US Monopolisation

Single-Firm Conduct Enforcement in the Us - A Year in Review

The current antitrust enforcement administration promised early on that single-firm conduct would get a fresh look and a higher level of scrutiny than in recent years. Following through with verve and vigour, the Department of Justice Antitrust Division has in the past 16 months initiated several single-firm conduct investigations that might not have been brought previously, sending a clear message to those with market power to tread lightly or face the enforcers.

The US Department of Justice Antitrust Division

When Assistant Attorney General Christine Varney announced early in her tenure that the Department of Justice Antitrust Division would reverse the Bush administration's policy with respect to Sherman Act section 2 enforcement, antitrust lawyers rushed to counsel their clients on the implications of the policy shift, and on how to avoid becoming the exemplar for the government's new enforcement efforts. The experience of the last year has shown those early concerns to be well placed.

Section 2 prohibits, among other things, monopolisation and attempts to monopolise, including exclusionary and predatory practices by companies in positions of market power, and seeks to prevent the formation of monopolies that restrain competition.¹A monopoly exists when an enterprise exercises sufficient control over a particular product or service to determine significantly the terms on which others have access to it.

Section 2 serves the same fundamental purpose as other provisions of US antitrust law: promoting a market-based economy that increases economic growth and freedom, and that promotes competition in the marketplace. The theory behind monopolisation policy is that competition in a free market benefits consumers by facilitating lower prices, better quality and greater choice. Free competition enables businesses to compete on price and quality in an open market and on a level playing field, unhampered by anti-competitive restraints.

But promoting a healthy level of competition is a balancing act. While section 2 and the antitrust laws generally seek to thwart anti-competitive behaviour aimed at exclusive control in the marketplace, the antitrust laws also strive to avoid chilling aggressive competition and lawful 'growth or development as a consequence of a superior product [or] business acumen.'²Section 2, thus, does not aim to eradicate firms from exercising monopoly power gained as a result of legitimate success. Rather, section 2 seeks to protect the process of competition.

During the Bush administration, the Antitrust Division issued a policy statement concerning single-firm conduct under section 2 that provided an analysis of the Division's views and enforcement intentions at that time.³The Division's views were embodied in a report issued by the Department of Justice on section 2 enforcement (the Report).⁴Notably, the Report was not joined by the Federal Trade Commission. It was generally understood to signal a reduction in section 2 enforcement activity by the Antitrust Division. As her first step in initiating a new wave of antitrust enforcement, Varney withdrew the guidelines for bringing section 2 cases that the Division had promulgated at the end of the Bush administration. Varney rejected the Report's concerns that antitrust enforcers and the courts would be unable to distinguish between anti-competitive acts and lawful conduct, and that their failure would lead to over-deterrence.⁵Varney disapproved of the Report's conclusion that the anti-competitive effects of unilateral conduct should be regulated only where the anti-competitive harm substantially outweighs pro-competitive benefits.⁶Instead, Varney emphasised the importance of vigorous antitrust enforcement, particularly in the government's response to economic crises.⁷

In its spring 2010 Update, the Antitrust Division repeated its commitment to section 2 enforcement and to the standards laid out in leading section 2 cases, including Lorain Journal v United States, Aspen Skiing Co v Aspen Highlands Skiing Corp, and United States v Microsoft.⁸In Lorain Journal and Aspen Skiing, the Supreme Court held conduct to violate section 2 of the Sherman Act where a firm with significant market share takes affirmative steps to exclude smaller competitors from the market for its products.⁹In the Microsoft case, the DC Circuit similarly held that affirmative steps to exclude rivals, when taken by a firm with a significant market position, can lead to a Sherman Act section 2 violation.¹⁰The Division's recent Update also echoed Varney's comments about removing barriers to government challenges to illegal monopolisation, and the need for strong enforcement to prohibit predatory or unjustified acts by companies with market power.¹¹

While the Division has not yet brought any monopolisation cases, it initiated several monopolisation investigations in 2009, and it has already brought a number of investigations in 2010.¹²In January 2010, the Antitrust Division reached a proposed settlement with the Daily Gazette Company and MediaNews Group Inc (now known as Affiliated Media Inc), that requires the companies to restructure their newspaper joint operating arrangement and take other steps to remedy the anti-competitive effects of their 2004 transaction, which consolidated ownership and control of the only two local daily newspapers in Charleston, West Virginia under the Daily Gazette Company.¹³The Division's complaint stated that the Gazette Company had monopolised the Charleston local daily newspaper market and that it possessed substantial monopoly power in the sale of local daily newspapers in the Charleston area in violation of section 2 of the Sherman Act.¹⁴

The Antitrust Division also has initiated a number of high-profile investigations into the potentially monopolistic behaviour of large internet and technology companies. The agency is reportedly in the preliminary stages of an investigation into Apple's alleged refusal to promote music that is part of Amazon.com's 'MP3 Daily Deal.'¹⁵DoJ investigators have reportedly interviewed executives from the four major music labels and several digital music retailers about Apple's business practices with respect to iTunes.¹⁶Regulators are also expected to launch a separate investigation of Apple following a complaint from Adobe, the software company whose video-on-the-internet platform Flash has never been supported on iPhones and other mobile devices from Apple.¹⁷Last year, additionally, the technology giant IBM was the subject of a preliminary investigation by the DoJ into whether it had abused its monopoly position in the market for mainframe computers.¹⁸In October 2009, antitrust regulators sought information about IBM's business practices from companies that compete with IBM in the market for large computer hardware and software.¹⁹The investigation followed a complaint by a computer trade organisation, backed by IBM competitors like Microsoft and Oracle, which alleged that IBM stymied competition in the mainframe market and blocked efforts by competitors and potential partners to license IBM's software.²⁰

The Antitrust Division has also restated its goal of prioritising competition advocacy efforts by enhancing cooperation with antitrust enforcement partners, and it has taken steps in the past year to create stronger relationships with other agencies to form a more unified front against anti-competitive conduct.²¹On 25 June 2010, the Antitrust Division and the US Department of Agriculture held a joint public workshop to examine competition and trends in the dairy industry, including market consolidation and market transparency.²²This unprecedented joint effort by the DoJ and the USDA may signal a heightened regulatory interest in ensuring efficiency and competition in the dairy industry through antitrust enforcement. Indeed, the DoJ has recently launched several widely publicised investigations into anti-competitive conduct in the agriculture sector. In March, the DoJ and seven state attorneys general reportedly began investigating whether Monsanto Co, the world's largest seed company, is using gene licences to keep competing technologies off the market.²³At issue is how the company sells and licenses its patented trait that allows farmers to kill weeds with Roundup herbicide while leaving crops unharmed.²⁴The company's Roundup Ready gene was in 93 per cent of US soya beans last year.²⁵In addition, it was reported in May 2010 that the Department of Justice began conducting an investigation into whether the handful of large meatpackers that slaughter most of the nation's cattle are illegally driving down cattle prices.²⁶Varney promised that the government was undertaking an 'unrelenting quest to find the correct balance' within the agricultural industry.²⁷

The Federal Trade Commission

Over the past year the Federal Trade Commission likewise has taken steps to enhance antitrust enforcement efforts. The Commission announced its plan to employ greater use of section 5 of the Federal Trade Commission Act as an enforcement tool to combat anti-competitive conduct. In a March 2010 speech, Commissioner Rosch stated that 'section 2 is not the only weapon in the Federal Trade Commission's arsenal … the Commission can also attack anti-competitive conduct under section 5 of the Federal Trade Commission Act.'²⁸Section 5 prohibits 'unfair methods of competition' and conduct that constitutes 'unfair or deceptive acts or practices.'²⁹The FTC's enhanced reliance on section 5 unsaddles it from the more stringent standards of proof that have emerged in the Supreme Court's section 2 jurisprudence.

Historically the Commission has relied on section 5 in a relatively small number of antitrust litigations; the overwhelming majority of the FTC's antitrust litigations have involved a traditional Sherman Act or Clayton Act analysis. Section 5, nonetheless, has a long history, and the FTC has sought to revive that history by using section 5 as another way to pursue free-standing claims alleging unfair methods of competition.

The FTC's greater interest in section 5 may reflect its concern that recent political and judicial activity has constrained access to traditional tools of antitrust enforcement. Specifically, the Commission has noted the judicial trend in recent decades to limit the reach of antitrust, which the Commission attributes to 'concern over class actions, treble damages awards, and costly jury trials.'³⁰'[T]he result [of this judicial trend] has been that some conduct harmful to consumers may be given a 'free pass' under antitrust jurisprudence, not because the conduct is benign but out of a fear that the harm might be outweighed by the collateral consequences created by private enforcement.'³¹As Commissioner Rosch noted, the most recent guidance from the Supreme Court on section 5 is a 1972 decision in FTC v Sperry & Hutchinson Co,³²where the court held that section 5 is not simply coextensive with other federal antitrust statutes, but instead reaches further.³³Just how far section 5 should reach beyond the Sherman Act, however, remains an unanswered question, and one that may be shaped in part by FTC enforcement efforts during the past year that have explicitly relied on section 5.

The Commission has outlined three areas of cases where it anticipates using section 5 as an enforcement tool in the future. First, where a party's conduct causes anti-competitive effects, such as an increase in price or a reduction in output (as required under the Sherman Act), but also conduct that causes a reduction in consumer choice by restraining free competition in the marketplace - such as a firm that uses deception to establish monopoly power and thereby eliminate competition. The second area of enforcement involves cases that fall into gaps in the Sherman Act, such as where the Commission believes that conduct is clearly having anti-competitive effects, but it determines that the facts would not be sufficient to bring a successful Sherman Act section 2 case. Finally, the FTC anticipates pursuing cases that Congress did not intend for private plaintiffs to be able to pursue under the other federal antitrust laws. Examples of such cases include instances where the conduct is in its incipient stages, and allegations that hinge on claims of deception.³⁴

Over the past year, the FTC has begun to shape the contours of section 5 enforcement. In a high-profile move last December, the FTC charged Intel Corporation with illegally using its dominant position in the markets for central processing units and graphics processing units to stifle competition and to strengthen its monopoly in violation of section 5 of the FTC Act.³⁵Specifically, it alleged that Intel carried out an anti-competitive campaign using threats and rewards aimed at the world's largest original equipment manufacturers to coerce them not to buy rival CPUs.³⁶The FTC's complaint also alleges Intel secretly redesigned key software in a way that deliberately stunted the performance of competing CPUs.³⁷The administrative trial is set to begin on 15 September 2010.³⁸The FTC also charged Transitions Optical Inc with violating section 5 of the FTC Act by using exclusionary contracts to maintain its monopoly in the photochromic lenses market.³⁹According to the FTC, Transitions had an 85 per cent market share of photochromic lenses sold in the US and new entrants could not find outlets for their products.⁴⁰Under a settlement with the FTC reached in April of this year, Transitions agreed to end existing exclusive dealing contracts and not enter into new ones.⁴¹

The Commission's proposed use of section 5 as a broad mandate to restore competition enjoys ample historical, yet by no means recent, judicial support.⁴²The judicial history of section 5 lends support to the FTC's broad mission to use section 5 to 'fill gaps' in antitrust law and to challenge conduct it finds harmful to consumers and against the spirit of free competition. It also supports the Commission's authority to bring such challenges where it could not, or would not, do so using other antitrust enforcement tools.

The Commission's decision to enhance use of section 5 is not without controversy however. Critics argue that this is simply a way for the FTC to evade section 2 monopolisation law and the narrower and more stringent legal requirements for bringing a claim under the Sherman Act. Commissioner Rosch's statements regarding the FTC's reliance on section 5 in its complaint against Intel provide fodder for such criticism. According to Commissioner Rosch, the FTC brought the case against Intel under section 5 partly because it involved a reduction of consumer choice, which warrants antitrust action even if the that loss is not also associated with a reduction in output, increase in price, or some demonstrably measurable competitive harm.⁴³Another reason, according to the Commission, that section 5 was the more appropriate claim against Intel is that intent evidence was relevant in that case, and some courts restrict the use of intent evidence in Sherman Act cases.⁴⁴

Over the past year, the FTC has also recommended changes in legal standards that apply to single-firm conduct under section 2 of the Sherman Act. Commissioner Leibowitz has addressed the controversial notion that, to promote efficiency, it is more important to protect potentially efficient conduct by monopolists than it is to protect competition.⁴⁵According to Leibowitz, proponents of this view favour per se legality and safe harbours for many types of conduct that could harm competition.⁴⁶Leibowitz has stated that this notion is inconsistent with the fundamental policy of the antitrust laws that competition leads to efficiency and to consumer gains.⁴⁷Similarly, Commissioner Rosch has fiercely criticised Justice Scalia's position in Trinko suggesting that monopolists are valuable; in Rosch's view, the net effect of a monopoly is less innovation.⁴⁸

FTC commissioners have also commented on the legal tests used to evaluate single-firm conduct. In an October 2009 speech concerning the scope and application of section 2, Commissioner Rosch suggested that there should be a single test for evaluating all exclusionary conduct under section 2, even if that test is not perfect and does not apply to all monopolisation cases.⁴⁹Rosch noted that the court came close to establishing such a test in Aspen Skiing.⁵⁰In Rosch's view, under such a test a firm with monopoly or near monopoly power that engages in exclusionary conduct that has anti-competitive effects could be liable under section 2.⁵¹ Anti-competitive effects would be measured by looking at: the effect of the defendant's exclusionary practices considered together,⁵²allowing a plaintiff to plead and prove a section 2 claim based on a course of conduct, even where a series of actions, standing alone, would not be unlawful; evidence that a firm intended its exclusionary conduct to exclude or cripple a rival or would-be rival, which should be considered probative of monopolisation; and a defendant's change in practices, which can bespeak an anti-competitive intent.⁵³The idea of considering a change in practice as indicative of a firm's intent is not without judicial support. For example, the District Court for the Northern District of California, in an extension of Aspen Skiing, refused to dismiss a challenge based in part on a monopolist's duty to deal and their sudden change of course.⁵⁴There, Abbott manufactured an HIV drug, Norvir, which was found to work better as a booster to other drugs, decreasing its required dosage and thus its daily price.⁵⁵It introduced its own 'boosted' version called Kaletra, but competitors introduced more effective drugs, Reyataz and Lexiva, which used Norvir as a 'booster.'⁵⁶Abbott then raised the wholesale price of Norvir 400 per cent while keeping the price of Kaletra constant.⁵⁷The court found that Abbott's sudden change in practices, combined with an alleged duty to deal, was enough to sustain the plaintiff's complaint.⁵⁸

As far as industry-specific activity, the FTC has made it clear that healthcare enforcement is a major priority, particularly in light of the national debate on healthcare policy, and the idea that competition in this area is especially critical to reducing costs and encouraging innovation. The FTC has been active in the area of follow-on biologic drug competition, which involves drugs manufactured using living tissues and microorganisms which are classified as 'large molecule' drugs (in comparison to their 'small molecule,' chemically-synthesised cousins). In June 2009, the FTC issued a report which concluded that follow-on biologic drug (FOB) competition is unlikely to be similar to generic drug competition.⁵⁹Commissioner Rosch stated that:

In theory, follow-on biologics are like generic drugs in that they provide a lower cost replica of the original large molecule biologic drug. However, because follow-on biologics are not 'identical' (in the same way a small molecule generic drug is to its brand counterpart), follow-on biologics pose significant challenges from a regulatory standpoint.⁶⁰

The FTC June 2009 report found that the dynamics of the FOB market will contrast sharply with the market dynamics of generic drug competition, where lower-cost generic entry and automatic substitution lead to rapid erosion of the branded drug's market share.⁶¹ Instead, FOB entry is likely to occur only in biologic drug markets with more than US$250 million in annual sales; only two or three FOB manufacturers are likely to attempt entry in competition with a particular pioneer drug product; and these FOB entrants likely will not offer price discounts larger than 10 to 30 per cent off the pioneer product's price.⁶² The FTC concluded that innovative products should not receive additional market exclusivity beyond the term of their patents.⁶³

However, on 23 March 2010, President Obama signed into law the Patient Protection and Affordable Care Act, which included the Biologics Price Competition and Innovation Act of 2009 (the Biologics Act).⁶⁴

The Biologics Act creates an abbreviated regulatory approval pathway for biosimilar versions of branded biological products. Some features of the Act that may impact antitrust regulation include: a 12-year data exclusivity period for the innovator biological product; one-year exclusivity for an interchangeable biosimilar product; procedures to accelerate the litigation of patents through the creation of a list to identify patents in question; and provisions that require information sharing between innovator firms and FOB manufacturers.⁶⁵ Before the Bill passed, Commissioner Rosch criticised the information-sharing provision, warning it would create anti-competitive outcomes by chilling developments by generic firms - as well as innovator firms - because all of the trade secrets flowing from development will have to be disclosed.⁶⁶ The effects of the Bill are yet unknown, but many will be watching to see whether Commissioner Rosch's predictions prove true. Also relevant to monopolisation is the unique effect the Biologics Act may have on advertising campaigns surrounding FOB products. Because the Biologics Act only requires an FOB product to be biosimilar and not identical, FOB products will necessarily be different from the innovator's product in some way. Unlike brand drug manufacturers of small-molecule pharmaceuticals, innovators could be incentivized to initiate advertising campaigns that compare the innovator's product to the FOB product. Such advertising campaigns may be vulnerable to attempted monopolisation challenges under section 2 of the Sherman Act.

Private party litigation

A number of developments have also emerged with respect to private party antitrust litigation - with mixed results. Although both the Department of Justice and Federal Trade Commission have stated their intentions to make enforcement of the antitrust laws in the healthcare markets a priority, courts have recently been reluctant to sustain plaintiffs' antitrust challenges in healthcare markets. For example, in Howard Hess Dental Labs Inc v Dentsply Int'l Inc, a group of dental laboratories brought a class action alleging that agreements between manufacturers of artificial teeth and distributors, which prohibited the distributors from carrying competitive brands violated, inter alia, section 2 of the Sherman Act.⁶⁷ Plaintiffs sought injunctive relief to prevent Dentsply from imposing exclusive agreements on the distributors and retaliating from those that did not submit to Dentsply's demands.⁶⁸ The Third Circuit upheld the denial of plaintiffs' summary judgment motion on monopolisation claims even though the same defendants had successfully been prosecuted by the DoJ for the same monopolisation claim. In the government's case, United States v Dentsply Int'l Inc,⁶⁹ the court found that Dentsply both possessed monopoly power in the artificial tooth market and had used that power to foreclose competition.⁷⁰ The Hess plaintiffs argued that the court's holding in the government's case led to an inference of antitrust injury that defendants were estopped from denying.⁷¹ The Third Circuit, however, found that antitrust injury was not a necessary component of the holding in the government's case and thus collateral estoppel did not apply. The Third Circuit held that plaintiffs had failed to state a cognisable claim of antitrust injury because the government's injunction was sufficient to remedy any antitrust harms.⁷²

Courts have also recently addressed the ability of monopolists to make alterations to their products that have the effect of reducing compatibility with competitors' products. While these changes are not immune from antitrust scrutiny, product improvements alone, even by a monopolist whose improvement harms competitors, generally do not violate section 2 of the Sherman Act. For example, in Allied Orthopedic Appliances Inc v Tyco Health Care Group LP, the Ninth Circuit held that Tyco's improvements to its pulse oximetry sensors did not constitute anti-competitive conduct.⁷³ Tyco patented a new system incompatible with generic sensors, which plaintiffs argued was done unlawfully to maintain its monopoly over the sensor market.⁷⁴ The court found that although Tyco's improvements might have reduced competition, it was due only to improvements in the product, not to any anti-competitive conduct. There is no room in this analysis for balancing the benefits or worth of a product improvement against its anti-competitive effects.⁷⁵Even an admitted monopolist thus has the right to redesign products to make them more competitive or more attractive to buyers, without weighing the resulting injuries to competitors. There was no evidence that Tyco used its market power to force anyone to adopt the new system and summary judgment was granted to defendant.⁷⁶

Contrast that result with In re Apple iPod iTunes Antitrust Litigation, where the court denied the defendant's motion to dismiss a monopolisation claim.⁷⁷The plaintiffs alleged that Apple used software updates to shut out competition from the digital music and music player industries.⁷⁸ Plaintiffs argued that the software redesigns had no legitimate antipiracy or other purposes and were solely to exclude rivals from the market.⁷⁹ The court held that those allegations, if proven, sufficiently established a claim for monopolisation.⁸⁰

Courts, in the past year, have enforced strict limits on antitrust standing for cases brought by competitors. For example, in Four Corners Nephrology Assocs PC v Mercy Medical Ctr of Durango, Mercy Medical sought to bring plaintiff, Dr Bevan, to its practice, but he declined.⁸¹ It then hired someone else, revoked Dr Bevan's consultation rights at the hospital, and made the new hire the exclusive nephrology provider at the hospital.⁸² Bevan sued, arguing that the exclusive contract was either monopolisation or an attempt to monopolise the market for nephrology services in the Durango, Colorado area.⁸³ The court found that even if the defendant was a monopolist, the plaintiff was simply attempting to join in the monopoly, not to compete with it effectively. Plaintiff thus lacked antitrust standing.⁸⁴

Similarly, in Race Tires Am Inc v Hoosier Racing Tire Corp, plaintiffs challenged 'single tyre rules' where bodies that sanction car races require that a specific tyre type and brand be used in races sanctioned by that body.⁸⁵ Plaintiffs argued that defendant's exclusive single tyre contracts with various sanctioning bodies foreclosed competition.⁸⁶ The competition to be the exclusive supplier, however, created a competitive market in which plaintiff had successfully competed. Accordingly, the court found as a matter of law that there is no antitrust injury to the plaintiff when it loses the competitive battle to be the exclusive supplier.⁸⁷

Moreover, in Kentucky Speedway LLC v Nat'l Ass'n of Stock Car Auto Racing Inc, Kentucky Speedway LLC (KYS) brought sections 1 and 2 claims against both the National Association of Stock Car Auto Racing Inc (NASCAR) and an affiliated company, International Speedway Corporation (ISC) that owns multiple racetracks, on the grounds that not sanctioning a Sprint Cup race at KYS's racetrack in Kentucky and preventing KYS from purchasing other racetracks that already host such a race violated the antitrust laws.⁸⁸ The appeals court upheld dismissal by the district court on the basis of failure to adequately define a relevant product market, but also noted that the plaintiff did not suffer an antitrust injury.⁸⁹

At least one case, however, Palmyra Park Hosp v Phoebe Putney Memorial Hosp, allowed a competitor's antitrust challenge to proceed based on the unique circumstances of the healthcare industry and the low likelihood of other plaintiffs suing.⁹⁰ Plaintiff, Palmyra, operated a for-profit hospital and defendant, Phoebe Putney, operated a non-profit hospital in the same area.⁹¹ Phoebe Putney was the only area hospital that held certificates of need (CONs) from the state, which entitled it to provide certain specialty services.⁹² Private insurers, therefore, needed to ensure that Phoebe Putney was within its network to compete effectively.⁹³Palmyra alleged that Phoebe Putney used its monopoly in the areas where it had the only CONs to force insurers to remove Palmyra from their networks.⁹⁴ The district court dismissed for lack of antitrust standing. The appeals court reversed, employing a two-prong test for antitrust standing. First, there must be antitrust injury. Second, the plaintiff must be an efficient enforcer of the antitrust laws.⁹⁵ The court held that, given the unique market circumstances in the healthcare industry, Palmyra had antitrust standing.⁹⁶It did not address the merits of the parties' positions on antitrust violations, and remanded to the district court for further consideration.⁹⁷The court distinguished the case at issue from those where the plaintiff simply wants to join in the alleged anti-competitive behaviour because Palmyra lacks CONs for the services, so could never join Phoebe Putney in its alleged unlawful arrangement.⁹⁸

These developments in enforcement of the antitrust laws indicate the need for companies to monitor the pulse of the changing regulatory environment. While gaps between agency enforcement and judicial decision-making exist, the courts, especially lower courts, continue to pay deference to the agencies' policy objectives and enforcement efforts to promote competition. The near-term future is likely to see still stricter scrutiny of exclusionary conduct by firms with market power, and business practices will need to be tailored accordingly with the advice of antitrust counsel.

*. The authors wish to thank John R Ingrassia for his assistance in the preparation of this article.

Notes

1

. 15 USC section 2 (2000).

2

. United States v Grinnell Corp, 384 US 563, 571 (1966).

3

. US Department of Justice, Competition and Monopoly: Single-Firm Conduct Under Section 2 of the Sherman Act (2008), available at www.justice.gov/atr/public/reports/236681.pdf.

4

. Christine A Varney, assistant attorney gen, Antitrust Div, US Dep't of Justice, Vigorous Antitrust Enforcement in this Challenging Era, Remarks Prepared for the Center for American Progress 14 (11 May 2009) (transcript available at www.usdoj.gov/atr/public/speeches/245711.pdf).

5

. Id.

6

. Id.

7

. Id.

8

. Christine A Varney, US Dep't of Justice Spring 2010 Update, www.justice.gov/atr/public/update/2010/aag-message.html (last visited July 26, 2010) (hereinafter 2010 Update ).

9

. Lorain Journal Co v United States, 342 US 143 (1951); Aspen Skiing Co v Aspen Highlands Skiing Corp, 472 US 585 (1985).

10

. United States v Microsoft Corp, 165 F3d 952 (1999).

11

. 2010 Update, supra note 8.

12

. John D Harkrider, Obama: The First Year, Vol 24, No. 3, Antitrust 11 (Summer 2010).

13

. Press release, US Dep't of Justice Antitrust Division, Justice Department Reaches Settlement with Daily Gazette Company And Medianews Group Inc. (Jan. 20, 2010) (available at www.justice.gov/atr/public/press_releases/2010/254282.htm).

14

. United States v Daily Gazette Company and Medianews Group Inc; Proposed Final Judgment and Competitive Impact Statement, 75 Fed Reg 11682-01, ¶ 44 (Dep't of Justice, Antitrust Division, 11 March 2010).

15

. Greg Sandoval, 'With iTunes, Apple has Thrown Weight Around', CNET (26 May 2010), http://news.cnet.com/8301-31001_3-20006019-261.html.

16

. Id.

17

. Josh Kosman, 'An Antitrust App: Apple May Be in the Eye of Regulatory Storm', NY Post, 3 May 2010, available at www.nypost.com/p/news/business/an_antitrust_app_buvCWcJdjFoLD5vBSkguGO.

18

. Ashlee Vance & Steve Lohr, 'US Begins Antitrust Inquiry of IBM', New York Times, 7 October 2009, available at www.nytimes.com/2009/10/08/technology/companies/08antitrust.html.

19

. Id.

20

. Id.

21

. 2010 Update, supra note 8.

22

. Press release, US Dep't of Justice Antitrust Division, Department of Justice and USDA Hold Workshop Focused on Competition Issues in the Dairy Industry (25 June 2010) (available at www.justice.gov/atr/public/press_releases/2010/260109.htm).

23

. Jack Kaskey & William McQuillen, 'Monsanto's Patents may be Resistant to Antitrust Claims', The News Journal (Wilmington, Del), 13 March 2010.

24

. Id.

25

. Id.

26

. Nate Jenkins, 'Feds Doing 1st Investigation of Major Meatpackers', The Associated Press (May 3, 2010), www.salon.com/wires/allwires/2010/05/03/D9FF790G2_us_food_and_farm_meatpacker_probe/index.html.

27

. Carey Gillam, 'Update 1-US Pledges to Probe, Bust Agribusiness Monopolies', Reuters (12 March 2010), www.reuters.com/article/idUSN1215754320100312.

28

. J Thomas Rosch, Commissioner, Fed.Trade Comm'n, Promoting Innovation: Just How Dynamic Should Antitrust Law Be?, Remarks Before the USC Gould School of Law 2010 Intellectual Property Institute (23 March 2010) (transcript available at www.ftc.gov/speeches/rosch/100323uscremarks.pdf) (hereinafter Rosch, Dynamic Antitrust Law ).

29

. 15?USC sections?41-58.

30

. Jon Leibowitz, chairman & J Thomas Rosch, commissioner, Fed Trade Comm'n, Statement of Chairman Leibowitz & Commissioner Rosch, In the Matter of Intel Corporation, Docket No. 9341, available at www.ftc.gov/os/adjpro/d9341/091216intelchairstatement.pdf.

31

. Id.

32

. 405 US 233, 244 (1972).

33

. Rosch, Dynamic Antitrust Law, supra note 28.

34

. Id.

35

. Press Release, Fed Trade Comm'n, FTC Challenges Intel's Dominance of Worldwide Microprocessor Markets (16 December 2009) (available at www.ftc.gov/opa/2009/12/intel.shtm).

36

. Id.

37

. Id.

38

. Id.

39

. Press Release, Fed Trade Comm'n, FTC Bars Transitions Optical Inc from Using Anticompetitive Tactics to Maintain its Monopoly in Darkening Treatments for Eyeglass Lenses (3 March 2010) (available at www.ftc.gov/opa/2010/03/optical.shtm).

40

. Id.

41

. Id.

42

. See, eg, Pan Am World Airways Inc v United States, 371 US 296 (1963) (stating that section 5 gives the Commission the power to issue cease and desist orders and divestures that would prevent methods of unfair competition); FTC v Sperry & Hutchinson Co, 405 US 233, 244 (1972) (confirming the FTC's power to consider under section 5 public values beyond simply those enshrined in the letter or encompassed in the spirit of the antitrust laws ); FTC v Motion Picture Advertising Serv Co, 344 US 392, 394-95 (1953) (suggesting that section 5 covers incipient practices that, when full-blown, would violate the Sherman or Clayton Act); FTC v Beech-Nut Packing Co, 257 US 441 (1922) (section 5 prohibits practices which violate the policy but not the letter of the Sherman Act).

43

. J Thomas Rosch, commissioner, Fed Trade Comm'n, Concurring and Dissenting Statement of Commissioner J Thomas Rosch, In the Matter of Intel Corporation, Docket No. 9341, available at http://ftc.gov/os/adjpro/d9341/091216intelstatement.pdf.

44. Id.

44

. Id.

45

. Jon Leibowitz, chairman, Fed. Trade Comm'n, Remarks of Chairman Jon Leibowitz, 36th Annual Conference on International Antitrust Law & Policy, Fordham Competition Law Institute at Fordham Law School (24 September 2009) (transcript available at www.ftc.gov/speeches/leibowitz/090924fordhamspeech.pdf).

46

. Id.

47

. Id.

48

. J Thomas Rosch, commissioner, Fed Trade Comm'n, Wading into Pandora's Box: Thoughts on Unanswered Questions Concerning the Scope and Application of section 2 & Some Further Observations on section 5. Remarks Before the LECG Newport Summit on Antitrust Law & Economics. (3 October 2009) (transcript available at www.ftc.gov/speeches/rosch/091003roschlecgspeech.pdf) (hereinafter Rosch, Pandora's Box ).

49

. Id.

50

. Id.

51

. Id.

52

. LePage's Inc v 3M, 324 F3d 141, 162 (3d Cir 2003) (en banc).

53

. Rosch, Pandora's Box, supra note 48.

54

. Safeway Inc v Abbott Labs, 2010 WL 147988 (N.D. Cal. Jan. 12, 2010).

55

. Id at *1.

56

. Id.

57

. Id.

58

. Id at *8.

59

. Fed Trade Comm'n, Emerging Health Care Issues: Follow-on Biologic Drug Competition , FTC Report (June 2009), available at www.ftc.gov/os/2009/06/P083901biologicsreport.pdf (hereinafter FTC Biologics Report).

60

. J Thomas Rosch, commissioner, Fed Trade Comm'n, Pay-for-Delay Settlements, Authorized Generics, and Follow-on Biologics: Thoughts on the How Competition Law Can Best Protect Consumer Welfare in the Pharmaceutical Context, Remarks Before the World Generic Medicine Congress (19 November 2009) (transcript available at www.ftc.gov/speeches/rosch/091119worldgenerics.pdf) (hereinafter Rosch, Pay-for-Delay).

61

. FTC Biologics Report, supra note 59.

62

. Id.

63

. Id.

64

. Patient Protection and Affordable Care Act, HR 3590, 111th Cong (2010).

65

. Id.

66

. Rosch, Pay-for-Delay, supra note 60.

67

. 602 F3d 237 (3d Cir. 2010).

68

. Id at 246.

69

. 399 F3d 181 (3d Cir 2005).

70

. Id at 196.

71

. Hess, 602 F3d at 247.

72

. Id at 251.

73

. 592 F3d 991 (9th Cir 2010).

74

. Id at 994.

75

. Id at 1000.

76

. Id. at 1003.

77

. 2010 WL 2629907 (N.D. Cal. June 29, 2010).

78

. Id. at *3.

79

. Id at *4.

80

. Id.

81

. 582 F3d 1216 (10th Cir 2009).

82

. Id at 1219.

83

. Id.

84

. Id at 1227.

85

. 660 F Supp 2d 590, 597 (WD Pa 2009).

86

. Id at 595.

87

. Id at 607.

88

. 588 F3d 908, 913-14 (6th Cir 2009).

89

. Id at 920-21.

90

. 604 F3d 1291 (11th Cir 2010).

91

. Id at 1295.

92

. Id.

93

. Id.

94

. Id.

95

. 604 F3d at 1299.

96

. Id at 1306.

97

. Id at 1307.

98

. Id at 1304.