Antitrust and Trade Regulation Commons^™

“Sport-Extortion:” Causes, Consequences, And Solutions, Jack Berger

Northwestern Journal of Law & Social Policy

The modern U.S. stadium-development model enables “sport-extortion,” a phenomenon in which franchise owners leverage artificial scarcity, antitrust carve-outs, and credible relocation threats to extract public subsidies that deliver negligible public benefits. Owners use the league’s monopoly power and superior negotiating leverage to pit cities against one another and extract public money for new stadiums or upgrades to their existing stadiums. The owners and community leaders who support using public money to finance these projects promise huge economic returns and development for their communities. However, a survey of the empirical literature and examination of recently approved stadium projects reveal that these …

The Healing Power Of Antitrust, Theodosia Stavroulaki

Northwestern University Law Review

Millions of Americans live in hospital deserts—communities where people lack geographic access to hospitals and primary care physicians. People living in these deserts often miss doctor appointments, delay necessary care, and stop adhering to their treatment. In this way, hospital deserts exacerbate the health disparities plaguing America. This Article demonstrates that hospital deserts are not inevitable but the result of several business strategies—including noncompete agreements and merging with competitors—and antitrust enforcers’ unwillingness to recognize these harmful practices as antitrust violations. To cure the issue of hospital deserts, this Article makes three proposals. First, antitrust enforcers and the courts should expand …

Louboutin Lawfare: Exploring Conceptions Of Sanctions' Utility Through Export Controls On Luxury Goods, Vinita R. Singh

Northwestern University Law Review

There is widespread consensus amongst scholars that sanctions—the deliberate withdrawal of customary trade and financial relations—do not work. Despite this perception, states are deploying sanctions at an increasing rate. This Article explains this paradox by arguing the predominant notion of sanctions’ utility employed by scholars is unduly constrained, narrowly focusing on the ability of such measures to modify the behavior of sanctioned parties while disregarding the alternative benefits this instrument can deliver. To support this argument, this Article uses export controls on luxury goods deployed in connection with the Russo–Ukraine War as a case study. Under prevailing perceptions of sanctions’ …

Taxation's Limits, Luís C. Calderón Gómez

Northwestern University Law Review

Countless pages have been devoted to the question of why everyone should pay tax, yet its opposite has gone largely unnoticed: why should some people and organizations not pay tax? Our tax system exempts from ordinary income taxation a wide and diverse array of people and organizations engaged in significant economic activity—from parents providing childcare services for their family to consular activities and charities operating animal shelters—seemingly without a convincing explanation. Perhaps because of the dizzying diversity of tax-exempt activities, scholars and policymakers have avoided comprehensively or coherently justifying our exemption regimes.

This Article develops a novel normative theory that …

The False Choice Between Digital Regulation And Innovation, Anu Bradford

Northwestern University Law Review

This Article challenges the common view that more stringent regulation of the digital economy inevitably compromises innovation and undermines technological progress. This view, vigorously advocated by the tech industry, has shaped the public discourse in the United States, where the country’s thriving tech economy is often associated with a staunch commitment to free markets. U.S. lawmakers have also traditionally embraced this perspective, which explains their hesitancy to regulate the tech industry to date. The European Union has chosen another path, regulating the digital economy with stringent data privacy, antitrust, content moderation, and other digital regulations designed to shape the evolution …

I Want A New (Generic) Drug: A Comparative Case For Shifting U.S. Generic Drug Policies To Increase Availability And Lower Healthcare Costs, Immer S. Chriswell

Northwestern Journal of International Law & Business

Enacted in 1984, Hatch-Waxman was intended to increase generic drug availability and make critical healthcare more affordable for Americans. In the nearly forty years following, while it has increased availability of drugs, it has also allowed drug originators to create avenues to profit in ways not intended when the original compromise was struck, undermining its success. Moreover, given a weak antitrust standard against reverse settlement payments proscribed in Actavis, the U.S. faces a dilemma to further improve access to generic medications in the future. The E.U.’s approach to generic drugs, while presently geographically fragmented, is simpler and has a clear …

About-Face: How Facebook’S Restrictions On User Posts Could Violate Antitrust Law, Efrem Berk

Northwestern Journal of Technology and Intellectual Property

This Note examines whether Facebook’s restrictions on its users’ posts are subject to Sherman Act § 2. This Note looks at the economic activity generated by social media activity and argues that posts are commerce. While this piece finds that current antitrust jurisprudence likely favors Facebook, an alternative approach sought by some antitrust scholars could influence judges to preclude the platform’s restrictions.

Live And Let Liv?: The Case Against Antitrust Alarm And The Multi-Tour Future Of Professional Golf, Reed Silverman

Northwestern Journal of International Law & Business

No abstract provided.

The Dawn Of A New Era: Antitrust Law Vs. The Antiquated Ncaa Compensation Model Perpetuating Racial Injustice, Amanda L. Jones

Northwestern University Law Review

Two crises in 2020 fueled the fire underlying a debate that has been smoldering for years: whether student athletes should be compensated. The COVID-19 pandemic coincided with the Black Lives Matter movement and drew unprecedented attention to systemic racism permeating society, including college sports that rely disproportionately on Black men risking physical harm to support an entire industry. The Supreme Court’s decision in NCAA v. Alston opened the door for some athletic conferences to offer student athletes unlimited education-related benefits and called out the NCAA’s business model that relies on not paying student athletes under the justification of amateurism. Alston …

The Probative Synergy Of Plus Factors In Price-Fixing Litigation, Christopher R. Leslie

Northwestern University Law Review

Private plaintiffs alleging that defendants conspired to fix prices in violation of antitrust law must usually prove their claims through circumstantial evidence, generally in the form of “plus factors”—evidence indicating that the defendants’ parallel conduct was caused by collusion, not by independent decision-making. Supreme Court precedent requires fact finders to examine antitrust plaintiffs’ evidence holistically. With increasing frequency, however, federal courts in price-fixing cases improperly isolate each piece of circumstantial evidence presented by the plaintiff and then deprive it of all probative value because that single piece of evidence is insufficient, standing alone, to prove a price-fixing conspiracy. As a …

Ftc V. Phoebe Putney And Municipalities As Nongovernments, Peter F. Nascenzi

Northwestern University Law Review

American courts have long struggled with categorizing municipalities. They treat municipalities sometimes as private corporations, sometimes as governmental bodies, and sometimes as something in between. This uncertainty provides a shaky foundation for local government law and hampers its development. Local governments are not sure of their powers, and states are unable to create a comprehensive vision of municipal governance. When federal law is involved, the situation is muddled further.

In FTC v. Phoebe Putney, the Supreme Court’s application of the state action doctrine unnecessarily injected federal antitrust law into the relationship between states and municipalities. The state action doctrine …

Antitrust Arbitration And Merger Approval, Mark A. Lemley, Christopher R. Leslie

Northwestern University Law Review

In a string of recent opinions, the Supreme Court has made it harder for consumers to avoid arbitration clauses, even when businesses strategically insert provisions in them that effectively prevent consumers from being able to bring any claim in any forum.

Arbitration differs from litigation in ways that harm the interests of consumer antitrust plaintiffs. For example, arbitration limits discovery and has no meaningful appeals process. Furthermore, defendants use the terms in arbitration clauses to prevent class actions and to undercut the pro-plaintiff features of antitrust law, including mandatory treble damages, meaningful injunctive relief, recovery of attorneys’ fees, and a …

How Not To Apply Actavis, Michael A. Carrier

NULR Online

No abstract provided.

Supervising Managed Services, James B. Speta

Faculty Working Papers

Many Internet-access providers simultaneously offer Internet access and other services, such as traditional video channels, video on demand, voice calling, and other emerging services, through a single, converged platform. These other services—which can be called "managed services" because the carrier offers them only to its subscribers in a manner designed to ensure some quality of service—in many circumstances will compete with services that are offered by unaffiliated parties as applications or services on the Internet. This situation creates an important interaction effect between the domains of Internet access and managed services, an effect that has largely been missing from the …

No Good Whistle Goes Unpunished: Can We Protect European Antitrust Leniency Applications From Discovery?, Constanza Nicolosi

Northwestern Journal of International Law & Business

In recent years, the most successful tool in the antitrust arsenal of the European Commission and the Antitrust Division of the U.S. Department of Justice has proven to be leniency programs, which provide full immunity from fines to the first cartel-member that confesses its participation in the conspiracy. Even though European and U.S. leniency programs are fairly similar to one another, procedural differences may undermine their effectiveness. It has long been argued that potential discovery of corporate statements accompanying the leniency application before the Commission in subsequent proceedings in the United States would put the firms that cooperated with the …

Why More Antitrust Immunity For The Media Is A Bad Idea, Maurice E. Stucke, Allen P. Grunes

NULR Online

The U.S. newspaper industry specifically and traditional media industries generally are in transition. In response to declining audiences and advertising revenue, many traditional media firms have laid off journalists and cut back on news. With their financial difficulties, some traditional media firms have called for greater leniency under the federal antitrust laws. Newspaper owners and journalists have called for greater antitrust immunity for joint advertising, joint fees for readership and accessing content online, and joint reporting. Others have called on the Federal Communications Commission (“FCC”) to loosen further its Cross-Ownership Rules. Some politicians have suggested that the federal antitrust agencies …

Fcc Regulation And Increased Ownership Concentration In The Radio Industry, Peter Dicola

Faculty Working Papers

In 1996, Congress increased the limits on how many radio stations one firm can own within a single "radio market." To enforce these limits, the FCC used an idiosyncratic method of defining radio markets, based on the complex geometry of the signal contour patterns of radio stations' broadcasts. Using a unique geographic data set, this paper provides the first calculations of the pre- and post-1996 limits on local radio ownership as actually implemented by the FCC. The limits are surprisingly permissive and vary considerably from city to city. While the limits were seldom binding on radio firms, I find a …

Competition Policy And Financial Distress, Ezra Friedman, Marco Ottaviani Ottaviani

Faculty Working Papers

Traditional analyses of competition policy assume that firms operate in perfect credit markets. We argue that imperfections in credit markets should be taken into account, and show one channel by which accounting for financial conditions could alter the welfare effects of a merger. In line with empirical evidence, we posit that the presence of financial distress might diminish price competition by reducing firms' willingness to undertake long-term investments in their customer base. Mergers that reduce the probability of financial distress can induce the merging firms to compete more fiercely for customers, thus partly offsetting the traditional effects of an increase …

Federalism And Concurrent Jurisdiction In Global Markets: Why A Combination Of National And State Antitrust Enforcement Is A Model For Effective Economic Regulation, Katherine Mason Jones

Northwestern Journal of International Law & Business

The focus of the article is on the proper role of U.S. state governments in regulating international business. The specific issue analyzed is the desirability of having state attorneys general enforce federal antitrust laws in global markets concurrently with federal antitrust regulators. Congress granted state officials this power in 1976. In 2009, however, a large proportion of the world's commerce is now conducted in international, rather than national markets. This development has led Judge Richard A. Posner and others to advocate that the states be stripped of their statutory power to enforce federal antitrust laws on behalf of their residents …

Building Antitrust Agency Capacity In Context, Salil Mehra

NULR Online

No abstract provided.

Selection Neglect In Mutual Fund Advertisements, Jonathan Koehler, Molly Mercer

Faculty Working Papers

Mutual fund companies selectively advertise their better-performing funds. However, investors respond to advertised performance data as if those data were unselected (i.e., representative of the population). We identify the failure to discount selected or potentially selected data as selection neglect. We examine these phenomena in an archival study (Study 1) and two controlled experiments (Studies 2 and 3). Study 1 identifies selection bias in mutual fund advertising by showing that the median performance rank for advertised funds is between the 79th and 100th percentile. Study 2 finds that both novice investors and financial professionals fall victim to selection neglect in …

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

NULR Online

No abstract provided.

Competition And Privacy In Web 2.0 And The Cloud, Randal C. Picker

NULR Online

No abstract provided.

Bargaining In The Shadow Of The European Microsoft Decision: The Microsoft-Samba Protocol License (Part Ii), Seldon J. Childers, William H. Page

NULR Online

No abstract provided.

A Single-License Approach To Regulating Insurance, Henry N. Butler, Larry E. Ribstein

Faculty Working Papers

State regulation of insurance companies has been criticized for many years because of the burden imposed on insurers by having to comply with the laws of many jurisdictions. These higher costs are passed on to consumers. The problems with the current regulatory structure are prompting calls for increased federal regulation of insurance. However, all proposals to federalize insurance regulation create opportunities for abuse at the hands of the federal government and fail to utilize the benefits of a federal system. This article shows how many of the problems of the current system can be addressed without resorting to a large …

International Legal Practice Involving England And New York Following Adoption Of The United Kingdom Legal Services Act Of 2007, Sydney M. Iii Cone

Northwestern Journal of International Law & Business

This article deals with the regulation of legal services in England and New York in the context of, first, multidisciplinary practice ("MDP") and, second, permitted investment in legal practice. The article summarizes both the background of and potential differences between the regulations in those two jurisdictions, and comments on the possible reconciliation of those differences. Because, chronologically, New York was the first of the two jurisdictions under consideration to adopt rules on MDP, the New York rules will be considered first, and the more recent statute, known as the United Kingdom Legal Services Act 2007 (hereinafter "U.K. Act"), will then …

"Perfectly Properly Triable" In The United States: Is Extradition A Real And Significant Threat To Foreign Antitrust Offenders?, Daseul Kim

Northwestern Journal of International Law & Business

Seeking extradition of foreign officers in charge of foreign corporations for trial in the United States is one of the latest policies that the U.S. Department of Justice ("DOJ") has adopted to enforce U.S. antitrust laws internationally. As a result, the world has become a much riskier place for foreign officers and executives, who, in the past, could practically ignore U.S. antitrust laws and still hide safely behind the protection of their own countries' borders. The DOJ expects this "real and significant" threat of extradition to incentivize foreign corporate officers to comply with U.S. antitrust laws by altering their conduct, …

Antidumping And Cotton Subsidies: A Market-Based Defense Of Unfair Trade Remedies, Nadia E. Nedzel

Northwestern Journal of International Law & Business

This article argues that trade remedies, problematic though they may be, provide a legal framework in which litigation can and must be promulgated to protect the benefits of a global market economy.

Pleading Standards Should Not Change After Bell Atlantic V. Twombly, Keith Bradley

NULR Online

No abstract provided.

Methanex V. United States: The Realignment Of Nafta Chapter 11 With Environmental Regulation, Kara Dougherty

Northwestern Journal of International Law & Business

In July 1999, the Canadian firm Methanex Corporation ("Methanex") notified the United States of its intention to seek approximately $1 billion in damages for the United States's alleged breach of Chapter 11 of the North American Free Trade Agreement ("NAFTA"). NAFTA, a trilateral agreement among the United States, Canada and Mexico (the "Parties"), gives private, foreign investors from each country the right to bring claims against another Party under certain circumstances. Methanex claimed a California measure banning the use of the gasoline additive MTBE discriminated against and expropriated its investments. The case of Methanex v. United States highlights two unintended …