answer is not to deny the FTC Section 5 authority, though it may be to augment DOJ’s powers with Section 5 authority.[1] I have yet to make up my mind on that one, which, in any event, is a debate for another day.
A fourth challenge I have heard is that we should stay out of high-tech markets because, as a matter of policy, we should not be in the business of challenging an inventor’s conduct. Or, to put it differently, we don’t want to deter inventors from innovating, so their conduct should be per se legal. In the alternative, conduct by innovators in the high-tech sphere – regardless of its horizontal nature – should be subject to the rule of reason. I completely disagree with these arguments.
As a threshold matter, it would be irresponsible of us to treat any transaction or conduct by an inventor as per se legal. That would be like creating a super-immunity for patent holders. To be sure, patent law grants a period of exclusivity to an inventor who lawfully obtains a patent from the PTO. But even determining the bounds of that exclusivity is not easy. On the one hand, we must be sensitive—as Justice Scalia noted in Trinko—to the fact that monopoly profits are often what incentivize a firm to innovate in the first place.[2] On the other hand, however, as the FTC acknowledged in its amicus brief to the Federal Circuit in the TiVo v. Echostar litigation (which dealt with incentives
- ↑ Commissioner J. Thomas Rosch, Rewriting History: Antitrust Not As We Know It . . . Yet, Remarks before the ABA Antitrust Section 2010 Spring Meeting (April 23, 2010), available at http://www.ftc.gov/speeches/rosch/100423rewritinghistory.pdf.
- ↑ Verizon Commc’ns, Inc. v. Law Offices of Curtis V. Trinko, 540 U.S. 398, 407 (2004) (“The mere possession of monopoly power, and the concomitant charging of monopoly prices, is not only not unlawful; it is an important element of the free-market system. The opportunity to charge monopoly prices—at least for a short period—is what attracts “business acumen” in the first place; it induces risk taking that produces innovation and economic growth. To safeguard the incentive to innovate, the possession of monopoly power will not be found unlawful unless it is accompanied by an element of anticompetitive conduct.”).
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