Abstract

This Appendix contains excerpts from the U.S. code of statutes relating to competition outside of the Clayton and Sherman Acts.

Abstract

This Appendix contains descriptions of the antitrust laws of each state, with relevant statutory citations and some brief excerpts of more interesting provisions or provisions with unusual language. States that align the interpretation of their antitrust laws to federal law are marked with an asterisk.

Abstract

It is always an appropriate time to reevaluate, reexamine, and question the optimal scope and shape of our antitrust institutions. For example, the United States is peculiar in having two distinct antitrust enforcement agencies. More peculiar still, the agencies have both common and unique functions. For example, both the Federal Trade Commission (FTC) and the Antitrust Division of the Department of Justice (DOJ) review mergers pursuant to Section 7 of the Clayton Act and enforce Sections 1 and 2 of the Sherman Act through civil actions. At the same time, the Division alone is responsible for criminal enforcement of the Sherman Act, and the FTC alone enforces the Clayton Act provisions that prohibit tying and unfair methods of competition. Layered atop the peculiar dual jurisdiction of the FTC and DOJ at the federal level is a remarkably complex and decentralized system of competition enforcement authority distributed among myriad federal sectoral regulators, state attorneys general, and private litigants.

This article asks whether the current distribution of competition functions in the U.S. can be improved by some reorganization or other reform. We answer in the affirmative and propose several changes — perhaps the most significant being consolidating the competition functions of the FTC into the Antitrust Division. We also propose stripping the Federal Communications Commission of authority independently to review mergers, as the Congress did with regard to the Department of Transportation in view of its similarly poor performance reviewing airline mergers. Our more general proposals regarding the authority of sectoral regulators over competition should not be overlooked, however; it would do much good and has little or no downside.

Read at SSRN.

Abstract

The EC has proposed a regulatory framework for SEPs, the heart of which is the establishment of a regulatory authority—a “competence center”—charged with maintaining a registry of SEPs with detailed information drawn from required submissions by SEP holders and “administering a system for essentiality checks and processes for aggregate royalty determination and FRAND determination.” The proposal’s stated aim is to facilitate licensing negotiations between SEP holders and implementers, applying a balanced approach towards the bargaining parties. The approach is highly unbalanced, however. It would sharpen incentives for holdout by implementers and thereby substantially weaken SEP holders’ ability to appropriate the value of their IP. In particular, implementers would be empowered to substantially delay requests by SEP holders for injunctive relief against infringement in national courts of law. It is a truism that justice delayed is justice denied. Likewise, IP rights delayed are IP rights denied. Beyond delay, the Proposal would entirely bar the recovery of some losses from infringement in certain circumstances. As a result, the practical effect of the Proposal would be to induce licensing disputes where there would otherwise have been none, supplanting private bargaining with a less well-informed and inefficient administrative process that would materially depress incentives for innovation and standardization.

Abstract

The GAI filed this Comment with the Canadian Competition Bureau in response to the Bureau’s request for public feedback on draft Guidance on Wage-Fixing and No-Poaching Agreements. Such agreements will be subject to a new statute (subsection 45(1.1), Canadian Competition Act) taking effect June 23, 2023, prohibiting such agreements as per se offenses and making violations subject to criminal remedies. The GAI’s Comment commends the Bureau for seeking public comment prior to implementation and generally concurs with the basic approach taken by the Bureau. To further refine and improve the Bureau’s approach, the Comment identifies potential ambiguities in the Guidance. Ambiguity complicates compliance, since businesses are likely to avoid even procompetitive or competitively neutral conduct potentially exposed to challenge. Avoidance of lawful conduct by business firms due to uncertainty regarding applicable legal standards may inhibit competition and ultimately reduce economic performance and innovation. Per se condemnation and criminal remedies should be reserved for conduct always or almost always anticompetitive and lacking plausible procompetitive rationale. The GAI therefore asks the Bureau to take particular care in defining the types of agreements that may be subject to the new law. Principal areas of focus involve (1) transition provisions; (2) the scope of an exemption for agreements between “affiliates”; (3) the definition of what constitutes an “employment relationship,” a key term defining the scope of the new law; (4) the line between permissible information sharing and impermissible coordinated conduct, and (5) the proper interpretation of the “Ancillary Restraints Defense” that will be applicable.

As former judges and government officials, legal academics and economists who are experts in antitrust and intellectual property law, we write to express our support for the Avanci business review letter issued by the Antitrust Division of the U.S. Department of Justice on July 28, 2020 (the “2020 business review letter”). The 2020 business review letter represented a legally sound and evidence-based approach in applying antitrust law to innovative commercial institutions like the Avanci patent pool that facilitate the efficient commercialization of new standardized technologies in the fast-growing mobile telecommunications sector to the benefit of innovators, implementers, and consumers alike.

Read the full letter here.

Abstract

This comment by 25 law professors, economists and former United States government officials was submitted to the European Union Commission in response to a “call for evidence” on the licensing, litigation, and remedies of standard-essential patents (SEPs). It details the principal concepts and substantial evidence relating to the constructive role of SEPs in efficiently promoting innovation and structuring commercialization activities in high-tech devices generally and the mobile revolution specifically. It also addresses widespread misunderstandings and misstatements about the commercialization and litigation of SEPs. It broadly makes three points.

First, in contrast to the evidence of the positive role of SEPs in promoting innovation and commercialization in wireless technologies, no published empirical study has found evidence of the predicted marketplace effects of “holdup” or “royalty stacking” theories, such as higher prices, less innovation, and less market competition in smartphones. Second, contrary to claims by some commentators that courts do not issue injunctions for the infringement of SEPs, the comment reviews some representative decisions from the substantial case law in Europe in which SEP owners have requested or obtained injunctions against implementers engaging in holdout tactics. Third, it explains how courts have consistently held that the fair, reasonable, and non-discriminatory (FRAND) commitment by SEP owners does not mandate a “license to all” rule nor that reasonable royalties be calculated according to the “smallest salable, patent practicing unit” (SSPPU) standard. These court decisions are consistent with the economic function and evidence of SEP licensing on FRAND terms.

The mobile revolution has created unparalleled economic and technological growth over the past three decades. So long as courts provide robust enforcement of intellectual property rights, and do not impede the licensing and other contracts predicated on those rights, there is every reason to believe that the mobile market will continue to thrive. The comment concludes with an Appendix listing the substantial, published literature addressing both the success of the SEP-based sector of the global innovation economy and the numerous substantive and methodological flaws in “holdup” and “royalty stacking” theories.

Thank you, Victoria, for the invitation to respond to Mr. Coscelli and his proposal for a legislatively founded Digital Markets Unit. Mr. Coscelli is one of the most talented, successful, and creative heads a competition agency has ever had. In the case of the DMU [ed., Digital Markets Unit], however, I think he has let hope triumph over experience and prudence. This is often the case with proposals for governmental reform: Indeed, it has a name, the Nirvana Fallacy, which comes from comparing the imperfectly functioning marketplace with the perfectly functioning government agency. Everything we know about the regulation of competition tells us the unintended consequences may dwarf the intended benefits and the result may be a less, not more, competitive economy. The precautionary principle counsels skepticism about such a major and inherently risky intervention.

Read the full piece here.

In response to the Draft Vertical Merger Guidelines released by DOJ and the FTC on January 10, 2020,1 the International Center for Law & Economics convened a blog symposium to discuss the legal and economic implications of the proposed changes. Published on Thursday, February 6, 2020 and Friday, February 7, 2020 on TruthOnTheMarket.com, that symposium included contributions from twenty-six well respected legal academics, economists, and seasoned practitioners. This Comment collects those posts together so that they can form part of the record as DOJ and the FTC consider the final form of the Vertical Merger Guidelines.

Please note, inclusion of the posts in this comment should not be interpreted as indicating that any particular author supports any post that is not his or her own — this was a broad effort that included many different viewpoints.