Abstract

In this chapter, we discuss the development of the duty to deal doctrine in antitrust law, its application to the digital economy, and proposals for specific duties to deal, such as data portability and interoperability.

Part I outlines the development of the duty to deal doctrine in antitrust law. The development of the doctrine in the United States will be compared to that in the European Union. Popular economic justifications for the doctrine and key cases will be explored. Part II then situates this doctrine within the digital economy, focusing on the importance of getting the contours of the doctrine right in that economy. As we shall see, the law and economics of the duty to deal caution against its application to dynamic, digital markets. This will be illustrated by looking at cases where it has been applied. Part III focuses on two specific categories of duties to deal: data portability and interoperability.

Abstract

There is growing academic, regulatory, and legislative interest in “dark patterns” – digital design practices that influence user behavior in ways that may not align with users’ interests. For instance, websites may present information in ways that influence user decisions, or use design elements that make it easier for users to engage in one behavior (e.g., purchasing the items in a shopping cart) than another (e.g., reviewing the items in that shopping cart). The general thrust of this interest is that dark patterns are problematic and require regulatory or legislative action.

While acknowledging that many concerns about dark patterns are legitimate, this Article discusses the more nuanced reality about “patterns”: that design is, simply, hard. All design influences user behavior, sometimes in positive ways, sometimes in negative; sometimes deliberately, sometimes not. This Article argues for a more cautionary approach to addressing the concerns of dark patterns. The most problematic uses of dark patterns almost certainly run afoul of existing consumer protection law. That authority – not new, broader rules – should be our first recourse to addressing these concerns. Beyond that, this is an area where we should both allow the marketplace – including the design professionals working to improve User Interface and User Experience design practices – should be allowed to continue to develop, but with the understanding that Congress and regulators have a keen interest in ensuring that consumer interests are reflected in those practices.

Abstract

This article uses recent literature on Public-Private Partnerships (P3s) to argue that “Regulation as Partnership” is often a more productive approach to regulation than the more common adversarial and transactional approaches common to the contemporary regulatory environment. Partnerships, in which public entities engage the private sector to serve some government purpose (often to construct infrastructure) in exchange to some ownership interest derived from that purpose, have become popular since the 1980s. They are most often thought of as an alternative vehicle for financing public projects. But they primarily operate (and are most effective when) by aligning the incentives between the public and private project participants. This alignment of incentives stands in stark contrast to the often adversarial and transactional approach to much regulation – with regulation of the tech sector highlighted as an example in this article.

In a remarkable ruling issued earlier this month, the Third Circuit Court of Appeals held in Oberdorf v. Amazon that, under Pennsylvania products liability law, Amazon could be found liable for a third party vendor’s sale of a defective product via Amazon Marketplace. This ruling comes in the context of Section 230 of the Communications Decency Act, which is broadly understood as immunizing platforms against liability for harmful conduct posted to their platforms by third parties (Section 230 purists may object to myu use of “platform” as approximation for the statute’s term of “interactive computer services”; I address this concern by acknowledging it with this parenthetical). This immunity has long been a bedrock principle of Internet law; it has also long been controversial; and those controversies are very much at the fore of discussion today.

Read the full piece here.

This Essay takes prior work on Chevron in a new direction, arguing that broad deference doctrines have the largely unrecognized but particularly pernicious effect of increasing the political gridlock and politicization of the legislative process. Untethered from the need to actively govern agencies that have been delegated sufficiently broad authority to keep the basic ship of state afloat, legislators refocus their attention on maintaining power for themselves and their political party. In the thirty or so years since Chevron became the law of the land, our country’s governing institutions have grown increasingly politicized: At the risk of overstating this Essay’s claim, perhaps Chevron itself—and the related embrace of broad judicial deference to the administrative state of which it is part—is in some measure responsible for our current sorry political state.

This is an undesirable outcome. And, as framed here, it is not only unfortunate, but also problematic on separation of powers grounds. The intuition explored in this Essay is that Chevron dramatically exacerbates Congress’s worst tendencies, encouraging Congress to push its constitutional legislative duties to the Executive. Chevron thus effectively allows, and indeed encourages, Congress to abdicate its role as the most politically-accountable branch by deferring politically difficult questions to agencies. This argument is, at core, based in separation of powers concerns. While separation of powers concerns generally focus on preventing one branch of government from encroaching into the realm of the other branches, this Essay offers a twist, arguing that Chevron’s demurral to agency interpretations encourages a Congressional abdication of its constitutional responsibilities—and that such deference is therefore an abdication of the Judiciary’s constitutional role as a check on the problematic conduct of its sister branches.

Click here to read full paper.

In the “News Roundup” of episode 269. A McLaughlin Group for Cybersecurity, Gus Hurwitz covers the Supreme Court’s ruling on when a forum is subject to First Amendment limits. The full episode is embedded below.

https://www.steptoe.com/podcasts/TheCyberlawPodcast-269.mp3

William McGeveran’s recent article, The Duty of Data Security, is a significant contribution to ongoing debates about what duty firms holding electronic information about consumers owe in ensuring the security of that data. It also supports the opposite conclusion from that which McGeveran articulates. McGeveran frames the article as identifying a clear duty of data security. This response argues that in his efforts to locate a clear duty in existing data security law he has identified a standard that, in all meaningful ways, is one of subjective (not objective) reasonableness – and therefore offers no clarity at all. There is likely room for disagreement on both sides of this argument – both that which McGeveran makes and my response to it. The ultimate purpose of this response, however, is to recognize this aspect of the duty that McGeveran has identified and to reframe it in the familiar terms of objective vs. subjective reasonableness. This distinction is both useful and important, and has gone unremarked upon in two decades of discussions about the data security obligations.

Read the full response here.

ICLE Director of Law & Economics Programs Gus Hurwitz participated on the Consumer Protection Remedies: Economic & Legal Considerations panel at the 14th session of the FTC’s Hearings Initiative with Creighton University School of Law in Omaha, Nebraska on June 12, 2019. This concluded the FTC’s Hearings on Competition and Consumer Protection in the 21st Century. Video of the event is embedded below.

Gus Hurwitz joins Cyberlaw Podcast host Stewart Baker as they discuss topics ranging from the pending “techocalypse” to the FTC v. Qualcomm decision. Gus reads the runes to see whether a 50-year Chicago winter for antitrust plaintiffs is finally thawing in Silicon Valley. Gus thinks the predictions of global antitrust warming are overhyped. But he recognizes we’re seeing an awful lot of robins on the lawn: The rise of Margrethe Vestager in the EU, the enthusiasm of state AGs for suing Big Tech, and the piling on of Dem presidential candidates and the House of Representatives. Judge Koh’s Qualcomm decision is another straw in the wind, triggering criticism from Gus (“an undue extension of Aspen Skiing”) and me (“the FTC needs a national security minder in privacy and competition law”). The full episode is embedded below.

https://www.steptoe.com/podcasts/TheCyberlawPodcast-267.mp3