Through issuing public guidance documents and engaging in competition advocacy, the Antitrust Division promotes awareness and understanding of the requirements of the antitrust laws and of competition principles. These efforts help to strengthen competition in the U.S. economy and promote the value of economic liberty inherent in competition.
This past year the Division’s efforts addressed a range of significant issues, including intellectual property, corporate hiring practices, and state laws regulating licensed professions. In addition, the Division filed amicus briefs with the U.S. Supreme Court and appellate courts and provided comments with Federal agencies sharing its expertise in evaluating market power and mergers.
One important function of the Antitrust Division is to issue public guidance about how it enforces the antitrust laws regarding various types of conduct. Such guidance serves several important purposes: it gives clarity to the public about how to avoid antitrust liability, it shares understanding of the economic and legal principles that underlie the U.S. antitrust laws and support competitive markets, and it provides Antitrust Division staff direction about how to structure investigations and enforcement actions. This year has been a busy one in this respect.
On January 13, 2017, the Antitrust Division and FTC issued an update to the Antitrust Guidelines for the Licensing of Intellectual Property (2017 IP Licensing Guidelines), which covers a variety of complex issues at the intersection of antitrust and intellectual property law. The update modernizes and builds on the success of the 1995 IP Licensing Guidelines. The IP Licensing Guidelines guided the Division’s enforcement decisions and policy documents, provided a model for foreign jurisdictions, and aided business planning. The 2017 IP Licensing Guidelines reflect intervening changes in statutory and case law, as well as relevant enforcement and policy work, including the Agencies’ 2010 Horizontal Merger Guidelines. The 2017 IP Licensing Guidelines continue to set forth an effects-based analysis, grounded in economics, that puts the focus on evaluating harm to competition while allowing procompetitive IP licensing that can further innovation.
The Division also issued, for the first time, a guidance document for human resource professionals with respect to hiring practices. This document gives practical advice to such professionals on how to avoid antitrust liability and, among other things, makes clear that naked wage-fixing or no-poaching agreements among employers are per se illegal.
Comments on Proposed State Laws Regulating Licensed Professions
One way the Antitrust Division promotes competition in the U.S. economy is through its competition advocacy program. Both individually and jointly with the FTC, the Division submits letters to state and local legislatures, regulatory boards, and officials, to provide a competitive analysis of local policies and urge the rejection of those policies that unnecessarily restrict competition.
In the last year, the Division responded to requests for advice about proposed legislation affecting licensed professions in four jurisdictions:
- The Division issued a statement highlighting the potential benefits to competition in a State of Michigan bill regarding telehealth services that would allow innovative technologies to expand consumers’ access to affordable healthcare.
- In Puerto Rico, the Division submitted a letter with the FTC encouraging the legislature to consider the potential benefits to competition of a bill permitting optometrists to use and prescribe medications to diagnose and treat diseases of the eye as they do across the United States and its territories.
- In North Carolina, the Division submitted a joint statement with the FTC recommending that the legislature consider the competitive benefits of legislation that would allow websites to generate legal forms for consumers without constituting “the practice of law.”
- The Division also outlined factors that the California legislature could use in evaluating the competitive effects of legislation that could restrict court reporters’ ability to enter into court-reporting contracts with third parties.
Such comments take seriously state and local policies promoting health, safety, and other laudable goals, but recommend that these goals be advanced without creating unnecessary barriers to competition.
Comments with Federal Agencies
The Antitrust Division’s competition mission also involves working with other Federal agencies to help them tailor their regulations in ways that best protect and promote competition. In 2016, the Division shared its expertise in merger analysis with multiple Federal agencies. For example, in November, the Antitrust Division and the FTC submitted comments to the U.S. Federal Energy Regulatory Commission (FERC) regarding how FERC assesses market power in the agency’s review of mergers and electricity sales rates under the Federal Power Act.
Likewise, in April the Division submitted a statement to the Surface Transportation Board opposing a voting trust that would not preserve the independence of two railroads during the pendency of the Board’s review of their potential merger. The railroads abandoned their planned merger days after the Division made this statement. And on two occasions last year, the Division offered comments with the Federal Maritime Commission opposing anticompetitive “alliance” agreements between significant competitors in the market for ocean container shipping services (letter dated September 19, 2016, letter dated November 22, 2016).
Filing amicus briefs in significant private antitrust cases is another important element of the Division’s competition advocacy program. Amicus briefs enable the Division to offer courts the benefit of the Division’s specialized knowledge and expertise. These briefs also contribute to the Division’s transparency efforts by offering the business community and the antitrust bar an opportunity to better understand the Division’s approach to important antitrust and competition issues.
In the past year, the Division filed a brief in the Third Circuit arguing that an antitrust exemption in the Shipping Act of 1984 barred private damages actions under the Clayton Act but did not impliedly preempt state-law consumer protection and unjust enrichment claims. The Third Circuit agreed that the exemption barred the Federal antitrust claims, but disagreed on the exemption’s effect on state-law claims.
The Division filed briefs in the Fifth Circuit and the Ninth Circuit arguing that there is no appellate jurisdiction when antitrust defendants try to appeal, prior to a final decision by the district court, from district court denials of motions to dismiss based on the state action doctrine. The Division also argued in the alternative that the requirements of the state action defense were not met in these cases. The defendant in the Fifth Circuit case withdrew its appeal after the Division filed its brief. The Ninth Circuit case remains pending.