GCP on the Section 2 Report Schism

Josh Wright —  13 October 2008

Global Competition Policy has a trio of interesting articles on the DOJ Section 2 Report, and FTC response, which I’ve blogged about here and here from Tim Brennan, William Kolasky and Mark Popofsky.  The abstract from Popofsky’s article gives a sense of the scope and importance of the issues here:

The U.S. Department of Justice released a long-awaited report on Section 2 of the Sherman Act on September 8, 2008. Strikingly, although the Federal Trade Commission and the DOJ jointly held the 2006 hearings that led to the Report, the Report was issued under the DOJ’s name alone. Even more strikingly, three FTC Commissioners—a working Commission majority—immediately issued a statement roundly condemning the Report as improperly seeking to “erect a multi-layer, protective screen for firms with monopoly or near-monopoly power.” The FTC trio further expressed its readiness “to fill any Sherman Act void that might be created if the Department actually implements the policy decisions expressed in its Report.”

The agencies’ spat over the Section 2 Report is not their first in the current administration. In one celebrated episode, the FTC and DOJ disagreed with one another in the Supreme Court on the substantive antitrust standard to apply to patent settlements. But what is notable about the Report rift is that it exposes not only a disagreement over substantive Section 2 standards, but also a fundamental divergence over Section 2’s place in antitrust enforcement. If there is a holy war raging over Section 2’s content, then the DOJ’s unilateral release of its Report has produced something of a great schism.