Questions

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Class 2 - Enforcement and Monopolization

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Class 4 - Monopoly Conduct

Question 1

I'm still stuck on how embedding service in with United Shoe's leases was anti-competitive. I get that the lease was, but what is inherently anti-competitive to other shoe machinery sellers about offering a service with your lease? After all the lease was the industry standard since the civil war. I do get that this clause limited a third party service industry, but I don't understand how it was anti-competitive with regard to other shoe machinery manufacturers.

Answer 1

Consider it as a matter of barriers to entry: What do you need to gather to start selling shoe machinery? If the 70-80% market leader offers only "leases with service included," customers can't price the service separately, and independent service organizations can't easily develop (with max 30% of the shoe machines to service). To get started, the would-be competitor must be able to offer both machines and service.

Class 5 - Monopoly Conduct II

Comment

In the notes after Trinko, the supplement mentions a case Evic Class Action Litigation. The book says that the case "held that UPS's software for tracing packages could be an essential facility that must be shared with rivals." Defendant, UPS, had brought a motion to dismiss. The court found that the plaintiff class, sellers of shipping insurance, had alleged sufficient facts relating to the use of UPS facilities for selling insurance as essential facilities to survive a demurrer. The court did not hold, as the text implies, that UPS would have to allow FedEx to use UPS's tracking software.

Comment

Wikipedia Entry on Bundling (Tying) http://en.wikipedia.org/wiki/Product_tying

Class 13

Comment

The Economist has an excellent cartoon on the Delta-Northwest merger that we discussed in class: http://www.economist.com/daily/kallery/displaystory.cfm?story_id=11072063

Class 16

Comment

"In his chapter in the forthcoming book Antitrust Stories (Foundation Press, Eleanor Fox and Dan Crane editors), Steve Calkins relates the saga that included the landmark Broadcast Music case. It's a great story peopled with colorful characters - and one in which amicii, both in Broadcast Music and in a predecessor case, may have helped cause the litigation to have lasting impact." http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1003825