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AAI Asks En Banc Ninth Circuit to Reconsider Panel’s Algorithmic Collusion Opinion (Gibson v. Cendyn)

On October 9, 2025, the American Antitrust Institute (AAI) filed an amicus brief urging the Ninth Circuit Court of Appeals to grant rehearing en banc in Gibson v. Cendyn Grp., Inc. (9th Cir. No. 24-3576).

The plaintiffs in Gibson allege that defendants, hotels on the Las Vegas strip, licensed the same third-party pricing algorithm, which used the hotels’ non-public, commercially sensitive pricing information to make pricing and vacancy recommendations that had the effect of reducing room occupancy and driving up prices. The district court dismissed the case, and AAI filed an amicus brief urging the Ninth Circuit to reverse. A panel of the Ninth Circuit affirmed, insisting that plaintiffs must plead and prove a causal link between the hotels’ licensing agreements and a “restraint” in the relevant market. The panel concluded that the licensing agreements were not vertical agreements but “ordinary sales contracts” which need not be reviewed under the rule of reason.

In its brief supporting rehearing en banc, AAI points out fundamental errors in the panel’s reasoning. By insisting on a causal link between the licensing agreements and a restraint in the relevant market, the panel confused proof of an agreement with proof of the agreement’s effects on competition. As AAI’s brief explains, black letter antitrust law dating back over one hundred years holds that all agreements restrain trade, such that insisting on a causal connection between “an agreement and a restraint” makes no sense. Instead, the panel should have focused on whether there was a causal link between the licensing agreements and anticompetitive effects in the relevant market. The panel’s confusion between a restraint and its effects caused it to disregard the plaintiffs’ well-pleaded allegations that the licensing agreements caused prices to increase and occupancy to decrease in the relevant market. And it leads to the absurd conclusion that, because they do not “cause a restraint” in the relevant market, vertical agreements can never violate Section 1.

AAI also argues that, beyond the fundamental errors in the panel’s reasoning, the opinion merits en banc rehearing because it conflicts with Supreme Court precedent on an issue of exceptional public importance. By creating a new category of agreements which are not subject to rule-of-reason analysis, the panel opinion conflicts with Board of Trade of the City of Chicago v. United States, 246 U.S. 231 (1918), which held that that an agreement must be tested under the rule of reason to determine whether it restrains trade unreasonably in violation of Section 1. AAI also explains that competitors’ use of the same third-party pricing software is an increasingly common feature of the economy, and that the panel opinion would exempt this practice from antitrust scrutiny despite a consensus among experts that it can raise prices and facilitate collusion.

The brief was written by AAI Senior Counsel David O. Fisher, with assistance from AAI President Randy Stutz and AAI Vice President and Director of Legal Advocacy Kathleen Bradish.

Read the full brief: AAI Amicus Brief in Gibson v. Cendyn

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From Labor Market Theory to Antitrust Policy: A Conversation with Ioana Marinescu

On this episode of Ruled by Reason, AAI Senior Counsel David O. Fisher talks with leading economist Ioana Marinescu about the theoretical frameworks underpinning labor monopsony and how they apply in various antitrust law and policy contexts.

The conversation centers on Marinescu’s recent paper with coauthor José Azar, Monopsony Power in the Labor Market: From Theory to Policy, which lays out the theoretical frameworks underlying monopsony power in labor markets and develops a theory-informed discussion of antitrust law and policy. The conversation begins with an examination of Marinescu’s background and her research on labor markets and monopsony power (3:15). She then explains the three main theoretical frameworks underpinning labor monopsony as reflected in the literature: oligopsony, differentiated jobs, and search-and-matching frictions (10:04).

The conversation then moves to a discussion of how economists determine which models to apply in which context (18:47). In the enforcement context, Marinescu examines the usefulness of each framework in the context of enforcing against no-poach and wage fixing agreements (21:24), and underscores the significance of a 2023 study by Tania Babina and co-authors which finds that antitrust enforcement against anti-competitive conduct tends to increase overall employment and business formation (26:48). Marinescu also discusses merger enforcement, and how each of the three theoretical frameworks apply in the merger context as reflected in the 2023 Merger Guidelines (30:53). Finally, she examines the theoretical work supporting the FTC’s Noncompete Rule, and whether it supports the agency’s current approach of addressing noncompete clauses on a case-by-case basis (35:24).

GUEST

Ioana Marinescu is an associate professor at the University of Pennsylvania School of Social Policy & Practice, with secondary appointments in the Economics Department and the Wharton School of Business (BEPP), and a research associate at the National Bureau of Economic Research. Her pioneering research on wages and monopsony power led to her appointment as principal economist at the U.S. Department of Justice Antitrust Division (2022-2024).

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AAI Files Tunney Act Comments Questioning Unusual HPE/Juniper Settlement

AAI has filed Tunney Act comments urging the District Court for the Northern District of California to conduct additional discovery before considering whether it can approve the Department of Justice’s controversial settlement allowing the merger of Hewlett Packard Enterprise Co. (HPE) and Juniper Networks, Inc. (Juniper).

After suing to block the HPE/Juniper merger in January, the Department of Justice (DOJ) reversed course in June, agreeing to settle the merger only twelve days before trial in exchange for a combination of structural and behavioral relief. For a variety of reasons, the settlement is controversial. Most notably, two of Assistant Attorney General Abigail Slater’s top deputies were fired after reportedly opposing it. Last month, one of the deputies, Roger Alford, delivered a speech revealing numerous troubling developments, including that political appointees in the Justice Department overruled the experts in the Antitrust Division after a lobbying campaign by the merging parties. According to news reports, Assistant Attorney General Slater herself opposed the settlement.

Under the Antitrust Procedures and Penalties Act (APPA), more commonly known as the Tunney Act, DOJ settlements embodied in consent decrees must meet certain requirements before being entered by a court. First, the DOJ must file a Competitive Impact Statement (CIS) and Proposed Final Judgment (PFJ) with the court. The public then has a 60-day period to comment on the settlement. After the public comment period, the DOJ must file a response to public comments, along with the comments themselves, with the court. The court must then determine whether entering the consent decree is in the public interest. The Tunney Act authorizes the court to conduct additional discovery, including to hold hearings, appoint a special master, take witness testimony, appoint consultants and experts, and hear from amici curiae, before determining whether the settlement is in the public interest.

AAI’s public comments argue that the CIS does not fulfill the DOJ’s Tunney Act obligation to provide “an explanation of any unusual circumstances” giving rise to the PFJ. Most immediately, it does not address the credible allegations of Alford, who was the second-highest ranking official in the Antitrust Division. Specifically, it does not address the overruling of the Antitrust Division, the firings, or the reports of extensive lobbying activity by non-antitrust lobbyists.

Moreover, the DOJ’s complaint expressly states that the merger “should be blocked,” which signals that it believes the merger is incurable using remedies. The CIS does not explain what led the DOJ to reverse this substantive conclusion. Although news reports quoting DOJ spokespeople have said the reversal was motivated by a desire to strengthen HPE’s international competitiveness for national security reasons, that approach would contravene longstanding DOJ policy holding that protecting and promoting domestic competition—rather than stabilizing or reducing it through anticompetitive mergers—is the best way to promote international competitiveness. Moreover, the CIS itself undermines that justification by asserting that the settlement would effectively remedy the merger’s anticompetitive effects. If the remedy will do what the CIS claims it will do, then it will not strengthen HPE’s hand internationally.

AAI’s comments also identify and explain omissions in the DOJ’s recitation of legal standards governing public interest review under the Tunney Act. The CIS fails to meet the Tunney Act’s reasonableness standard because it fails to provide a factual foundation for its prediction that the proposed remedy will lead to entry or repositioning, which itself contravenes the complaint’s allegations that entry and repositioning are not viable.

Finally, AAI’s comments review the legislative history of the Tunney Act, which had its origins in a Nixon administration scandal in which lobbyists persuaded White House officials to overrule Antitrust Division experts. AAI argues that the Tunney Act was made for cases like one, because it ensures disclosure of information to the public though fact discovery when there are (1) unusual circumstances giving rise to the consent decree; (2) public reports of extensive lobbying activity and credible allegations that government antitrust specialists were overruled; and (3) a remedy proposal that is facially dubious because it lacks a factual foundation.

The comments were written by AAI President Randy Stutz, with assistance from AAI Vice President and Director of Legal Advocacy Kathleen Bradish and AAI Senior Counsel David O. Fisher.

Read the full comments here: AAI Tunney Act Comments

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AAI Counsels Ninth Circuit on Trial Courts’ Broad Powers to Enjoin Monopolistic Conduct (Epic Games v. Apple)

The American Antitrust Institute (AAI) recently filed an amicus brief in Epic Games v. Apple encouraging the Ninth Circuit Court of Appeals to affirm a district court’s order modifying an injunction against Apple for violating California’s Unfair Competition Law (UCL).

In a 2021 order, Judge Yvonne Gonzalez Rogers ruled that Apple’s “anti-steering” policies preventing app developers from directing users to outside payment options violated the UCL. The court enjoined Apple from charging a supracompetitive 30% commission on all in-app purchases. Aided by an AAI amicus brief on the merits, the Ninth Circuit affirmed.

This April, after evidentiary hearings, the district court found that Apple’s response to the 2021 injunction—which included imposing a new 27% commission on out-of-app purchases and new restrictions designed to dissuade app customers from making purchases outside of the App Store—were in direct defiance of the injunction. The court held Apple in civil contempt and issued a new, modified injunction that prohibits Apple from impeding app developers’ communications with users and from charging any commission on out-of-app purchases. Apple appealed.

AAI’s amicus brief explains that Apple’s replacement practices achieved the same anticompetitive ends as its original practices, using the same economic mechanism. Rather than contractual provisions, it used pricing and design tactics to raise rivals’ costs by making it more difficult for users to discover and substitute to lower-cost sellers. Because such tactics can often achieve the same ends as contractual provisions, courts must be able to enjoin them to prevent end-runs around competition remedies.

Addressing Apple’s argument that its general expenditures developing and maintaining the App store entitle it to a commission on out-of-App purchases, AAI explained that a defendant’s procompetitive justifications for otherwise harmful conduct must be specific to that conduct, and that “ruinous competition” is not a cognizable defense.

In response to Apple’s argument that the court’s modified injunction violates its First Amendment rights by ordering it to stop limiting or refusing to display information from third Parties, AAI explained that First Amendment rights are not absolute. Antitrust and unfair competition remedies prohibiting certain kinds of speech are common and often necessary, particularly where, as here, a defendant refuses to permit certain communications that would have increased competition.

Finally, addressing Apple’s argument that the court cannot issue a new injunction without first adjudicating liability as to the newly enjoined conduct, AAI pointed to Supreme Court precedent holding that a court’s remedial powers extend well beyond the particular conduct found to be illegal at the liability stage. AAI argued that allowing  antitrust defendants to relitigate liability at the remedy and compliance stages would considerably compound the administrative costs of antitrust litigation.

The brief was written by AAI Advisory Board member John M. Newman, who is Professor and Herbert Herff Chair of Excellence in Law at the University of Memphis Cecil C. Humphreys School of Law. AAI President Randy M. Stutz assisted.

Read the full amicus brief: AAI Amicus Brief in Epic Games v. Apple

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Monopolizing by Conditioning: A Conversation Between Jack Kirkwood and Daniel Francis, Jerry S. Cohen Award Winner for Antitrust Scholarship

In this episode of Ruled by Reason, guest host John B. “Jack” Kirkwood, Professor of Law and the William C. Oltman Professor of Teaching Excellence at Seattle University School of Law, sits down with Daniel Francis, Assistant Professor of Law at NYU Law School. The two discuss Francis’s award-winning article, Monopolizing by Conditioning, 124 Colum. L. Rev. 1917 (2024).

Professor Francis’s article won the 23rd Annual Jerry S. Cohen Memorial Fund Writing Award, presented on May 29 at AAI’s 2025 Annual Policy Conference, The State of the Antitrust Technocracy. The article demonstrates that conditional dealing should be recognized as its own, separate form of monopolistic conduct rather than squeezed into ill-fitting categories in existing monopolization law. It provides a new analytical framework for evaluating conditional dealing, including a definition of conditioning and standards for gauging its exclusionary impact, contribution to power, and procompetitive justifications. It also explains why courts’ current criteria for evaluating claims based on conditional dealing should be jettisoned.

Professor Kirkwood and Professor Francis discuss the basic idea of monopolizing by conditioning and past efforts to squeeze it into “shoe boxes” under existing monopolization law (7:01); horizontal versus vertical conditioning and raising rivals’ costs (12:43); how “conditioning” compares and contrasts with above-cost pricing, volume discounts, market share discounts, requirements contracts, and refusals to deal (15:57); Francis’s proposed legal standard and how it aligns with the goals of antitrust law (29:43); error-cost analysis (37:05); and the prospect of “quick-look” monopolization (40:21).

The Jerry S. Cohen Award recognizes antitrust scholarship that reflects a concern for principles of economic justice, the dispersal of economic power, the maintenance of effective limitations on economic power, or the federal statutes designed to protect society from various forms of anticompetitive activity. Selected scholarship reflects an awareness of the human and social impacts of economic institutions upon individuals, small businesses and other institutions necessary to the maintenance of a just and humane society—values and concerns Jerry S. Cohen dedicated his life and work to fostering.

GUESTS:

John B. “Jack” Kirkwood, Professor of Law and the William C. Oltman Professor of Teaching Excellence at Seattle University School of Law

Daniel Francis, Assistant Professor of Law at NYU Law School

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New AAI White Paper Analyzes Causation Standards for Monopolization Remedies

During the first two decades of the twenty-first century, the federal government brought few monopolization cases, and only a tiny fraction resulted in litigated, court-ordered remedies. However, the last five years has seen an uptick in monopolization cases, including against major digital platforms. Several cases have resulted in early enforcement victories, including during the liability phase at trial, and they have now entered the remedy phase, where the trial court will be tasked with ordering equitable relief.

In this context, applying the correct standard for evaluating monopolization remedies has lasting and broad importance. An overly demanding standard will not just frustrate justice in any particular case but will have a significant impact on antitrust law’s ability to rein in monopolistic conduct in much of the modern economy. In a new White Paper, AAI’s Vice President and Director Legal Advocacy, Kathleen Bradish, addresses a key, recurring issue in legal battles over monopolization remedies: causation standards. The White Paper, entitled Unrealistic Causation Standards Put Effective Monopolization Remedies at Risk, explains why certain problematic causation standards suggested by defendants and their supporting amici threaten a core principle of monopolization remedies—the need to put “effectiveness first.”

Read the full white paper: Unrealistic Causation Standards Put Effective Monopolization Remedies at Risk

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AAI Urges Supreme Court to Recognize an Independent Misrepresentation Exception to Noerr-Pennington Immunity (Chatham Primary Care, P.C. v. Merck & Co.)

On August 11, 2025, AAI filed an amicus brief in the Supreme Court supporting a petition for certiorari in Chatham Primary Care, P.C. v. Merck & Co. (In re Merck Mumps Vaccine Antitrust Litigation), No. 25-45.

Relying on the Noerr-Pennington doctrine, a Third Circuit panel overturned a district court’s denial of summary judgment on the plaintiffs’ allegations that Merck violated Section 2 of the Sherman Act by misrepresenting the potency of its mumps vaccine on the vaccine’s FDA labelling. As a result of Merck’s alleged false labelling, competing vaccines could not show equivalence and were delayed from entering the market by several years. The court reasoned that Merck’s labelling representations, even if intentionally false, were government petitioning activity protected by the First Amendment. AAI had filed an amicus brief in support of en banc rehearing in the Third Circuit, but the petition was denied.

In its Supreme Court brief, AAI argues that Third Circuit caselaw granting Noerr-Pennington immunity for knowing misrepresentations to adjudicatory bodies reflects a minority position that has been rejected by every other circuit to consider it. The brief urges the Court to grant certiorari, resolve the circuit split in favor of the other circuits, and formally adopt a misrepresentation exception to Noerr-Pennington that stands apart from the “sham litigation” exception identified in Pro. Real Est. Invs., Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49 (1993).

AAI’s brief explains that the majority view in the circuits better protects both constitutional rights and consumers. Knowingly false statements to adjudicatory bodies harm competition, distort markets, and undermine adjudicatory processes while serving no lawful purpose that could warrant constitutional protection.

The brief was written by Berger Montague Associate Matt Summers, with assistance from Berger Montague Shareholder Josh Davis, Berger Montague Paralegal & Office Manager Connor Rowe, AAI President Randy Stutz, and AAI Vice President & Director of Legal Advocacy Kathleen Bradish.

Read the full brief here: AAI Amicus Brief in Chatham Primary Care, P.C. v. Merck & Co.

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AAI Warns Ninth Circuit Against Robotic Application of Kodak/Epic in Aftermarket Monopolization Cases (Surgical Instrument Service Co., Inc. v. Intuitive Surgical, Inc.)

The American Antitrust Institute (AAI) recently filed an amicus brief in Surgical Instrument Service Co., Inc. v. Intuitive Surgical, Inc. urging the Ninth Circuit to reverse the district court’s order requiring proof of the so-called “Kodak/Epic” lock-in factors for aftermarket tying claims when the defendant has a monopoly in the foremarket.

Plaintiff SIS alleged that the defendant Intuitive holds a near-total monopoly (99%) in the market for minimally invasive surgical robots. According to the complaint, Intuitive used that power to force hospitals to purchase Intuitive’s own expensive replacement parts for the robots, blocking SIS’s lower-cost repair and refurbishing services. The district court issued a ruling requiring SIS to show that the Kodak/Epic factors were satisfied. These include: (1) consumers in the foremarket must not generally be aware of the aftermarket restrictions; (2) consumers cannot price the aftermarket restrictions accurately because of significant information costs; (3) the cost of switching to a different brand in the foremarket is high; and (4) the aftermarket is itself a well-defined market.

AAI’s brief argues that the district court erred because the Kodak/Epic factors can logically apply only when anticompetitive behavior in the aftermarket is constrained by a robustly competitive foremarket. AAI explains that when the primary market is monopolized, requiring the Kodak/Epic factors is both redundant and illogical because customer choice is already constrained. In this scenario, customer coercion is inherent and aftermarket restrictions cannot be considered voluntary or informed. Accordingly, applying the Kodak/Epic factors in monopolized markets creates a dangerous loophole that allows entrenched monopolists to extend their dominance without meaningful antitrust scrutiny.

AAI’s brief also points out that common policy concerns about expanded aftermarket liability are not implicated in this scenario. Efforts to protect efficient lifecycle pricing, contractual remedies, and incentives to compete in the foremarket only make sense when foremarket competition exists—something absent in this case. As a result, there is no policy justification for requiring proof of the Kodak/Epic factors in a case like this. Worse, insisting on the Kodak/Epic factors in such a setting may incentivize monopolists to shift anticompetitive behavior to the aftermarket to evade scrutiny, effectively stripping vulnerable consumers—such as the surgery patients who are the ultimate customers here—of any antitrust protections.

The brief was written by Kathleen Bradish, AAI’s Vice President and Director of Legal Advocacy, with assistance from AAI President Randy Stutz.

Read the full brief: AAI Amicus Brief in Surgical Instrument Service Co., Inc. v. Intuitive Surgical, Inc.

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New AAI Analysis Finds Changes Are Needed to Criminal Antitrust Plea Bargains

In new findings, AAI identifies changes that are needed to harmonize the Department of Justice’s Model Corporate Plea Agreement with its Corporate Leniency Policy and to respond to recent case law developments.

In antitrust criminal plea agreements, the Department of Justice (DOJ) includes provisions that forego criminal restitution when private civil damages actions challenging the same conduct are pending. The DOJ’s current practice, as reflected in its Model Corporate Plea Agreement, is to waive restitution so long as such civil actions have been filed. However, notwithstanding their filing, these civil actions may not actually lead to the recovery of private damages. When damages are not recovered and restitution is also waived, guilty criminal defendants keep ill-gotten gains (sometimes billions of dollars) and avoid making victims while.

When private civil actions following criminal guilty pleas do not lead to the recovery of damages, it is usually because the actions must be pursued as class actions to be economically viable, and the defendants are able to successfully challenge class certification. The doctrine of collateral estoppel prevents guilty criminal defendants from contesting liability in overlapping civil damages actions, but nothing—including the DOJ’s plea agreement—prevents them from challenging class certification. Accordingly, guilty defendants who confess to antitrust crimes often devote exorbitant amounts of time and resources trying to prevent class certification.

AAI finds that the DOJ’s current policy of waiving restitution prior to class certification in plea agreements exacerbates this problem and creates inefficient incentives. Defendants need not litigate class certification any differently when they have confessed guilt relative to when they profess innocence, but confessed guilt changes class certification dynamics in important respects. Certain recurring arguments defendants marshal to defeat class certification, while understandable in the absence of liability, become frivolous once liability is confirmed. In particular, guilty criminal defendants often attempt to defeat class certification on grounds that the class is defined to include uninjured members.

As AAI explains in its paper, such arguments are not only frivolous but can become absurd in antitrust cases where plaintiffs are forced to rely on aggregate damages calculations because of market uncertainties created by a confessed antitrust violation. When these inappropriate class certification challenges nonetheless succeed, they undermine plea agreements, the broader criminal enforcement mission, and the antitrust class action mechanism. Moreover, such class certification challenges are in danger of becoming far more prevalent and effective because of recent developments in class action law.

In a detailed letter to the DOJ, AAI recommends three changes to the Model Corporate Plea Agreement that would help discourage inappropriate class certification challenges and align the restitution provisions in the DOJ’s criminal plea bargains with the restitution provisions in its Corporate Leniency Policy. The latter requires cooperating defendants to assume an affirmative obligation to make victim restitution unless doing so is “impossible,” and it requires that such defendants provide “reasonably achievable” plans for making restitution and encourages them to do so through settlements that streamline damages determinations and make victims whole as swiftly as possible.

AAI makes the following recommendations in its letter:

  1. When a guilty criminal defendant chooses to rely on civil damages as a substitute for victim restitution in a corporate plea agreement, the Department should clarify that only the actual payment of damages, and not merely the filing of civil suits that “potentially provide for a recovery,” fulfills the defendant’s restitution obligation.
  2. When a guilty criminal defendant chooses to rely on a civil class action as a substitute for victim restitution in a corporate plea agreement, the Department should condition the waiver of restitution on class certification being granted.
  3. If the guilty criminal defendant wishes to contest class certification despite relying on the class action as a substitute for victim restitution, the Department should require the defendant to provide a “reasonably achievable” alternative plan for making restitution if class certification is denied.

The letter was written by AAI President Randy Stutz.

Read the Letter to DOJ.

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AAI Clarifies Aftermarket Monopolization Standards in the D.C. Circuit (PhantomALERT v. Apple)

AAI has joined with Professor Eric A. Posner, the Kirkland & Ellis Distinguished Service Professor of Law and Arthur and Esther Kane Research Chair at the University of Chicago Law School, in filing an amicus brief urging the D.C. Circuit Court of Appeals to credit economically distinct theories of liability for aftermarket monopolization under Section 2 of the Sherman Act.

In PhantomALERT, Inc. v. Apple, Inc., the plaintiff is an app developer who, during the pandemic, developed an app allowing smartphone users to report Covid-19 symptoms and hot spots by location. After Apple launched a similar app and excluded PhantomALERT’s app from the App Store, PhantomALERT brought a Section 2 case asserting that Apple tied the iPhone to the App Store and to Apple’s Covid-19-related tracing app and monopolized the aftermarket for Covid-19-related tracing apps. Apple then moved to dismiss the complaint.

The district court granted Apple’s motion, agreeing with Apple that PhantomALERT’s claim failed because it did not adequately define a “Kodak-style aftermarket.” Among other things, the district court found that the plaintiff failed to adequately allege lock-in, which it held “is the crux of any Kodak-style theory.”

In Kodak, the Supreme Court held that a defendant who lacks monopoly power in a foremarket nonetheless may monopolize an aftermarket under a lock-in theory, provided that a set of enumerated conditions are met. As explained in Epic v. Apple in the Ninth Circuit, the factors required for a Kodak-style lock-in theory are: (1) consumers in the foremarket must not generally be aware of the aftermarket restrictions; (2) consumers cannot price the aftermarket restrictions accurately because of significant information costs; (3) the cost of switching to a different brand in the foremarket is high; and (4) the aftermarket is itself a well-defined market. Here, however, the plaintiff alleged that Apple had market power in the foremarket.

AAI and Professor Posner explain that Kodak applies to claims of aftermarket monopolization only where the defendant lacks market power in the foremarket, not where, as in this case, the defendant possesses market power in the foremarket. A plaintiff can make out a prima facie case by showing that the defendant has market power over the foremarket and uses that market power to exclude competitors from the aftermarket. That theory of aftermarket monopolization follows from a straightforward application of traditional antitrust principles and not from the holding in Kodak. Among other things, the brief explains that a defendant with market power in the foremarket can exercise that power in the aftermarket regardless of whether its customers are aware of the defendant’s aftermarket behavior or can engage in lifecycle pricing. Proof of lock-in is not required in this scenario because the defendant’s power comes directly from its market power in the foremarket and not from its customers’ ignorance or confusion.

AAI thanks Garwin Gerstein & Fisher LLP (GGF), and GGF Partner and AAI Advisory Board member Deborah Elman, for serving as counsel to amici curiae. The brief was written by Professor Posner, with assistance from Ms. Elman and from AAI staff.

Read the full brief here.