Monday, April 20, 2009
Posted by D. Daniel Sokol
ABSTRACT: Assume that Defendant is a monopolist at the upstream level; that it produces a product at the downstream level; and that it also sells the upstream input to downstream competitors. Under certain circumstances, Defendant can, by reducing its downstream prices or by increasing its upstream prices, eliminate downstream competitors’ margins and “squeeze” the downstream competitor out of the downstream market. That much is uncontroversial. Much more controversial is whether such conduct should be subject to scrutiny under the antitrust laws.