Antitrust & Competition Policy Blog

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

Tuesday, July 5, 2011

Video on Australia’s approach to expert evidence in competition law cases - the Hot Tub

Posted by D. Daniel Sokol

The University of Melbourne Competition Law & Economics Network (CLEN) is pleased to announce the release of a video that it has made on Australia’s approach to expert evidence in competition law cases – THE HOT TUB

Viewing The Hot Tub Video The Hot Tub video can be viewed on the University Faculty of Business and Economics You Tube channel at It is split into three Parts for reasons of length. It is recommended that viewers click “Play all” rather than any of the links to the individual Parts.

About the Making of The Hot Tub Video

On 24 May 2011, the Melbourne Law School held a mock performance of a 'hot tub' - a mode of taking economic evidence from expert witnesses developed in competition law cases, and regularly employed in the Australian Competition Tribunal and the Federal Court. This approach has benefits over the traditional style of witness examination insofar as it enables the expert evidence to be adduced after the lay evidence has been adduced on both sides and hence at a stage in proceedings when the "facts" are established and the issues clearly identified. It also has benefits in enabling the experts to question each other directly, in addition to cross examination by counsel which generally follows. The direct questioning method is regarded as an effective way of narrowing the differences between the experts and crystallising their opinions on the matters at issue. The mock performance was held in the Law School's state-of-the-art moot court. It was based on the case brought by the Australian Competition and Consumer Commission against the concrete manufacturer, Boral, alleging breach of the prohibition in s 46 (the misuse of market power/abuse of dominance prohibition) of the then Trade Practices Act 1974 (now the Competition and Consumer Act 2010). The allegations were based on pricing and capacity related conduct by Boral. The proceeding in the moot court was presided over by the Hon Peter Heerey QC, the judge who sat at first instance in the actual Boral trial. Acting as the experts were leading economists from the economic consultancy Frontier Economics (and senior fellows in the Law School's Masters program), Dr Philip Williams (for the ACCC) and Richard York (for Boral). Counsel were played by senior members of the Victorian Bar, David Shavin QC (who acted for the ACCC in the actual case) and Jack Fajgenbaum QC. An agreed statement of facts was prepared and the experts also prepared expert reports which were made available to students in advance.

The hot tub enactment took place over an hour in front of students from the Law School. It saw the experts each give an opening statement and then question each other directly, followed by cross examination of each of them by opposing counsel. The enactment proved a highly effective way of demonstrating to students this distinctive approach to economic evidence in competition law cases. The University is very grateful to the "cast" of senior members of the profession who contributed their time and expertise so generously to make this possible.

The proceeding was filmed and, together with commentary from several of the cast, has been produced as a film by the Teaching and Learning Unit of the University’s Faculty of Business & Economics for use in teaching students in a range of law and economics subjects at the University in undergraduate and graduate programs. The commentary in the video canvasses the origins of the Hot Tub in Australia and the advantages as well as some of the challenges involved with this approach from the perspectives of counsel, judges and economists.

July 5, 2011 | Permalink | Comments (0) | TrackBack (0)

The Role of Hearing Officers in EU Competition Proceedings: A Historical and Practical Perspective

Posted by D. Daniel Sokol

Michael Albers and Jeremie Jourdan (both European Commission) have written The Role of Hearing Officers in EU Competition Proceedings: A Historical and Practical Perspective.

ABSTRACT: The role of the Hearing Officers evolved over time since their creation in 1982. Today, they are the guardians of the rights of defence, and contribute to the objectivity, transparency and efficiency of EU competition proceedings. In the current debate about due process, suggestions have been made to strengthen their role further.

July 5, 2011 | Permalink | Comments (0) | TrackBack (0)

Monday, July 4, 2011

Leveraging Monopoly Power by Degrading Interoperability: Theory and Evidence from Computer Markets

Posted by D. Daniel Sokol

Christos Genakos (Cambridge), Kai-Uwe Kuehn (Michigan), and John Van Reenen (LSE) discuss Leveraging Monopoly Power by Degrading Interoperability: Theory and Evidence from Computer Markets.

ABSTRACT: When will a monopolist have incentives to foreclose a complementary market by degrading compatibility/interoperability of his products with those of rivals? We develop a framework where leveraging extracts more rents from the monopoly market by "restoring" second degree price discrimination. In a random coefficient model with complements we derive a policy test for when incentives to reduce rival quality will hold. Our application is to Microsoft's strategic incentives to leverage market power from personal computer to server operating systems. We estimate a structural random coefficients demand system which allows for complements (PCs and servers). Our estimates suggest that there were incentives to reduce interoperability which were particularly strong at the turn of the 21st Century.

July 4, 2011 | Permalink | Comments (0) | TrackBack (0)

An Inconvenient School of Thought

Posted by D. Daniel Sokol

F. Scott Kieff, George Washington University - Law School has posted An Inconvenient School of Thought.

ABSTRACT: While a core focus of Carrier’s book is the relation between patents and antitrust, the book leaves its reader entirely in the dark about the school of thought about that interface that actually motivated Congress in passing the present patent system into law and that shaped the next half century of development in the case law. It is good that the book is not designed to recount history, because it would in that endeavor be writing out of the history the very events that were controlling. It also is good that the book is not designed to help the reader engage in a fulsome intellectual enterprise, because it would fail in that endeavor as well by leaving the reader totally in the dark about a major school of thought in the field. The book’s success is in providing a nicely written and thoughtfully worded dissertation about the views of Carrier and his intellectual friends.

July 4, 2011 | Permalink | Comments (0) | TrackBack (0)