SCL Associate Tyler Ross’ article, “Do Not Pass ‘Go’; Do Not Collect $200: Anti-monopoly Law Reintroduced in the New York Legislature“, was recently featured on Law360’s website, where he expanded his analysis on the impact the 21st Century Antitrust Act would have on New York antitrust law.
Tyler’s article, newly titled “Will 4th Time Be A Charm For NY’s 21st Century Antitrust Act?“, discusses the implications of the 21st Century Antitrust Act’s introduction of a European-style abuse of dominance standard — “a standard that is widely regarded as covering more conduct than Section 2 of the Sherman Act.”
“For example, in a predatory pricing case, a Sherman Act plaintiff must show that the alleged monopolist was able to recoup — or had a dangerous probability of recouping — its investment in below-cost pricing. In practice, this requirement is very difficult to prove, which has been fatal to most claims of price predation. European Union law, by contrast, imposes no such requirement.
Similarly, an alleged monopolist’s refusal to deal with a competitor will only give rise to a Section 2 claim if the monopolist is sacrificing a preexisting and profitable course of dealing, which happens about as often as the stars align while Mercury is in retrograde. In the EU, a dominant firm’s refusal to deal can constitute abuse under an essential-facilities theory. If the 21st Century Antitrust Act stopped here, New York antitrust law would become the most far-reaching in the country.
A peek under the hood, however, reveals that the bill goes much further and statutory presumptions do much of the work. First, sellers with greater than 40% market share and buyers with greater than 30% market share are presumptively dominant. While the EU law tends to consider 40% market share a benchmark for dominance, the presumption is rebuttable; here, the bill’s presumption appears irrebuttable. Moreover, EU law has no analogue for the bill’s 30% buy-side market share presumption.
The buyer-side presumption appears intended to capture large firms’ hiring practices — i.e., as buyers in the labor market. Thus, major employers in the state, like Walmart Inc., Pfizer Inc. and Mount Sinai Health System would potentially be exposed to liability. Mount Sinai could qualify as dominant if it employs, for example, more than 30% of the cardiologists in New York City. Labor markets are likely to feel the greatest impacts of the 21st Century Antitrust Act.”
Read the full article on Law360 here.
