DOJ Giving Cover to Monopolizing Firms that Breach Antitrust Rules

The Hill (Oct. 11, 2018)

3 Pages Posted: 16 Jan 2019

Date Written: October 11, 2018

Abstract

Imagine that a company makes a promise an industry relies on, gains monopoly power as a result, and then says “just kidding.” The head of the Antitrust Division, Makan Delrahim, has given this conduct an antitrust pass. That’s not right.

The setting for this scenario involves standards, which are ubiquitous in our high-tech, connected world. Standards that involve patents threaten concern: after companies are locked in to a standard, the patent holder could “hold up” the industry by demanding unreasonable royalties or blocking products from the market. For that reason, standards organizations have required patent holders to license on fair, reasonable, and nondiscriminatory (FRAND) terms.

In a series of speeches, Delrahim has been skeptical of patent holdup, and in an address in September 2018, he stated that FRAND abuse would not violate antitrust law. This piece explains how Delrahim reached this remarkable position through mischaracterizations of antitrust policy, the conduct at issue, and antitrust law.

Keywords: standards, patents, antitrust, holdup, FRAND

JEL Classification: K21, L40, L41, L63, O31, O34

Suggested Citation

Carrier, Michael A., DOJ Giving Cover to Monopolizing Firms that Breach Antitrust Rules (October 11, 2018). The Hill (Oct. 11, 2018). Available at SSRN: https://ssrn.com/abstract=3310840

Michael A. Carrier (Contact Author)

Rutgers Law School ( email )

217 North Fifth Street
Camden, NJ 08102-1203
United States
856-225-6380 (Phone)
856-225-6516 (Fax)

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