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The Rule of Reason After California Dental

18 Pages Posted: 21 Nov 2000  

Timothy J. Muris

George Mason University School of Law

Date Written: 2000

Abstract

Antitrust practioners, scholars, and jurists have struggled for decades with the appropriate form of analysis for restraints among competitors. One theme that emerges from this struggle is that, since the Warren Court era, there has been much progress. Per se categorization no longer determines results in antitrust cases. Nevertheless, as California Dental reveals, the steps of applying the Rule of Reason remains elusive. For restraints that clearly threaten consumer welfare, the crucial issue has become whether the collaborators can justify them. By blessing "truncated" analysis explicitly, CDA demonstrates that categorization remains necessary to determine when such analysis is appropriate for the practice at hand. I argue that the decision to truncate must be based on probable economic effects, not just on analogies. Empirical economic evidence provides the basis for determining these effects. In CDA, for example, although not part of the record, considerable empirical evidence exists to show that when professionals restrict advertising, even partially, prices increase without an offsetting increase in quality. Finally, I argue that the FTC's 1988 Massachusetts Board decision remains highly useful in determining the steps of truncated analysis.

Suggested Citation

Muris, Timothy J., The Rule of Reason After California Dental (2000). George Mason Law & Economics Research Paper No. 00-41. Available at SSRN: https://ssrn.com/abstract=250156 or http://dx.doi.org/10.2139/ssrn.250156

Timothy J. Muris (Contact Author)

George Mason University School of Law ( email )

3301 Fairfax Drive
Arlington, VA 22201
United States
703-993-8050 (Phone)
703-993-8088 (Fax)

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