|
>Except tying is one of the few antitrust things that is still per-se illegal, so it won't matter. Nope. Courts have been subjecting tying to rule of reason analyses for a while now. Illinois Tool Works: >Over the years, however, this Court’s strong disapproval of tying arrangements has substantially diminished. Rather than relying on assumptions, in its more recent opinions the Court has required a showing of market power in the tying product. Our early opinions consistently assumed that “[t]ying arrangements serve hardly any purpose beyond the suppression of competition.” Standard Oil Co., 337 U. S., at 305–306. In 1962, in Loew’s, 371 U. S., at 47–48, the Court relied on this assumption despite evidence of significant competition in the market for the tying product. And as recently as 1969, Justice Black, writing for the majority, relied on the assumption as support for the proposition “that, at least when certain prerequisites are met, arrangements of this kind are illegal in and of themselves, and no specific showing of unreasonable competitive effect is required.” Fortner Enterprises, Inc. v. United States Steel Corp., 394 U. S. 495, 498–499 (Fortner I). Explaining the Court’s decision to allow the suit to proceed to trial, he stated that “decisions rejecting the need for proof of truly dominant power over the tying product have all been based on a recognition that because tying arrangements generally serve no legitimate business purpose that cannot be achieved in some less restrictive way, the presence of any appreciable restraint on competition provides a sufficient reason for invalidating the tie.” Id., at 503. >Reflecting a changing view of tying arrangements, four Justices dissented in Fortner I, arguing that the challenged “tie”—the extension of a $2 million line of credit on condition that the borrower purchase prefabricated houses from the defendant—might well have served a legitimate purpose. Id., at 510 (opinion of White, J.); id., at 520 (opinion of Fortas, J.). In his opinion, Justice White noted that promotional tie-ins may provide “uniquely advantageous deals” to purchasers. Id., at 519. And Justice Fortas concluded that the arrangement was best characterized as “a sale of a single product with the incidental provision of financing.” Id., at 522. >The dissenters’ view that tying arrangements may well be procompetitive ultimately prevailed; indeed, it did so in the very same lawsuit. After the Court remanded the suit in Fortner I, a bench trial resulted in judgment for the plaintiff, and the case eventually made its way back to this Court. Upon return, we unanimously held that the plaintiff’s failure of proof on the issue of market power was fatal to its case—the plaintiff had proved “nothing more than a willingness to provide cheap financing in order to sell expensive houses.” United States Steel Corp. v. Fortner Enterprises, Inc., 429 U. S. 610, 622 (1977) (Fortner II). And overturning the per se rule for patents: >After considering the congressional judgment reflected in the 1988 amendment, we conclude that tying arrangements involving patented products should be evaluated under the standards applied in cases like Fortner II and Jefferson Parish rather than under the per se rule applied in Morton Salt and Loew’s. While some such arrangements are still unlawful, such as those that are the product of a true monopoly or a marketwide conspiracy, see, e.g., United States v. Paramount Pictures, Inc., 334 U. S. 131, 145–146 (1948), that conclusion must be supported by proof of power in the relevant market rather than by a mere presumption thereof.[Footnote 4] >Congress, the antitrust enforcement agencies, and most economists have all reached the conclusion that a patent does not necessarily confer market power upon the patentee. Today, we reach the same conclusion, and therefore hold that, in all cases involving a tying arrangement, the plaintiff must prove that the defendant has market power in the tying product. https://supreme.justia.com/cases/federal/us/547/28/#tab-opin... Apple should have no fears about flexing on Facebook and Google. |
This is not quite right. You are right that i removed some nuance, which, imho, would not matter much in this particular case but might matter in others.
Your cites are about the presumption of market power, which is not the same as rule of reason analysis in full. It's definitely part of it.
It's definitely true courts are "less per-se". But even illinois tool works is about whether the market power presumption could be rebutted, not about whether the effect was to restrain trade. They still only require a showing of market power.
Your cites even say that, with the illinois toolworks one explicit saying that if they can show market power, partial summary judgement on liability should be granted.
The more interesting part of the rule of reason is about the latter (restraint of trade) more than the former (market power)
Wikipedia even agrees with what i said https://en.wikipedia.org/wiki/Rule_of_reason, see the last section.
" Further, the Court retained the per se rule against tying contracts but raised the threshold showing of market power that plaintiffs must make to satisfy the rule's requirement of "economic power" (see Jefferson Parish Hospital District No. 2 v. Hyde, 466 U.S. 2 (1985).[2]".
The square cite from ITW is "Held: Because a patent does not necessarily confer market power upon the patentee, in all cases involving a tying arrangement, the plaintiff must prove that the defendant has market power in the tying product. "
(IE they just have to show market power)
You can see basically all courts have followed this since.