Three Antitrust Developments to Watch in Wake of High Court’s “Ohio v. American Express” Ruling

swisherFeatured Expert Column: Antitrust & Competition Policy — U.S. Department of Justice

By Anthony W. Swisher, a Partner in the Washington, DC office of Baker Botts LLP

As vertical issues continue to attract attention in the world of antitrust, the U.S. Supreme Court’s decision in Ohio v. American Express was a long-awaited milestone.  The outcome of the decision was not surprising—many commenters had predicted that a Court that has generally been skeptical of antitrust plaintiffs would uphold the U.S Court of Appeals for the Second Circuit’s decision in favor of American Express—but a few features of the decision were noteworthy.

Recall that the case involved Amex’s use of non-discriminatory provisions, or “NDPs,” that prevent a merchant that accepts Amex cards from engaging in strategic behavior to steer customers toward use of a different payment card that might carry a lower transaction fee for the merchant. At issue was whether the NDPs constituted unreasonable restraints that suppressed interbrand competition by preventing merchants from favoring lower-cost payment methods by customers. Continue reading “Three Antitrust Developments to Watch in Wake of High Court’s “Ohio v. American Express” Ruling”

Europe’s Antitrust Demagogues Shake Down Google

thumbnail_imageToday the European Union imposed a $5 billion fine on Alphabet Inc., owner of Google, for antitrust violations. The punishment illustrates the power of that most abiding of monopolists, government, to extract rents and impose deadweight losses.

The EU’s core theory is that Google improperly pressures smartphone manufacturers to bundle Google apps with Android, Google’s free smartphone operating system. Continue reading “Europe’s Antitrust Demagogues Shake Down Google”

Thanks to the Court, Justice Done in AT&T/Time Warner Merger Challenge

DOJOur nation’s federal prosecutors recommend themselves as dispassionate champions of the law. As then-Attorney General Robert Jackson put it: “Although the government technically loses a case, it has really won if justice has been done.” The government, he said, should seek “truth and not victims.” The United States’ top lawyers repeat these sentiments often.

For the Justice Department’s Antitrust Division, seeking “truth and not victims” means prosecuting cases that benefit consumers. And it means winning with strong economic analysis rather than with legalistic maneuvering or chicanery.

By this measure the government’s lawsuit to block the merger of AT&T and Time Warner was a shambles. Continue reading “Thanks to the Court, Justice Done in AT&T/Time Warner Merger Challenge”

Solicitor General Inveighs Against Antitrust-Law Revolution in SCOTUS “Apple v. Pepper” Amicus Brief

app storeEd. Note: With this post we welcome WLF’s newest attorney, Corbin K. Barthold, as a WLF Legal Pulse author.

Many legal disputes pit the affective and sometimes utopian thinking of lawyers against the statistical and efficiency-oriented thinking of economists. The archetypal lawyer subscribes to the maxim ubi jus ibi remedium—“where there is a right, there is a remedy.” The archetypal economist is more likely to agree with Oliver Wendell Holmes, Jr.’s view that “such words as ‘right’ are a constant solicitation to fallacy.”

In antitrust cases, at least, the Supreme Court often sides with the economists. Illinois Brick Co. v. Illinois, 431 U.S. 720 (1977), is a good example. It says that only the direct purchaser of an abusive monopolist’s goods or services may sue the monopolist for violating the antitrust laws. Someone who buys a product only indirectly—someone who, say, buys from a retailer who buys from an antitrust-law-violating manufacturer—is out of luck. She may not sue even if the retailer incorporated some of the supracompetitive wholesale price into the retail price. It would be too difficult, Illinois Brick concludes, to accurately apportion damages among distributers, retailers, and consumers. Continue reading “Solicitor General Inveighs Against Antitrust-Law Revolution in SCOTUS “Apple v. Pepper” Amicus Brief”

Ruling on Philly Taxis’ Suit vs. Uber, Third Circuit Reaffirms Antitrust Focus on Competition, not Competitors

swisherFeatured Expert Column: Antitrust & Competition Policy — U.S. Department of Justice

By Anthony W. Swisher, a Partner in the Washington, DC office of Squire Patton Boggs (US) LLP.

A recent decision from the U.S. Court of Appeals for the Third Circuit (Philadelphia Taxi Association v. Uber Technologies) reinforces the longstanding principle that antitrust laws protect competition, not competitors. The case involved a claim of attempted monopolization levied against Uber, brought by the Philadelphia Taxi Association and a number of individual taxi drivers. The essence of the plaintiffs’ claim was that Uber entered the Philadelphia taxi market without complying with existing municipal regulations, and that as a result, Uber obtained “a stronghold in the Philadelphia taxicab market.”

The Third Circuit upheld the trial court’s ruling that plaintiffs failed to state a monopolization claim because they failed to allege a harm to the competitive process, as opposed to individual competitors. Continue reading “Ruling on Philly Taxis’ Suit vs. Uber, Third Circuit Reaffirms Antitrust Focus on Competition, not Competitors”

Tronox/Cristal Merger Fight Highlights the FTC/DOJ Divide in U.S. Merger Control Proceedings

06633 - Royall, M. Sean ( Dallas )Featured Expert Column: Antitrust & Competition Policy — Federal Trade Commission

By M. Sean Royall and Richard H. Cunningham, Partners with Gibson, Dunn & Crutcher LLP, and Justin Epner, an Associate in the firm’s Washington, DC office.  The authors would like to thank Jasper Hicks, who is an Associate in Gibson Dunn’s Denver, CO office, for his substantial contributions to this post.

In early 2017, Mississippi-based titanium dioxide (TiO2) pigment producer Tronox Limited (“Tronox”) agreed to purchase the TiO2 business of one of its rivals, Saudi Arabian producer Cristal (“Cristal”).  Alleging a horizontal competitive effects theory, the Federal Trade Commission (FTC) voted in December 2017 to challenge the deal in its internal administrative court.  Roughly two months after the FTC initiated the administrative challenge, however, the litigation took an interesting and unusual turn—Tronox filed a federal lawsuit of its own against the Commission in the Northern District of Mississippi.  Continue reading “Tronox/Cristal Merger Fight Highlights the FTC/DOJ Divide in U.S. Merger Control Proceedings”

The Supreme Court’s “American Express” Antitrust Case: What’s at Stake

swisherFeatured Expert Column: Antitrust & Competition Policy — U.S. Department of Justice

By Anthony W. Swisher, a Partner in the Washington, DC office of Squire Patton Boggs (US) LLP.

With the New Year comes the opportunity to consider the cases to the U.S. Supreme Court will hear in the second half of its October Term 2017. As has become routine in the last several years, the Court has an antitrust case on its docket. In Ohio v. American Express Co., the justices will have the opportunity to consider the proper application of the rule of reason to vertical agreements between credit card companies and merchants. The case presents important substantive issues, but also provides a chance to see whether the Court’s recent trends in antitrust enforcement will continue. The justices will hear arguments in the case on February 26. Continue reading “The Supreme Court’s “American Express” Antitrust Case: What’s at Stake”