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Scholarship Abstract This Article critiques the “Law and Political Economy” (LPE) framework. It aims to challenge the Law and Economics (L&E) approach. We argue that LPE . . .
This Article critiques the “Law and Political Economy” (LPE) framework. It aims to challenge the Law and Economics (L&E) approach. We argue that LPE lacks a coherent theoretical foundation and fails to engage with empirical evidence, rendering its critiques of markets, law, and political economy incomplete and unpersuasive. By contrast, L&E provides robust analytical tools and a well-developed understanding of legal and market dynamics, is grounded in empirical research, and has theoretical consistency. We illustrate these points through historical examples in the evolution of L&E and suggest ways LPE can evolve to offer a meaningful alternative. Rigorous intellectual competition will advance the understanding of law and its role on the economy.
Popular Media Competition benefits consumers, not just through lower prices and better quality, but also by protecting them against fraudulent practices. Clear-eyed government regulation can promote competition . . .
Competition benefits consumers, not just through lower prices and better quality, but also by protecting them against fraudulent practices. Clear-eyed government regulation can promote competition and consumer protection by stomping out fraudulent and deceptive practices as well as facilitating the flow of accurate, easy-to-understand information. But what happens when the government is the source of bad information and uses that to promote specious claims that competition has “failed”? In the case of the Consumer Financial Protection Bureau, another round of misleading economic analysis is being used to justify further intrusions on market competition that could confuse consumers and lead to worse regulation.
Read the full piece here.
Scholarship Abstract A significant debate in patent law today concerns what remedy a patent owner may receive when a court finds a defendant liable for patent . . .
A significant debate in patent law today concerns what remedy a patent owner may receive when a court finds a defendant liable for patent infringement. In eBay v. MercExchange (2006), the Supreme Court held that courts must use a “four-factor test historically employed by courts” for issuing injunctions that represented a “long tradition of equity practice.” Chief Justice John Roberts further claimed in a concurrence that, from “the early 19th century, courts have granted injunctive relief upon a finding of infringement in the vast majority of patent cases.”
Both of these historical claims are conventional wisdom today in law and scholarship, and both claims are empirically unverified. This article tests both historical claims in reporting the results of a database of 899 opinions in which federal courts sat in equity in patent lawsuits. The database comprises opinions by trial courts and appellate courts in lawsuits filed between 1790 and 1880 that are compiled in the Federal Cases reporter.
The database confirms and challenges the conventional wisdom. First, eBay is wrong: there was no four-factor test in the “long tradition of equity practice” in patent cases. In the 899 opinions, no judge applied a four-factor test in granting an injunction, either for a permanent or a preliminary injunction. Second, Chief Justice Roberts is correct: courts did grant permanent injunctions in a vast majority of cases as a remedy for patent infringement. In the 899 opinions, courts awarded permanent injunctions in 93.7% of the cases in which a defendant infringed a valid patent. Given the stark absence of a four-factor test, the article concludes by describing the historical equitable jurisprudence applied by federal courts. Based on the opinions, it describes how courts applied the same equitable doctrines and principles in patent cases as in redressing continuing trespasses of real property, protecting patents as much as they protected real estate and other property interests.
Popular Media A February report from the Committee on Digital Competition Law (CDCL) recommended special competition rules for digital markets in India. It was accompanied by a draft Digital . . .
A February report from the Committee on Digital Competition Law (CDCL) recommended special competition rules for digital markets in India. It was accompanied by a draft Digital Competition Act (DCA) that is virtually identical to the European Union’s Digital Markets Act (DMA). Since it entered into force early last month, the DMA has imposed strict preemptive rules on so-called digital “gatekeepers,” a cohort of mostly American tech giants like Google, Amazon, Apple, Meta, and Microsoft.
Popular Media In a recent article for ProMarket, Jonathan Masur and Eric Posner defend the legality of the Federal Trade Commission’s rule banning noncompetes. However, little of their argument addresses the . . .
In a recent article for ProMarket, Jonathan Masur and Eric Posner defend the legality of the Federal Trade Commission’s rule banning noncompetes. However, little of their argument addresses the widespread contrary arguments against the ban.
On the Yale Journal of Regulation Notice and Comment Blog, Dan Crane recently shared the results of an informal survey of antitrust and administrative law professors. Of his 17 respondents, “Only one person predicted that the rule will be upheld.” Both the Wall Street Journal and Washington Post editorial boards have argued that the FTC lacks congressional authority to issue the rule. While it is risky to draw inference from silence, it seems notable that the New York Times editorial board, a long-time advocate for FTC Chair Lina Khan and early supporter of the noncompete rule, has not opined. A recent Congressional Research Service report characterizes the FTC’s legal authority to issue such rules as “unsettled.”
Scholarship Abstract Scholars have widely criticized the Supreme Court’s Fourth Amendment jurisprudence as incoherent, especially in cases involving emerging technologies. This Article argues that to understand . . .
Scholars have widely criticized the Supreme Court’s Fourth Amendment jurisprudence as incoherent, especially in cases involving emerging technologies. This Article argues that to understand Fourth Amendment doctrine, one must consider how the values that underlie the Court’s decisions are balanced against each other and shift over time. To do so, this Article first proposes a novel, bottom-up approach to identifying the relevant values that focuses on the specific evidence that the Court considers in each case. Distilling the values underlying the Fourth Amendment provides a more coherent understanding of Fourth Amendment doctrine. This Article then applies this framework to three biometric technologies: facial recognition, iris recognition, and DNA profiling. Law enforcement use of these technologies may all raise Fourth Amendment challenges, but the framework shows how these challenges implicate different values. Recognition and application of this framework can result in a better appreciation of the impact of emerging technologies on Fourth Amendment doctrine.
Read at SSRN.
TOTM Aaron, could you please tell us a bit about your background and how you became interested in competition law and digital-competition regulation? I’m a lawyer . . .
I’m a lawyer by profession, but have taken a somewhat unconventional career path—I started as a litigator in a small general practice in my hometown outside Toronto, moved on to corporate law with one the world’s biggest law firms in London, Hong Kong, and Abu Dhabi, and then came back to Canada, where I moved through roles in polling and market research, lobbying, and tax advocacy. For the last three years, I’ve run the Domestic Policy Program at the Macdonald-Laurier Institute, an Ottawa-based think tank. Competition law—and especially the emergence of dominant digital players—has been one of my biggest files, primarily because it has become so politically salient in recent years.
Scholarship Abstract Decentralized Finance (DeFi) on Ethereum lacks a clear legal framework akin to what exists in traditional financial markets, leading to uncertainty for traders, intermediaries, . . .
Decentralized Finance (DeFi) on Ethereum lacks a clear legal framework akin to what exists in traditional financial markets, leading to uncertainty for traders, intermediaries, and other market participants regarding their protections, responsibilities, and risk exposures. Key concepts like what constitutes a “transaction,” who serves as a transaction counterparty, and what duties are owed remain undefined. This paper aims to clarify the legal journey of Ethereum transactions, focusing on the stages of trade instruction and execution. We examine the complex technical processes and actors involved, highlight areas where end-user expectations may be violated, discuss potential sources of legal liability, and explore whether certain DeFi activities like DEX trading should be governed by contract law. The paper assesses various parties, including validators, DEX liquidity providers, and smart contracts themselves, as potential legal counterparties to a DeFi trader. Based on this analysis, we provide recommendations for the development of a legal framework to enhance certainty and efficiency in DeFi markets. Establishing clear rules around trade instruction, execution, and liability allocation would enable more accurate risk assessment, support market participation and liquidity, and facilitate the healthy development of the DeFi ecosystem.
Scholarship Abstract In the first quarter of 2024, the Stanford Computational Antitrust project team invited its partnering antitrust agencies to share their advances in implementing computational . . .
In the first quarter of 2024, the Stanford Computational Antitrust project team invited its partnering antitrust agencies to share their advances in implementing computational tools. The 16 contributions received provide a distinctly broad geographical representation, offering an overview of global developments. In terms of the substantive focus of the agencies, the main trends that can be discerned are the following: i) emphasis on the detection of bid rigging practices; ii) focus on practices that harm end consumers (e.g., price increases in fuels, airplane tickets; detection of dark patterns); and iii) significant investments in detecting the public perception of market competition. In terms of the computational tools used, the key developments are: i) the gradual integration of large language models (LLMs) in the daily operations of the agencies; ii) increasing reliance on machine learning (ML) tools for analyzing sizeable volumes of textual data; and iii) the development of Proof-of-Concept Application Programming Interfaces (APIs).
