Antitrust Analysis Problems Text and Case 8th edition by Phillip E. Areeda, Louis Kaplow, Aaron S. Edlin, C. Scott Hemphill – Ebook PDF Instant Download/DeliveryISBN: 1543817492, 9781543817492
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ISBN-10 : 1543817492
ISBN-13 : 9781543817492
Author: Phillip E. Areeda, Louis Kaplow, Aaron S. Edlin, C. Scott Hemphill
Distinguished authorship characterizes Antitrust Analysis: Problems, Text, and Cases, first written by Phil Areeda, the leading antitrust commentator of the 20th century. The text continues to be revised by three of the leading lawyer economists of the early 21st century. This traditional casebook is also known for its pedagogy (cases, explanatory text, and problems) and insightful text that conveys essential background information along with necessary economic principles. Recognizing that the most important development in antitrust doctrine over the past fifty years is the increasingly central role of economic analysis, the authors take great care to convey economic learning to students in plain language with a minimum of technical apparatus, resulting in a powerful volume adopted by experienced instructors and first-time teachers alike. Helpful appendices include Selected Statutes, such as the Sherman Act, the Clayton Act, and the Federal Trade Commission Act. New to the Eighth Edition: The addition of C. Scott Hemphill as a co-author, adding to the already distinguished author team. Since the last edition, antitrust enforcers and courts have struggled to grapple with the rising importance of platforms in our increasingly digital economy. The new edition gives extensive attention to these developments, including: The Supreme Court’s decision in Ohio v. American Express Major enforcement actions against Apple, Facebook, and Google New Vertical Merger Guidelines Completely rewritten and streamlined introductory material in Chapter 1. Professors and student will benefit from: Distinguished authorship: Original author Areeda was the leading antitrust commentator of the 20th century; Kaplow, Edlin, and Hemphill are leading lawyer-economists of the early 21st century. Pedagogy: Traditional casebook with cases, explanatory text, and problems. Insightful textual explanations convey essential background information and necessary economic principles. Adopted by experienced instructors and first-time teachers alike. Appendix includes selected statutes and the Sherman Act, the Clayton Act, and the Federal Trade Commission Act. Teaching materials Include: Teacher’s Manual
Antitrust Analysis Problems Text and Case 8th Table of contents:
Chapter 1. The Setting for Antitrust Analysis
¶100 Prologue
¶101 Organization; caveat
¶102 Bibliographic note
Antitrust Study, Generally
¶103 Economic power
¶104 The antitrust laws:
(a) Nature of the statutes
(b) Legislative history; congressional role
¶105 Economic theory, uncertainty, and the judicial role
1A. The Role of Competition: Analytic Model and Useful Tendency
The Value of Perfect Competition
¶106 Perfect competition defined
¶107 Competition and efficiency
¶108 The dynamic adjustment process
¶109 Consumer decisions as the basis for market choice:
(a) Consumer preferences weighted by wealth
(b) Consumer choice “mistaken”
¶110 Market failures:
(a) Market power
(b) Externalities
(c) Public goods
(d) Imperfect information
¶111 The value of perfect competition and the role of antitrust policy
Perfect and Imperfect Competition Compared
¶112 Price and output decisions:
(a) Monopoly
(b) Perfect competition compared
(c) Oligopoly
¶113 Allocative efficiency
¶114 Barriers to entry
¶115 Cost minimization
¶116 Promotion and product differentiation:
(a) Product identification
(b) Product differentiation
¶117 Other values of competition:
(a) Income distribution
(b) The distribution of opportunities
(c) The control of unchecked power
(d) Fairness in economic behavior
(e) Economic stabilization
Possible Grounds for Deemphasizing Competition
¶118 The example of public restraints
¶119 Economies of scale
¶120 Invention and innovation:
(a) The argument
(b) Empirical evidence
¶121 Adjustment pains
¶122 Social responsibility
¶123 Countervailing power
¶124 The theory of second best
Workable Competition
¶125 The problem
¶126 Criteria
¶127 Summary
1B. Enacting the Antitrust Laws
¶128 Common-law background:
(a) Government-granted monopoly
(b) Restraints of trade
(c) Limiting corporate powers
¶129 Political background:
(a) Reform sentiment
(b) Political manifestations
¶130 Enactment of the Sherman Act: legislative history and contemporary political understanding:
(a) Relationship of Sherman Act and common law
(b) Senator Sherman
(c) H. Thorelli
(d) R. Hofstadter
(e) Antitrust policy goals in light of legislative history
¶131 Sherman Act: procedure and early cases:
(a) Procedure
(b) Early cases
¶132 The 1914 legislation
¶133 Later statutes and guidelines
1C. Procedures for Enforcing the Antitrust Laws
¶134 Sanctions generally
Criminal Punishment
¶135 Which statutes?
¶136 Government practice
¶137 Differentiating criminal offenses
Civil Enforcement
¶138 Introduction
¶139 DOJ enforcement
¶140 FTC enforcement
¶141 Federal enforcement in practice:
(a) Agency independence
(b) Intragovernmental coordination
(c) Litigating the big case
¶142 State enforcement
Private Actions
¶143 Injunctive relief
¶144 Treble damages:
(a) Generally
(b) Proving damages
(c) Suits by states
(d) Joint and several liability; contribution
¶145 Directness of injury:
(a) Introduction
(b) Indirect purchaser rule
(c) Standing
¶146 Antitrust injury:
(a) Brunswick
(b) Cargill
(c) Atlantic Richfield (ARCO)
Procedural Issues
¶147 Starting a case:
(a) Statutes of limitation
(b) Right to a jury
(c) Class actions
¶148 Ending a case: dispositive motions
¶149 Other issues:
(a) Res judicata
(b) Collateral estoppel
(c) In pari delicto
(d) Unclean hands
1D. The Reach of the Antitrust Laws
¶150 Introduction
Exemptions
¶151 Regulated industries
¶152 Labor unions
¶153 Industry-specific exemptions:
(a) Agriculture
(b) Airlines
(c) Banks
(d) Higher education
(e) Professional sports
State Law and State Action
¶154 Invalid state laws:
(a) Constitutional problems
(b) Preemption by federal patent law
(c) Preemption by federal antitrust law
(d) State antitrust laws
¶155 Antitrust immunity for state action:
(a) Basic rule
(b) Clear articulation
(c) Active supervision
(d) Insurance exemption
Foreign Commerce
¶156 Extraterritorial reach:
(a) Statutory development
(b) Comity
(c) Act of state
(d) Sovereign immunity
(e) OPEC
¶157 Restraints affecting exports
1E. The Patent System
¶158 Prologue:
(a) Relevance of patent laws to antitrust
(b) Introduction to patents
(c) Trade secret and copyright protections
Premises of the Patent System
¶159 Rationale
¶160 Costs of a patent system
¶161 Patents as incentives:
(a) Generally
(b) Need for protection
(c) Nonpatent incentives
(d) Development incentives
Operation of the Patent System
¶162 Patentability:
(a) Patentable subject matter
(b) Novelty
(c) Nonobviousness
(d) Utility
¶163 Obtaining a patent
¶164 Patent validity
¶165 Probabilistic patents
Overlap with Antitrust Law
¶166 Antitrust remedies
¶167 Patent misuse
Chapter 2. Horizontal Restraints: Collaboration Among Competitors
¶200 Prologue
2A. Development of the Rule of Reason and the Per Se Illegality of Price Fixing
¶201 Anticompetitive effect of cartels:
(a) The cartel problem
(b) Cheating in cartels
(c) Cartel justifications
(d) Preventing cutthroat competition
(e) Financing desirable activities
(f) Countervailing power
(g) Assessment
(h) Preview
Sherman Act §1
¶202 Trans-Missouri
Addyston Pipe & Steel
¶203 Joint Traffic
¶204 Standard Oil
¶205
Chicago Board of Trade
¶206
Trenton Potteries
¶207
¶208 Appalachian Coals
Socony-Vacuum Oil
¶209
¶210
¶211
¶212 Per se rules:
(a) Rationale
(b) Meaning: scope of inquiry
(c) Meaning: coverage of category
2B. Determining Which Restraints Are Reasonable
¶213 Introduction
¶214 Cartel variations:
(a) Allocating markets
(b) Other limits on price competition
Topco Associates
¶215
¶216 Palmer
Broadcast Music (BMI)
¶217
Maricopa County Medical Society
¶218
National Society of Professional Engineers
¶219
¶220
National Collegiate Athletic Association
¶221
California Dental
¶222
¶223 Joint ventures—introduction
¶224 Government health care enforcement policy statements
¶225
¶226 Statutory protection for some joint ventures
¶227
¶228 Guidelines for Collaborations Among Competitors
¶229
2C. When Does an Agreement Exist?
¶230 Introduction
Oligopoly Theory
¶231 The oligopoly or shared monopoly problem
¶232 Oligopoly—basic model and theory:
(a) Simple case
(b) Elements of successful oligopoly
(c) Cartels compared
(d) Relevance of number of firms
(e) Oligopoly pricing in the absence of cooperative behavior
¶233 Factors affecting likelihood of oligopolistic coordination:
(a) Introduction
(b) Divergent interests
(c) Available channels of verbal and nonverbal communication
(d) Price comparability of products
(e) Nonprice competition
¶234 Factors affecting the potential gains from successful coordination, express or tacit:
(a) Fringe expansion
(b) Substitute products or new entry
¶235 Evidence on oligopoly pricing in the economy:
(a) Measuring economic performance and concentration
(b) The empirical evidence on concentration and oligopoly pricing
Inferred Express Agreements and Tacit Agreements
¶236 What constitutes an agreement?
¶237 Eastern States
Interstate Circuit
Theatre Enterprises
American Tobacco
¶238
¶239
¶240 Later cases:
(a) Matsushita Electric
(b) Brooke Group
(c) Twombly
¶241 Plus factors:
(a) Introduction
(b) Indications of express collusion
(c) Motive to conspire
(d) Acts against self-interest
(e) Plus factors and express coordination
Text Messaging
¶242
Single Entity Doctrine
¶243 Introduction
Copperweld
¶244
¶245 Additional issues
American Needle
¶246
¶247 Texaco
2D. Facilitating Practices
¶248 Introduction
¶249
¶250 Information exchange
American Column & Lumber
Maple Flooring
¶251
Container Corp.
¶252
¶253
¶254 General Motors
¶255 Basing point pricing:
(a) Description
(b) Economic effects
(c) Collusion or competition?
(d) Legal issues
Cement Institute
¶256
¶257
¶258 Remedies for basing point pricing
¶259 du Pont v. Federal Trade Commission
¶260
2E. Concerted Refusals to Deal
¶261 Introduction
¶262 Early cases:
(a) Eastern States
(b) Cement Manufactuers
(c) Paramount Famous Lasky
(d) McCann
Fashion Originators’ Guild (FOGA)
¶263
¶264
Klor’s
¶265
¶266
(a) American Medical
(b) Molinas
(c) Proposition
¶267
Associated Press (AP)
¶268
¶269
Northwest Wholesale Stationers
¶270
¶271
Indiana Federation of Dentists
¶272
¶273 NYNEX
¶274 Additional varieties of concerted refusals to deal
¶275 Summary
2F. Influencing Government Action
¶276 Introduction
Noerr Motor Freight
¶277
California Motor Transport
¶278
Professional Real Estate
¶279
Omni Outdoor Advertising
¶280
Allied Tube
¶281
¶282 Missouri v. National Organization for Women
Superior Court Trial Lawyers Association (SCTLA)
¶283
2G. Intellectual Property Licensing and Settlements
¶284 Introduction
Price-Restricted Licenses and the IP–Antitrust Tension Generally
General Electric Co.
¶285 The IP–antitrust conflict:
(a) Is there a conflict?
(b) Formalistic resolutions
(c) Resolving the conflict
¶286 Use, assignment, or licensing
¶287 Price and related restrictions in IP licenses:
(a) Reasons for refusing to license without a price restriction
(b) Output limitations
(c) Territorial limitations
(d) Exclusive licenses
(e) IP licenses and vertical restraints
¶288 Suppression; compulsory licensing:
(a) Nonuse explained
(b) Precedent
(c) De facto compulsory licensing
(d) Compulsory licensing
¶289
¶290
¶291 Scope of the GE rule:
(a) Multiple patentees
(b) Multiple licenses
(c) Unpatented product or nonmanufacturing patentee
Use Restrictions
¶292 Introduction
¶293 Price discrimination, patent exploitation, and use restrictions:
(a) Discrimination’s nature and prerequisites
(b) Discrimination’s consequences
(c) Discrimination and patent exploitation
(d) Use restrictions and discriminatory royalties
¶294 The legality of use restrictions
(a) General Talking Pictures
(b) Limiting use of purchased patented product
¶295
IP Settlements
¶296 The problem:
(a) Private benefits of IP settlement
(b) Social benefits of settlement
¶297 The legality of IP settlements
¶298
Actavis
¶299
Chapter 3. Monopoly
¶300 Prologue
Sherman Act §2
¶301 Useful definitions
3A. Monopolization
The Distinction Between Monopoly and Monopolization
¶302 The bad conduct element
¶303 Early landmarks
(a) Standard Oil
(b) American Tobacco
(c) American Can
(d) United States Steel
¶304
Alcoa
¶305
¶306
¶307 American Tobacco
¶308 Remedies in Alcoa
¶309
¶310 No-fault monopoly and oligopoly
¶311 Monopoly and oligopoly compared
¶312 Sherman Act §2 coverage
Leverage and the Single Monopoly Profit Theory
¶313 Is leverage an act of monopolization or a way to enjoy monopoly profits?
Griffith
¶314
Refining the Notion of Exclusionary Behavior
United Shoe Machinery Corp.
¶315 The monopolization test: Grinnell
¶316
¶317
¶318
¶319
¶320
¶321
Microsoft Corp.
¶322
¶323
¶324 Remedies in Microsoft
Vertical Integration and Dealing with Competitors
¶325 Vertical integration in brief:
(a) Overview
(b) A second monopoly? Or is it “only” price discrimination?
(c) Avoiding successive monopoly
(d) Avoiding inefficient input substitution
(e) Long-run effects on market structure and performance
(f) Summary
¶326 Otter Tail Power
¶327 Berkey Photo
Aspen Skiing Co.
¶328
¶329
¶330 The AT&T breakup
Trinko
¶331
¶332
¶333
¶334
¶335 Proposals to rein in Big Tech
Predatory Pricing
Barry Wright Corp.
¶336
¶337
Brooke Group Ltd.
¶338
AMR
¶339
¶340
Weyerhaeuser Co.
¶341
¶342 linkLine
Monopolization with Patents: Standards-Essential Patents and Patent Accumulation
¶343 Standards-essential patents and patent accumulation:
(a) Standards-essential patents
(b) Patent accumulation: development and acquisition
¶344 The authorities on accumulation
¶345
¶346
3B. Monopoly Power
¶347 Introduction
¶348 Monopoly and market power:
(a) Defining monopoly in terms of market power
(b) The price of monopoly
(c) Market power as power over price
(d) Market power and the goals of the antitrust laws
¶349 Ways of measuring market power:
(a) Introduction
(b) Difficulty of direct measurement
(c) Unexploited power
(d) Prospective power
(e) Power inferred from conduct
¶350 Determinants of market power:
(a) Buyer responsiveness determines seller’s power
(b) Price at which buyers’ alternatives are assessed
(c) High margins under monopolistic competition
¶351 Market definition, the relevant market, and market share:
(a) The market definition concept
(b) Market share and market power
(c) Group power
(d) Later developments
¶352 More about product market substitution:
(a) Differentiated products, different brands
(b) Physically different products
(c) Elasticity versus cross-elasticity
¶353 Geographic market definition
¶354 Supply responses:
(a) Expansion by immediate competitors
(b) Supply substitution
(c) Entry
¶355 Summary of market power: unavoidable approximations
¶356 Market definition and measurement under the Horizontal Merger Guidelines
Horizontal Merger Guidelines
¶357 Issues in determining the relevant market and monopoly power in practice:
(a) The hypothetical monopolist test
(b) Interpreting market shares
Alcoa
¶358
¶359
du Pont (Cellophane)
¶360 du Pont’s profits
¶361
¶362
¶363
Microsoft Corp.
¶364
¶365
¶366 Market definition for two-sided platforms:
(a) Introduction
(b) American Express Co.
¶367
3C. Attempt to Monopolize
¶368
Lorain Journal
¶369
¶370
¶371 American Airlines
Spectrum Sports
¶372
Chapter 4. Vertical Restraints
¶400 Prologue
4A. Restricted Distribution
¶401 Introduction
The Per Se Era
¶402 Introduction
Dr. Miles Medical Co.
¶403
¶404 Fair trade laws
¶405 Albrecht
¶406 Arnold, Schwinn
The Rule of Reason Revolution
¶407 The basic differences between vertical relationships and horizontal ones
¶408 Why manufacturers sometimes limit dealer markups to increase sales
¶409 Higher distributor markups might purchase better distribution for a manufacturer:
(a) High markups may buy dealer salesmanship and marketing
(b) Absent RPM, territorial or other restraints, free riding could limit dealer efforts
(c) Markups may purchase market penetration
(d) What is good for the manufacturer is not necessarily good for consumers
¶410 Dealer-inspired restrictions
¶411 RPM could facilitate price coordination among manufacturers
GTE Sylvania
¶412
¶413
¶414
Khan
¶415
Leegin
¶416
Agency and Similar Relationships
¶417 Agency and partial vertical integration
¶418
Refusal to Deal and Vertical Agreement
¶419 The vertical agreement puzzle
Colgate & Co.
¶420
¶421 Parke, Davis
Monsanto Co.
¶422
¶423
4B. Tying Arrangements
¶424 Introduction and variations
¶425 Business reasons for tying:
(a) Monopoly in the tied product
(b) Avoiding inefficient input substitution
(c) Price discrimination
(d) Disguising price
(e) Cost savings
(f) Quality control or improvement
(g) Summary
¶426 Development in patent cases:
(a) Motion Picture Patents
(b) Later elaboration
(c) Tying by patentees and the antitrust laws
¶427 Tying under the Clayton Act
Clayton Act §3
International Salt Co.
¶428
Northern Pacific Railway Co.
¶429
¶430
¶431 Mandatory package licensing of patents:
(a) Justifications for packages
(b) Findings of illegality
(c) Related patents
(d) Identifying a mandatory package
¶432 Patent royalty base
(a) Duration of payments
(b) Sale price of unpatented products
¶433 International Business Machines
Jerrold Electronics Corp.
¶434
¶435
¶436
¶437 Fortner Enterprises
¶438
¶439 Coping with noninjurious ties
Jefferson Parish Hospital
¶440
Eastman Kodak Co.
¶441
Microsoft Corp.
¶442
¶443 Illinois Tool Works
4C. Exclusive Dealing and Other Interbrand Restraints
Exclusive Dealing
¶444 Introduction
¶445 Objects of exclusive dealing:
(a) Preempting outlets
(b) Assured markets or prices for sellers and buyers
(c) Promoting dealer loyalty and investment
(d) Other cost savings
Standard Oil Co. (Standard Stations)
¶446
¶447
¶448 Motion Picture Advertising Service
¶449
¶450 Tampa Electric
¶451
¶452
¶453
Barry Wright Corp.
¶454
Bundled Discounts and Loyalty Discounts
¶455 Similarities to tying and exclusive dealing
¶456 Loew’s
¶457 LePage’s
¶458 PeaceHealth
¶459
Antisteering Agreements
American Express Co.
¶460
Chapter 5. Mergers: Horizontal, Vertical, and Conglomerate
¶500 Prologue
5A. Concentration Levels and Merger Motivations
¶501 The extent of concentration
¶502 Merger motives:
(a) Anticompetitive reasons
(b) Easier expansion or entry
(c) Operating efficiencies and scale economies
(d) Financial gains without new efficiencies
(e) Financial gains with new efficiencies
(f) Management goals
(g) Substituting better management
(h) Defensive mergers
(i) Exit
(j) The net reckoning
5B. Introduction to Merger Law
¶503 Early Sherman Act cases:
(a) Northern Securities
(b) Union Pacific
(c) United States Steel
(d) Columbia Steel
Clayton Act §7
¶504 Legislative history of amended §7:
(a) Brown Shoe Co.
(b) D. Bok
¶505 Preliminary issues:
(a) Role of market definition
(b) Monopoly and merger compared
(c) Multiple markets
¶506 Modern merger practice
¶507 Agency settlements:
(a) Divestitures
(b) Behavioral remedies
¶508 Merger challenges beyond the agencies
5C. Horizontal Mergers
¶509
Brown Shoe Co.
¶510
¶511
Philadelphia National Bank
¶512
¶513
¶514
¶515 The Philadelphia Bank presumption
¶516 Continental Can
¶517 Von’s Grocery
¶518 Reduced antagonism to mergers
General Dynamics Corp.
¶519
¶520 The failing company defense
¶521 Horizontal Merger Guidelines: introduction
Horizontal Merger Guidelines
Staples
¶522
¶523
¶524
¶525 Hospital mergers
Butterworth Health Corp.
¶526
¶527
¶528
¶529 Efficiencies:
(a) Introduction
(b) Economies of scale or of production allocation
(c) Economies outside the horizontal context
(d) Financing efficiencies
(e) Acquiring efficiencies through contract, not merger
¶530
¶531
¶532
¶533 Oracle
¶534 Critical loss analysis
H&R Block
¶535
¶536 Eliminating potential competition
(a) Generally
(b) The relationship between present and potential future competition
¶537 Procter & Gamble Co. (Clorox)
¶538 Potential competition case law:
(a) Perceived potential competition
(b) Actual potential competition
(c) The toehold doctrine
(d) Potential competition and joint ventures
¶539
¶540
¶541 Interlocking directorates
5D. Vertical Mergers
¶542 Early development:
(a) Sherman Act cases
(b) du Pont (General Motors)
Brown Shoe Co.
¶543
¶544 Vertical Merger Guidelines
Vertical Merger Guidelines
¶545 Theories of harm
(a) Raising rivals’ costs through increased bargaining leverage
(b) Access to competitively sensitive information
(c) Coordinated effects
¶546
¶547
5E. Conglomerate Mergers
¶548 The conglomerate problem
¶549 Procter & Gamble Co. (Clorox)
¶550 Predation, pricing discipline, and the powerful firm:
(a) Predation
(b) Pricing discipline or leadership
¶551 Reciprocity:
(a) Generally
(b) Consolidated Foods Corp.
(c) Discussion
¶552 International Telephone & Telegraph
Chapter 6. Discrimination Under the Robinson-Patman Act
¶600 Prologue
Clayton Act §2(a) and §2(b)
¶601 General requirements of §2(a)
¶602 The development of §2:
(a) The original provision
(b) Background of the 1936 legislation
6A. Primary-Line Injury
¶603
¶604 Utah Pie
¶605 Brooke Group
6B. Secondary-Line Injury
Morton Salt Co.
¶606
¶607
Texaco
¶608
¶609
¶610 Borden
¶611
Volvo Trucks
¶612
6C. Affirmative Defenses Under §2(a) and §2(b)
Cost Justification
¶613 Introduction:
(a) Scope of defense; burden of proof
(b) The relevant costs
Borden
¶614
Meeting Competition in Good Faith
¶615 Introduction
¶616 Good faith and knowledge of rivals’ prices:
(a) A.E. Staley Manufacturing
(b) United States Gypsum
(c) Great Atlantic & Pacific Tea Co. (A&P)
¶617
¶618 Good faith and pricing systems:
(a) A.E. Staley Manufacturing
(b) Falls City Industries
¶619
¶620
6D. Supplementary Provisions
Buyer Liability
¶621 Congressional concern with buyers
¶622 Automatic Canteen
Great Atlantic & Pacific Tea Co. (A&P)
¶623
Brokerage
Clayton Act §2(c)
¶624 The brokerage prohibition:
(a) Statutory purpose as stated by the Supreme Court
(b) Requirements for violation and availability of defenses
(c) When brokerage is “for services rendered”
(d) Identifying “a commission, brokerage, or other compensation, or any allowance or discount in lieu thereof”
(e) Application to commercial bribery
(f) Buyer liability
Discriminatory Allowances or Services
Clayton Act §2(d) and §2(e)
¶625 The prohibition on discriminatory allowances or services:
(a) The statutory concern
(b) Requirements for violation and availability of defenses
(c) When is an allowance or service “available on proportionally equal terms”?
(d) The competing customer requirement
(e) Distinguishing price discrimination from promotional allowances
(f) Buyer liability
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