CONTENTS

Foreword iii

Introduction xix

Chapter I - Restraints of Trade
A. Introduction

B. Elements of a Section 1 Violation
1. Proof of a Contract, Combination, or Conspiracy
a. Distinguishing Unilateral from Concerted Action
(1) Inferring an Agreement among Competitors
(2) Inferring a Vertical Agreement
(3) Inferring a Hub-and-Spoke Agreement
b. A Special Case: Intraenterprise Conspiracy
e. Trade Association Conduct as Concerted Action
2. Proof That the Restraint of Trade Is Unreasonable
a. The Per Se Rule
b. The Rule of Reason
(1) Proof of Anticompetitive Effect
(a) The Quick Look

C. Horizontal Restraints of Trade
1. Horizontal Arrangements Controlling or Affecting Price
a. Per Se Illegal Arrangements Affecting Price
b. Arrangements Affecting Price Subject to the Rule of Reason
e. Exchanges of Price Information
2. Horizontal Arrangements among Competitors to Divide Markets or Allocate Customers
3. Horizontal Arrangements Constituting Concerted Refusals to Deal
a. Industry Self-Regulation
b. Sports Leagues and Associations
e. Health Care
4. Joint Ventures
5. Other Horizontal Arrangements
a. Conspiracies to Eliminate a Competitor by Unfair Business Conduct
b. Covenants Not to Compete

D. Vertical Restraints of Trade
l. Vertical Price Restraints
a. Resale Price Maintenance
b. Programs and Practices Affecting Resale Price
(1) Suggested Resale Prices
(2) Price Restrictions Related to Customer or Territorial Restrictions
2. Vertical Nonprice Restraints on Distribution
a. Exclusive Distributorships
b. Deal er Terminations and Refusals to Deal
3. Vertical Nonprice Restraints on Purchasing
a. Tying Arrangements
(1) Elements of a Per Se Violation
(a) Proof of Conditioning
(b) Sufficient Economic Power
b. Exclusive Dealing Arrangements

Chapter II - Monopolization and Related Offenses
A. Introduction
B. Monopoly Power
1. Definition of the Relevant Market
2. Evidence of Monopoly Power
a. Market Share as Indicator of Monopoly Power
b. Other Evidence Relevant to Existence of Monopoly Power
e. Regulation
d. Distinguishing Monopoly Power from Contractual Power
C. Willful Acquisition or Maintenance
1. Vertical Agreements That Foreclose Competition
2. Predatory Pricing
a. Price-Cost Analysis
b. Market Structure and Recoupment
3. Price Squeezes

4. Refusals to Deal
a. Generally
b. The Essential Facilities Doctrine
5. Monopoly Leveraging
6. Anticompetitive Litigation
7. Other Anticompeti tive Conduct.
D. Attempt to Monopolize
1. Predatory or Anticompetitive Conduct
2. Specific lntent
3. Dangerous Probability of Success
E. Conspiracy to Monopolize
F. Shared Monopoly

Chapter III - Mergers and Acquisitions

A. Introduction
1. Scope of Section 7
2. Enforcement Mechanisms and Guidelines

B. Horizontal Mergers
1. Determining and Assessing the Relevant Market
a. Defining the Relevant Market
b. Identifying Market Participants
e. Significance of Market Share and Concentration
2. Determining and Assessing Ease of Entry
3. Assessi ng Other Factors Bearing on the Competitive Impact of Increased Concentration
a. Market Conditions Affecting Coordinated Interaction
b. Market Conditions Affecting Unilateral Anticompetitive Activity
4. Determining and Assessing Efficiencies
5. Partial Ownership Issues

C. Nonhorizontal Mergers
1. Mergers between Potential Competitors
2. Vertical Mergers

D. Federal Agency Enforcement
1. Premerger Notification
2. Negotiated Settlements
3. Preliminary Relief

E. Enforcement by Private Parties

F. Enforcement by State Attomeys General

G. Interlocking Directorates

Chapter IV - Joint Ventures

A. Introduction

B. Legal Standards Applicable to Joint Ventures
1. Enforcement Agency Guidelines for Joint Ventures

C. Types of Joint Ventures
1. Joint Marketing and Selling Agreements

D. Analysis of Collateral Restraints

Chapter V - Robinson-Patman Act

A. Introduction

B. Price Discrimination Prohibited by Section 2(a)
1. The Req uirement of a Difference in Price
2. The Requírement of Sales to Two or More Purchasers
3. The Requirement of Commodities
4. The Requirement of Competitive Injury
a. Primary Line Injury
b. Secondary Line Injury

C. Wholesaler and Direct-Buying Retailer Pricing Issues

D. The Brokerage Provision

E. Buyer Liability

F. Injury to Plaintiffs under Section 4 of the Clayton Act

Chapter VI - Relevant Market

A. Introduction

B. Product Market Definition
1. Reasonable Interchangeability of Use
2. Cross-Elasticity of Supply
3. Submarkets
4. Limiting a Market to a Single Manufacturer's Product

C. Geographic Market Definition

D. Relevant Market Pleading and Practice
1. Motions to Dismiss the Complaint
2. Motions for Summary Judgment
3. Expert Evidence

Chapter VII - The Federal Trade Commission

A. Introduction

B. Jurisdictional Elements under the FTC Act
1. The Common Carrier Exemption

C. Section 5 of the FTC Act as an Antitrust Law
1. Practices That Violate the Sherman, Clayton, or Robinson-Patman Acts
a. The Three Tenors
b. Biovai! Corp. (Tiazac Orange Book Listing)
e. Biovail Corp. and Elan Corp
d. Schering-Plough Corp
e. Health Care
(1) Physician Organization Cases
(2) Review of Consurnmated Hospital Mergers
(3) FTC Study of Generic Drug Entry Prior to Patent Expiration
f. Standard-Setting Activities
g. Mergers
(1) Libbey, Inc./Anchor Hocking
(2) Commission Statements in Closed Merger Investigations
(a) Synopsys/Avant!
(b) Royal Caribbean/P&O Princess Cruises/Camival Corporation
(e) Kroger/Raley's Supermarkets

D. Section 5 of the FTC Act as a Consumer Protection Law
1. Deceptive Acts and Practices
a. Failure to Have Substantiation for a Claim Is Deceptive
b. Failure to Disclose Material Facts
2. Examples of How and When the Deceptive Standard Is Used
a. Characteristics of Products
b. Guides on Use of Endorsements and Testimonials
e. Guarantees
d. Rebates and Other Promotional Practices
e. Origin of Products
f. Deceptive Business, Employment, and Sales Practices in Certain Industries
g. Issues Related to New Technologies
(1) Privacy
(2) Identity Theft
(3) Internet Fraud
3. Unfair Acts and Practices
a. Examples of Unfair Practices

E. Federal Trade Commission Remedia! Power
1. Cease and Desist Orders
a. Limitations on Scope of FTC Orders
(1) First Amendment Concems
2. Trade Regulation Rules
3. Civil Penalties
4. Consumer Redress
5. Disgorgement in Competition Cases
F. Federal Trade Commission Enforcement Procedures
1. Precomplaint Investigation
a. Precomplaint Compulsory Process
b. Consumer Protection Enforcement Sweeps
e. Joint Federal and State Enforcement Efforts
d. Joint Enforcement with Foreign Govemments
2. Adjudicative Procedures
a. Adjudicative Discovery Procedures
3. Enforcement of District Court Orders

G. Other Federal Trade Commission Activities
l . Advisory Opinions, Industry Guides, Statements of Policy, and Reports
a. Advisory Opinions
b. Reports
2. Competition and Consumer Advocacy
3. Consumer Credit Enforcement
a. FTC Act
b. Fair Credit Reporting Act Fair Debt Collection Practices Act
d. Gramm-Leach-Bliley Act
e. College Scholarship Fraud Prevention Act
4. The Telemarketing Act
5. Pay-per-Call Services

H. Hearings and Workshops

Chapter VIII - Department of Justice Administration and Enforcement

A. Introduction

B. Organization and Structure

C. Relationship with the FTC

D. Investigations
1. Civil Investigations
2. Criminal Investigations
a. Grand Jury Proceedings

E. Civil Litigation
1. Injunctive Remedies
a. Consent Decrees
(1) Entry of Consent Decrees
(2) Intervention in a Consent Decree Proceeding

F. Criminal Litigation
1. Motions to Dismiss
2. Statements of Coconspirators
3. Posttrial Motions
4. Trends in Criminal Antitrust Enforcement
G. Nonprosecutorial Activities

Chapter IX - State Enforcement

A. Introduction

B. Statutory Framework
1. Federal Antitrust Laws
a. Actions as a Private "Person"
(1) Treble Damages Suits
(2) Actions for Injunctive Relief
b. Parens Patriae Actions
2. State Antitrust Laws
a. Development of State Antitrust Laws
b. Indirect Purchasers
e. Criminal Penalties and Civil Damages

C. Constitutional Challenges to State Antitrust Laws
1. The Commerce Clause
2. The Supremacy Clause

D. Coordinated Enforcement
1. Federal-State Cooperation

E. Recent State Enforcement Actions
1. Vertical Restraints
2. Mergers and Joint Ventures
3. Boycotts
4. Monopolization
5. Multistate Indirect Purchaser Litigation

Chapter X - Private Antitrust Suits

A. Introduction

B. Standing Requirements of Section 4 of the Clayton Act
1. "Injured in His Business or Property" Defined
a. "Business or Property" Defined
2. "By Reason of ' - The Antitrust Injury Requirement
3. Considerations of Remoteness
a. The Pass-On/Indirect Purchaser Doctrine
b. Other Cases Dealing with Remoteness Concems

C. Standing Requirements of Section 16 of the Clayton Act

D. Proof of lnjury and Damages
1. Proof of Damages
a. Burden of Proof
b. Calculation of Damages

E. Injunctive Relief.
1. ln General
2. Preliminary Injunctions
3. Permanent Injunctions

F. Defenses
1. Statute of Limitations
a. Accrual of Cause of Action
b. Tolling the Statute of Limitations
(1) Fraudulent Concealment

G. Practice and Procedure
1. Sumrnary Judgment
2. Antitrust Class Actions
a. Prerequisites to a Class Action
(1) The Numerosity Requirement
(2) Commonality
(3) Typicality
(4) Adequacy
b. Additional Requirements to Maintain a Class Action
(1) Rule 23(b)(3) Classes
(a) Predominance
(b) Superiority
e. The Class Certification Decision
d. Appealing the Class Certification Decision
e. Dismissal and Compromise of Class Actions
(1) Generally
(2) Distribution Plan Approval
(3) Approval of Attorneys' Fees
f. Notice and Costs in Class Actions
3. Selected Discovery Problems
a. Scope of Discovery
(1) Relevant Time Period
(2) Range of Products Subject to Discovery
b. Discovery from Nonparties
(1) Corporate Affiliates
(2) Nonparty Market Participants
e. Attomey-Client Privilege
d. Sanctions for Failure to Make Discovery
e. Fifth Amendment Issues
f. Electronic Discovery
4. Use of Govemment Judgments and Decrees
5. Admissibility of Expert Testimony
6. Appeals

H. Declaratory Judgments

I. Attomeys' Fees

J. Miscellaneous Topics
1. Arbitrability of Antitrust Claims
2. Rule 11
3. Antitrust Violation as a Defense to a Contract Suit
4. Contribution
5. Insurance Coverage for Antitrust Claims

Chapter XI - Antitrust Issues lnvolving Intellectual Property

A. Introduction

B. Federal Enforcement Activities

C. Patent and Copyright Antitrust Issues
1. Acquisitíon of Patents as an Antitrust Violation
2. Enforcement of Intellectual Property Rights as an Antitrust Violation
a. Intellectual Property Obtained by Fraud or Inequitable Conduct
b. Bad-Fai th Enforcement of Intellectual Property Rights
3. Licensing Intellectual Property as an Antitrust Violatíon
a. Exclusivity
b. Royalties
(1) Preissuance and Postexpiratíon Royalties
c. Tying Arrangements
4. Nonuse and Refusal to License Patents or Copyrights
5. Settlement of Infringement Actions and Interference Proceedings

D. Patent and Copyright Misuse
l . The Patent Misuse Doctrine
a. Overview of the Doctrine-Relation to Antítrust
b. Remed ies for Misuse
2 . The Copyright Misuse Doctrine

E. Procedural Aspects of the Antitrust-Intellectual Property Interface
1. Jurisdiction
2. Procedure

Chapter XII - Antitrust and International Commerce

A. Introductíon

B. Subject-Matter Jurisdiction and Related Issues
1. Jurisdiction over Foreign Conduct Involving Import Comrnerce
2. Jurisdiction over Foreign Conduct Not Involving Import Comrnerce
3. Direct, Substantial, and Reasonably Foreseeable Effect

C. Defenses and Exemptions to Application of Antitrust Law in Foreign Commerce

D. Discovery and the Conduct of Litigation in Foreign Commerce Cases
1. Discovery in Intemational Commerce Cases
2. Discovery within the United States in Actions outside the United States
3. Procedural Issues in Foreign Commerce

E. Intemational Antitrust Enforcement
1. Intemational Criminal Enforcement
2. Multijurisdictional Merger Review
3. Bilateral and Multilateral Cooperation

Chapter XIII - General Exemptions and Immunities

A. Introduction

B. The State Action Doctrine
1. State Action Analysis of Private Conduct-A Two-Part Framework
a. The Clear Articulation Requirement
b. The Active Supervision Requirement
2. Actions Taken by Subordinate Govemment Entities
a. State Executive Department, Agencies, or Special Authorities
b. Cities, Counties, and Municipalities
(1) Clear Articulation

C. Solicitation of Govemment Action
1. Basic Framework and Evolution of Noerr Immunity
a. Efforts to Influence Administrative Processes
b. Efforts to Influence Adjudicatory Processes
c. Efforts to Influence Private Organizations
2. Qualifications to Noerr Immunity
a. Sham Exception
b. Supplying False Information

D. Relationship between Antitrust and Govemment Regulation
1. Implied Exemptions
2. The Filed Rate Doctrine
3. Primary Jurisdiction

Chapter XIV - Regulated Industries

A. Agriculture

B. Communications
1. Common Carriers
a. The Telecommunications Act of 1996
(1) Judicial Interpretation of the 1996 Act
(a) The Interplay between the Antitrust Laws and the 1996 Act
(b) Iowa Utilities Board and the Limits of the Federal Communications Commission 's Local Competition Authority
(2) Provision of In-Region Long Distance

C. Energy
1. Natural Gas
a. Mergers and Acquisitions
2. Electric Power
a. Mergers and Acquisitions

D. Financial Institutions and Markets
1. Financial Institutions
a. Joint Ventures
b. Mergers and Acquisitions

E. Government Contracts

F. Health Care
1. Introduction
2. Staff Privileges
a. Denial, Terrnination, or Limitation of Staff Privileges
b. The Health Care Quality Improvement Act
3. Health Care Provider Networks and Joint Ventures
a. Pricing Issues for Provider Networks
b. Exclusionary Conduct by Provider Networks and Joint Ventures
(1) Refusals to Deal
(2) Exclusive and Selective Contracting
4. Other Pricing Issues in Health Care
a. Exchanges of Price and Other Information
5. Pharmaceuticals and Agreements to Impede Market Entry
6. The Noerr-Pennington and State Action Doctrines

G. Organized Labor

H. Sports

I. Transportation
1. Rail Transportation
a. Regulation of Rates and Agreements
b. Mergers and Acquisitions
e. Entry and Exit
2. Air Transportation
a. Regulatory History and Framework
b. Mergers, Acquisitions, and Joint Ventures
(1) Airline Joint Ventures
(2) International
e. Price Fixing and Related Conduct
d. Monopolization
e. Computer Reservation Systems

Table of Cases