Amicus Brief of 29 IP, Internet Law, & Antitrust Professors in 1-800 Contacts v. F.T.C.

30 Pages Posted: 21 Sep 2019 Last revised: 18 Nov 2019

See all articles by Mark A. Lemley

Mark A. Lemley

Stanford Law School

Eric Goldman

Santa Clara University - School of Law

Date Written: September 12, 2019

Abstract

This amicus brief supports the FTC's position in the 2d Circuit appeal of 1-800 Contacts v. FTC. The brief was joined by 29 intellectual property, Internet law, and antitrust professors.

The case involves 1-800 Contacts' settlement agreements with its online competitors in which they agreed not to bid on each other's trademarks as keywords for search engine advertising. The FTC held that 1-800 Contacts' conduct violated antitrust law.

The brief makes two main points. First, the brief shows how game theory explains 1-800 Contacts' use of settlement agreements for anticompetitive purposes. Second, the brief explains how trademark law provided only pretextual justification for 1-800 Contacts' settlement campaign.

Keywords: 1-800 Contacts, online retailing, trademark, FTC, federal trade commission, keyword advertising, adwords, settlement, antitrust, advertising, search engine, bid rigging, market division, horizontal restraints, game theory, prisoner's dilemma, trademark bullying

JEL Classification: K21, K42, K1, C7, D4, I11, L41, L81, M37, O33

Suggested Citation

Lemley, Mark A. and Goldman, Eric, Amicus Brief of 29 IP, Internet Law, & Antitrust Professors in 1-800 Contacts v. F.T.C. (September 12, 2019). Stanford Law and Economics Olin Working Paper No. 538. Available at SSRN: https://ssrn.com/abstract=3452884 or http://dx.doi.org/10.2139/ssrn.3452884

Mark A. Lemley

Stanford Law School ( email )

559 Nathan Abbott Way
Stanford, CA 94305-8610
United States

Eric Goldman (Contact Author)

Santa Clara University - School of Law ( email )

500 El Camino Real
Santa Clara, CA 95053
United States
408-554-4369 (Phone)

HOME PAGE: http://www.ericgoldman.org

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