Contesting anticompetitive actions taken in the name of the state: state action immunity and health care markets

The so-called state action doctrine is a judicially created formula for resolving conflicts between federal antitrust policy and state policies that seem to authorize conduct that antitrust law would prohibit. Against the background of recent commentaries by the federal antitrust agencies, this article reviews the doctrine and discusses its application in the health care sector, focusing on the ability of states to immunize anticompetitive actions by state licensing and regulatory boards, hospital medical staffs, and public hospitals, as well as anticompetitive mergers and agreements. Although states are free, as sovereign governments, to restrict competition, the state action doctrine requires that "the state itself" make the decision to do so. Partly on the basis of problems in the political environment, the article criticizes courts for using a mere "foreseeability" test to decide whether a state legislature sufficiently authorized competitors to act in contravention of clear federal policy: "Few things are more foreseeable than that a trade or profession empowered to regulate itself will produce anticompetitive regulations."     

Private antitrust enforcement and the role of harmed parties in public enforcement

It is commonly believed that the possibility to sue privately for antitrust damages increases the probability that anticompetitive actions are prosecuted at the cost of an increased probability that procompetitive actions are prosecuted. We extend the analysis by taking into account that private parties often submit evidence during public investigation. Such parties consider private suit as a partial substitute for public prosecution. The trial option might induce these parties to be less willing to contribute evidence to public cases. Private trials crowd out public prosecution. In effect, the probability of prosecution of anticompetitive actions might decrease, while the earlier result that the probability of prosecuted actions being prosecuted is confirmed. In general, while the attractiveness of trials weakly decreases by considering a reporting possibility, they can remain an enforcement efficacy increasing institution.     

THE PROHIBITION OF THE PROPOSED SPRINGER-PROSIEBENSAT.1 MERGER: HOW MUCH ECONOMICS IN GERMAN MERGER CONTROL?

We review the Bundeskartellamt (Federal Cartel Office Germany)decision on the proposed merger between Springer and ProSiebenSat.1from an economic point of view. In doing so, it is not our goalto analyze whether the controversial decision by the Bundeskartellamthas been correct or flawed from a legal point of view. Instead,we analyze whether the economic reasoning in the decision documentreflects state-of-the-art economic theory on conglomerate mergers.Regarding such types of mergers, anticompetitive effects eitherdo not occur regularly or are more often than not overcompensatedby efficiency gains, so that a standard welfare perspectivedemands reluctance concerning antitrust interventions. Thisis particularly true if two-sided markets, like media markets,are involved. However, anticompetitive conglomerate mergersare not impossible, in particular in neighboring markets wherethere is some relationship between the products of the mergingcompanies. In line with the more-economic approach in Europeanmerger control, a particular thorough line of argumentation,backed with particularly convincing economic evidence, is necessaryto justify a prohibition of a conglomerate merger from an economicpoint of view. Against this background, we do not find the reasoningof the Bundeskartellamt entirely convincing and sufficientlystrong to justify a prohibition of the proposed combinationfrom an economic perspective. The reasons are that (i) the Bundeskartellamtfails to continuously consider consumer and customer welfareas the relevant standards, (ii) positive efficiency and welfareeffects of cross-media strategies are neglected, (iii) in contrast,the competition agency sometimes appears to view profitabilityof post-merger strategy options to be per se anticompetitive(efficiency offence), (iv) the incontestability of the relevantmarkets is not sufficiently substantiated, (v) inconsistenciesoccur regarding the symmetry of the TV advertising market duopolyversus the unique role of the Bild-Zeitung and (vi) the employmentof modern economic instruments appears to be underdeveloped.Thus, we conclude that the Bundeskartellamt has not embracedthe European more-economic approach in the analyzed decision.However, one can discuss whether economic effects are overcompensatedin this case by concerns about a reduction in diversity of opinionand threats to free speech. Similar to the Bundeskartellamt,we do not consider these concerns in our analysis.     

Multiproduct activity and competition policy: The Tetra Pak case

We suggest the Tetra Pak case as a real-world example to study the implications of multiproduct activity for European Competition Policy. Tetra Pak, a monopolist in aseptic carton packaging of liquid food, competes with Elopak in the nonaseptic sector. The EC Commission used the effect of Tetra Pak's dominance in the aseptic sector on its rival's performance as an evidence of the former's anticompetitive behavior. With linear demand and cost functions and interdependent demands, the Commission's position can be supported. However, a more general model suggests that the Commission's conclusions cannot be supported as the unique outcome of the analysis of the information available.     

Press articles and influence processes: the different effects of incriminating information and crime story information on judgments of guilt

The present study examines how potential jury members' judgments are affected by two types of information provided by the media: (1) information that is directly incriminating for the accused and (2) crime story information, that is, information about the events of the crime but not directly pertaining to the defendant's innocence or guilt. Although the influence of directly incriminating information has been widely researched, the effect of crime story information has never been studied. Our objective was to test the hypothesis that incriminating information affects judgments directly, whereas crime story information affects judgments indirectly via the arousal of negative emotions. We did this by coding the two types of information in 78 press articles about a criminal trial heard in France. Participants (N = 312) were asked to read the articles and then indicate their anger arousal and give their judgment about the accused. The results support our hypothesis. We conclude by discussing the contribution of our findings to research into the media's influence on legal cases.     

Optimal enforcement of competition policy: the commitments procedure under uncertainty

The introduction of a commitments procedure in EU antitrust policy (Article 9 of Council Regulation 1/2003) has entitled the the European Commission to extensively settle cases of alleged anticompetitive conduct. In this paper, we use a formal model of law enforcement to identify the optimal procedure to remedy cases in a context of partial legal uncertainty (Katsoulacos and Ulph in Eur J Law Econ 41(2):255–282, 2016). We discuss in particular the merits of a policy of selective commitments where firms either take strong commitments or are investigated under the standard infringement procedure.     

When stereotypes backfire: Trying to suppress stereotypes produces false recollections of a crime

Purpose . This study examined whether participants' memories of a racially neutral crime story are influenced by stereotypes and the instruction to suppress stereotypes while reading the crime story. We expected that participants who saw a photograph of a foreign group (negative stereotype prime) and were given the instruction to suppress stereotypes before reading a crime story would make significantly more stereotype‐consistent errors on a recognition test than participants who received a neutral prime and a suppression instruction. Methods . Participants were 88 undergraduate students (59 women) who were randomly allocated to the cells of a 2 (negative stereotype versus neutral prime)×2 (thought suppression versus control) between‐subjects design. The dependent variables were recognition of accurate items, stereotype‐consistent items and confabulation items. Results . The critical stereotype × suppression interaction was statistically significant for false recognition of non‐presented stereotype‐consistent items. Simple effect analyses of the suppression condition showed that participants who were primed with a negative stereotype made more stereotype‐consistent recognition errors than those who had been exposed to a neutral prime. Conclusions . Stereotypes not only make cognitive processing easier, but might also contribute to recognition errors when people do what they often are told to do in the legal arena: suppress stereotypical thinking.     

论核心卡特尔参与者获得宽大的必要条件

核心卡特尔是世界各国公认的最严重的竞争违法行为,打击核心卡特尔已经成为主要市场经济国家竞争机构的首要工作任务。由于核心卡特尔行为具有很强的隐蔽性,竞争机构传统上采用的调查和办案手段往往对其无法奏效。为了解决这一问题,各国纷纷制定了从内部瓦解卡特尔、鼓励卡特尔参与者自首的宽大方案。根据各国宽大方案,申请人必须满足一系列条件才能获得宽大,本文旨在考察主要市场经济国家宽大方案基础上,对宽大的必要条件进行深入的研究和分析,为我国相关制度的进一步发展提供一定借鉴。     

BIDDING MARKETS

The existence of a "bidding market" is commonly cited as a reasonto tolerate the creation or maintenance of highly concentratedmarkets. We discuss three erroneous arguments to that effect:the "consultants' fallacy" that "market power is impossible,"the "academics' fallacy" that (often) "market power does notmatter," and the "regulators' fallacy" that "intervention againstpernicious market power is unnecessary," in markets characterizedby auctions or bidding processes.Furthermore we argue that theterm "bidding market" as it is widely used in antitrust is unhelpfulor misleading. Auctions and bidding processes do have some specialfeatures—including their price formation processes, common-valuesbehavior, and bid-taker power—but the significance ofthese features has been overemphasized, and they often implya need for stricter rather than more lenient competition policy.     

Electricity Market Restructuring and Energy Contracts: A Critical Note on the EU Commission’s NEA Decision

As highlighted in the economic literature, contracts are crucial policy instruments to organize and manage restructured electricity markets. In the early 90’s, during the restructuring of the electricity market in UK, the three main Scottish electricity generators stipulated a long-term, “take-or-pay” contract, the Nuclear Energy Agreement, which contained provisions for the trade of wholesale electricity in Scotland.The European Commission scrutinized such contract in order to derive the congruity of the agreement to European laws. Whilst the NEA was awarded an exemption under Article 85, paragraph 3 of the EU Treaty, the Commission recognized the inner anticompetitive content and potential effects of the contract.In this paper, we criticize the Commission NEA decision and economic reasoning and provide an alternative reading and analytical approach, which lead to opposite results and conclusions (the NEA contract is not anticompetitive and it enhances efficiency in competitive electricity markets). Given that the restructuring process in the EU electricity market is still in fieri, we select the NEA contract as a benchmark-case, in order to provide an alternative reading and a case-study for eventual, future energy contracts administration and authority decisions.JEL K, K2, K230     

Incomplete antitrust laws and private actions for damages

Our purpose in this paper is to identify some of the implications that derive from the incompleteness of antitrust laws. Since with regard to certain anticompetitive conduct, the law remains substantially incomplete up to the first relevant court judgment, in terms of policy it is worth concentrating on stand-alone claimants who, not relying on earlier judgments, face very high evidentiary requirements, while generating large positive (information) externalities for potential follow-on claimants. The paper is structured as follows. In Sect. 2, we introduce the notion of incompleteness of the laws and address the process of production of evidence in antitrust lawsuits. Sect. 3 provides a survey of EU national case law and our summary of the results puts emphasis on incomplete laws, evidentiary requirements and stand-alone lawsuits. Sect. 4 presents a framework model to distinguish the decision-making processes for stand-alone and follow-on claimants in the presence of incomplete antitrust laws. In Sect. 5 we introduce a vector autoregressive model that we test with reference to the US antitrust law enforcement regime. Sect. 6 discusses some policy options and concludes the paper.     

FORM- VERSUS EFFECTS-BASED APPROACHES TO THE ABUSE OF A DOMINANT POSITION: THE CASE OF TICKETMASTER IRELAND

The paper applies a form-based and an effects-based approachto determine whether allegations that TicketMaster Ireland'sexclusive contracts with the two leading promoters on the islandof Ireland resulted in high or excessive prices for the ticketingservices provided by TicketMaster Ireland to consumers. Theform-based approach strongly supported the allegations of highprices based on exclusive contracts, while the effects-basedanalysis found, correctly, that countervailing buyer power,efficiencies and other factors meant that TicketMaster Irelandwas neither dominant nor that its conduct was anticompetitive.The paper concludes with some suggestions as to the more generalimplications for the burden of proof in such exclusive contractcases.     

Minimizing culpability increases commission errors in a mock crime paradigm

Purpose. Empirical studies have demonstrated that feigning amnesia undermines memory for a mock crime. Not much is known about the effects of other culpability‐reducing strategies on memory. The present study investigated what strategies participants use when they are instructed to minimize culpability and if these strategies undermine memory to a similar extent as claiming amnesia. Methods. Participants performed a mock crime. Next, they were either instructed to minimize culpability for this mock crime in a simulated interrogation or asked to respond honestly. One week later, memory for the mock crime was tested. Results. None of the participants claimed amnesia when trying to minimize culpability. Conversely, all participants fabricated an alternative account of their role in the crime. Compared with responding honestly on both tests, fabricating an alternative story on the first test undermined memory for the mock crime in terms of commission errors. Correct recall was unaffected. It appeared that this effect was related to story length: the longer the fabricated story, the more the commission errors when telling the truth 1 week later. Conclusions. Fabricating an alternative story (i.e. lying) did not compromise correct recall, but induced more commission errors. The findings are discussed in terms of possible underlying mechanisms.     

THE CASE OF EXPORT CARTEL EXEMPTIONS: BETWEEN COMPETITION AND PROTECTIONISM

Most competition laws do not prohibit anticompetitive conductthat affects foreign target markets as long as there is no spillover effect on the home market. The U.S. in particular justifiesthis leniency towards export cartels by the aim of increasingefficiency in target markets that are suffering from high entrancebarriers for importers. Attempts to use the legal regime ofthe WTO to overcome private restrictions of competition arelikely to fail, because of the fundamental differences betweentrade policy and competition policy. Although a multilateralcompetition policy would be best suited to challenge exportcartels, the current state of the political debate makes itmore likely that second-best solutions such as capacity buildingin lesser developed target states will have to be established.     

Religion and Bullets in North-Eastern Nigeria

As an entity, Nigeria is cracking and melting away. The barometer that measures the pressures its people have exerted on one another is fast reaching its elastic limit. The problem with Nigeria lies in the fact that although we honestly could live together simply, it seems it is difficult to simply live together. My submission here does not portray the usual flamboyant intellectualism associated with academic lectures. It is devoid of the normal bibliographic dressing found in journal literature. It may not pass the test of professorial or doctoral research. It is something else. It is an honest reflection from someone caught up in the web of bitter experiences. It is an experience of one who has seen a brother kill his own brother in the Name of God. It is a story of brethren turned enemies. It is a story of a people who fight for God in a battle that is not His. I am from Michika Local Government of Adamawa State in Northern Nigeria; I am the Catholic Bishop of Yola Diocese, the Chairman Christian Association of Nigeria Adamawa State Chapter and this is my story.     

Congress,The U.S. Supreme Court And Must-Carry Policy: A Flawed Economic Analysis

The Cable Television Consumer Protection and Competition Act of 1992, which requires cable operators to carry the signals of local broadcast television stations, was hailed by supporters as a measure that would preserve the economic viability of the local independent broadcaster by unlocking the anticompetitive grip that the local cable company places on access to its system. In upholding the Act in 1997, the United States Supreme Court seemed to ignore the degree to which the cable and broadcast industries have become vertically integrated. In the end, local independent stations became economically viable not because they were guaranteed carriage on a cable system, but because they represented a practical programming outlet for conglomerate firms with large investments in content production. This article recommends that Congress repeal the Act.     

Can Common Business Practices Ever Be Anticompetitive? Redefining Monopolization

For most of its modern history, antitrust law distinguished between normal competition and monopolization by looking for merit, legitimate business justifications, or efficiencies in the challenged business conduct. These proxies were seen as appropriate because they served antitrust law's welfare objectives well. However, the universal adoption of these proxies has overshadowed significant shortcomings, chief among them being that firms do not think in terms of legitimate business justifications or efficiencies, but rather in terms of long-term sustainability and appropriation of value. As a result, antitrust law becomes detached from the very subjects it purports to regulate. Against the backdrop of the recent resurgence of enforcement activity, particularly involving tech giants, this article attempts a conceptualization of monopolization that does not revolve around merit in any form or function. Instead it introduces the proxy of commonness of business practices to determine their legality. This helps highlight the importance of considering “how things are done” in the relevant market, and helps reground antitrust law in business realities, which can enhance the heuristic mechanism of distinguishing between normal and anticompetitive practices. To prove this point the article develops an error test framework, through which it compares current tests with the proposed test in terms of their error footprint and concludes that the integration of the commonness parameter delivers better results. Ultimately, the inquiry undertaken herein is not only about constructing a conception of normal competition different from the only standard we currently have, that is, variants of merit, but also about shifting the conversation from how to fine-tune existing standards to how to capture a more complete conception of competition.     

专利联营之反垄断规制分析

由于“专利灌丛”问题,产业发展越来越受控于很多分散的、独立的专利权。专利联营解决了这一问题,它整合了互补技术,降低了交易成本,排除了专利间实施的交互限制,避免了昂贵的法律诉讼。但由于专利联营固有的“联合”特点,使其必然对联合体之外的市场主体构成限制竞争,具有“垄断”的先天嫌疑,而由于专利联营政策越来越被拥有较多专利权的跨国企业控制,特别是信息领域技术标准制定中诞生的专利联营,已经凸现出滥用市场支配力、防碍技术创新的趋势。因此,有必要制定专利联营的反垄断规则。     

Murder in Black and White

Abstract

In this paper we will tell the story of “The Poisoning of the Late Levi Smelser.” Through detailed examination of both the media reports and official documents, the ensuing narrative portrays how race and gender influence the criminal justice processes of late antebellum New Orleans. As the story unfolds, two types of accounts emerge. We come to know the major participants in this case, Kitty, the slave, Levi Smelser, the victim, Theresa Smelser, the widow, and Adam Scott, the young foreman of Smelser's tin and copper shop, in their ordinary and comfortable lives before the murder. Secondly, we see these same characters play shifting roles of guilt and innocence in the planning and implementation of the murder as the newspapers reveal, magnify and glorify new “particulars,” day-by-day. This story is actually composed of a number of plots and constitutes a “scenario” of crime creation by sources of the mass media and related groups. As a scenario, the story represents “an interactional moment or site of meaning creation.”     

CONGLOMERATE MERGER CONTROL:FROM THE CONTINENTS TO A SMALL ECONOMY

To condemn a conglomerate merger for the foreclosure effect of post-merger activities,one should examine the anticipated conduct against the same liability rules under the law of agreement and the law of abuse of dominance as if the conduct has been materialized.Given the inherent uncertainty of pre-merger assessment,it requires a high standard of proof to satisfy the adjudicator that the merger in question would lead to anticompetitive effect in all the circumstances.Conglomerate merger,which will reinforce market concentration or increase entry barriers,should be stringently scrutinized Saying so,the pro-efficiency effects of conglomerate merger are appreciated One should not take itfor granted that agglomeration will be restrained through conglomerate merger control.