Antitrust and Intellectual Property
Antitrust Law Remedies in Intellectual Property Cases
In any research paper it is important to first define the terms used prominently in order to make sure that the reader understands what is being said. In this case, the two terms that require definition are antitrust and intellectual property. According to a definition from Cornell University Law School "Trusts and monopolies are concentrations of economic power in the hands of a few." Thus, antitrust legislation would logically follow as "designed to protect competition and protect free trade" (Putnam). Mark Putnam, a business ethics expert, goes on to say that "Basically, antitrust laws prohibit price-fixing, allocating territories, boycotts, or any other kind of conspiratorial or monopolistic behavior between companies that unfairly restrain free trade." Intellectual property, however, is different entirely from a trust. The United States Patent and Trademark Office (USPTO) which deals almost exclusively with intellectual property…… [Read More]
Antitrust laws are laws that were enacted to guarantee American consumers the right to expect the benefits of free and open competition. Such laws are enforced by the United States Department of Justice's antitrust division (Anonymous, 2010). There are numerous Acts that constitute the Antitrust Laws. These include the Sherman Act, Clayton Act, and the obinson-Patman. Sherman Act, the primary federal antitrust provision, seeks to promote and protect competition by outlawing any form of combination or conspiracy that restraint interstate commerce.
Antitrust legislations envisaged a situation where competitors would collude and engage in price fixing, bid rigging, market division, or allocation of schemes to the disadvantage of the consumers who may have to buy goods or access services at inflated prices. The customers could also end up getting cheated (Anonymous, 2010).
The Antitrust laws were legislated to deter dishonest businessmen from engaging in price fixing activities. Competitors can collude to…… [Read More]
Antitrust practices and market power:
Technology, social networking sites, and anti-competitive behavior
Q1.Why was/were the firm(s) investigated for antitrust behavior?
IBM, AT&T, Microsoft, Intel, Google, Twitter, and Facebook are all technology companies that have been accused of operating as de facto and de jure monopolies: in other words, of engaging in blatant violations of the Sherman Antitrust Act or of substantially limiting market competition to such a degree that a monopoly has been created and consumer choice has been limited in a negative fashion. "From an antitrust standpoint, monopoly power is the power to raise price or exclude competition. Monopoly power is not unlawful in its own right, but unless a firm is deemed to have monopoly power (or at least a dangerous probability of acquiring such power), it cannot be held liable for monopolization or attempted monopolization" and having a negative impact upon consumers (Waller 2012: 1775).…… [Read More]
Summary and Conclusion
As noted by Greaney (2009) competition is heavy on the legislative minds of the United States and it is believed as evidence by all proposals stating the same that competition is the factor that will drive the competition in the health care market and ultimately will be that which resolves many of the present consumers complaints and shortcomings of the health care programs presently in use in today's Health Care market. Excess and waste are noted as two primary costs associated with the health care market that must be effectively addressed.
Uncertain Future of Competition in Health Care Law: Legislative Proposals to Immunize Providers from Antitrust Law (2002) Health Affairs. 2002;21(2) © 2002 Project HOPE.
Sage, William M., Hyman, David a. And Greenberg, Warren (2003) Health Affairs. Vol. 22, No. 2, 2003 Project Hope. Online available at: http://content.healthaffairs.org/cgi/reprint/22/2/31.pdf
Greaney, Thomas L. (2009) Statement of Professor efore…… [Read More]
.. are not to be distinguished by any judgment regarding the wisdom or unwisdom, the rightness or wrongness, the selfishness or unselfishness of the end to which the particular union activities are the means.'
The law, however, still bites on situations where trade unions and groups of employers conspire together to suppress or eliminate competition. In other words, businessmen are not entitled to take advantage of the relative immunity of labor and suborn the union, perhaps in consideration of a wage increase, to carry out restrictive schemes that they cannot legally operate themselves. Cases in which collusion between employers and unions is alleged are not infrequent; even so, some commentators believe that a serious loophole is left, since the community of interest between employers and unions may at times be so close that collusion is either unnecessary or of so informal a nature that its occurrence cannot be proved.
Public…… [Read More]
Antitrust Law: The Microsoft Company Probe
Antitrust law umbrellas all pieces of federal and state legislation that are aimed at regulating commerce and trade by preventing price fixing and unlawful restraints, and controlling monopolies so as to maximize consumer welfare by promoting competition, encouraging quality production and ensuring reasonable prices (Farlex, 2014). Monopolies and oligopolies are the two forms of market structures covered under antitrust law. Such could be natural monopolies, government monopolies, or monopolies resulting from collusion. One significant feature of these is that a handful of firms (one firm in the case of monopoly) control the entire market, and therefore enjoy significant market power. Owing to this, such firms often charge a price higher than would be the case in a competitive structure (monopoly price), and produce less-than-optimal output levels. The resultant productive and allocative inefficiencies, as signified by the monopoly dead weight loss and high prices provide…… [Read More]
One recent antitrust action has been between the United States Justice Department and the credit card companies. The government has argued that American Express has hindered competition in the credit card market. At issue are rules that AMEX imposes on retailers to prevent them from offering incentives to customers to use other cards (Longstreth, 2014). This is not the first time that credit card companies have faced antitrust action, either. In 2012, Mastercard and Visa entered into a settlement worth $7.25 billion, regarding alleged price fixing of the interchange fees that are paid by merchants when customers use Mastercard or Visa for their purchases. Interchange fees are paid by the store to the credit card company. When these two companies always charge the same fees, it opened up the possibility of antitrust legislation, with accusing of collusion. The settlement meant that the companies were not officially found…… [Read More]
One of the first national laws against trusts and monopolies was the Sherman Antitrust Act of 1886, which applies to all businesses engaged in interstate or international commerce. Federal law and the courts have defined commerce very broadly, as the "giving of essentially anything in return for barter or money" unless a specific exemption is granted (ABA, p2007, p. 7). Up to the 1970s and 1980s, many industries had such exemptions, including shipping, trucking, airlines, and telephones, on the grounds that excessive competition was destructive and destabilizing to the economy or that foreign cartels had an unfair advantage over American industries. According to the Clayton Act and Federal Trade Commission Act of 1914, and the National Labor elations Act of 1935, labor unions are specifically exempt from prosecution on antitrust grounds. Moreover, the Supreme Court has granted them non-statutory exemptions in the Jewel Tea and Pennington cases of…… [Read More]
The enforcement action being studied is that of Novartis AG. The case involves the proposed acquisition by Novartis of Alcon Inc., which is a subsidiary of Nestle. The industry in question is the injectable miotics, which is a $12.4 million market. Injectable miotics are a class of prescription pharmaceuticals. These two companies are the only two in the industry, with respective market shares of 67% and 33%. Post-merger, Novartis would have a 100% share of this industry in the United States.
The specific antitrust act that is relevant to this investigation is the Clayton Act, Section 7 and Section 5 of the Federal Trade Commission Act. If the merger went through, Novartis would have a monopoly in the injectable miotics industry. Firms with monopoly power have no market incentive to constrain their prices. The risk to consumers of this deal is that Novartis would have complete pricing power in…… [Read More]
The government discarded its claims under section 1 after adverse evaluation at the appellate court level. The center of the government's elite contracts accusation was that Microsoft had banned the allocation of Netscape's competing Web browser. This dispute was unproductive at the district court level since Netscape's continued to expand throughout the late 90's (Butts, 2010).
Tying is fundamentally a contract conditioning the acquiring of one product on the purchase of another. Tying infringements are found where two separate products are concerned; the defendant forces its consumers to take the tied good in order to attain the tying product; the agreement influences a considerable volume of interstate business; and the defendant has marketplace control in the tying product market. The government disputed that Microsoft was at fault of tying because IE and Windows were thought to be two distinct products by customers, Netscape had experienced a decline in revenues ensuing…… [Read More]
Failure of the Firm to Increase Market Power through the Merger
Merging refers to a corporate combination of two or more independent companies into one enterprise. A merge can take various forms such as a dominant firm purchasing the shares of another or a mutual agreement by two rival firms to cut unhealthy competition between them. The forms of mergers between companies can be horizontal, vertical or market extensional. The form of merger in our case is horizontal because the two rival firms produce the same commodities and serve the same market. The aim of this merger is to reduce rivalry and increase market power for both companies. The merger did not produce the intended purpose, and as a result, our company has not increased its market power. The aims of the merger were also to increase market efficiency, market extension, eliminate competition from other companies within the industry…… [Read More]
Antitrust egulations and Business Law
Antitrust regulations regulate economic activity in a way that encourages competition and discourages collusion between competitors. This collusion could be the result of horizontal mergers, price fixing, or even vertical contracts, which act to exclude competitors from a market. Antitrust regulations and actions are often hot button issues within the economics community as well as the business law field. Many different cultures have varying ides and understandings of these issues and may deal with them in completely different ways. This can, and does occur within the framework of U.S. business relations and exchanges, especially on the internet. As technologies change and adapt, antitrust laws and regulations need to be changed as well.
There is a mountain of evidence suggesting that while the current U.S. antitrust laws are quite effective on the macro level, many of these regulations were put in place before the economics of…… [Read More]
New York Yankees, 1953; Picher, 1997; as cited by Scremin, 2005). It is interesting to note that: "with the exception of baseball, to some extent, all other major professional sports have had to adapt their rules and policies to comply with antitrust law." (Scremin, 2005) The principle was again tried in the case Flood v. Kuhn in 1972 but the U.S. Supreme Court reaffirmed the exemption.
According to the U.S. Supreme Court due to exemption from antitrust laws claimants making claims based on federal antitrust laws in the major league did not have sufficient basis for suit because the U.S. Supreme Court did not assume jurisdiction over the baseball teams even though clubs did travel across state lines and even though players could be transferred across a state line to another club. The reasoning for this is the fact that during the development of the existing antitrust legislation as…… [Read More]
A common reason for antitrust investigation is with mergers and acquisitions. The Department of Justice must approve proposed mergers, to ensure that the merger or acquisition activity does not unduly restrain competition in an industry or market. One recent example of antitrust investigation came with the bids by Dollar General and Dollar Tree to acquire Family Dollar. The concern was that post-merger, the combined entity would be able to constrain competition and by virtue of that raise prices, in a market whose customers depend on access to those low prices (Heneghan, 2015).
Antitrust behavior comes with it costs to the economy. The underlying principle of antitrust legislation is that when there is insufficient competition in a market, the participants in that market have the ability to exploit that lack of competition, and raise their prices to a level that would not occur if the market was competitive (Investopedia, 2015).…… [Read More]
The Structural approach believes high barriers to entry reduces efficiency and the potential entry may not limit the power of incumbent firms. Chicago believes barriers to entry are due to the efficiency of incumbent firms and the potential to entry limits the economic power of incumbents. On the other hand, New IO believes barriers can be present, especially from the economics of standardization that can lead to market power of an incumbent. The New IO approach agrees with the Structural approach where market power derives from horizontal power and vertical arrangements, but also views market power as extended through strategic behavior. Chicago, on the other hand, views market power as only deriving from horizontal factors.
The Structural approach believes that collusion can be expected with profit increases and is more likely in concentrated markets. The Chicago approach believes that is not likely due to the difficulty of enforcement and is…… [Read More]
In short, the petitioners accused Microsoft of monopolizing the market by way of unfair practices. In 2000, the court found Microsoft guilty of such violations of antitrust laws. As a consequence, Microsoft was broken into two businesses. What's more, other businesses filed grievances against Microsoft; the latter oftentimes settled out of court, paying restitution to the claimants. Shortly after the judgment to breakup Microsoft was made, it was partly overturned in an appellate court. Furthermore, recent events have shown a more conciliatory stance towards Microsoft; President ush's administration sought a settlement with the computer giant in 2001.
Microsoft has been brought to court abroad as well. The European Union forced the company to pay over $600 million dollars in fines as a result of its anti-competitive practices. What's more, Microsoft was required to divulge some of its industry formula to rivals in the hopes of promoting future competition.
Certainly, additional…… [Read More]
Antitrust Investigation: Google
It was reported in 2011 that the 'Wall Street Journal' reported that the FTC was preparing a major antitrust investigation into Google's core search advertising business. Specifically stated by the Wall Street Journal was:
"The new FTC investigation . . . will examine fundamental issues relating to Google's core search advertising business, which still accounts for the overwhelming majority of its revenues. Those will include whether Google -- which accounts for around two-thirds of internet searches in the U.S. And more abroad -- unfairly channels users to its own growing network of services at the expense of rivals'." (Schonfeld, 2011, p.1)
It is reported that the issues was that Google "was using its market power 'in search to push consumers to its own services." (Schonfeld, 2011, p.1) Stated as the most prominent example is that of "Google Places, which comes up at the top of search results…… [Read More]
antitrust claims faced Microsoft corporation
Who to Trust: Analysis of United States vs. Microsoft
On May 18, 1998, The United States vs. Microsoft trial began. The computer networking and software company, Microsoft, was being charged with numerous allegations, the most salient of which included monopolizing the market for computer operating systems and engaging in illicit practices that were detrimental to competition. The company was also charged with trying to create a monopoly for the internet browser market, since the usage of multiple browsers would allow for competition from alternative operating systems. Other points of anti-competitive charges that Microsoft faced included the bundling of its browser, Internet Explorer, with all Windows Operating systems (another Microsoft product), that it engaged in exclusive contracts with original equipment manufacturers for computers and with internet service providers.
There is still a lingering sense of ambiguity that surrounds many of these allegations that still exists two…… [Read More]
New Bus Dilemma
The author of this report has been asked to assess a situation where a bus company is trying to make entry into a market. They are present in said market but the barriers to entry as well as the barriers for any firm other than the top three players in the field to stay there are quite high. It is to the point that there would seem to be subterfuge being executed by at least one of the three competitors. Given all that, it would seem that the best option is to put Greenbus (the subterfuge party) in the limelight for not following the law or just acquiring the two smaller players in the market and go after Greenbus head to head. The author of this report will describe the situation and will then describe the best path forward.
The situation here is pretty basic. Tom…… [Read More]
Antitrust Legislation and Healthcare
The Sherman Anti-Trust Act (1890) was designed to promote competitive practices in the marketplace and protect consumers from price gouging and other egregious practices generated from a lack of competition in monopolistic markets. It was not originally designed to impact the healthcare market but over the years its protections have been extended to do so
Antitrust and anticompetitive laws were not always applied to physician and healthcare conduct. But in Goldfarb v. Virginia State Bar (1975), the “Supreme Court made it clear that professional conduct that interfered with normal market processes would face a heavy burden of justification and might even be unlawful per se” (Sage, Hyman, & Greenberg, 2003, par. 18). This ensured that collusion between healthcare providers, including withholding information, was illegal. It also meant that it was illegal to limit the actions of consumer ratings agencies which graded physicians and other healthcare…… [Read More]
Antitrust Laws: Apple's Case
Competition is a vital element of any vibrant marketplace. Thanks to competition, both businesses and individuals get to benefit from lower prices, increased product variety, higher-quality commodities, and greater innovation. Antitrust laws are meant to ensure that consumers are protected from unfair business practices and anticompetitive mergers, and that consequently, effective levels of competition are created and sustained in the economy.
Antitrust laws differ from country to country and, at times, from jurisdiction to jurisdiction. In the U.S., antitrust laws include the Sherman Act of 1890 and the Federal Trade Commission and Clayton Acts, both of 1914 (FTC, 2014). The Sherman Act, whose violation is punishable by criminal law, outlaws any attempts to monopolize a market or restrain trade through rig bids, divide markets, or price fixation (FTC, 2014). The Federal Trade Commission Act, on the other hand, illegalizes any '"unfair methods of competition' and 'unfair…… [Read More]
(discuss them and then choose one that would possibly work)
One possible solution for this anti-trust problem, which is currently proposed by authorities, is that Microsoft should allow its competitors to access its information database. In this way, the competition could build new applications that are compatible with the Microsoft operating systems - Windows so would not be affected by the Microsoft strategy to develop an integral and connected line of products. Another solution could be the individual taxation of Microsoft due to its market power. In this case, the taxes that could be as high as 0% from the total profits and would unfairly tax the advantage taken in time by Microsoft. The money for this tax could be otherwise used by Microsoft for development plans, or why not for resolving social aspects - the poverty reduction of third world countries.
Another answer proposed by analysts in this case…… [Read More]
Antitrust Practices and Market Power: Google Antitrust Behavior
Economic theory expresses that competition contributes substantially to the efficient operations of markets, and hence to the improvement of a nation's wealth status. Antitrust laws seek to foster competition in the marketplace and to consequently ensure that the welfare of consumers is maximized through the provision of low-priced high-quality products. This the laws do by preventing the emergence of cartels and monopolies, which impede on competition by creating barriers to entry, with the help of which they are able to obtain market power and consequently drive market prices to favor them. Although monopolies may result from either government action or natural reasons, in which case they are referred to as government and natural monopolies respectively, most monopolies are formed through exclusivity contract arrangements, mergers, acquisitions, and collusion. Antitrust laws work at limiting these.
The Costs of Antitrust Behavior
A number of companies…… [Read More]
I don't have the proper bibliographical info for the book chapters. I noted the number from the two PDFs of the book where appropriate. You might wish to add the proper info and change the notes to fit.
MAKET CONDITIONS in the U.S.: It would seem highly unlikely that this information alone would be sufficient to bring an antitrust action. Prudent and even gutsy or aggressive business people might well seek such information to generate a competitive advantage with little intention toward manipulating the market (Fried Frank, 2002). Even if it does lean toward some expected restraint of trade (Sherman Act), what is occurring at this point clearly passes the reasonableness test. Talking of such issues is not collusive price fixing and suggests no conscious parallelism, for example, which might indicate that their association is for inappropriate purposes (pg. 468).
DETAILS of INDIVIDUAL SALES: In this instance the burden…… [Read More]
Of course, in recent years, this power has been diluted somewhat thanks to the rise of collective bargaining. Nonetheless, the fact that for so many years baseball has been characterized as a game rather than interstate commerce worked to the benefit of the industry as a whole.
If the exemption were repealed, apparently only possible through act of Congress, players and teams could sue the league if their movements were restricted and limitations placed on their ability to conduct business for themselves (Rovell). MLB could still manage how teams and players moved, but the repeal of the exemption would eliminate their absolute control over these movements. Obviously, this would have a significant impact on the baseball industry, but would not be necessarily devastating. Other sports have persisted despite not having antitrust exemptions, so there is little reason to expect that baseball couldn't adapt as well.
Belth, Alex. "Ending…… [Read More]
Additionally, he argued that the best interest of the consumers, as promoted by Gate's organization, was in fact not the core element of new endeavors, as the company had argued, but that whenever a new product or service was being projected, this would be done in order to serve the financial interests of the organization rather than increase customer utility (Kegel, 2006).
In order to better understand why the above mentioned actions were ethical or unethical, it is best to assess them in light of three ethical perspectives. From the standpoint of the utilitarian perspective, the company is able to seek out those actions which maximize its gains, but in doing this, it must remain aware of the needs of others. More specifically, they can work towards their goals as long as these do not impede with the goals of others (Leiss, 1988). From this standpoint, the behavior of Microsoft…… [Read More]
Online AntiTrust Issues
Antitrust law is a United States legal code that helps to maintain market competition by regulating anti-competition actions by organizations. The Sherman Act of 1890 was one of the first attempts to restrict large companies who fixed price, output and then manipulated demand to maximize their products. Standard Oil was one of the prime early examples of a company that controlled markets to the point that the government felt was detrimental to the entry of other competitors (Bork, 1993). In our current example, companies like Facebook and Google are being investigated, similar to Microsoft and AT&T, for controlling the Internet search process and/or network effects. This does not stop with Facebook and Google, but moves into many of the giant e-tailers (Amazon, EBay, etc.) that often use predatory or collusive practices to force customers into either advertising on their site, pricing to their scale, or in the…… [Read More]
After an eleven year investigation against Microsoft claiming it was trying to monopolize the web, the company finally settled with the Justice Department. Even though Microsoft was required to implement changes, the company maintains its dominance and has grown larger while being responsibly and adhering to the antitrust laws.
The Potential U.S. Case Against Google
An antitrust suit was filed against Google this year claiming the search giant is violating the antitrust laws. The Justice department has been looking at Google for some time now. In the fall of 2007, while Google was prepared to commit to a search ad deal with Yahoo, the justice department was planning to file suit if the deal hadn't fallen through with Yahoo.
Google is now becoming everyone's favorite antitrust target, rapidly replacing Microsoft. In February of this year a company called TradeComet.com, which operates a business-focused search service called SourceTool.com, filed an antitrust…… [Read More]
Federal Trade Commission ruled on charges of anti-trust leveled against the Wisconsin Chiropractic Association. The WCA and its executive director, Russell A. Leonard, had been charged with organizing a conspiracy among members of the WCA, which represent 90% of the chiropractors in Wisconsin, of conspiring to force health care providers to pay higher rates for chiropractic services than they had previously paid.
According to the proceeding records (FTC, 2003) and published statements by the FTC (FTC, 2000a), the plan began when the federal government as well as many insurance companies adopted new billing codes to cover chiropractic treatments. In addition, two other chiropractors, Michael T. erkley, D.C., and Mark A. Cassellius, D.C., settled with the FTC on similar charges (FTC, 2000a).
The final settlement included about 2,800 words of restrictions on the WCA and Leonard, some of them extending to the year 2020 (FTC, 2003).
The FTC alleged that the…… [Read More]
Antitrust Practices and Market Power
The modern business environment is increasingly characterized by the proliferation of emerging monopolies in various industries. One of the industries that have experienced an increase in budding monopolies is Information Technology, particularly with the growth and development of social media and networks. Technology companies have rapidly developed into monopolies because of the connection between attractive business opportunities. The growth of leading technology companies into monopolies has also been fueled by their efforts to gain and maintain market power. However, some of these companies such as Google, AT&T, Standard Oil, Microsoft, and Facebook have been investigated for antitrust behavior.
Similar to Google, Facebook is company whose growth and development is partly attributed to the failure by Microsoft to strangle it like it did to Netscape a decade before. Facebook's business and operations are entirely built on focusing on developing network effects since the firm's value for…… [Read More]
Antitrust practices and market power: Microsoft
One of the most famous and prolonged cases involving antitrust allegations was that of the suit brought about by the Department of Justice against the Microsoft Corporation. It was alleged that Microsoft's act of 'bundling' specific applications such as its web browser, Internet Explorer and Windows Media Player to make them the default setting of its Windows operating system resulted in anticompetitive practices within the software industry. The European Union also waged an antitrust case against Microsoft, and its findings against the company were even more broad and sweeping than in the United States. As a result, in the EU, Microsoft "was not allowed to offer any technological, commercial, or contractual term or inducement to make the bundled version the more attractive, and a monitoring trustee was required to ensure that the unbundled version of Windows works as well as…… [Read More]
Although one cannot make a good case for asserting that any one component in and of itself constitutes a monopolistic practice (see, for example how the operating system's prices have remained low in the following graphs), as part of a greater plan to dominate the market, there certainly is a solid case. Although the penalty for Microsoft as a monopoly is hardly extreme, it will certainly serve as a model to both avoid, and watch out for in the future.
Table retrieved at http://www.gsm.uci.edu/~mckenzie/mantra.pdf
Bill Gates, the Economist, 6/13/98
Ralph Nader and James Love, Computerorld, 11/9/98
Economics Resource Center. "Policy Debate. Is Microsoft a Monopoly? http://www.swlearning.com/economics/policy_debates/microsoft.html
Economics Resource Center. "Policy Debate. Is Microsoft a Monopoly? http://www.swlearning.com/economics/policy_debates/microsoft.html
McKenzie, Richard. "Microsoft: The Monopoly Mantra." http://www.gsm.uci.edu/~mckenzie/mantra.pdf
http://www.brainyencyclopedia.com/encyclopedia/m/mi/microsoft.html#the%20monopoly%20question zdnet. "Microsoft to Reveal indows Code. http://news.zdnet.com/2100-3513_22-948381.html
Branyencyclopedia.com. "Microsoft Anti-trust Case." 2004. eb site. Retrieved on September 30, 2004 http://www.brainyencyclopedia.com/encyclopedia/m/mi/microsoft_antitrust_case.html…… [Read More]
Monopolies and Trusts:
Appropriate Areas for Government Intervention?
Capitalism is the economic system that has dominated the United States virtually since the day of its independence. A social and economic system based on the recognition of individual rights; capitalism demands that owners' rights to control, enjoy, and dispose of their own property must be respected. In a capitalist system, the purpose of government is to protect individual economic rights, and to make sure that no one individual, or group may employ physical or coercive force upon any other group or individual. The success of capitalism is well evident. The surpluses that this system produces have enabled individuals to experiment; to create new products, and market new ideas. These private surpluses are traded in a free market in direct competition with other buyers and sellers. Such competition is best represented by the efforts of two or more parties acting independently to…… [Read More]
Over the last few years, it is evident that the airline industry in the U.S. has been experiencing long standing as well as novel challenges (The American Antitrust Institute, 2012). These includes the increase in the price of fuel, slowing demand for air travel and pressures to expand globally. Consolidation among various airlines across the country is the most common remedy that most of the airline firms are applying.
In April 2012, the U.S. Airways made an announcement to move and take over the American Airlines. American airline is the fourth largest airline in the United States while U.S. Airways is the fifth (Plane Buzz, 2013). This merger, therefore, will make the U.S. Airways- American the largest in the United States with a combined share of more than 21% (The American Antitrust Institute, 2012).
The merger is worth 11 billion U.S. dollars and will turn America into the largest…… [Read More]
Independent dealers must sign a contract that sets forth the manner in which they will operate their rental centers. Often a small business owner will supplement their income be adding U-Hauls to their market mix. Independent contractors earn a commission on their sales.
Each division of AMERCO has it own president. All of them must report to a Board of Directors. The Chairman of the Board and overall President is Edward Shoen, descendent of the original founders of the company. Many members of the Shoen family still control much of the company (Google Finance). Little information is available about the company, aside from their financial statements. Although they have a Board of Directors, the company continues to operate as a family-style operation, with the family members occupying many positions in upper management. The company structure is simple and little is available beyond basic information.
Purchasing Contract Analysis and the UCC…… [Read More]
Of course, this is a good thing for customers on short-term, but is negatively affects other companies on the market. This is because smaller competitors and especially those that intend to enter the market addressed by IBM find it at least difficult to provide product prices in accordance with those provided by IBM. These smaller companies do not have the ability of reducing their production or operating costs, which does not allow them to introduce competitive prices on the market. This way, they are clearly disfavored by IBM's position and market power.
In addition to this, in a field like it, it is imperative to make continuous investments into the research and development activity. This requires significant capital amounts from these companies. The investment levels that IBM reaches cannot be reached by many of these companies. This makes it difficult for these companies to keep up with IBM and its…… [Read More]
Wireless although the performance of Cingular has been mediocre also. The new Cingular expects that the added network coverage from at & T. Wireless will assist in opposing that belief nearly from the very beginning. (FCC OKs Cingular, at&T Wireless Merger)
The merger is regarding placing two companies in unison that do not have the metrics to go for the optimum services. Whereas there is scanty reservations regarding the amalgamation gives Cingular instruments to perk up customer satisfaction, the company has to proceed very speedily. Since in excess of 170 million subscribers are at present using a mobile phone in the United States, the phenomenal surge in the recent years is sure of slowing down. Meanwhile, the customers of at & T. Wireless has been deserting at the rate of 3.5% per month during 2004 which is worrying given that rivals Verizon and Nextel Comunications Inc. has been losing their…… [Read More]
Microsoft Anti-Trust Case
Microsoft was charged with using its position as an industry leader in computer software to force buyers to buy products that were bundled with Internet Explorer. The claim was considered a breach of anti-trust laws which declared that a company cannot package two products together based on one's popularity or market position with the consumer (U.S. v. Microsoft, 2002-2006). Microsoft has denied such claims that they took an unfair advantage of the market and consumer in order to strengthen an already dominant position in the industry (Hemphill, 2004). Especially in the case of the product coming from a company that has domination over the software industry such as Microsoft.
The Internet Explorer browser was not sold but given as a free product with the purchase of the Operating System by Microsoft. This is done by many companies throughout the industry. However when Microsoft applied this marketing principle,…… [Read More]
Private University is selling a share, or something else. At the outset of the Act, "security" is defined as "any note, stock, treasury stock, security future, security-based swap, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, collateral-trust certificate…" and many others are subject to the law. The key is that the security creates a share of income for the holder, whether in the form of debt or equity. Options for later purchase are also included in the definition of security.
The asset in question is a "share" that entitles the bearer to college credits in any school at the future date. A college credit is not a claim to a cash flow, nor it is claim to equity. Therefore, this is not a security. Rather, it is a coupon by which a product can later be acquired. There is no difference between this asset…… [Read More]
separation of powers and federalism. How do these central architectural features of American government seek to support Thomas Jefferson's perspectives; "That government is best which governs least." Why from the view of many business executives is government "gridlock" good?
Separation of powers is that element of the American government designed to protect the nation from tyranny and to, as far as possible, keep the power of the nation decentralized. Federalism, while certainly not designed to promote tyranny, is designed to strengthen the power of the government to act and govern the nation, centralizing power into a strong formal national government. Each of these aspects of modern American government have different implications for business.
According to Thomas Jefferson, "That government is best which governs least." The separation of powers helps to assure that the different branches of the government balance each other sufficiently that no single branch can govern so much…… [Read More]
Grasso last year, contending that the $139.5 million payout that Mr. Grasso received in the summer of 2003 was exorbitant and in violation of New York's not-for-profit law, which states that executives at not-for-profit organizations, like the exchange, receive "reasonable" compensation. Mr. Spitzer has said he will seek more than $100 million back from Mr. Grasso. In his complaint, Mr. Spitzer cited the Webb report as crucial to his investigation. But until yesterday it remained confidential. The document describes some of the crucial points made in the complaint, among them that the board was misled about the size of Mr. Grasso's bonuses and that $13 million of his $139.5 million payment was vested when in fact it was not (THOMAS and Anderson 2005).
The antitrust authorities should permit Microsoft to merge with Yahoo because it will be more profitable in the end. This is due to the fact that…… [Read More]
alt Disney Company Scenario
Scene: Fiscal Karat (FK), host of TV's Let's Talk Money, is seated at the center of an oak conference table. Let's Talk Money is a weekly PBS talk show that interviews business leaders and often finds government officials to debate certain ideas and programs. Tonight's episode features Mr. Michael McDuck (MM), CEO of alt Disney Company and Mr. Rigid B. Crat (RC), Senior Administrator for the U.S. Treasury's Anti-trust Division.
FK: Good evening and welcome to Let's Talk Money, your weekly adventure into provocative and interesting monetary topics ranging from mild to wild. Tonight, a special treat for the kid in us all -- Michael McDuck, CEO of alt Disney goes head to head with the Administration's Senior Anti-Trust Maven, Rigid B. Crat. elcome gentlemen!
First though, let's take a moment to establish a bit of background. The alt Disney Company is a multinational mass media…… [Read More]
economic situation in the U.. As compared to five (5) years ago. Include interest rates, inflation, and unemployment in the analysis.
Between 2009-2011, 6.1million workers were displaced from jobs that they held for at least 3 years. In 2012, the statistics for employment seemed to be more optimistic: whilst 1,340 mass layoff actions occurred in July, the Bureau of Labor tatistics (http://www.bls.gov/) reported that productivity increased 2.2% in the nonfarm business sector in the second quarter of 2012 whilst in manufacturing, productivity grew 0.1%. During this same year (2012), demand for employment also grew in wholesale trade and retail trade, whilst employment in the food and drink sector remained constant. The jobless rate as a whole this year has also decreased in a large number of areas whilst from April to July alone employment rose from 2.1 million to 19.5 million.
In June, 2012, the Federal Reserve ystem noted that…… [Read More]
The result is an increasing gap between the richest and poorest teams that would reinforce disparities around and earning power, concentrating productivity into monopolistic dominant teams with a concommitant reduction of competition in play and consumer price. The result is less competition for higher prices and restricted options for most employees.
Under a bargaining agreement negotiated with a players' union on the other hand, all employers could offer baseline salaries negotiated with players at various tiers, based on productivity, tenure or any legal conditions the teams collaborated to offer should the players agree, which could result in salary reductions, salary caps, various distribution of BI revenue and perhaps reduced 'frictional cost' of having to bid for talent every season (Feldman, 2012, p. 1233). This stability could reduce turnover and search cost and thus slow ticket price increases, and then if players agreed to additional free agent conditions in the negotiated…… [Read More]
Unethical Business esearch Practices
What unethical research behavior was involved?
The antitrust case brought by Wal-Mart and other retailers against Visa and MasterCard in the U.S. Eastern District court, was settled in 2003 for $3 billion and primarily involved a dispute concerning the efficient pricing of access to payment information, including security data that confirmed or refuted the transactional identities of cardholders (oberds & Schreft, 2009). In their pleadings, Wal-Mart and other class action litigants argued that third-party providers such as Visa and MasterCard required them to accept both debit and credit cards issued by MasterCard but the interchange fees were higher for debit cards (Ulzheimer, 2012). In sum, the suit filed by Wal-Mart and other large retailers claimed that Visa and MasterCard "required all merchants who accept their credit cards to also accept their signature debit cards [which] constitutes an illegal tie-in in violation of antitrust law" (Peterson, 2002,…… [Read More]
According to the Organization for Economic Cooperation and Development (OECD) defines economic regulations (industrial regulations) as "intervening directly in market decisions such as pricing, competition, market entry, or exit ("Economic regulations," 2002). The main reason for economic regulation is because it is permits the straightforward businessman to succeed in the economy and decrease business relations within the economy from being broken by the illegal activity that takes place (Black, 2010). However, within the economy the market has four different structures that industries are classified under that the government uses to help control the advantages and limitations of supply and demand. The goal of the four structures is to look at how it "affects the outcomes in the market with impacts on the motivations, opportunities, and decisions of economic buyers and sellers through their behaviors within market competition" states Fischer (n.d.). The OECD defines social regulations as an impact…… [Read More]
This report is based upon the book Titans of Takeover by Robert Slater. This book was originally published in 1987 by Englewood Cliffs, and then re-published and copyrighted in 1999 by Beard Books.
Introduction of the Author
The book Titans of Takeover was authored by Robert Slater, who is famous for his strong stand against President Ronald Reagan's attempts to make the U.S. marketplace a free economy by doing away with the Sherman and Clayton Antitrust Laws. He proved to America that although such a move would appear to yield immediate benefits by putting the nation's economy on the map against the vibrant economies that gave no room to antitrust laws, it would, to an equally large extent, produce devastating outcomes on the economy in the long run. Slater has authored a couple of other bestselling business books and authored several articles on the Wall Street Journal, in…… [Read More]
orkers can increase their own value in the workplace by improving their work assets, through education, effort or tenure.
In addition, the U.S. economy would not necessarily benefit. A higher national minimum wage would distort the market for labor in some states that currently face conditions leading to lower wages. This disruption of the market could reduce demand for labor and could also result in a less efficient market. In addition, increases in production costs are often passed on to consumers. hile the minimum wage worker may earn more, inflation will increase, essentially transferring wealth from all consumers to a small group of workers. This does not imply the creation of new wealth, only a redistribution of it in a manner that increases economic inefficiency. In addition, a higher minimum wage entices workers into the job market to the detriment of other workers, and many minimum wage earners are young…… [Read More]
Microsoft is a company that was found to be in violation of antitrust laws by both the U.S. Justice Department and the European Commissions. The reason behind such a finding, is that Microsoft acted in a manner that was found to be overly aggressive in regards to its operating systems and software. As the Weil and McMillan article wrote that it was "alleged that Microsoft harmed Netscape's browser business through anticompetitive practices related to the Windows operating system" (Weil, McMillan, 2003) while the United States vs. Microsoft article went even further by stating "critics contend that Microsoft used monopolistic business practices and anti-competitive strategies including refusal to deal and lying, put unreasonable restrictions in the use of its software and used misrepresentative marketing tactics" (United States, 2002, 2006).
It is this author's belief that it does not matter if a company is 'capitalistic' or not, most companies would not have…… [Read More]
It is surely an understatement to observe: "Competitors who rely on the same setup as Youube," said Heberger, "where it's all user-generated content, they might be in trouble facing a Google-Youube team." (Mills & Sandoval, 2006)
he impact of the federal government upon economic behavior in this instance is clear -- there may have been grounds to contest the merger of Google and Youube, especially as Google has its own video service already. he government's action or inaction has changed the future of the Internet. Moreover, although the market structure of providers is relatively concentrated, the social diversity of the users of the services of Google and Youube is unprecedented. Every person's lives are affected, provided they use the Internet
What is the downside for Google? On one hand, people could begin to lose interest in posting on Youube, as Youube is not a strictly essential service, like a business'…… [Read More]
Corporate Mergers and the Public Good
The United States of America, during the last years of the Nineteenth Century, witnessed a rash of corporate mergers. The Industrial Revolution had taken firm hold, and the nation was changing rapidly. Millions of Americans who had once been independent farmers or tradesmen now found themselves in the position of what some termed "wage slaves." At the mercy of their corporate employers, they worked long hours at low pay, and often under appalling conditions. The reasons for the merger mania of this period are many and complex, as are its effects upon the population as a whole. In breaking down the traditional vocational environment, the gigantic new conglomerates also transformed the entire social landscape. ork was no longer a family business shared by all generations. Communities no longer clung together for mutual protection and aid. Suddenly, the citizen of this new world was out…… [Read More]
The May 2007 economy presented a rosy picture: the lowest unemployment rate of the Bush Administration 4.4% (Bureau of Labor Statistics.gov. 2012. PP. 1), the peak of housing values, strong GDP growth of 3.6% (Trading Economics.com. 2012. PP. 1), a stable inflation rate of 2.2% (Trading Economics.com. 2012. PP. 1), and a normalized non-emergency FED Funds of 5.25% (Moneycafe.com. 2012. PP. 1). Yet, the collapse was imminent as the "Great Recession" began in the fourth quarter of 2007, decimating the economy and bringing the global financial system to a grinding halt. Now five years later the economy is regaining its footing in a ponderous yet upward trajectory which began in the second quarter of 2009. An espy of May 2012 presents a dramatically different story than of 2007: unemployment stands at 8.1% (Bureau of Labor Statistics.gov. 2012. PP. 1), housing values have plummeted; "Americans overall have lost almost…… [Read More]
economic situation U.S. compared (5) years ago. Include interest rates, inflation, unemployment analysis. 2.Propose (2) strategies federal government implement encourage people spend money order create employment opportunities.
Q1.Analyze the current economic situation in the U.S. As compared to five (5) years ago. Include interest rates, inflation, and unemployment in your analysis.
The unemployment rate in January 2012 was 8.3%. The relative improvement in the economy has caused many to pressure Fed chairman Ben Bernanke to raise interest rates above their current record lows to curb inflation, although Bernanke still feels that the economy is fragile enough to justify keeping rates extremely low. "The unemployment rate has fallen for five straight months and employers have added an average of 200,000 net jobs per month from November through January" (Crustinger 2012). Until recently, the Fed has believed that there has been little risk of inflation due to an excess in the money…… [Read More]
" (Schlossberg, 2004)
FERC analyzed while making a review of the electric utility mergers proposition, the transaction being proposed "likely effect" on (1) competition;
(2) rates; and (3) regulation. (Schlossberg, 2004)
There are stated to be "no antitrust exemptions for transactions subject to FERC review and such mergers are regularly reviewed by either the Federal Trade Commission (FTC) or the Division." (Schlossberg, 2004) The Securities and Exchange Commission had previously held jurisdiction for reviewing acquisitions of stock of electric utility companies however, the authority provided under the Public Utilities Holding Company Act of 1935 was repealed in 2005.
III. FORESEEAILITY DOCTRINE REHAILITATION
The work of Trujillo (2006) entitled: "State Action Antitrust Exemption Collides with Deregulation: Rehabilitating the Foreeseability Doctrine" states that a capitalist society that has policies which were established for the purpose of regulating "the promotion of competition in traditionally regulated industries such as the electrical market seems counterintuitive.…… [Read More]
, 93 F. 3d 1358 (CA7 1996) for its statement that "monopsony pricing is analytically the same as monopoly...pricing and is so treated by the law." ased on this determination that the two concepts are analytically similar, the Court thus concludes that therefore "similar legal standards should apply to claims of monopolization and to claims of monopsonization." Reasoning that predatory-pricing is fundamentally an act of monopolization and that predatory-bidding is fundamentally an act of monopsonization, and that both claims involve the deliberate use of unilateral pricing measures for anticompetitive purposes, the Court finds that the logically same legal standard should therefore govern actions brought on both.
ased on this reasoning, the Court concludes that "the general theoretical similarities of monopoly and monopsony combined with the theoretical and practical similarities of predatory pricing and predatory bidding convince us that our two-pronged rooke Group test should apply to predatory-bidding claims." Accordingly, under…… [Read More]
The Dying Profession of Independent Physicians
In the past, it has always been the case that physicians were, for the most part, independent contractors who had working agreements with certain hospitals in their region. However, that is not the case anymore. Physicians are increasingly joining healthcare organizations because the costs of remaining autonomous are too strenuous. It does not matter that independent physicians, on average still make more than their group counterparts because there are too many advantages to joining a healthcare group. The primary advantage being the fact that the individual is no longer solely responsible for such tasks as billing and scheduling. Although joining a group may be advantageous in some ways, it is troubling in others. Patient care is sometimes lessened because, as with the government sponsored socialized medical practices that exist in other countries, the patient may have to wait longer for care and…… [Read More]
There are a number of different laws that govern fair, balanced and competitive practices. One major category is the antitrust laws. Antitrust laws seeks to create a competitive environment by preventing companies from obtaining the ability to abuse their market positions. Ensuring that each industry and market has a healthy amount of competition has been the work of a series of acts that govern antitrust practices.
The most significant piece of antitrust legislation is the Sherman Act, which was passed in 1890 in order to define antitrust activities. The act was passed in response to monopoly abuses on the part of a number of companies, and the recognition that a successful capitalist economy required at least enough market intervention on the part of government to prevent the formation of unnatural monopolies (FTC, 2014).
There have been subsequent laws that have enhanced the Sherman Act, and refined it, largely…… [Read More]
A favorite target for conspiracists today as well as in the past, a group of European intellectuals created the Order of the Illuminati in May 1776, in Bavaria, Germany, under the leadership of Adam Weishaupt (Atkins, 2002). In this regard, Stewart (2002) reports that, "The 'great' conspiracy organized in the last half of the eighteenth century through the efforts of a number of secret societies that were striving for a 'new order' of civilization to be governed by a small group of 'all-powerful rulers.' The most important of these societies, and the one to which all subsequent conspiracies could be traced, is the Illuminati founded in Bavaria on May 1, 1776 by Adam Weishaupt" (p. 424). According to Atkins, it was Weishaupt's fundamental and overriding goal to form a secret organization of elite members of Europe's leading citizens who could then strive to achieve the Enlightenment version of revolutionary social…… [Read More]
There have been several arguments with reference to the social impact of the Intellectual Property, and it has been observed that the Intellectual property law has been responsible for the promotion of the competitive forces in such a manner that 'antitrust law does not address, and may do so based on evidence that would be insufficient in an antitrust context' (Brinson, 1994). It is indeed a difficult practice related to the 'forced sharing to attain optimal competition' (Brinson, 1994), and it appear to be unwarranted 'in most antitrust contexts, and it is clear indication of the absent clear proof of market harm' (Thomas, 2006), although it is expected to 'constitute improved and comprehensive Intellectual Property policy, even in the presence of ambiguous evidence' (Brinson, 1994). The anti-trust law and the intellectual property law is expected to minimize the cost of three different things, which include, false positives, as per which…… [Read More]
Business and Society: The Microsoft Case
"Microsoft" is one of the most well-known and highly diversified computer software manufacturing organizations of the world, founded in 1975 by Bill Gates. Only after five years of its foundation, this company earned $8 million and this success has continued to date. It is still run by its founder and its success story continues, which has made it one of the most famous organization of the world.
Microsoft was the first company that introduced the first user friendly and affordable operating system for personal computers. It manufactures several products today including; windows family of operating systems for personal computers & servers, applications softwares that run on the windows family of operating systems, and the most famous and successful MS-Office Suite, which consists of ord, Excel, Power Point, Outlook and Access.
These applications are not only used by students and professionals but also by users…… [Read More]