Antitrust Law Blog

Continuing a well established trend and reflecting consistency among the federal courts, at least two federal courts in five months have granted summary judgment for lack of antitrust injury where plaintiffs could not show competition had been injured. The two cases briefed here demonstrate that federal courts require that without any accompanying injury to competition, injury to a competitor will not be enough to show antitrust injury and establish standing to assert a claim under the Sherman Act.

On February 8, 2006, President Bush signed into law the Digital Television Transition and Public Safety Act of 2005 (the "DTV Act"). The DTV Act contains provisions relating to the nation's transition from analog to digital television broadcasting. Most significantly, the DTV Act establishes February 18, 2009 as the "hard" deadline by which full-power television stations must cease broadcasting analog signals and commence broadcasting exclusively in digital format. Congress previously had set a target date of December 31, 2006 for the end of the transition from analog to digital broadcasting. That date, however, was flexible in that television stations could seek an extension of the deadline, and continue broadcasting in analog format, if less than 85 percent of the households in their respective market had access to the digital broadcast signals (e.g., owned a digital television set or a converter box that would make digital signals viewable on older analog television sets). The DTV Act eliminates the 85 percent extension criteria and establishes February 18, 2009 as the "hard" deadline for turning off analog television signals.

Tying is the sale of one product which the buyer wants (the "tying" product") on the condition that the buyer purchase a second product (the "tied" product) which the buyer either does not want or would prefer to purchase elsewhere. When certain prerequisites are satisfied, tying is per se illegal under the antitrust laws. One of those prerequisites is that the seller have market power over the tying product. Several Supreme Court decisions, including Loew's v. United States, 371 U.S. 38 (1962), held this market power was presumed when the tying product was patented or copyrighted. In Illinois Tool Works, Inc. v. Independent Ink, Inc., 506 U.S. ___ (March 1, 2006), however, the Supreme Court in an 8-0 decision held that this market power presumption was invalid, and that plaintiffs in tying cases involving patented or copyrighted products must prove market power as is necessary in cases involving the tying of nonpatented products.

In 2006, the Federal Trade Commission ("FTC") approved the merger of Seagate and Maxtor while, a few months prior in 2005, Antitrust Division of the Department of Justice ("DOJ") approved the merger of WebCT and Blackboard, neither issuing a second request for information. In both cases, the two merging firms had sufficiently high market shares that most analysts expected at least a second request, if not some call for divestitures. Yet, the DOJ and the FTC did not issue a second request, much less initiate a suit to block the merger, proving that high market shares do not always guarantee second requests.

According to the European Commission's latest Report on European Electronic Communications Regulation and Markets, which was released on February 20, telecom operators in Europe are investing in new technologies to cut costs and seize new opportunities opened up by the convergence of communication networks, media content and devices. The Commission confirmed that growing competition, especially in telecom retail markets, is bringing increased consumer benefits and the positive outlook for innovation and investment within Member States and across Europe.