Law Commons^™

Updating The Merger Guidelines: Comments, Steven C. Salop, Serge Moresi

Georgetown Law Faculty Publications and Other Works

These comments (originally submitted to the DOJ and FTC in November 2009) make a number of comments relevant to revising the Merger Guidelines. The comments focus on the use of the GUPPI (gross upward pricing pressure index) in unilateral effects analysis. They also comment on the deterrence and incipiency standard, exclusionary effects of horizontal mergers and market definition when there are multi-product firms or pre-merger coordination, among other issues.

Toward A Better Competition Policy For The Media, Maurice E. Stucke, Allen P. Grunes

College of Law Faculty Scholarship

It is difficult to formulate meaningful competition policy when there is a fierce debate over the current competitiveness of the media industry. After addressing the importance of the marketplace of ideas in our democracy, our article examines the current state of the media industry, including the response of traditional media to audience declines, the growth of new media, the impact of media consolidation (including its impact on minority and women ownership), and the role of the Internet. In response to recent calls for liberalizing cross-ownership rules to protect traditional media, our article outlines why conventional antitrust policy is difficult to …

Toward A Better Competition Policy For The Media: The Challenge Of Developing Antitrust Policies That Support The Media Sector's Unique Role In Our Democracy, Maurice Stucke, Allen Grunes

Scholarly Works

It is difficult to formulate meaningful competition policy when there is a fierce debate over the current competitiveness of the media industry. After addressing the importance of the marketplace of ideas in our democracy, our article examines the current state of the media industry, including the response of traditional media to audience declines, the growth of new media, the impact of media consolidation (including its impact on minority and women ownership), and the role of the Internet. In response to recent calls for liberalizing cross-ownership rules to protect traditional media, our article outlines why conventional antitrust policy is difficult to …

On Writ Of Certiorari To The United States Court Of Appeals For The Second Circuit, Stolt-Neilsen S.A., V. Animalfeed International, No. 08-1198 (U.S. Oct. 20, 2009), Cornelia T. Pillard

U.S. Supreme Court Briefs

No abstract provided.

Quick - Somebody Call Amnesty International! Intel Says Eu Antitrust Fine Violated Human Rights, Robert H. Lande

All Faculty Scholarship

This articles discusses Intel's claim that the EU's fine against it for a competition law violation was so large that its human rights' were violated.

Slides: Water Leasing In The Lower Arkansas Valley: The "Super Ditch Company", Peter Nichols

Western Water Law, Policy and Management: Ripples, Currents, and New Channels for Inquiry (Martz Summer Conference, June 3-5)

Presenter: Peter NIchols, Trout, Raley, Montano, Witwer & Freeman, Denver, CO

28 slides

The Price Of Abuse: Intel And The European Commission Decision, Robert H. Lande

All Faculty Scholarship

The May 13, 2009 decision by the European Commission ('EC') holding that Intel violated Article 82 of the Treaty of Rome and should be fined a record amount and prohibited from engaging in certain conduct, set off a predictable four part chorus of denunciations:

1. Intel did nothing wrong and was just competing hard;
2. Intel's discounts were good for consumers;;
3. The entire matter is just another example of Europeans protecting their own against a more efficient U.S. company; and;
4. Even if Intel did engage in anticompetitive activity, the fine was much too large. These assertions will be addressed in turn.;

Does The Rule Of Reason Violate The Rule Of Law?, Maurice Stucke

Scholarly Works

In the past few years, the Supreme Court has been more active in deciding antitrust issues. The Court's choice of legal standards affects future market behavior and the incentives for individuals and organizations to engage in productive activity. Despite its increased activity, the Court never assesses the deficiencies of its rule-of-reason standard under rule-of-law principles. This assessment is critical. This article analyzes the standard's significant deficiencies, and how these deficiencies adversely affect antitrust enforcement and competition policy generally. Perfect compliance with rule-of-law ideals, however, may be unobtainable and undesirable, so the Article recommends several improvements to reorient the rule of …

Of Myths And Evidence: An Analysis Of 40 U.S. Cases For Countries Considering A Private Right Of Action For Competition Law Violations, Robert H. Lande, Joshua P. Davis

All Faculty Scholarship

This article assesses some of the benefits of private enforcement of the United States antitrust laws by analyzing forty large recent, successful private cases. It should help in assessing the desirability and efficacy of private enforcement - information that may prove useful to jurisdictions contemplating a private right of action for competition cases.

National Security Review Of Foreign Mergers And Acquisitions Of Domestic Companies In China And The United States, Kenneth Y. Hui

Cornell Law School Inter-University Graduate Student Conference Papers

China’s recently enacted Anti-Monopoly Law has received much academic attention. In particular, many articles and comments have been written about Article 31 of the Anti-Monopoly Law, a provision on national security review of foreign mergers and acquisitions of domestic companies. The provision has often been labelled as draconian and protectionist. This paper argues that Article 31 is not necessarily so. Article 31 is actually, to a large extent, in line with the national security provisions found in liberal economies. By taking a comparative approach, this paper will demonstrate the similarities between the national security laws in China and the United …

Concentrated Media Is Something We Can't Ignore: A Response To Speaker Pelosi, Maurice Stucke

Scholarly Works

This essay briefly responds to a request that the U.S. Department of Justice should give San Francisco Bay Area newspapers more leeway under the federal antitrust laws to merge or consolidate their business operations. The essay agrees with House Speaker Nancy Pelosi's concerns that a strong, free, and independent press is vital to our democracy and in informing our citizens, especially news organizations that devote resources to gathering news. As the essay explains, the antidote is not to weaken the antitrust laws to enable large media conglomerates to become even bigger. Instead, the health of the marketplace of ideas depends …

Analyzing Horizontal Mergers: Unilateral Effects In Product-Differentiated Markets, Herbert J. Hovenkamp

All Faculty Scholarship

This essay offers a brief, non-technical exposition of the antitrust analysis of horizontal mergers in product differentiated markets where the resulting price increase is thought to be unilateral - that is, only the post-merger firm increases its prices while other firms in the market do not. More realistically, non-merging firms who are reasonably close in product space to the merging firm will also be able to increase their prices when the post-merger firm's prices rise. The unilateral effects theory is robust and has become quite conventional in merger analysis. There is certainly no reason for thinking that it involves any …

The Neal Report And The Crisis In Antitrust, Herbert J. Hovenkamp

All Faculty Scholarship

The Neal Report, which was commissioned by Lyndon Johnson and published in 1967, is rightfully criticized for representing the past rather than the future of antitrust. Its authors completely embraced a theory of competition and industrial organization that had dominated American economic thinking for forty years, but was just in the process of coming to an end. The structure-conduct-performance (S-C-P) paradigm that the Neal Report embodied had in fact been one of the most elegant and most tested theories of industrial organization. The theory represented the high point of structuralism in industrial organization economics, resting on the proposition that certain …

Revitalizing Section 5 Of The Ftc Act Using “Consumer Choice” Analysis, Robert H. Lande

All Faculty Scholarship

This paper makes two points. First, Section 5 of the FTC Act, properly construed, is indeed significantly broader and more encompassing than the Sherman Act or Clayton Act. Section 5 violations include incipient violations of the other antitrust laws, and also violations of their policy or spirit.

Second, the best - and probably the only - way to interpret Section 5 in an expansive manner is to do so in a way that also is relatively definite, predictable, principled and clearly bounded. This best can be done if Section 5 is articulated using the consumer choice framework. Without the discipline …

Mergers And Market Dominance, Herbert J. Hovenkamp

All Faculty Scholarship

Mergers involving dominant firms legitimately receive close scrutiny under the antitrust laws, even if they involve tiny firms. Further, they should be examined closely even in markets that generally exhibit low entry barriers. Many of the so-called "unilateral effects" cases in current merger law are in fact mergers that create dominant firms. The rhetoric of unilateral effects often serves to disguise this fact by presenting the situation as if it involves the ability of a small number of firms (typically two or three) in a much larger market to increase their price to unacceptable levels. In fact, if such a …

Chicago, Post-Chicago, And Neo-Chicago, Daniel A. Crane

Reviews

Of all of Chicago's law and economics conquests, antitrust was the most complete and resounding victory. Chicago, of course, is a synecdoche for ideological currents that swept through and from Hyde Park beginning in the 1950s and reached their peak in the 1970s and 1980s. From early roots in antitrust and economic regulation, the Chicago School branched outward, first to adjacent fields like securities regulation, corporate law, property, and contracts, and eventually to more distant horizons like sexuality and family law. Predictably, the Chicago School exerted its greatest influence in fields closely tied to commercial regulation. But never did Chicago …

The Method And Role Of Comparative Law, Edward J. Eberle

Law Faculty Scholarship

No abstract provided.

Anticompetitive Trade Remedies: How Antidumping Measures Obstruct Market Competition, Sungjoon Cho

All Faculty Scholarship

Through trade policies such as antidumping remedies, the United States government often protects domestic producers at the expense of market competition. Yet a judicially created antitrust immunity, the Noerr-Pennington doctrine, obstructs the Federal Trade Commission’s antitrust investigations of these trade remedies. This Article argues that judicial and administrative interventions are needed to restore antitrust oversight when implementing trade remedies. This Article does not propose a repealing of the current antidumping statue, an act that would be politically infeasible in the current protectionist atmosphere of Congress. Instead, it takes a more modest yet realistic stance: antidumping remedies must be sanitized by …

Dr. Miles Is Dead. Now What?: Structuring A Rule Of Reason For Minimum Resale Price Maintenance, Thom Lambert

Faculty Publications

This article critiques six approaches that have been proposed for evaluating minimum RPM and offers an alternative approach. The six approaches critiqued are (1) the Brandeisian, unstructured rule of reason; (2) Judge Posner's rule of per se legality; (3) the approach advocated by 27 states in the recent Nine West case; (4) the approach adopted by the Federal Trade Commission in that case; (5) the approach advocated by economists William Comanor and F.M. Scherer; and (6) the approach proposed in the Areeda & Hovenkamp Antitrust Law treatise. Finding each of these approaches deficient, the article proposes an alternative evaluative approach …

The Viability Of Antitrust Price Squeeze Claims, Erik Hovenkamp, Herbert J. Hovenkamp

All Faculty Scholarship

A price squeeze occurs when a vertically integrated firm "squeezes' a rival's margins between a high wholesale price for an essential input sold to the rival, and a low output price to consumers for whom the two firms compete. Price squeezes have been a recognized but controversial antitrust violation for two-thirds of a century. We examine the law and economics of the price squeeze, beginning with Judge Hand's famous discussion in the Alcoa case in 1945. While Alcoa has been widely portrayed as creating a "fairness" or "fair profit" test for unlawful price squeezes, Judge Hand actually adopted a cost-based …

Patents, Property, And Competition Policy, Herbert J. Hovenkamp

All Faculty Scholarship

The decision to regulate involves the identification of markets where simple assignment of property rights is not sufficient to ensure satisfactory competitive results, usually because some type of market failure obtains. By contrast, if property rights are well defined when they are initially created and can subsequently be traded to some reasonably competitive equilibrium, then regulation is thought not to be necessary. In such cases the antitrust laws have a significant role to play in ensuring that the market can be as competitive as free trading allows. One problem with the patent system is that once a patent is granted …

Competition Policy And Organizational Fragmentation In Health Care, Thomas L. Greaney

All Faculty Scholarship

A central challenge for all health care reform proposals currently being discussed is finding the means to effectively channel market forces given many deeply embedded features of our system and the peculiar economics of health care delivery and financing. This essay traces the path of competition law in health care and explains its chicken-and-egg relationship with provider organizational arrangements. It explores a central puzzle for future health care policy: why have market forces failed to counteract organizational fragmentation? Answering this question requires an understanding of why competition policy is inexorably linked to the organizational structures of health care providers and …

Competition Policy And Comparative Corporate Governance Of State-Owned Enterprises, D. Daniel Sokol

UF Law Faculty Publications

The legal origins literature overlooks a key area of corporate governance-the governance of state-owned enterprises ("SOEs"). There are key theoretical differences between SOEs and publicly-traded corporations. In comparing the differences of both internal and external controls of SOEs, none of the existing legal origins allow for effective corporate governance monitoring. Because of the difficulties of undertaking a cross-country quantitative review of the governance of SOEs, this Article examines, through a series of case studies, SOE governance issues among postal providers. The examination of postal firms supports the larger theoretical claim about the weaknesses of SOE governance across legal origins. In …

The Trojan Horse Of Electric Power Transmission Line Siting Authority, Jim Rossi

Vanderbilt Law School Faculty Publications

Reform proposals pending in the U.S. Congress would increase federal and regional power to preempt states in siting transmission lines on order to allow the development of a high-votage transmission grid for renewable resources. This Article recognizes the inadequacy of existing state siting authority over transmission, but takes a skeptical approach to expanding federal siting jurisdiction as a solution to the problem and argues that the over-attention to transmission line siting authority is a bit of a Trojan horse in the climate change debate. Specifically, because it ignores the more difficult issues of how the costs and benefits of transmission …

The Future Of International Antitrust And Improving Antitrust Agency Capacity, D. Daniel Sokol

UF Law Faculty Publications

One of the key issues in international antitrust has been how to make antitrust more effective around the world. Most antitrust laws have been adopted or significantly modified since 1990. A number of key jurisdictions are either fairly new to antitrust altogether or to an antitrust regime that effectively employs the latest in economic thinking and the legal tools necessary to promote competition. Jurisdictions that have made antitrust a new and important cornerstone to economic policy include Brazil, Russia, India, and China. Because of the stakes involved in the ability of antitrust to foster economic development and to prevent misguided …

Limiting Anticompetitive Government Interventions That Benefit Special Interests, D. Daniel Sokol

UF Law Faculty Publications

When government regulates, it may either intentionally or unintentionally generate restraints that reduce competition ("public restraints"). Public restraints allow a business to cloak its action in government authority and to immunize it from antitrust regulation. Private businesses may misuse the government's grant of antitrust immunity to facilitate behavior that benefits businesses at consumers' expense. One way is by obtaining government grants of immunity from antitrust scrutiny. A recent series of Supreme Court decisions has made this situation worse by limiting the reach of antitrust law in favor of sector regulation. This is true even though the Supreme Court refers to …

Remedies, Antitrust Law, And Microsoft: Comment On Shapiro, Keith N. Hylton

Faculty Scholarship

The subject of remedies is a relatively under-theorized area of antitrust law, and Professor Shapiro has done the antitrust community a great favor by offering some innovative and useful theoretical insights on the design of antitrust remedies. He applies his theoretical insights to the Microsoft III case to reach the conclusion that the remedies adopted were inadequate to restore competition in the market for software platforms. In this review, I will offer additional theoretical insights on remedies and explain my reasons for rejecting his conclusions on Microsoft III.

United States Competition Policy In Crisis: 1890-1955, Herbert J. Hovenkamp

All Faculty Scholarship

The development of marginalist, or neoclassical, economics led to a fifty-year long crisis in competition theory. Given an industrial structure with sufficient fixed costs, competition always became "ruinous," forcing firms to cut prices to marginal cost without sufficient revenue remaining to pay off investment. Early neoclassicists such as Alfred Marshall were not able to solve this problem, and as a result many economists were hostile toward the antitrust laws in the early decades of the twentieth century. The ruinous competition debate came to an abrupt end in the early 1930's, when Joan Robinson and particularly Edward Chamberlin developed models that …

Complex Bundled Discounts And Antitrust Policy, Herbert J. Hovenkamp, Erik Hovenkamp

All Faculty Scholarship

A bundled discount occurs when a seller conditions a discount or rebate on the buyer's purchaser or two or more different products. Firms that produce fewer than all the good in the bundle find it difficult to compete because they must amortize the discount across a smaller range of goods. For example, if the dominant firm offers a 10% discount for purchase of both good A and good B, but the rival makes only good B, it will have to offer a discount that is large enough to match the dominant firm's B discount as well as the foregone discount …

Cartels As Two-Stage Mechanisms: Implications For The Analysis Of Dominant-Firm Conduct, William E. Kovacic

GW Law Faculty Publications & Other Works

Cartels often act like single dominant firms. Because there are a number of difficulties in determining market effects of single dominant firms, this article proposes that enforcement policy recognize the connection between cartels and firms engaged in monopolization. The resulting insight would be useful to determine whether or not cartel conduct should be viewed with suspicion when engaged in or by a dominant firm in a similar industry. Many cartels do not focus solely on suppressing interfirm rivalry; rather, many operate as two-stage mechanisms: the first stage consists of reaching a consensus on a plan to restrict output and curb …