Antitrust and Trade Regulation Commons^™

Precedent-Based Antitrust Law, Anca Daniela Chirita

William & Mary Business Law Review

This contribution revisits the authentic origins of antitrust law and the U.K.’s legacy of EU precedent rulings, spanning an eclectic and holistic analysis of the wider contemporary objectives of antitrust law, the versatile doctrine of vertical restraints of trade applied in the context of the online resale price maintenance, and the abuse theory of monopoly power applied in the context of excessive pricing and, more recently, of data-driven digital market competition. This contribution offers an original legal interpretation of precedent-based antitrust law: First, sustaining as principal narrative streams of evolutionary development, the rise of authentic precedent, which has had a …

Playing The Hermès Game: Quota Bags, Antitrust Law, And The Limits Of Consumer Protection In Luxury Markets, Madeleine Chou

William & Mary Business Law Review

Luxury fashion retail has become a behemoth of an industry. Through acquisitions and strong brand recognition, some brands have developed significant market power in the luxury retail space. Chief among these brands is Hermès, a luxury leather retail boutique known for its highly sought after quota bags, like the Birkin and the Kelly. Quota bags are handbags that can generally only be bought by customers who have developed a substantial purchase history and relationship with the brand. Through this sales model, Hermès has created what plaintiffs have alleged to be an antitrust tying scheme, in which the purchase of one …

A Structural Approach To The Application Of Section One Of The Sherman Act To Oligopolistic Interdependence, Annmarie Levins

Maine Law Review

A central tenet of American economic thought is that markets in which many producers compete for business are preferable to those in which one or a few sellers dominate. The conventional wisdom underlying this preference is that competitive markets produce more of the goods consumers want at lower prices than do noncompetitive markets. Oligopolies are markets in which there are few sellers. Oligopolistic markets are characterized frequently by higher prices and lower outputs than competitive markets. Many sectors of the American economy are oligopolistic. For example, the American automobile industry is dominated by "the big three," General Motors, Ford, and …

Vertical Restraints In An Amazon World, Martin Edwards

Dickinson Law Review (2017-Present)

Vertical restraints are a peculiarity, even among the dizzying array of contracts subject to antitrust scrutiny. While current law treats vertical restraints permissively, antitrust reformers have added this permissive treatment of vertical restraints to their list of proposed reforms. The reformers have softly proposed that courts apply a presumption of illegality standard for vertical restraints— greater scrutiny than the current standard, the rule of reason. This Article argues that doing so is inadvisable.

Producers and their consumers both want the same thing: the best overall product experience for the money. The critical economic functions of vertical restraints are to enable …

Reconstruction, And The Unfulfilled Promise Of Antitrust, Greg Day, Bennett Capers

Scholarly Works

Wealth inequality remains as wide, and as troubling, as it was a half-century ago. While scholars have offered various explanations, there is a contributor that has escaped serious scrutiny: state monopoly power. It is not just that there is a long history of states and municipalities using their monopoly power to protect dominant interests, from enacting Black Codes to shuttering Chinese laundries to barring women, immigrants, and minorities from certain professions. It is also that states continue to use their monopoly power in ways that entrench inequality, from zoning restrictions to eminent domain to regulations that, in effect, bar Black …

Monopolizing Digital Commerce, Herbert Hovenkamp

William & Mary Law Review

Section 2 of the Sherman Act condemns firms who “monopolize,” “attempt to monopolize,” or “combine or conspire” to monopolize—all without explanation. Section 2 is the antitrust law’s only provision that reaches entirely unilateral conduct, although it has often been used to reach collaborative conduct as well. In general, § 2 requires greater amounts of individually held market power than do the other antitrust statutes, but it is less categorical about conduct. With one exception, however, the statute reads so broadly that criticisms of the nature that it is outdated cannot be based on faithful readings of the text.

The one …

Big Tech Is Why I Have (Anti)Trust Issues, Sophie Copenhaver

St. John's Law Review

(Excerpt)

“There is a cost to bigness, even if it’s not passed onto the consumer.” Antitrust laws were once an effective tool to break up companies that had grown too large. However, subsequent rulings have altered their original meaning, and they are no longer useful in regulating large technology companies such as Amazon, Facebook, and Google. This Note will argue that judicial interpretation of antitrust laws should no longer be governed by the consumer welfare standard. Rather, judges should apply a two-part test, focusing on the market power and any anticompetitive business practices of the defendant corporation.

Megacorporations Are Jacking Up Prices 'Because They Can,' Pushing Red-Hot Inflation To Historic Levels, Robert H. Lande

All Faculty Scholarship

This article argues that corporations may be taking advantages of supply chain bottlenecks and shortages to collude and raise prices illegally. Although price fixing is illegal, the current levels of penalties are far too low. This gives firms an incentive to collude. Before the pandemic, when inflation was low, consumers and the antitrust enforcers would have been more likely to notice any sudden price increases and investigate whether they were caused by collusion. But using bottlenecks and shortages as cover, companies can take advantage of their years of consolidation and collude more easily with less chance of it being detected. …

The Bipartisan Consensus On Big Tech, Roger P. Alford

Journal Articles

This Article contends that there is an emergent bipartisan consensus that Big Tech has grown too powerful and that action must be taken to address its abuse of power. That action takes the form of a variety of legislative proposals to enhance government enforcement powers, reform the merger laws, and address self-preferencing, data portability, and interoperability. Litigation efforts focus on Facebook and Google’s abuse of monopoly power, particularly with respect to Facebook’s elimination of competition through acquisitions and Google’s abuse of monopoly power in search and display advertising. While we are in the midst of one of the most divisive …

Monopolizing Sports Data, Marc Edelman, John T. Holden

William & Mary Law Review

With legal sports betting viewed as a panacea for state budget woes across the United States, the underlying data that fuels the sports betting industry has emerged as an especially valuable asset. In the hopes of capitalizing on state laws that have now legalized sports betting, United States professional sports leagues have attempted to gain exclusive ownership rights over valuable sports betting data by asking legislators to mandate that bookmakers exclusively use data sold through the league. In addition, some sports leagues have imposed policies mandating that teams bundle together their collected data for purposes of selling it exclusively through …

Christianity And Antitrust, Kenneth G. Elzinga, Daniel Crane

Book Chapters

The purpose of this chapter is to consider whether the Christian faith has a nexus with the institution of antitrust. It turns out it doesn’t – and it does. For example, Christianity cannot explain why the Herfindahl–Hirschman Index is superior to the four-firm concentration ratio as a measure of industry concentration. Economics can. On the other hand, economics cannot explain why the per se rule against price-fixing is morally appropriate. The Bible can.

In Defense Of Breakups: Administering A “Radical” Remedy, Rory Van Loo

Faculty Scholarship

Calls for breaking up monopolies—especially Amazon, Facebook, and Google—have largely focused on proving that past acquisitions of companies like Whole Foods, Instagram, and YouTube were anticompetitive. But scholars have paid insufficient attention to another major obstacle that also explains why the government in recent decades has not broken up a single large company. After establishing that an anticompetitive merger or other act has occurred, there is great skepticism of breakups as a remedy. Judges, scholars, and regulators see a breakup as extreme, frequently comparing the remedy to trying to “unscramble eggs.” They doubt the government’s competence in executing such a …

A New Corporate Tax, Reuven S. Avi-Yonah

Articles

If we can regulate our corporations simply through the medium of taxation, we can destroy every trust in a fortnight. It would be a great deal better for the Finance Committee to turn its attention to the imposition of such a tax upon corporations and the persons who actually need regulation, who are exercising powers that are injurious to the American people, destroying competition and invading our prosperity, than to attempt to levy a revenue tax upon all the little shareholders of all the little corporations throughout the length and breadth of the United States.

Fascism And Monopoly, Daniel A. Crane

Michigan Law Review

The recent revival of political interest in antitrust has resurfaced a longstanding debate about the role of industrial concentration and monopoly in enabling Hitler’s rise to power and the Third Reich’s wars of aggression. Proponents of stronger antitrust enforcement argue that monopolies and cartels brought the Nazis to power and warn that rising concentration in the American economy could similarly threaten democracy. Skeptics demur, observing that German big business largely opposed Hitler during the crucial years of his ascent. Drawing on business histories and archival material from the U.S. Office of Military Government’s Decartelization Branch, this Article assesses the historical …

Antitrust And The Corporate Tax: Why We Need Progressive Corporate Tax Rates, Reuven S. Avi-Yonah, Lior Frank

Articles

In this article, Avi-Yonah and Frank explore how progressive corporate tax rates could address the abuse of power by monopolistic big tech companies.

Why It's A Bad Idea To Let A Few Tech Companies Monopolize Our Data, Maurice Stucke

Book Chapters

No abstract provided.

Libra: A Concentrate Of "Blockchain Antitrust", Thibault Schrepel

Michigan Law Review Online

Blockchains promise to decentralize the economy, bypassing trusts in favor of decentralized communities. The World Economic Forum predicts that 10 percent of the global gross domestic product will be stored on block-chain by 2027. Gartner further prophesizes that blockchain will create $3.1 trillion worth of business value by 2030. Even if that prediction turns out to be too optimistic, blockchain’s legal implications cannot be neglected.

The Sherman Act Is A No-Fault Monopolization Statute: A Textualist Demonstration, Robert H. Lande, Richard O. Zerbe

American University Law Review

The drafters of the Sherman Act originally designed Section 2 to impose sanctions on all monopolies and attempts to monopolize, regardless whether the firm had engaged in anticompetitive conduct. This conclusion emerges from the first ever textualist analysis of the language in the statute, a form of interpretation originally performed only by Justice Scalia but now increasingly used by the Supreme Court, including in its recent Bostock decision.

Following Scalia’s methodology, this Article analyzes contemporaneous dictionaries, legal treatises, and cases and demonstrates that when the Sherman Act was passed, the word “monopolize” simply meant that someone had acquired a monopoly. …

Taming Sherman's Wilderness, Derrian Smith

Indiana Law Journal

This Note proceeds in four Parts. Part I outlines the interpretive difficulties spawned by the vagueness of the Sherman Act—particularly, the judiciary’s necessary but undeniable departures from the text of the statute and the resulting doctrinal confusion. Part II considers ways in which the judiciary’s decision-making in Sherman Act cases approximates agency rulemaking and whether it makes sense to delegate interpretive authority to an antitrust agency. Yet, while the agency solution has upside, it would not easily escape criticisms that the Act does not provide sufficient notice of the conduct it proscribes and that the Act is an impermissible delegation …

Antitrust's Unconventional Politics, Daniel A. Crane

Articles

Antitrust law stands at its most fluid and negotiable moment in a generation. The bipartisan consensus that antitrust should solely focus on economic efficiency and consumer welfare has quite suddenly come under attack from prominent voices calling for a dramatically enhanced role for antitrust law in mediating a variety of social, economic, and political friction points, including employment, wealth inequality, data privacy and security, and democratic values. To the bewilderment of many observers, the ascendant pressures for antitrust reforms are flowing from both wings of the political spectrum, throwing into confusion a conventional understanding that pro-antitrust sentiment tacked left and …

Further Reflections On Antitrust And Wealth Inequality, Daniel A. Crane

Articles

Since I have already published a lengthy academic article on antitrust and wealth inequality, I have the freedom of using this piece to present the key arguments unvarnished by dense citations or technical details (readers interested in those things should consult my earlier article) and to respond to some of the criticisms of my article that have since been levied. My thesis, before and now, is this: claims that antitrust enforcement advances income or wealth progressivity are overstated and rest on simplistic and unrealistic understandings of how antitrust actually operates. While some enforcement actions may generate progressive results, others will …

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, …

The New Road To Serfdom: The Curse Of Bigness And The Failure Of Antitrust, Carl T. Bogus

University of Michigan Journal of Law Reform

This Article argues for a paradigm shift in modern antitrust policy. Rather than being concerned exclusively with consumer welfare, antitrust law should also be concerned with consolidated corporate power. Regulators and courts should consider the social and political, as well as the economic, consequences of corporate mergers. The vision that antitrust must be a key tool for limiting consolidated corporate power has a venerable legacy, extending back to the origins of antitrust law in early seventeenth century England, running throughout American history, and influencing the enactment of U.S. antitrust laws. However, the Chicago School’s view that antitrust law should be …

Balancing Effects Across Markets, Daniel A. Crane

Articles

In Philadelphia National Bank (PNB), the Supreme Court held that it is improper to weigh a merger's procompetitive effects in one market against the merger's anticompetitive effects in another. The merger in question, which ostensibly reduced retail competition in the Philadelphia area, could not be justified on the grounds that it increased competition against New York banks and hence perhaps enhanced competition in business banking in the mid-Atlantic region. I will refer to the Supreme Court's prohibition on balancing effects across markets as a "market-specificity" rule. Under this rule, efficiencies that may counterbalance anticompetitive aspects must be specific to …

All I Really Need To Know About Antitrust I Learned In 1912, Daniel A. Crane

Articles

Herbert Hovenkamp has indisputably earned the deanship of contemporary antitrust scholarship. One could point to many different attributes by which he has earned his laurels: fantastic scholarly productivity; clarity and precision in the craft of writing; analytical depth in both law and economics; moderation in a field apt to polarization; and custodianship of the influential Areeda treatise. In this Essay, I hope to honor another quality that has contributed significantly to Herb’s tremendous success as an antitrust scholar—his engagement with history. Much contemporary antitrust scholarship bursts with excitement at the discovery of new phenomena or theories that in all actuality …

Conditional Pricing And Monopolization: A Reflection On The State Of Play, Daniel A. Crane

Articles

Conditional pricing practices--including bundled discounting, loyalty rebating, and market share discounts--are not new phenomena in the U.S. market. Their potentially exclusionary consequences were raised in antitrust cases decades ago. But unlike trying or exlcusive dealing--which have a rich hsitory of case law and scholarly converage--conditioanl pricing practices did not emerge as salient to the antitrust community until a little over a decade ago. Two federal appellate decisions in the early 2000s--Concord Boar on market share rebates adn LePage's on bundled discounting--sparked a period of intensive interest and activity on these topics in teh antitrust agencies, courts, bench, and legal …

Market Power Without Market Definition, Daniel A. Crane

Articles

Antitrust law has traditionally required proof of market power in most cases and has analyzed market power through a market definition/market share lens. In recent years, this indirect or structural approach to proving market power has come under attack as misguided in practice and intellectually incoherent. If market definition collapses in the courts and antitrust agencies, as it seems poised to do, this will rupture antitrust analysis and create urgent pressures for an alternative approach to proving market power through direct evidence. None of the leading theoretic approaches—such as the Lerner Index or a search for supracompetitive profits—provides a robust …

Ftc V. Lundbeck: Is Anything In Antitrust Obvious, Like, Ever?, Chris Sagers, Richard M. Brunell

Law Faculty Articles and Essays

In FTC v. Lundbeck, the Eighth Circuit affirmed a bench verdict finding a merger to monopoly, followed by a 1400% price increase, not only legal, but effectively not even subject to antitrust. The result followed from the district court's view that peculiarities in the market for hospital-administered drugs rendered it essentially immune from price competition. That being the case, the court found that even products very plainly substitutable on any traditional "functional interchangeability" analysis are not in the same "relevant market" for purposes of rules governing horizontal mergers. We think the court's analysis was incorrect for a number of …

Aftermarketfailure: Windows Xp's End Of Support, Andrew Tutt

Michigan Law Review First Impressions

After 12 years, support for Windows XP will end on April 8, 2014. So proclaims a Microsoft website with a helpful clock counting down the days. "What does this mean?" the website asks. "It means you should take action." You should "migrate to a current supported operating system - such as Windows 8.1 - so you can receive regular security updates to protect [your] computer from malicious attacks." The costs of mass migration will be immense. About 30% of all desktop PCs are running Windows XP right now. An estimated 10% of the U.S. government's computers run Windows XP, including …

Merger Control Under China's Anti-Monopoly Law, D. Daniel Sokol

UF Law Faculty Publications

This essay explores the factors that drive merger outcomes under China's Anti-Monopoly Law (AML). While there are currently only a small number of published merger decisions, this paper overcomes that obstacle by utilizing a unique practitioner survey of antitrust lawyers across multiple jurisdictions. This survey captures transactions contemplated, but never undertaken (deterred by the merger regime), as well as mergers notified for approval under the AML. The survey allows for broader inferences to be drawn about the development of Chinese antitrust law, including: the welfare standard used in merger analysis, what industrial policy and other political factors may impact merger …