ANTITRUST: ANTITRUST LAW & POLICY eJOURNAL

"Behavioural Antitrust - A 'More Realistic Approach' to Competition Law" Free Download
Klaus Mathis (ed.), European Perspectives on Behavioural Law and Economics, 2015, p. 211 – 242

ANDREAS HEINEMANN, University of Zurich
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The paper explores the potential of behavioural economics for competition law. After a summary of the most important behavioural findings from a competition law perspective, several applications are presented. Behavioural economics does not only influence basic concepts like the definition of relevant markets but also affects the competition law analysis of specific conduct like vertical agreements, practices on aftermarkets, tying and bundling, conditional rebates, predatory pricing and merger control. Moreover, the behavioural insights have an impact on the shaping of remedies and sanctions. In spite of these consequences, it seems more appropriate to describe this development as a “behavioural turn? than a “behavioural revolution? since traditional analysis is not replaced but complemented. Therefore, the new insights can be integrated into the existing system without major frictions. Although the behavioural approach more often makes a case for enforcement than against it, it cannot be blamed for greater interventionism. The goal of the “more realistic approach? is, no more and no less, to base competition law on a more reliable foundation.

"Intellectual Property Rights and Antitrust in China" Free Download
IP Protection in China 299-318, Donna P. Suchy, Ed. (ABA Publishing 2015)

YEE WAH CHIN, Ingram Yuzek Gainen Carroll & Bertolotti, LLP
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China’s Anti-Monopoly Law (AML) came into effect on August 1, 2008, following its enactment the year before and 13 years of drafting. China enacted the Third Amendments to its Patent Law on December 26, 2008, effective October 1, 2009. This chapter summarizes the AML, and discusses those aspects that may have particular impact on intellectual property rights (IPR), as well as the provision of the Patent Law that implicates competition law issues and the implementing regulations and Judicial Interpretations relating to those laws that involve the IPR-competition law interface.

"A Socioeconomic Approach to Antitrust: Unpacking Competition, Consumer Surplus, and Allocative Efficiency" Free Download

JEFFREY LYNCH HARRISON, University of Florida - Fredric G. Levin College of Law
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The primary function of socioeconomics is to ask questions and broaden the discussion. I have attempted to do that by unpacking and contextualizing the two economic goals of antitrust law – maximizing consumer surplus and allocative efficiency. I have avoided what I believe is today’s faith-based approach as exemplified by the Supreme Court. That approach has now gone beyond economics and seems to reveal, in its most benign form, a deep distrust of government.

At its most basic and obvious level the two antitrust goals cede to those with income – earned or not – the right to determine how scarce resources will be used. That may be fine in many respects and may be far superior to any other method. The problem is that consumer surplus is under-inclusive, recognizes only a small universe of values, and falls well short of measuring actual well-being. When the focus is on allocative efficiency and costs of production, antitrust courts and enforcement agencies are unlikely to recognize all costs and can perpetuate a race to exploit. To the extent the race to exploit is repugnant to some, they may be able to express that in markets but only to a limited extent.

"Patent Pools and Related Technology Sharing" Free Download

HERBERT J. HOVENKAMP, University of Iowa - College of Law
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ERIK N. HOVENKAMP, Northwestern University, Department of Economics
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A patent "pool" is an arrangement under which patent holders in a common technology commit their patents to a single holder, who then licenses them out to the original patentees and perhaps also to outsiders. The payoffs include both revenue earned as a licensor, and technology acquired by pool members as licensees. Public effects can also be significant. For example, technology sharing of complementary patents can improve product quality and variety. In some information technology markets pools can prevent patents from becoming a costly obstacle to innovation by clearing channels of technology transfer. By contrast, a pool's aggregate output reduction or price fixing in a product market can produce cartel profits.

A traditional justification for patent pools is that they facilitate improved products by uniting complements Sharing of complementary patents means that licensees can then employ all the patents in their product, rather than creating silos in which each manufacturer incorporates only its own patented features. Pools created for this purpose can reduce problems of royalty stacking and holdup, as well as problems involving blocking patents. A more robust explanation for pooling in many markets comes out of the economics of transaction costs, which emphasizes the role of limited information and the costs of obtaining it, as well as uncertainty in bargaining and sharing. Pooling is an efficient solution to problems of technology development and transfer when determining patents' validity or identifying their boundaries is costly. In this sense, patent pools function much as traditional common pool resources.

An individual patent’s boundaries distinguish its protected technological embodiments from noninfringing technology. But when multiple patents are aggregated what really matters are the outer boundaries that separate the portfolio as a whole from outside patents or the public domain. So long as the relevant rights are somewhere in the portfolio, the parties do not need to delineate the boundaries of individual patents in order to strike a deal. While most patent pools are socially beneficial, certain practices or structures can pose competitive problems. The biggest antitrust risk from pooling is collusion, and its threat depends on two things. First is the market structure and the power of the pool within its market. Second is the nature of pricing and exclusivity arrangements within the pool. Pool "exclusivity" can take several forms. First, it can refer to the contract that each licensor has with the pool, asking whether that licensor is free to license to others outside of the pool. Second it can refer to the pool’s willingness as licensee to accept an offered technology from an outsider for inclusion in the pool. Third it can refer to the pool's willingness as licensor to license to outsider manufacturers. Fourth, it can refer to field-of-use or other restrictions given to licensees from the pool.

A large but inconclusive literature considers the relationship between pooling and innovation. Conclusions are sensitive to assumptions about patent strength and quality, about the relationship among the patents in a pool and the strength of alternatives outside the pool, about the impact on innovation of insiders vs. outsiders to the pool, and finally, about the strategic responses of participants. Most of the literature concludes that most pools increase innovation rates. A pool should increase the demand for innovation of complements to the pool. First of all, access to the existing technology by pool members should be guaranteed and cheaper. To the extent the pool reduces licensing costs and eliminates royalty stacking the cost of further improvements should decline. When innovation is cumulative the development of new technology may require the licensing of existing technology with multiple patent holders. Pooling can reduce these costs and thus facilitate cumulative innovation.

"Access to Evidence and Presumptions – Communicating Vessels in Procedural Law" Free Download
Hüschelrath/Schweitzer (eds.), Public and Private Enforcement of Competition Law in Europe – Legal and Economic Perspectives, 2014, p. 167 – 191

ANDREAS HEINEMANN, University of Zurich
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In the discussion on the European Commission’s White Paper on Damages Actions, the proposals on the disclosure of evidence have attracted great attention and have met with approval by some observers and with rejection by others. The critics point to the risk of introducing a US-style litigation culture in Europe. What is less noticed in this discussion is the fact that some continental legal orders have found another way to fix the problem of evidence: special presumptions are used. In this contribution, the relationship between disclosure obligations and presumptions will be scrutinized. We will see that the success of presumptions is not necessarily due to their substantial persuasiveness but to their role of filling in the continental gaps in the field of disclosure. The advantages and disadvantages of both instruments and their economic rationale shall be discussed.

"Weyerhaeuser: An Epilogue" Free Download

JEFFREY LYNCH HARRISON, University of Florida - Fredric G. Levin College of Law
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Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber Co., could have been influential in three ways. First, the Court directly addressed the standard for predatory buying and, consequently, has undoubtedly had an impact on whether plaintiffs will rely on that theory. Second, its express recognition of the similarities between buyers and sellers may encourage increased reliance on monopsony-based theories of liability. Finally, the decision could have created the impetus for refining the analysis of a number of issues when they arise in monopsony contexts. These include monopsony tying, the use of monopsony power to gain power on the selling side of markets, as well as standing and antitrust injury. This study of post-Weyerhaeuser events demonstrates that it is a narrow opinion perhaps only economically suitable for very few special fact patterns. It is frequently ignored although sometimes relied upon by defendants who attempt to reframe their cases as Weyerhaeuser-like in hopes of a dismissal.

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About this eJournal

This eJournal distributes working and accepted paper abstracts dealing with all aspects of antitrust and competition policy, including mergers, cartels, monopolies, and price discrimination.

Editor: John Shepard Wiley, Independent

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Directors

ANTITRUST & REGULATED INDUSTRIES EJOURNALS

BERNARD S. BLACK
Northwestern University - School of Law, Northwestern University - Kellogg School of Management, European Corporate Governance Institute (ECGI)
Email: bblack@northwestern.edu

RONALD J. GILSON
Stanford Law School, Columbia Law School, European Corporate Governance Institute (ECGI)
Email: rgilson@leland.stanford.edu

Please contact us at the above addresses with your comments, questions or suggestions for LSN-Sub.

Advisory Board

Antitrust: Antitrust Law & Policy eJournal

JAMES R. ATWOOD
Covington & Burling

JONATHAN B. BAKER
Professor of Law, American University - Washington College of Law

MAXWELL M. BLECHER
Attorney at Law, Blecher and Collins

DENNIS W. CARLTON
Professor, University of Chicago - Booth School of Business, National Bureau of Economic Research (NBER)

FRANK H. EASTERBROOK
Senior Lecturer, University of Chicago Law School

NICHOLAS ECONOMIDES
Executive Director, Networks, Electronic Commerce, and Telecommunications Institute, Professor of Economics, New York University - Leonard N. Stern School of Business - Department of Economics

EINER R. ELHAUGE
Professor of Law, Harvard Law School

ELEANOR M. FOX
Professor of Law, New York University School of Law

HERBERT J. HOVENKAMP
Professor, University of Iowa - College of Law

LOUIS KAPLOW
Professor of Law, Harvard Law School, National Bureau of Economic Research (NBER)

DANIEL L. RUBINFELD
Professor, University of California at Berkeley - School of Law, National Bureau of Economic Research (NBER), NYU Law School

CARL SHAPIRO
University of California, Berkeley - Haas School of Business