EXCLUSIONARY PRICING AND CONSUMERS HARM: THE EUROPEAN COMMISSION'S PRACTICE IN THE DSL MARKET

The assessment of exclusionary abuses by dominant firms is byno means an easy task. This is particularly true for pricingabuses, as there is no clear-cut way of distinguishing a pricecut that is abusive from one that instead is pro-competitive.We argue that there are several shortcomings in the way theEuropean Commission as assessed exclusionary pricing abusesin two important decisions concerning Internet access servicemarkets: Deutsche Telekom AG and Wanadoo Interactive. Firstof all, in computing downstream costs to apply the price squeezetest the incumbent's economies of scale and unavoidable costsshould be factored in, as the test is only meant to establishwhether an as-efficient competitor has been unlawfully foreclosed.Secondly, since the price squeeze test provides only for a necessarycondition for predation to occur, it is also necessary to provethat the recoupment of initial losses is a plausible scenarioso that the conduct under examination may indeed turn out tobe harmful to consumers. This is all but a trivial task, asthere are some sources of endogeneity that may cause a radicalchange in the underlying market structure. Particularly, inmarkets at early stage of development, entry barriers that mayfacilitate the recoupment of initial losses ex-ante may causea change such that market structure no longer supports recoupmentex-post.     

A Critical Appraisal of 'Triple Divorce' in Islamic Law

The issue of the ‘triple divorce’ is regarded ashighly sensitive among the Muslims, not only in India but elsewhere.The Holy Qur’an is very cautious in matters of divorce.Three talaqs have to be spaced over a period of 3 months togive husband and wife time for reconciliation through the interventionof relatives and friends. Moreover, talaq can be pronouncedonly when the wife is in a state of tuhur, ie purity after menstruation.Yet, despite clear Qur’anic injunctions to the contrary,immediate triple divorce is permitted, destroying marital lifein one breath. The practice of immediate triple divorce is widespreadamong Sunni Muslims and has legal validity. Even then the juristscall it a talaq-e-Bidat (innovative form of divorce). The disputehas been highlighted by reports of some Muslims instantly divorcingtheir wives by mail, over the telephone, and even through mobilephone text messages. This article explains the different theoriesof divorce prevailing in the contemporary Muslim world and whatchecks and restraints have been imposed by Islam over the exerciseof husband's power of talaq. The article critically appraisesthe ‘innovative triple divorce’ by examining whetherit is sanctioned by the Holy Quran or the sunnah and if thereis a consensus of opinion (ijma) on the effectiveness of tripledivorce.     

Violence and Massacres -- Towards a Criminal Law of Inhumanity?

The law's responses to massacres seem to vacillate between twomodels: (i) the model of the ‘criminal law of the enemy’inspired by the national criminal law and rendered topical againby the attacks of September 11; (ii) the model of the ‘criminallaw of inhumanity’ symbolized by the paradigm of crimesagainst humanity. The latter model is better suited to takeaccount of the qualitative dimension of massacres, i.e. thefact that they, besides being mass offences (quantitative criterion),also offend against humanity. To establish a ‘criminallaw of inhumanity’ as a model with a universal, or universalizable,dimension, three conditions are necessary, which concern (i)the definition of the crimes, (ii) the assignment of responsibilityand (iii) the nature of the punishment. As for the definitionof the crime, one could implicitly deduce from the list of actsconstituting crimes against humanity (Article 7 of the InternationalCriminal Court Statute) that humanity so protected has two inseparablecomponents: the individuality of each human being, not reducibleto membership in a group, and the equal membership of each inthe human community as a whole. With regard to the second condition,it is not sufficient to hold responsible the de jure or de factoleaders; intermediaries and perpetrators, at all levels of hierarchy,must also be held accountable. As for the third condition, itis not sufficient to content oneself with the watchword of thefight against impunity without bringing up the nature and functionsof the punishment; hence the necessity not only to rethink therole ‘criminal’ law can play in a policy of punishment,but also to focus on prevention, reparation and reconciliation.Finally, the author suggests that the proposed model of a ‘criminallaw of inhumanity’ must be built through the interplaybetween municipal law and international law. On the one hand,the wealth of national legal systems — also with regardto penalties and responsibility — should be better integratedinto international criminal justice; on the other, nationalcriminal systems should be better adapted to conditions of internationallaw, through the introduction into domestic law of the definitionsof the crimes and also the rules for assigning criminal responsibility.     

Towards the End and Beyond: The "Almost" Referral of Bagaragaza in Light of the Completion Strategy of the International Criminal Tribunal for Rwanda

The Bagaragaza case was the first at the International CriminalTribunal for Rwanda in which the referral of an accused to anational jurisdiction was discussed. Such a referral may bemade at the discretion of a Trial Chamber designated by thePresident, if the Chamber satisfied itself that the Accusedwill have a fair trial and that the death penalty will not beimposed or carried out. The referral can be made to three differentStates: the one where the accused was arrested, the one werethe crimes were committed and the one which has jurisdictionand is willing and adequately prepared to hear the case. Inthe Bagaragaza case, the request for referral was dismissed,because the Referral State in question, the Kingdom of Norway,has no provision for genocide in its penal law. This paper discussesthe referral mechanism and the role it plays in the Tribunal'sambitious completion strategy. An analysis of the Bagaragazacase will show how this mechanism has actually been applied,concluding that the Tribunal rightly resisted the pressure toabide by the completion strategy and chose substance over form.After the Tribunal's closure, two important questions will facethe international community: (a) Where will convicted and acquittedpersons be relocated? (b) Has international criminal justicebeen promoted at the expense of long-term peace and stability?     

Overcoming the challenges posted by technology to traditional copyright law: from Betamax to Grokster

Legal context: Dual use technology, or technology which can be used for bothinfringing and non-infringing uses, raises interesting issuesin the area of copyright law. This note analyses inter aliathe two US Supreme Court decisions on dual use technology, separatedby a gap of over 20 years—Sony v Universal Studios (1984)and MGM v Grokster (2005). Key points: Sony lays down the famous ‘Betamax’ defence—ifthe technology is ‘capable of substantial non-infringinguses’, then it cannot be challenged as infringing. Thistest had stood the test of time, and it is only recently inGrokster that there arose an occasion to reconsider its application.The Court in Grokster, borrowing from the jurisprudence developedin Patent law, recognized a novel test of liability—basedon the active ‘inducement’ to infringe. The flawin Grokster is that despite its attempt to develop new standardsfor a digital age, the ruling leaves areas of uncertainty. Practical significance: Dual use technology has become ubiquitous in this age—fromthe iPod to YouTube to P2P software, all are capable of beingused in lawful as well as unlawful ways. Legal pronouncementshave the potential to impact not just the development of law,but also innovation in technology. Some believe that the ‘brightline’ of Sony has been muddled thereby threatening technologicalinnovation. Others, me included, believe that Sony is inapplicablein the face of new technology, and hail the decision in Groksteras a positive step forward in what it actually decides. However,in what it does not decide, Grokster still represents a lostopportunity by the Court to clear up the muddled waters.     

Editors' Note

Ambrose Bierce's Devil's Dictionary has the following entry:‘Resident (adj.) Unable to leave’. There are manyexamples in fiction of people who are trapped where they donot want to be. Take the James Bond film (Goldfinger, from memory)in which a number of high-powered villains turn up in a high-techboard room to discuss a dastardly plot to steal the gold inFort Knox. When one of the crooks decides he does not like therisks and heads for the door, he discovers (too late) that thisis the sort     

The Best Interests of the Child? Is the Best Interests of the Child in the Best Interests of Children?

The writings of Goldstein, Freud and Solnit, particularly someof the concepts they developed, have exercised a profound influenceon our thinking about children. A new, revamped, final, authoritativeedition presents the opportunity for critical re-assessment.The author finds a partial analytical framework, a dated imageof children, a narrow concept of children's rights, triggersfor intervention which leave children dangerously exposed and,above all, a sense diat events have moved on leaving the mostinfluential text of this generation firmly rooted in the ideas,problems and concepts of the last. The publication in one revised volume of the landmark trilogyof Beyond, Before and In¹ provides an excuse, if one were needed,to assess the impact and re-evaluate the arguments containedwithin the three monographs and now compressed and updated.Whether or not one agrees with all, or even any, of the ideascontained within Best Interests (as I shall now call the collection),and I shall criticize both applications and implications, theconcepts have impressed themselves, perhaps indelibly, on ourthinking about children. Like it or not, anyone thinking aboutchild law or policy, the relation between parents and children,the state and family, has to grapple with concepts like ‘leastdetrimental alternative’, the ‘psychological parent’,a child's sense of time and others of the rich ideas which permeateBest Interests.²     

THE STOCHASTIC RELATIONSHIP BETWEEN PATENTS AND ANTITRUST

This article develops a novel theory by which to construe theinteraction between the patent and antitrust laws. The rulesof these respective disciplines are often portrayed as conflictingin means, yet harmonious in purpose. Although the intellectualproperty and antitrust laws have ostensibly divergent viewson the role of competition, their interaction is typically limitedto one of constraint. More specifically, antitrust rules havebeen (poorly) designed to limit the exclusivity inherent ina patent grant to the claimed invention alone. This article,however, articulates a new vision for the role of antitrust:it posits that competition rules operate as a stochastic regulatorof exclusionary patent rights. The Sherman Act constrains patentees'efforts to positively transform the probabilistic nature oftheir intellectual property rights through contract. Yet, becausethe empirical calculation of optimal innovation rates is anelusive, if not Sisyphean, task, the normative desirabilityof the foregoing fact is abstruse. Nevertheless, policymakers'inability to pinpoint precisely the ex post rewards requiredto trigger ideal levels of ex ante investment need not bindour hands to inaction. If contemporary rates of innovation aredeemed acceptable (even if not necessarily perfect), there maybe ways to trigger equivalent levels of ex ante investment withlower social cost. In this regard, it is clear that currentlyenacted competition rules significantly accentuate the uncertaintysurrounding patents' apotropaic effect. Concluding that contractssecuring otherwise stochastic rights may be highly desirable,the article calls for the incorporation of this concern intocontemporary rules, with modest substantive effect, and furtheradvocates a qualified antitrust immunity for "gold-plated" patentsif and when they are introduced.     

Power Politics and the Rule of Law: Shakespeare's First Historical Tetralogy and Law's 'Foundations'

Legal scholars’ interest in Shakespeare has often focusedon conventional legal rules and procedures, such as those ofThe Merchant of Venice or Measure for Measure. Those plays certainlyreveal systemic injustice, but within stable, prosperous societies,which enjoy a generally well-functioning legal order. In contrast,Shakespeare's first historical tetralogy explores the conditionsfor the very possibility of a legal system, in terms not unlikethose described by Hobbes a half-century later. The first tetralogy'sdeeply collapsed, quasi-anarchic society lacks any functioninglegal regime. Its power politics are not, as in many of Shakespeare'sother plays, merely latent, lurking beneath the patina of anotherwise functioning legal order. They pervade all of society.Dissenting from a long critical tradition, this article suggeststhat the figure of Henry VI does not merely represent antiquatedmedievalism or inept rule. Through Henry's constant recourseto legal process, arbitration and anti-militarism, the firsttetralogy goes beyond questions about how to establish a functioninglegal order. It examines the possibility, and meaning, of ajust one.     

'Trade mark use' in Europe: revisiting Arsenal in the light of Opel and Picasso

Legal context: The European Court of Justice (ECJ) decision in the case ofArsenal Football Club v. Reed led to uncertainty regarding thepractical scope of a trade mark proprietor's property rights. Key points: The uncertainty resulted from a failure of the ECJ to addressclearly the issue of what constitutes infringing trade markuse. The ECJ ignored the question of the High Court as to whetheruse of a trade mark as an indication of origin is necessaryfor establishing infringement. They instead established an ambiguousstandard for what constitutes infringing trade mark use, suggestingthat only use that jeopardises the essential function of a trademark is an infringing use. This ambiguity has had problematicimplications for subsequent interpretations of trade mark law,particularly in the Court of Appeal in Arsenal and the Houseof Lords in R v Johnstone. Two relatively new ECJ cases may help clarify the issue. InOPEL, the ECJ suggested that infringing use of a trade markmust be use that is perceived by the relevant public as a designationof origin. The Picasso decision limits the effect of the Arsenaldecision on the relevance of confusion in non-sale situationsto the facts of Arsenal. In particular, it stresses the pointthat when assessing likelihood of confusion in the context ofan opposition to an application for registration the court shouldfocus on the perception of the relevant public at the pointof sale. Practical significance: The benefit of these two cases is that they create some clarityfor legal practitioners and the Courts when addressing the questionof what constitutes infringing trade mark use.     

Computer-related inventions: from CFPH to Macrossan

Legal context: The recent joint decision of the Court of Appeal in AerotelLtd v Telco Holdings Ltd and othersand Patent Application byNeal William Macrossan concerns the proper application of theexclusions to patentability under Article 52 of the EuropeanPatent Convention (EPC) and in particular the exclusions concerningcomputer implemented inventions and methods of doing business. Key points: Before this decision, the proper approach to this area of thelaw had been thoroughly discussed and reformulated by DeputyJudge Prescott QC in CFPH followed by a string of first instancecases. There were also numerous decisions of the European PatentOffice, not all of which were consistent. Accordingly, thisis an area fraught with difficulty where it has been difficultto find an overreaching rationale to exclusions based on individualpolicy. The Court of Appeal has now set a new four stage test by whichcomputer implemented inventions should be approached, as wellas patents to which the other exclusions might apply. Practical significance: This new test may not reduce the difficulty of assessing inventionson a case by case basis, but it provides one source of authoritythat can now be followed. Furthermore, it may also prove helpfulthat each of the cases featured in this decision falls on eitherside of Article 52. As such the decision provides a useful,if sketchy, illustration of the dividing line between patentableand non-patentable subject matter.     

PATENT HOLDUP AND OLIGOPSONISTIC COLLUSION IN STANDARD-SETTING ORGANIZATIONS

Current controversies over patent policy place standard-settingorganizations (SSOs) on a collision course with antitrust law.Recent theoretical research conjectures that, in an SSO, patentowners can "hold up" patent users in the sense of demandinghigh royalties for a patented input after the SSO has adoptedthe patented technology as an industry standard and manufacturerswithin the SSO have incurred sunk costs to design end productsthat incorporate that standard. Consistent with this conjecture,actual SSOs have recently sought no-action letters from theAntitrust Division for a variety of amendments to SSO rulesthat would require or request, at the time a standard is underconsideration, the ex ante disclosure by the patent owner ofthe maximum royalty that the patent owner would charge underthe regime of fair, reasonable, and nondiscriminatory licensing.This price information—which is characterized as the "cost"of the patented input—would, under at least one recentSSO rule modification, be a permissible topic for potentialusers of the patent to discuss when deciding whether to selectit in lieu of some alternative standard. This exchange of informationamong horizontal competitors would occur ostensibly becausethe cost of the patented technology had been characterized assimply one more technical attribute of the standard to be set,albeit an important technical attribute. The Antitrust Divisionand the Federal Trade Commission have jointly stated that suchdiscussion, by prospective buyers who are competitors in thedownstream market, of the price of a patented invention thatmight become part of an industry standard should be subjectto antitrust scrutiny under the rule of reason rather than therule of per se illegality. The rationale that the antitrustagencies offer for applying the rule of reason to such conductis that such horizontal collaboration might avert patent holdup.The Antitrust Modernization Commission (AMC) similarly endorsedthe view that rule-of-reason analysis is appropriate for exante discussion of royalty terms by competing buyers of patentedtechnology. This rule-of-reason approach, however, is problematicbecause it conflicts with both the body of economic researchon bidder collusion and with the antitrust jurisprudence oninformation exchange and facilitation of collusion. Put differently,because of their concern over the possibility of patent holdup,the U.S. antitrust agencies and the AMC in effect have indicatedthat they may be willing in at least some circumstances to forgoenforcement actions against practices that facilitate oligopsonisticcollusion by encouraging the ex ante exchange of informationamong competitors concerning the price to be paid for a patentedinput as an implicit condition of those competitors' endorsementof that particular patented technology for adoption in the industrystandard. However, neither the proponents of these SSO policiesnor the antitrust agencies and the AMC have offered any theoreticalor empirical foundation for their implicit assumption that theexpected social cost of patent holdup exceeds the expected socialcost of oligopsonistic collusion. This conclusion does not changeeven if one conjectures that such collusion will benefit consumersby enabling licensees to pass through royalty reductions intheir pricing of the downstream product incorporating the patentedtechnology. Proper economic evaluation of the plausibility ofthe pass-through conjecture will require information about thecalculation of royalty payments; the demand and supply elasticitiesfacing the licensees; and the structure of any industries furtherdownstream between the manufacturer and the final consumer.Consequently, the magnitude of this effect will likely be amatter of empirical dispute in every case. Moreover, such ajustification for tolerating horizontal price fixing finds nosupport in antitrust jurisprudence. Given the analytical andfactual uncertainty over whether patent holdup is a seriousproblem, it is foreseeable that antitrust questions of firstimpression will arise and affect a wide range of high-technologyindustries that rely on SSOs. However, there is no indicationthat scholars and policy makers have seriously considered whetheroligopsonistic collusion in SSOs is a larger problem than patentholdup.     

Treaty Interpretation and the WTO Appellate Body Report in US - Gambling: A Critique

‘Before the game begins players should agree on a dictionaryto use in case of a challenge.’ (from the Official Rulesof SCRABBLE®)

Treaty interpretation in WTO law continues to represent a topicof highly theoretical and practical importance. The Panel’sand the Appellate Body’s reports in the recent US –Gambling dispute have critically turned on ascertaining themeaning of the United States’ GATS Schedule and ArticleXVI GATS on the basis of the public international law rulesof treaty interpretation as codified in the Vienna Conventionon the Law of Treaties. The paper’s principal aim is toreview the interpretative approach followed in particular bythe Appellate Body in reaching its decision in US – Gambling.Its main argument is that, although the Appellate Body appearsto be trying to emancipate itself from a rigorous textual approach,it has not yet embraced a holistic approach to treaty interpretation,one in which the treaty interpreter looks thoroughly at allthe relevant elements of the general rule on treaty interpretationpursuant to Article 31(1) of the Vienna Convention.     

AHRA does not protect device distributor against copyright claims arising from broadcaster role

In a case of first impression, and one of the few cases interpretingthe statute at issue, a district court in New York City hasheld that the Audio Home Recording Act, 17 USC sections 1001et seq. (‘AHRA’), does not immunize a distributorof digital audio recording devices (DARDs) from copyright liabilitywhen the infringement claims are based on the distributor'sallegedly infringing activity in its simultaneous role as asatellite radio broadcaster. The case illustrates the ambiguousnature of digital transmissions, which can be treated as distributionsof musical works as well as digital performances.     

The EOS Engineering Corporation Case and the Nemo Debet Bis Vexari Pro Una et Eadem Causa Principle in China

Nemo Debet Bis Vexari Pro Una et Eadem Causa is a general principleof civil procedure applied domestically in China. Foreign judgmentsare not regarded as res judicata unless an applicable internationaltreaty requires otherwise. The ruling in the EOS case by theSupreme People's Court in 2003 clarified to some extent theelements that should be considered when applying this principle.     

NEXT STEPS IN THE EVOLUTION OF ANTITRUST LAW: WHAT TO EXPECT FROM THE ROBERTS COURT

Under the leadership of Chief Justice John G. Roberts, Jr.,the Supreme Court has demonstrated a willingness to cast asidethe Court's prior antitrust decisions. The qualified per serule applicable to tying surely will not survive much longer,but what else might be in store is more speculative. This essayidentifies four decisions relating to competitor collaborationin which the Court's prior application of the per se rule doesnot comport with its modern decisions. In two of the cases,the conduct likely would be found lawful today; while in theother two, the conduct most likely still would be condemnedbut only after an abbreviated application of the rule of reason.This essay also identifies three legal doctrines ready for retirement.They are the absolute requirement of market delineation as apredicate for merger analysis, the outmoded approach to marketdelineation of Brown Shoe, and the unhelpful formulation ofthe monopolization offense in Grinnell.     

Copyright, continuums and freedom of speech

‘A book may be good for nothing; or there may be onlyone thing in it worth knowing; are we to read it all through?’(Samuel Johnson) This section is dedicated to the review ofideas, articles, books, films and other media. It will includereplies (and rejoinders) to articles, the evaluation of newideas or proposals, and reviews of books and articles both directlyand indirectly related to intellectual property law.

Copyright and Free Speech Comparative and International Analyses ByJonathan Griffiths and Uma Suthersanen, Eds, 2005, Oxford: OxfordUniversity Press Price: £80.00, Hardback, ISBN: 0199276048.pp. 426   If one were to summarize this     

Can We Protect How We Do What We Do? A Consideration of Business Method Patents in Australia and Europe

In the long history of monopolies, business method patents area novel and recent edition. In the Digital Age, where time ismoney and speed is everything, innovative methods for undertakingbusiness are as important to a business as the products or servicesit provides to its clients. In recent years several reviews,conducted in both Australia and internationally,⁴ have questionedthe appropriateness of patenting business methods. This paperreviews the availability of business method patents in Australiain light of the 2006 decision of the Full Court of the FederalCourt in Grant v Commissioner of Patents,⁵ which confirmed theneed in Australia for a ‘useful product’ to issuefrom the working of a method (business or otherwise) in orderfor the method to be patentable. This paper will review argumentsboth criticising and defending business method patents and considerwhether business methods warrant special treatment.     

The Spanish Constitutional Tribunal's Decision in Guatemalan Generals: Unconditional Universality is Back

On 26 September 2005, the Spanish Constitutional Tribunal reversedthe decisions of the Audiencia Nacional and the High Court (TribunalSupremo) in the case of the Guatemalan Generals. According tothe two judicial bodies, the exercise of universal jurisdictionover international crimes required a link between the crimeor the victims or the offender and Spain, such as the presenceof the offender on Spanish territory or the Spanish nationalityof the victims. The Constitutional Tribunal held, instead, thatthese requirements are contrary to the principle pro actione,i.e. they result in an unjustified restriction of the constitutionalright to effective judicial protection. The Tribunal also clarifiedthat universal jurisdiction, whose aim is fighting impunity,does not require any link other than the universal characterof the values protected by the provisions criminalizing themost serious violations of international law. The presence ofthe accused in Spain is merely a condition for trial, not adistinct ground of jurisdiction; in other words, the accusedmust be in Spain for the trial to begin, but jurisdiction maybe exercised even in his absence, for example for the issuanceof a request for extradition. The only condition to which theexercise of universal jurisdiction is subject is that the stateof the locus commissi delicti is not already investigating andprosecuting the case effectively.