'Vexatious'/'Sham' Litigation in EU and US Antitrust Law: A Mechanism Design Approach

Antitrust Bulletin, Vol. 62, No. 4, 2017

CLES Research Paper Series 1/2017, ISBN: 978-1-910801-14-7

63 Pages Posted: 20 Dec 2017

See all articles by Ioannis Lianos

Ioannis Lianos

University College London - Faculty of Laws; BRICS Competition Law & Policy Centre - HSE National Research University

Pierre Regibeau

University of Essex - Department of Economics; Centre for Economic Policy Research (CEPR)

Date Written: August 22, 2017

Abstract

In both the US and the EU, the antitrust category of “sham litigation” (in the US) or “vexatious litigation” (in the EU) enables a plaintiff, or a defendant in case this action forms part of a counterclaim, to argue that the introduction of litigation may constitute, under certain conditions, an infringement of competition law. This naturally leads to the question of what is a workable standard for establishing the existence of sham litigation, and how it is possible to distinguish between the legitimate use of the regulatory/litigation process and strategic attempts to use the process in order to restrict competition. Legal and economic literature, as well as the courts, have struggled to define operational tests enabling them to determine the boundaries of the “sham”/“vexatious” litigation antitrust category. The paper examines the intellectual underpinnings of this form of abusive/anticompetitive conduct and puts forward a “mechanism design approach” with the aim to reduce the occurrence of sham litigation.

Keywords: sham litigation, vexatious litigation, regulatory abuse, antitrust, competition law, abuse of dominance, monopolization, mechanism design

JEL Classification: K21, K41, L40, L41

Suggested Citation

Lianos, Ioannis and Regibeau, Pierre, 'Vexatious'/'Sham' Litigation in EU and US Antitrust Law: A Mechanism Design Approach (August 22, 2017). Antitrust Bulletin, Vol. 62, No. 4, 2017. Available at SSRN: https://ssrn.com/abstract=3076073

Ioannis Lianos (Contact Author)

University College London - Faculty of Laws ( email )

London
United Kingdom

BRICS Competition Law & Policy Centre - HSE National Research University ( email )

28/11, Shabolovka ulitsa
Moscow, 109028
Russia

Pierre Regibeau

University of Essex - Department of Economics ( email )

Wivenhoe Park
Colchester CO4 3SQ
United Kingdom
+44 1206 872 731 (Phone)
+44 1206 873 598 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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