S. Licensing Boards, Rebecca Haw Allensworth

Vanderbilt Law School Faculty Publications

The American system of occupational licensing is under attack. The current regime – which allows for almost total self-regulation – has weathered sustained criticism from consumer advocate groups, academics, politicians, and even the White House itself. But the recent U.S. Supreme Court opinion in North Carolina Board of Dental Examiners v. FTC,1 portends a sea change in how almost a third of American workers are regulated. The case has made it possible for aggrieved individuals and government enforcers to bring suits against most state licensing boards, challenging their restrictions as violating federal competition law. The case has prompted two responses: …

Facilitating Competition By Remedial Regulation, Kristelia A. García

Publications

In music licensing, powerful music publishers have begun—for the first time ever— to withdraw their digital copyrights from the collectives that license those rights, in order to negotiate considerably higher rates in private deals. At the beginning of the year, two of these publishers commanded a private royalty rate nearly twice that of the going collective rate. This result could be seen as a coup for the free market: Constrained by consent decrees and conflicting interests, collectives are simply not able to establish and enforce a true market rate in the new, digital age. This could also be seen as …

Closing Fireside Chat With The Assistant Attorney General For The U.S. Department Of Justice Antitrust Division, William Baer, Philip J. Weiser

Publications

This Closing Fireside Chat was the final session of the 16th annual Silicon Flatirons Center conference, The Digital Broadband Migration: The Evolving Industry Structure of the Digital Broadband Landscape, held on Feb. 1, 2016 in the Wittemyer Courtroom of the University of Colorado Law School.

"At the time this conference was held, William J. Baer was Assistant Attorney General for Antitrust in the United States Department of Justice. On April 17, 2016, President Obama asked Mr. Baer to become Acting Associate Attorney General of the United States. Video of this interview with Assistant Attorney General Baer is available at https://www.youtube.com/watch?v=C351xEX0h4g …