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The Workshop on Empirical and Experimental Methods for Law Professors is designed to teach law professors the conceptual and practical skills required to (1) understand and evaluate others’ empirical studies, and (2) design and implement their own empirical studies. Participants are not expected to have background in statistical knowledge or empirical skills prior to enrollment. Instructors have been selected in part to demonstrate the development of empirical studies in a wide-range of legal and institutional settings including: antitrust, business law, bankruptcy, class actions, contracts, criminal law and sentencing, federalism, finance, intellectual property, and securities regulation. Class sessions will provide participants opportunities to learn through faculty lectures, drawing upon data and examples for cutting edge empirical legal studies, and participating in experiments. There will be numerous opportunities for participants to discuss their own works-in-progress or project ideas with the instructors.

WORKSHOP FACULTY:

David Abrams, Ph.D., University of Pennsylvania School of Law, http://www.law.upenn.edu/cf/faculty/dabrams/

Eric Helland, Ph.D., Claremont-McKenna College, http://www.cmc.edu/academic/faculty/profile.asp?Fac=159

Jonathan Klick, J.D., Ph.D., University of Pennsylvania School of Law, http://www.law.upenn.edu/cf/faculty/jklick/

Bruce Kobayashi, Ph.D., George Mason University School of Law, http://www.law.gmu.edu/faculty/directory/fulltime/kobayashi_bruce

Kevin McCabe, Ph.D., George Mason University School of Economics and Law, http://www.law.gmu.edu/faculty/directory/fulltime/mccabe_kevin

Joshua Wright, J.D., Ph.D., George Mason University School of Law, http://www.law.gmu.edu/faculty/directory/fulltime/wright_joshua

SCHEDULE:

The Workshop will take place at:
George Mason University School of Law
3301 N. Fairfax Drive
Arlington, VA 22201
http://law.gmu.edu

The Workshop will begin on Monday May 23, at 8:30 a.m. and conclude on Thursday May 26, at 12 pm. Classes on May 23, 24 and 25 will run from 8:30 am to 5pm, and include lectures, group sessions, and opportunities for participants to present their own empirical projects or “works in progress.”

Topics covered include:

• Research Design
• Finding Data
• Basic Probability Theory
• Descriptive Statistics
• Formulating Testable Hypotheses
• Specification
• Statistical Inference
• Cross-Sectional Regression
• Time Series Regression
• Panel Data Techniques
• Sensitivity Analysis
• Experimental Methods

REGISTRATION AND TUITION:

Tuition for the Workshop on Empirical and Experimental Methods is $850 for the first professor from a law school and $500 for additional registrants from the same school.

Tuition includes all session materials, access to statistical software (STATA), three lunches, four continental breakfasts, and one evening reception. You will need a laptop for this workshop. A check for $850 made payable to George Mason University Foundation (please note on the check that it is for “Empirical Workshop Tuition”) must be included with the registration form. Registration and payment should be received by May 13, 2011. Space is limited and will be allocated on a first-come, first-accepted basis.

CANCELLATION POLICY:

Full refunds for cancellation of attendance to the Workshop on Empirical and Experimental Methods will be made for all written cancellations received before 5:00 p.m. on Monday, May 16th. No refunds will be given for any cancellations received after Monday, May 16th.

ACCOMMODATIONS:

GMU School of Law is conveniently located across the Potomac from Washington, DC with easy access to the Metro’s Orange Line (Virginia Square Station).

Special hotel rates for workshop participants are available at two hotels within walking distance of the GMU School of Law: the Comfort Inn Ballston, (1211 N. Glebe Rd) at a group rate of $149 per night, and the AKA Virginia Square (3409 Wilson Blvd) at a group rate of $211 per night.

To make a reservation at the Comfort Inn call (703) 247-3399. The hotel’s website can be viewed at:
http://www.comfortinn.com/hotel-arlington-virginia-VA417

To make a reservation at the AKA Virginia Square contact Scott Foster at (202) 904-2505, or by email at [email protected]. The hotel’s website can be viewed at: http://www.hotelaka.com/locations/virginia_square/default.aspx

To obtain the workshop rates, please mention the George Mason School of Law Workshop on Empirical and Experimental Methods. In order to receive these special rates you must book your room by April 23, 2011. There are limited rooms available so please make your reservations as soon as possible.

LEC CONTACT:

Jeff Smith
703-993-8101
[email protected]

Click Here to Apply

Filed under: announcements, economics, george mason university school of law, law and economics, law school, legal scholarship, scholarship

Slate’s David Weigel ran an otherwise informative piece on Cass Sunstein’s testimony, as head of OIRA, at a recent House Energy and Commerce Committee.  The headline?  Nudge on Trial: Cass Sunstein Defends the White House Against a Republican Attack.  From Weigel’s description of the hearing, there was some general hand wringing about whether there is too much or too little regulation, whether the number of regulations is higher or lower under the Obama administration than during the George W. Bush administration, some run-of-the-mill posturing from questioners.  Weigel concludes the hearing ended “with Sunstein having done no obvious harm to his mission.”

All fine.  And like I said — the article was informative with regard to the hearing.  But its a pretty sloppy and misleading headline.   There are, I think, some interesting issues concerning whether the Obama administration has retreated from behavioral economics a la Nudge, whether (as Ezra Klein contends) Republicans hate behavioral economics, and the role of behavioral economics in administrative agencies and regulation.   Unfortunately, the article really wasn’t about Nudging or behavioral-economics based regulation at all.  If Nudge is going to have its trial — it will be another day.

In the meantime, you can start here for some good background reading on the topic.

Filed under: behavioral economics, free to choose symposium, journalism, regulation

Apparently, the detergent industry has entered into what has been described as a “voluntary agreement” to reduce the use of phosphates in detergents (HT: Ted Frank).  A press release from Clean Water Action describes the agreement as follows:

On July 1, 2010 a voluntary ban on phosphates in dishwasher detergents will be implemented by many members of the American Cleaning Council (formerly the Soap and Detergent Association), a manufacturer’s trade group representing most detergent companies.”Industry’s announcement on phosphates in dishwasher detergents is welcome news, indeed, if somewhat overdue,” said Jonathan Scott, a spokesman for Clean Water Action, founded in the early 1970’s to fight for clean, safe water. “Even small amounts of phosphates can wreak havoc when they get into our water,” Scott says, “so it’s the last thing you want as an ingredient in detergents, which are specifically designed to end up in the water by way of household appliances and drain pipes.”

It is also apparent that some our none too pleased with the effects of reducing phosphate levels in detergents — with the primary downside being that the new product doesn’t work too well.  An article in the Weekly Standard describes the impact of the reduction:

The result is detergents that don’t work very well. There have been a handful of stories in the media about consumer complaints. The New York Times noted that on the review section of the website for Cascade—Procter & Gamble’s market-leading brand—ratings plummeted after the switch, with only 11 percent of consumers saying they would recommend the product. One woman in Florida told National Public Radio that she called Procter & Gamble to complain about how its detergent no longer worked. The customer rep told her to consider handwashing the dishes instead.

Some NPR commenters agreed. “Like so many -others, I had disassembled my dishwasher, run multiple empty ‘cleaning cycles’ using all kinds of various chemical treatments, all trying to get my dishwasher ‘fixed,’ ” said one. “We assumed that something was wrong with the machine, that it was limed up, and we tried vinegar and other remedies with limited success,” wrote another. “We do wash some dishes by hand now, using more hot water than before, and also have simply lowered our standards for what constitutes ‘clean.’ ” Another commenter complained: “I live in AZ and had the same thing happen last year when it was introduced out here. I thought it was a reaction between the ‘Green’ soap and the hard water. I wrote to the company and they sent me about $30 in coupons—for other items and for their non-green soap. I dumped the 3 unopened bottles plus the one I was using.”

The detergents were so problematic that they caused environmental delinquency even among NPR listeners. One disappointed commenter rationalized his backsliding:

We first heard about the new phosphate-free detergent formulations almost a year ago. Wanting to do the Right Thing we rushed out and bought some and immediately began using it. The results, although not as bad as reported by some, were still pretty underwhelming. Our dishes and glassware were covered by a gritty film and so was the inside of the dishwasher. We are in Southern California and have very hard water. Adding vinegar to the rinse cycle helped *some* but still we found excessive buildup on our dishes. Disgusted with the new detergent, we decided to go back to something with phosphate. We were not able to find phosphate detergent at the supermarket, but some local discount stores sell supplies that are apparently remaindered by the manufacturers. We bought six boxes of old Cascade with phosphate—about a year’s supply. We figured someone would buy it—might as well be us.

When Consumer Reports did laboratory testing on the new nil-phosphate detergents, they concluded that none of them “equaled the excellent (but now discontinued) product that topped our Ratings in August 2009.”

There is, of course, an interesting antitrust angle here.  Thom has posted previously on another voluntary industry agreement in the soda industry to refrain from selling high calorie soda (and limiting the size of even healthy drinks) in schools.  In the comments to that post I suggest that one important issue is whether the soda players actually reached an agreement:

The passing or collective endorsement of a set of “best practices” to which members of the industry can voluntary choose to adhere to or not is not necessarily an actionable antitrust conspiracy. Of course, calling something “voluntary guidelines” won’t immunize an actual agreement if it is there. But it seems that the parties were pretty careful — EXCEPT for in their commercials and in print!!! — to make sure to emphasize that the antitrust-relevant choices were made unilaterally. But I can’t imagine antitrust counsel would have given the thumbs up to the commercials…

So it is here.  I’ve no doubt that such an agreement, if it exists, is reachable under Section of the Sherman Act.  The question is whether the detergent industry has taken some steps to protect themselves from an “agreement” finding under Section 1.  I don’t have enough detail to know whether that is the case — but if anybody does, please send it along.

Filed under: antitrust, cartels, economics, environment

Along with co-author Judd Stone, I’ve posted to SSRN our contribution to the Review of Industrial Organization‘s symposium on the 2010 Horizontal Merger Guidelines — The Sound of One Hand Clapping: The 2010 Horizontal Merger Guidelines and the Challenge of Judicial Adoption.

The paper focuses on the Guidelines’ efficiencies analysis.  We argue that while the 2010 HMGs “update” the Guidelines’ analytical approach in generally desirable ways, these updates are largely asymmetrical in nature: while the new Guidelines update economic thinking on one “side” of the ledger (changes that make the plaintiff’s prima facie burden easier to satisfy, ceteris paribus), they do not do so with respect to efficiencies analysis on the other side of the ledger.  These asymmetrical changes thereby undermine the new Guidelines’ institutional credibility.

In particular, we focus on the Guidelines’ treatment of so-called “out-of-market” efficiencies as well as fixed cost savings.  In both cases we argue that updates were appropriate and consistent with the Agencies’ expressed preference to more accurately reflect economic thinking and shift from proxies to direct assessment of competitive effects.   If anything, the Guidelines appear to be more skeptical of efficiencies arguments than the previous version, adding “the Agencies are mindful that the antitrust laws give competition, not internal operational efficiency, primacy in protecting customers.”  We then turn to discussing the implications of this “asymmetrical update” for judicial adoption of the Guidelines.  Some have discussed the possibility that these Guidelines will be less successful with federal courts because they downplay market definition.  As I’ve said here many times, I do not think the Agencies (if out of nothing but self-interest) will avoid market definition.  However, we argue that the asymmetrical updating problem is a more serious one, and that widespread and wholesale adoption of the HMGs should not be taken for granted.

Here is the abstract:

There is ample justification for the consensus view that the Horizontal Merger Guidelines have proven one of antitrust law’s great successes in the grounding of antitrust doctrine within economic learning. The foundation of the Guidelines’ success has been its widespread adoption by federal courts, which have embraced its rigorous underlying economic logic and analytical approach to merger analysis under the Clayton Act. While some have suggested that the Guidelines’ most recent iteration might jeopardize this record of judicial adoption by downplaying the role of market definition and updating its unilateral effects analysis, we believe these updates are generally beneficial and include long-overdue shifts away from antiquated structural presumptions in favor of analyzing competitive effects directly where possible. However, this article explores a different reason to be concerned that the 2010 Guidelines may not enjoy widespread judicial adoption: the 2010 Guidelines asymmetrically update economic insights underlying merger analysis. While the 2010 Guidelines’ updated economic thinking on market definition and unilateral effects will likely render the prima facie burden facing plaintiffs easier to satisfy in merger analysis moving forward, and thus have significant practical impact, the Guidelines do not correspondingly update efficiencies analysis, leaving it as largely as it first appeared 13 years earlier. We discuss two well-qualified candidates for “economic updates” of efficiencies analysis under the Guidelines: (1) out-of-market efficiencies and (2) fixed cost savings. We conclude with some thoughts about the implications of the asymmetric updates for judicial adoption of the 2010 Guidelines.

Download and read the whole thing.

Filed under: antitrust, business, economics, legal scholarship, merger guidelines, mergers & acquisitions, scholarship

So says this BusinessWeek headline based on an interview with Federal Trade Commission Chairman Jon Leibowitz.   However, most of the article appears to be about establishing the Commission seeking to advance the proposition that the FTC Act expands beyond the scope of the antitrust laws.   For example, the Chairman is quoted as saying “We would like to see it tested by appellate courts because we think the legislation, the plain language of the legislation, makes it crystal clear that our jurisdiction goes beyond the antitrust laws” rather than anything specific about the Intel investigation.  I take this to mean, more accurately, that the FTC views Section 5 as a core statute in enforcing its competition mission.  For better or worse, a different statement than the one in the headline.

In a must-read op-ed in today’s Wall Street Journal, Yale Law’s Jonathan Macey weighs in on Goldman Sachs’s decision to allow only foreign gazillionaires — no Americans, regardless of their wealth or sophistication — to invest in new shares of Facebook.

Numerous observers have portrayed Goldman’s move as a “victory for the SEC.”  The New York Times‘ Dealbook called it “a serious embarrassment for Goldman.”  In reality, Macey contends, “[i]t is the SEC that should be embarrassed” for fostering a system in which, as Larry put it,  “the US securities laws exclud[e] US investors from investing in a US company in the US.”

Echoing a number of Larry’s observations, Macey explains:

Thanks to SEC regulation and the litigious atmosphere it fosters — not to mention Sarbanes-Oxley’s onerous burdens on corporate executives — the whole capital formation process is moving offshore. The U.S. share of total equity raised in the world’s capital markets is shrinking, while the number of U.S. companies listing their shares for trading exclusively in foreign markets has risen steadily for the past five years.

Macey then points a finger at the SEC’s overarching regulatory philosophy, which views investors — even rich, sophisticated ones — as needing governmental protection and displays scant regard for the unintended consequences of paternalistic limitations on the freedom of contract:

The SEC’s fundamental approach to regulation involves depriving investors of opportunities in order to protect them. This was not much of a problem in the immediate post-World War II period. Before Japan and Europe rebuilt, and before China emerged as an economic giant, the U.S. had the only large pools of investment capital in the world and dominated the financial scene. During this happy period of U.S. primacy, the SEC, along with most academics, took the rather ludicrous view that it actually deserved the credit for the primacy of U.S. capital markets. That world is long gone.

Still, according to the SEC, all investors large and small must be protected against the danger that they will succumb to a feeding frenzy of enthusiasm when given the opportunity to invest in a new deal. For example, the SEC rules governing the Facebook offering until Goldman pulled the plug include the requirement that the stock being sold “cannot be the subject of advertising, general promotional seminars or public meetings in connection with the offering.” The concern here is that publicity about a deal might, heaven forbid, create interest among investors. …

The investors who supposedly are being protected by the SEC’s rules here are not unsophisticated small investors. Goldman had limited the marketing of Facebook’s shares to the billionaires and large institutions that constitute its wealthiest clients.

Finally, Macey suggests that the Obama Administration, which has recently committed itself to ferreting out cost-ineffective regulations that “make our economy less competitive,” take a long, hard look at the “investor-protective” securities rules that drive capital overseas and prevent American investors from having access to the wealth-enhancing opportunities available to their European and Asian friends:

Ironically, the Goldman decision to move the Facebook deal offshore was announced just as President Obama was acknowledging in these editorial pages that “regulations do have costs” and saying that he would order a government-wide review to eliminate rules that cripple economic growth. That review should include the rules promulgated by the SEC, lest we continue to see U.S. capital markets fade into irrelevance.

If we ever get another President who believes that markets, while imperfect, generally work well, that government intervention often fails to make things better, and that regulations should be narrowly tailored to fix legimitate market failures, he or she should look hard at Prof. Macey for a spot on the SEC.

While the FCC has announced its approval of the Comcast-NBC deal, The problem of overlapping agency review of mergers arises once again.  We’ve discussed previously the costs of FCC merger view, and in particular, the issues of delay and imposition of conditions unrelated to the merger.  The FCC review of the Comcast-NBC deal appears to be no exception.  The list of conditions appears below the fold, along with a dissent from Commissioners Baker and McDowell on these issues.

The list of conditions here include:

• Ensuring Reasonable Access to Comcast-NBCU Programming for Multichannel Distribution. Building on successful requirements adopted in prior, similar transactions, the Commission is establishing for rival multichannel video programming distributors (MVPDs) an improved commercial arbitration process for resolving disputes about prices, terms, and conditions for licensing Comcast-NBCU’s video programming. The Commission is also requiring Comcast-NBCU to make available through this process its cable channels in addition to broadcast and regional sports network programming.
• Protecting the Development of Online Competition. Recognizing the risks this transaction could present to the development of innovative online video distribution services, the Commission has adopted conditions designed to guarantee bona fide online distributors the ability to obtain Comcast-NBCU programming in appropriate circumstances. These conditions respond directly to the concerns voiced by participants in the proceeding—including consumer advocates, online video distributors (OVDs), and MVPDs —while respecting the legitimate business interests of the Applicants to protect the value of their content. Among other things, the Commission requires that Comcast and/or Comcast-NBCU:
• Provides to all MVPDs, at fair market value and non-discriminatory prices, terms, and conditions, any affiliated content that Comcast makes available online to its own subscribers or to other MVPD subscribers.
• Offers its video programming to legitimate OVDs on the same terms and conditions that would be available to an MVPD.
• Makes comparable programming available on economically comparable prices, terms, and conditions to an OVD that has entered into an arrangement to distribute programming from one or more of Comcast-NBCU’s peers.
• Offers standalone broadband Internet access services at reasonable prices and of sufficient bandwidth so that customers can access online video services without the need to purchase a cable television subscription from Comcast.
• Does not enter into agreements to unreasonably restrict online distribution of its own video programming or programming of other providers.
• Does not disadvantage rival online video distribution through its broadband Internet access services and/or set-top boxes.
• Does not exercise corporate control over or unreasonably withhold programming from Hulu.
• Access to Comcast’s Distribution Systems. In light of the significant additional video programming Comcast will control after the merger with NBCU—programming that may compete with third-party programming Comcast currently carries or otherwise would carry on its MVPD service—the Commission requires that Comcast not discriminate in video programming distribution on the basis of affiliation or nonaffiliation with Comcast-NBCU. Moreover, if Comcast “neighborhoods” its news (including business news) channels, it must include all unaffiliated news (or business news) channels in that neighborhood. The Commission also adopts as a condition of the transaction Comcast’s voluntary commitment to provide 10 new independent channels within eight years on its digital tier.
• Protecting Diversity, Localism, Broadcast and Other Public Interest Concerns. The Commission is also imposing conditions and accepting voluntary commitments concerning a numbers of other public interest issues, including diversity, localism, and broadcasting, among others. For example, to protect the integrity of over-the-air broadcasting, network-affiliate relations, and fair and equitable retransmission consent negotiations with the joint venture, the Commission adopts a series of conditions that were independently negotiated between the Applicants and various network affiliates.
• The Applicants have also made a number of additional voluntary commitments, many of which the Commission has adopted as conditions to the transaction’s approval. Most of these commitments are geared towards enhancing the public interest as a result of the joint venture.  These commitments include:
• Broadband Adoption and Deployment. Comcast will make available to approximately 2.5 million low income households: (i) high-speed Internet access service for less than $10 per month; (ii) personal computers, netbooks, or other computer equipment at a purchase price below $150; and (iii) an array of digital literacy education opportunities. Comcast will also expand its existing broadband networks to reach approximately 400,000 additional homes, provide broadband Internet access service in six additional rural communities, and provide free video and high-speed Internet service to 600 new anchor institutions, such as schools and libraries, in underserved, low-income areas.
• Localism. To further broadcast localism, Comcast-NBCU will maintain at least the current level of news and information programming on NBC’s and Telemundo’s owned-and-operated (“O&O”) broadcast stations, and in some cases expand news and other local content. NBC and Telemundo O&O stations also will provide thousands of additional hours of local news and information programming to their viewers, and some of its NBC stations will enter into cooperative arrangements with locally focused nonprofit news organizations. Additional free, on-demand local programming will be made available as well.
• Children’s Programming. Comcast-NBCU will increase the availability of children’s programming on its NBC and Telemundo broadcast stations, and add at least 1,500 more choices to Comcast’s on-demand offerings for children. It will provide additional on-screen ratings information for original entertainment programming on the Comcast-NBCU broadcast and cable television channels and improved parental controls. Comcast-NBCU also will restrict interactive advertising aimed at children 12 years old and younger and provide public service announcements addressing children’s issues.
• Programming Diversity. Building on Comcast’s voluntary commitments in this area, we require Comcast-NBCU to increase programming diversity by expanding its over the- air programming to the Spanish language-speaking community, and by making NBCU’s Spanish-language broadcast programming available via Comcast’s on demand and online platforms. As noted above, Comcast also will add at least 10 new independent channels to its cable offerings.
• Public, Educational, and Governmental (“PEG”) Programming. Comcast will safeguard the continued accessibility and signal quality of PEG channels on its cable television systems and introduce new on demand and online platforms for PEG content.

The relationship between many of these conditions to merger analysis, competition concerns, or even the public interest is tenuous at best.  The Joint Concurrence of Commissioners McDowell and Baker describe the problem:

The Commission’s approach to merger reviews has become excessively coercive and lengthy. This transaction is only the most recent example of several problematic FCC merger proceedings that have set a trend toward more lengthy and highly regulatory review processes that may discourage future transactions and job-creating investment.

In this instance, our review exceeded its limited statutory bounds. Many of the conditions in the Memorandum Opinion and Order (Order) and commitments outlined in separate letter agreements were agreed to by the parties. The resulting Order is a wide-ranging regulatory exercise notable for its “voluntary” conditions that are not merger specific. The same is true for the separate “voluntary” commitments outlined in Comcast’s letter of agreement dated January 17, 2011. While many of these commitments may serve as laudable examples of good corporate citizenship, most are not even arguably related to the underlying transaction. In short, the Order goes too far.

More significantly, the Order has the potential to shape the future of entire industries, including the nascent online video market, on the basis of a record that is by necessity limited to facts pertaining only to the two parties. At a time of innovation and experimentation that is both dynamic and disruptive, the Order fails to recognize that the contours of our collective video future are best shaped outside the Beltway.  To secure approval of the underlying transaction, we therefore concur.

What price are consumers paying for FCC merger review?

Here is my colleague Tom Hazlett’s Congressional Testimony on the competitive effects of the merger.

The next installment in a seemingly never-ending series (see here for earlier offenders).

This time, its the California Attorney General Kamala Harris in a press release announcing a settlement with Bioelements, Inc., a Colorado-based company which sells skin care products in salons and online.  The relevant allegation, from the Complaint (Para. 10) is the following:

Beginning in mid 2009, Bioelements entered into many dozens of written contracts, entitled either “Bioelements Agreement for Authorized Professional Account Status” or “Bioelements Internet Only Accounts Agreement,” with third-party companies -several dozen of them physically located in California -that distribute and/or sell, retail to the public, Bioelements products, where such contracts contained resale price maintenance components. The “Authorized Professional Account” contract states, in part, that “Accounts shall not charge less than the Manufacturer’s Suggested Retail Price (MSRP).” The “Internet Only Accounts” contract states, in part, that “Accounts are prohibited from charging more or less than the Manufacturer’s Suggested Retail Price (MSRP).

Its an Resale Price Maintenance case.  No allegation of horizontal conspiracy.  Here’s AG Harris:

“Bioelements operated a blatant price-fixing scheme by requiring online retailers to sell its products at high prices,” Harris said. “Price manipulation harms consumers, competition and our business community. We will continue to be vigilant in protecting our markets from these kinds of abuses.”

The settlement is one of the first applications of California’s strict, pro-consumer antitrust law banning vertical price-fixing in the wake of a controversial 2007 U.S. Supreme Court decision that weakened federal law in this area. Vertical price-fixing occurs when companies along the distribution chain conspire to set the price of a product or service at an artificially high level. In California, prices must be set independently — and competitively — by distributors and retailers.

This is highly misleading on several fronts as a matter of basic antitrust economics.  I’ve covered the difference between “price-fixing” in the general antitrust sense and the use of RPM previously.  The  difference is critical because while the former is known and well understood to have pernicious competitive consequences, the same is not true for RPM.  Indeed, the existing empirical evidence (the evidence overwhelmingly shows (see also here)) suggests that a per se rule against RPM will harm consumers — bold assertions about “protecting our markets from these kinds of abuses” notwithstanding.

Yes, a vertical agreement “fixes prices” but this is a fairly transparent attempt to obfuscate the economic issues by analogizing it to a cartel and thereby make strong claims about the enforcers generating consumer welfare benefits for its constituents.  The data simply do not support that claim.  State AG offices are known to generate these press releases from time to time — or similar ones claiming that the RPM enforcement action generated $X in consumer welfare gains.  I’m not sure if they know better.  But they should.  And perhaps they do, but that knowledge is outweighed by the desire to win in the court of public opinion, in the press, and perhaps with policy makers.

There is a reasonable discussion to be had over the appropriate rule of reason treatment for RPM post-Leegin.   But the policy discussions should take place with a solid understanding of the underlying economics and evidence.   Press releases such as these undermine those efforts in my view.  Again.  I understand that the AG’s are marketing.  But this is all the more reason why groups that think seriously about antitrust, such as the ABA Antitrust Section — who certainly knows better — shouldn’t be making the same mistakes.

The New York State Bar Association is sponsoring a student writing contest focusing on antitrust.  Eligible papers (which must be solo-authored):

may address any antitrust topic including topics relating to civil and criminal antitrust law, intellectual property and antitrust law, competition policy, regulatory policy, consumer protection, international competition law and state antitrust enforcement.

Authors must be written by a “currently enrolled J.D. or LL.M. student at a New York State Law School or by a New York State resident at any ABA-accredited law school outside of New York State.”

The winner gets $5,000 and publication in a NYSBA journal.  You can download the entry form here, and submit the paper electronically (in PDF format) along with the entry form by April 30th to:

Professor Edward D. Cavanagh
St. John’s University School of Law
8000 Utopia Parkway
Queens, NY 11439
[email protected]

Good luck!