Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

Monday, November 10, 2008

Justice Stevens and the Rule of Reason

Posted by D. Daniel Sokol

Waller Spencer Waller of Chicago Loyola Law School provides an assessment of Justice Stevens and the Rule of Reason.

ABSTRACT: Over the past thirty plus years Justice Stevens has played a special role in the jurisprudence of antitrust. He came to the Supreme Court after a successful career as an antitrust litigator, scholar, law teacher, and federal appellate judge. Justice Stevens applied the special insights this background provided to articulate a unique voice in shaping antitrust. While much of the antitrust debate since World War II has concerned the proper legal standard for assessing the competitive impact of agreements under the antitrust laws, Justice Stevens has focused much of his analytical work for the Court on a more sophisticated, but no less important, question - how should a court actually determine whether an agreement unreasonably restricts competition in violation of the antitrust laws. In antitrust terms, the question for Stevens was not so much whether the per se rule or the rule of reason applied in a particular case, but what does the rule of reason actually mean and how should it be applied.

In this article, I examine the distinctive voice Justice Stevens brought to antitrust, some of the personal and professional influences that created this voice; and the impact of Justice Stevens on the antitrust jurisprudence of the Supreme Court in defining the rule of reason and its application. I argue that Stevens, more than any Justice, helped define the rule of reason as a single unitary continuum in analyzing agreements under Section 1 of the Sherman Act and further defined what counted as potential legitimate justifications under the rule.

Part I lays out Justice Stevens's student and early professional career and the influence that Professor James Rahl of Northwestern University School of Law had on Justice Stevens and his antitrust philosophy. Part II analyzes the litigation practice, scholarly writing, and limited antitrust appellate opinions of then Judge Stevens for further clues as to his evolving antitrust philosophy. Part III examines the numerous Supreme Court opinions authored by Justice Stevens which analyze the critical issue of what the rule of reason actually means when it applies in a case. Finally, I conclude that Justice Stevens' most important contribution in antitrust was to redefine the rule of reason from an empty analytical box in which defendants automatically prevailed into the core tool of modern antitrust law in which courts conduct a more meaningful analysis of the competitive impact of agreements.

November 10, 2008 | Permalink | Comments (0) | TrackBack (0)

Private Actions in EC Competition Law

Posted by D. Daniel Sokol

Rennato Nazzini (University of Southampton) & Ali Nikpay (Office of Fair Trading) provide their thoughts on Private Actions in EC Competition Law.

ABSTRACT: The paper considers the case for reform of the system of private actions in the European Union. In doing so, it seeks to identify the central changes which would need to be made if private actions are to play a more significant role in the competition regime. Contrary to recent statements made by the European Commission, the paper argues that any changes made must recognize that private actions perform a dual function in EC competition law: they not only compensate those who have been harmed by anticompetitive behavior but also contribute to the overall level of deterrence generated by the competition regime. Going further, it argues that whilst increased deterrence and compensation almost always go hand in hand, the primary objective of private actions is to support effective competition enforcement.

Building on this, the paper identifies and examines the main pillars of any effective reform program in Europe: enhancing the role of collective actions, clarifying the issues surrounding indirect purchasers’ standing and passing-on, and ensuring, as far as possible, that public and private enforcement operate in harmony—where they clash, the paper argues that the former must take precedence over the latter.

In light of this discussion, the paper goes on to assess the proposals made by the European Commission (“Commission”) and the U.K. Office of Fair Trading (“OFT”) for reform of the system. It concludes that the proposals made, if implemented, would appreciably increase the incentives of businesses to comply with the EC competition rules while at the same time achieving higher levels of compensation. In addition the reformed system would retain significant safeguards to guard against the risk of unmeritorious or speculative claims. However both sets of proposals are cautious in particular in relation to the availability of opt-out collective actions. This is an issue which policymakers in Europe may need to return to in the future.

November 10, 2008 | Permalink | Comments (0) | TrackBack (0)

Sunday, November 9, 2008

Competition Law and Policy in El Salvador: Peer Review

Posted by D. Daniel Sokol

The OECD has published Competition Law and Policy in El Salvador: Peer Review.  As someone who has done work for the Salvadorian agency, let me add that among young agencies around the developing world this is a great agency with strong leadership and a capable staff.  There are a number of more established agencies in Latin America that do far less than the Salvadorians, even when these more established agencies have larger budgets and more staff.

November 9, 2008 | Permalink | Comments (0) | TrackBack (0)