Competition Corner by Alden Abbott - FTC rulemaking, using antitrust to fight inflation, and other light summer reading
Issue #7
Originally Posted July 15, 2022
This month I am highlighting some refreshing articles as the summer heat is finally settling in around the Beltway.
Concurrences held a conference on June 27th for a recently released book on FTC competition rulemaking, and my contribution to the book is summarized in a commentary for Truth on the Market. For those of you who’d like a summary of the summary, here goes: competition rulemaking from the FTC is at best a waste of time, and at worst presents serious potential harm for consumers.
Moving on to lighter topics, I have two recent commentaries on patents. The first discusses the failures of the Supreme Court to adequately protect the rights of patent holders, and critiques the court’s “deal with it” mentality toward weakening patents. The second looks at the withdrawal of the 2019 FRAND policy statement without a 2022 replacement, and concludes that no statement is better than a bad statement, but the 2019 statement is even better.
Colleagues of mine, Tracy Miller and Andrew Mercado, wrote an excellent commentary explaining why antitrust should not be in the realm of possible policy instruments to deal with inflation, and noting that the Federal Reserve and politicians need to take accountability for the current crisis.
Finally, Andrew Mercado and I push back against an ill-conceived proposal to use the Postal Service (a real monopoly) as an “antimonopoly tool” against big companies such as Walmart and Amazon (not real monopolies).
So get outside, take a long coffee break, and enjoy these articles before the mid-day heat forces everyone inside until happy hour.
Why FTC Competition Rulemaking Likely Will Fail | Truth on the Market
On Monday, June 27, I spoke at a Concurrences conference on FTC rulemaking, held to highlight the release of a book on that topic, to which I contributed a chapter. On July 5, I published an abridged version of my chapter in Truth on the Market, which explains why any attempts by the FTC to promulgate competition rules will not pass legal muster in court.
Patent Eligibility, Competition, Innovation, Congress, and the Supreme Court | Truth on the Market
A highly competitive economy is characterized by strong, legally respected property rights, including patents. Unfortunately, however, recent Supreme Court decisions have weakened the law of patent eligibility, severely limiting the rights of innovators in the economy. In a July 6 Truth on the Market commentary, I explained that these holdings will generate confusion and undermine the U.S. patent system, thereby reducing American innovation and the effectiveness of market competition. I argued that Congress should act promptly to strengthen patent eligibility law.
Kudos to USPTO, DOJ, NIST for Abandoning a Bad Draft, but Future Remains Murky for SEP Holders | IPWatchdog
In a recent surprise decision, the U.S. DOJ, USPTO, and the NIST officially withdrew their 2019 Policy Statement on Remedies for Standards-Essential Patents Subject to Voluntary F/RAND Commitments and declined to advance an alternative policy statement as a replacement. Andrew Mercado and I discuss why no guidance is better than bad guidance, but stakeholders should not hold their breath hoping the administration will come to its senses.
Here’s Why We Can’t Control Inflation with Antitrust Enforcement | National Review
Instead of blaming corporations, politicians and Fed officials must acknowledge their own culpability for today’s high inflation. Tracy Miller and Andrew Mercado discuss why antitrust is the wrong tool to solve inflation, and why politicians and the Federal Reserve need to take accountability for high prices.
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Using the USPS Monopoly as an “Antimonopoly Tool” is a Bad Idea | Mercatus Center
Should the United States Postal Service (USPS) be enlisted as a trustbuster? Using it as an antimonopoly tool against Amazon, Walmart and the like, as proposed by Columbia Law School Professor Kathryn Judge, is a recipe for disaster. As Andrew Mercado and I explain, the USPS looks more like an out-of-control trust than a trustbuster. Using a government-backed monopoly to undermine efficient private sector companies will lead to consumer harm.
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