The Chairmen of the House and Senate Judiciary Committees have joined forces to open a new – antitrust – front in the war for healthcare reform.  The two leading Democrats are seeking to boost healthcare reform with a partial repeal of an antitrust exemption that’s about as old as Democrats’ efforts to enact universal healthcare.

On September 17, 2009, Chairman John Conyers (D.-Mich.) of the House Judiciary Committee and Chairman Pat Leahy (D.-Vt.) of the Senate Judiciary Committee introduced legislation to repeal the McCarran-Ferguson Act’s exemption from the federal antitrust laws for health and medical malpractice insurers.  The Act dates back to 1945, the same year that President Harry Truman asked Congress to enact a national health insurance program.   click here for more »

Just how weak does a company have to be to rely on a weakened firm defense in a merger analysis?  While the case law is sparse, courts have found such a defense compelling when one of the parties to a merger has been too weak to be a competitive threat.

In United States v. General Dynamics Corp., 415 U.S. 486 (1974), the Supreme Court approved a merger between coal producers who together had a high market share in a concentrated industry, finding that market share and concentration were “not conclusive indicators of anticompetitive effects.”  Id. at 498.  In that case, one party to the merger was unable to compete for new customers because it did not have uncommitted coal reserves.  Id. at 504-506.  In other words, it had a competitive weakness – a structural barrier – that prevented it from becoming a competitive threat.

The Supreme Court stressed that it was important to consider all relevant facts, including a firm’s weakness, in cases in which the market or industry is unpredictable or instable.  Id.  The court found that where a firm lacks resources to engage in new competition, its acquisition would not substantially lessen competition.  Id. at 510-11.

Five years ago this month, a new federal law aimed at encouraging standard-setting activities took effect – the Standards Development Organization Advancement Act (SDOAA) of 2004.  Why did Congress pass it?  And five years later, how has it fared?

In many industries, non-profit “standards development organizations” (SDOs) collaborate with businesses to develop industry-wide standards – from common light bulb sizes to uniform tests of concrete strength.  This work is generally procompetitive, as it tends to foster innovation and lower prices.  But because the work involves collaboration between competitors, it can raise antitrust issues and invite lawsuits. click here for more »

Since the Supreme Court’s 1977 decision in Illinois Brick Co. v. Illinois, 431 U.S. 720, plaintiffs have not been able to recover damages suffered by indirect purchasers from anticompetitive conduct stemming from §1 of the Sherman Act.  While this bar has existed for more than 30 years, plaintiffs are not without recourse. click here for more »

Many of us think the U.S. health care sector will withstand today’s economy because it supplies important consumer products and services.  Politicians and economists expect pharmaceutical companies to employ scientists, develop medically necessary products, and lead our nation to economic health.  But we must also safeguard companies’ incentive to innovate.  Otherwise we risk losing potentially large sources of employment that will keep our nation competitive in the global economy. click here for more »