ANTITRUST 

Antitrust law and competition policy are concerned with the creation and maintenance of market power. Our directors and academic affiliates are distinguished experts in the field of industrial organization – the area of economics that provides the intellectual foundation for determining when and why firm behavior and business practices warrant antitrust intervention. Our professionals are also highly trained in the statistical analysis of economic data, which permits us to examine, with empirical rigor, various hypotheses concerning firm behavior that arise in complex antitrust cases. We frequently testify in high-stakes matters, involving class certification, liability, and damages.

We also provide assistance in complex merger filings before federal antitrust and regulatory authorities. Our professional staff includes experts in auction and bidding markets, game theory, econometrics, and mathematical/simulation modeling. Team members have made significant contributions to the economic literature, dealing with how best to evaluate the likely competitive effects of mergers.

Areas of Expertise

Class Certification:

• Commonality regarding liability, injury, and damages
• Alignment of named plaintiffs’ incentives

Cartel Investigations and Price Fixing:

• Database construction and management
• Econometric modeling of alleged overcharges
• Damages
• Volume of commerce

Business Practices:

• Exclusive dealing
• Tying arrangements
• Loyalty rebates and bundled discounts
• Predatory pricing and non-price predation
• Resale price maintenance
• Price discrimination
• Standard setting
• Patent misuse
• Predatory hiring
• Sources of market power

Horizontal and Vertical Mergers:

• Product and geographic market definition
• Unilateral and coordinated price effects
• Efficiency gains and pass through analysis
• Entry and product repositioning analysis
• Buyer power analysis
• Innovation markets
• Auction and bidding models
• Merger simulation analysis
   

Representative Cases

Class Certification

Funeral Industry Litigation
We participated in two highly publicized class action antitrust lawsuits, involving the funeral industry, in which plaintiffs sought more than $1 billion in damages. The lawsuits were brought on behalf of casket consumers and independent casket retailers across the United States. The plaintiffs alleged that the three largest funeral home chains and a leading casket maker conspired to keep casket prices high, and exclude casket discounters in violation of federal antitrust laws.

On behalf of the defendants, our expert submitted an expert report and testified at an evidentiary hearing, where he explained why economic analysis led to the conclusion that individualized issues predominating common questions of fact in determining liability, injury, and damages. The magistrate judge denied class certification in both cases. In his memorandum and recommendation, the magistrate stated he found our expert’s analysis “to be well-reasoned and supported by concise, reliable testimony as to why the correct geographic market is localized and not nationwide – as why each claim is not susceptible to class-wide proof.”

Nurses Wages Litigation
We have participated in several federal antitrust wage-fixing lawsuits brought by registered nurses against defendant hospitals and health systems. In these matters, plaintiffs allege that the defendants are conspiring to suppress the wages of their nurse employees. On behalf of defendants in two such lawsuits, we prepared expert reports addressing the issue as to whether the alleged conspiracy, its impact on the class, and damages, may be proven with common evidence.

Price Fixing

Vitamins Antitrust Litigation
On behalf of a manufacturer of vitamin products, we prepared an expert report that critically evaluated the "overcharge" analysis performed by experts representing 140 direct-action plaintiffs. Our report discussed flaws in the econometric model developed by plaintiffs’ economists and presented an alternative model specification. In addition, our report critiqued claims by plaintiffs’ economic experts that defendants began colluding much earlier than the time period for which they pled guilty.

Tobacco Antitrust Litigation
On behalf of tobacco growers, we evaluated claims that major cigarette companies and leaf buyers engaged in a price-fixing agreement that allegedly fixed the bids made at tobacco auctions. We conducted economic analyses of confidential documents and data in order to determine whether the evidence tended to exclude the possibility that the firms acted in the absence of an agreement. The $1.4 billion settlement, ultimately reached in the matter, was the second highest antitrust settlement in history.

Business Practices

United States v. Microsoft
Competition Economics’ economists served as consultants to the U.S.  Department of Justice in its landmark antitrust case against Microsoft. On behalf of the government, we examined the central question confronting the court: Did Microsoft erect artificial entry barriers (through its bundling and contractual practices) to remove a competitive threat to its Windows operating system, or were its actions explained by economic efficiency justifications? Professor David Sibley, assisted by Competition Economics’ professional staff, submitted a declaration to the court on this topic that provided the economic foundation for the government’s case against Microsoft.

Geneva Pharmaceuticals v. Barr Laboratories
On behalf of Barr Laboratories, we were retained to analyze antitrust claims regarding the raw material source in blood thinner – warfarin sodium. Plaintiffs alleged that Barr’s exclusive arrangement with a raw material provider unfairly delayed plaintiffs’ entry into an alleged market for generic warfarin sodium and gave Barr a monopoly during that period. We conducted analyses to delineate the relevant antitrust markets, and evaluate plaintiffs’ monopolization claims. The case settled before trial.

Analysis of Bundled Discounts
We were retained by a large biotech corporation to evaluate plaintiff’s allegation that defendant’s bundled discounts violated antitrust laws. We prepared an expert report in which we demonstrated the pricing policy did not foreclose competition and defended our findings at a preliminary injunction hearing. The presiding judge ruled in favor of our client, denying plaintiff’s request to enjoin the pricing policy.

Merger Investigations

Competition Economics’ experts have served as consultants to merging parties, the U.S. Department of Justice, the U.S. Federal Trade Commission (FTC), and the Canadian Competition Bureau. Our work spans numerous industries, and includes the following investigations:

• Alameda News Group – Knight Rider Newspapers
• Arch Coal – Rio Tinto
• AT&T – McCaw Cellular
• AT&T – Comcast
• Baker – Hughes
• Barnes & Noble – Ingram Book
• Brahma – Antarctica (Brazil)
• British Petroleum – Amoco
• Campbell Soup – Van de Kamps
• Central Parking Systems – Allright Parking
• Comcast – NBCU
• Delta – Northwest
• Elf Aquitaine – Pennwalt
• Equilon – GATX
• Exxon – Mobil
• General Mills – Ralston
• Google – AdMob
• Harrah’s Entertainment – Caesars Entertainment
• Inbev NV/SA – Anheuser-Busch
• L’Oreal – Maybelline
• Lockheed Martin – Northrop Grumman
• Mattel – Hasbro
• MCI WorldCom – Sprint
• MGM Mirage – Mandalay Resort Group
• Monsanto – American Home Products
• Oracle – PeopleSoft
• Pepsico – Quaker Oats
• Phillips Petroleum – Conoco
• Pilot – Flying J
• Princess – Carnival
• Psychiatric Solutions, Inc. – Horizon Healthcare
• Reed Elsevier – Harcourt
• SBC – AT&T
• Time Warner – EMI
• TMP Worldwide – HotJobs
• United Airlines – US Airway
• Valero – Kaneb Services
• Verizon – MCI