Comments on: Credit Suisse and "Sector Regulation": SCOTUS Picks the Right Poison

By: TRUTH ON THE MARKET » Chemerinksy’s Theory of the Roberts’ Court’s Antitrust Jurisprudence

Wed, 15 Aug 2007 18:13:35 +0000

[...] comparative advantages of antitrust versus the SEC for regulating this sort of conduct (see Thom’s post, Keith’s eCCP paper, and Carlton & Picker’s excellent paper) and the costs imposed [...]

By: TRUTH ON THE MARKET » My Take on Credit Suisse . . .

TRUTH ON THE MARKET » My Take on Credit Suisse . . . — Fri, 29 Jun 2007 18:13:06 +0000

[...] is here, over at eCCP, and differs somewhat from Thom’s. [...]

By: M. Hodak

M. Hodak — Mon, 25 Jun 2007 01:11:54 +0000

I agree that SCOTUS got this one right. The law should provide either direct, positive regulation over an activity or indirect, negative regulation via the enforcement of certain rights through litigation–not both. I think the same logic would hopefully prevail on FDA approval versus the threat of lawsuit against approved food or drugs (assuming they weren’t tainted).

Certain people clearly think there is no such thing as too much regulation, but fortunately SCOTUS appears to be moving away from that view.

By: market failure, right here

market failure, right here — Thu, 21 Jun 2007 16:04:18 +0000

Interesting. It seems to me that the judges should have disposed of the opt outs by applying issue preclusion to dipositive factual issues, which should have kicked those remaining stray cases out quite painlessly.

I’d say that you’re throwing out the baby with the bathwater by limiting private actions to prevent abuses like this. If the judiciary does its job properly with res judicata, motions to dismiss, early summary judgment motions, phased discovery, and sanctions, there really shouldn’t be situations of this sort.

Also, I’d suggest that you’re focusing on only half of the equation. Don’t you need to consider the positive role plaintiff-side attys play, both in terms of reaching meritoriious cases the enforcement agenicies can’t/won’t touch for political or resource issues?

Plus, treble damages creates a strong disincentive preventing future anticompetitive conduct. The only reason client counselling is effective in reigning in the more adventuresome clients is the bogeyman of class action liability.

By: Thom

Thom — Wed, 20 Jun 2007 22:06:03 +0000

It is true that antitrust litigation is “expensive, risky, and time consuming,” but it’s also highly lucrative (treble damages, after all). In my practice, I saw many, many frivolous antitrust suits. I also saw actions that were continued, in an attempt to extract a settlement, LONG after they were exposed as worthless. Consider, for example, the In re Brand Name Prescription Drugs Antitrust Litigation. That litigation proceeded as a class action and a collection of “opt out” cases. The class action, which was begun sometime around 1994, ended in a directed verdict for the defendants in 1998. When I left private practice in 2003, many of the opt-out cases, which were based on exactly the same sllegations as the class case, were still pending. Treble damages make for tenacious plaintiffs (and even more tenacious plaintiffs’ lawyers).

By: market failure, right here

market failure, right here — Wed, 20 Jun 2007 20:19:02 +0000

Plaintiff side antitrust litigation is too expensive, risky, and time consuming to allow for purely frivolous claims. If a plaintiff can make it past summary judgment, then it’s most likely a sufficiently serious problem that it deserves some scrutiny.

Why are you guys rah rah free market everywhere except in the legal marketplace? You want a regulatory monopoly?