Digital Platforms and Antitrust Law

This Article is about “big data” and antitrust law. Big data, for my purposes, refers to digital platforms that enable the discovery and sharing of information by consumers, and the harvesting and analysis of consumer data by the platform. The obvious example of such a platform is Google. The big platforms owe their market dominance not to anticompetitive conduct but to economies of scale. This Article discusses three types of anticompetitive conduct associated with digital platforms: kill zone expropriation, acquisition of nascent rivals, and denial of access to data. There is nothing so unusual about digital platforms that would require a reform of the antitrust laws. Some are described as two-sided markets, but this designation, even after Ohio v. American Express Co., should not present an obstacle to the application of antitrust law. I. Introduction II. Platforms III. Competition Issues ... A. Kill Zone Expropriation ... B. Acquisition of Nascent Rivals ... C. Denial of Access to Data IV. Antitrust Law V. Conclusio

When Should a Case Be Dismissed? The Economics of Pleading and Summary Judgment Standards

This paper applies a simple economic framework to the choice between pleading and summary judgment as points at which a claim can be dismissed. It concludes generally that pleading standards should vary with the evidentiary demands of the associated legal standards and the social costs of litigation. The common law's imposition of higher pleading standards for fraud claims is consistent with this proposition. The theory implies that the rigorous summary judgment standards that have been developed by antitrust courts should lead to a correspondingly rigorous assessment at the pleading stage.

Innovation and Optimal Punishment, with Antitrust Applications

This paper modifies the optimal penalty analysis by incorporating investment incentives with external benefits. In the models examined, the recommendation that the optimal penalty should internalize the marginal social harm is no longer valid as a general rule. We focus on antitrust applications. In light of the benefits from innovation, the optimal policy will punish monopolizing firms more leniently than suggested in the standard static model. It may be optimal not to punish the monopolizing firm at all, or to reward the firm rather than punish it. We examine the precise balance between penalty and reward in the optimal punishment scheme.optimal law enforcement, optimal antitrust penalty, monopolization, innovation, internalization, strict liability, static penalty

Slavery and Tort Law

This paper evaluates the claim for slavery reparations from a torts perspective. I start with an examination of the injuries inflicted on slaves, and the extent to which tort law provides a vehicle for redressing these injuries. I then take up the question of derivative claims, claims brought by someone other than the direct victim, a category which covers the reparations complaint. Lastly, I discuss the accounting demand by the reparations plaintiffs. The derivative status of reparations claims presents special obstacles for plaintiffs. However, applying today\u27s law to slavery should be viewed as bringing law to a regime from which it had been entirely displaced, not as a retroactive application of a different set of rules. The more troubling problem for plaintiffs is the passage of time. After enough time has passed, tort doctrine shuts the door on claims based on old and distant injuries. It appears that the only component of reparations lawsuits that has the potential for social gain is the demand for an accounting

Due Process and Punitive Damages: An Economic Approach

This paper sets out a public choice (rent-seeking) theory of the Due Process Clause, which implies that the function of the clause is to prevent takings through the legislative or common law process. This view of the clause\u27s function supports a preference for expanding rather than contracting the set of entitlements protected by the clause. The Supreme Court\u27s application of due process reasoning in the punitive damages case law is in some respects consistent and in other respects inconsistent with this theory. For the most part, the Court has failed to develop a set of doctrines that would enable lower courts to distinguish takings from punishment consistent with reasonable regulation. This paper suggests general guidelines for developing such doctrines

Digital Platforms and Antitrust Law

This is a paper about “big data” and antitrust law. For my purposes, big data refers to digital platforms that enable the discovery and sharing of information by consumers, and the harvesting and analysis of data on those consumers by the platform. The obvious example of such a platform is Google. The big platforms owe their market dominance not to anticompetitive conduct but to economies of scale. I discuss three types of anticompetitive conduct associated with digital platforms: kill zone expropriation, acquisition of nascent rivals, and denial of access to data. There is nothing so unusual about digital platforms that would require a reform of the antitrust laws. Some are described as two-sided markets, but this designation, even after Ohio v. Amex, should not present an obstacle to the application of antitrust law

An Asymmetric Information Model of Litigation

This paper presents a cradle-to-grave model of tort liability, incorporating the decision to comply with the due-care standard, the decision to file suit, and the decision to settle. I use the model primarily to examine settlement rates, plaintiff win rates, and compliance with the due-care standard. The key results of the modelare as follows: (1) litigation to judgment occurs only when some but not all actors comply with the due-care standard, and (2) if defendants have the information advantage at trial, plaintiff win rates generally will be less than fifty percent. I apply the model and its simulation results to several empirical issues in the litigationliterature. The model simulation indicates that the British rule for allocating legal costs is superior to alternatives in terms of social welfare. In addition, the model is capable of explaining several empirical features of litigation and puzzles in the literature on trial outcomes

The Theory of Penalties and the Economics of Criminal Law

This paper presents a model of penalties that reconciles the conflicting accounts optimal punishment by Becker, who argued penalties should internalize social costs, and Posner, who suggested penalties should completely deter offenses. The model delivers specific recommendations as to when penalties should be set to internalize social costs and when they should be set to completely deter offensive conduct. I use the model to generate a positive account of the function and scope of criminal law doctrines, such as intent, necessity, and rules governing the distinction between torts and crimes. The model is also consistent with the history of criminal penalties set out by Adam Smith

When Should a Case Be Dismissed? The Economics of Pleading and Summary Judgment Standards

This paper applies a simple economic framework to the choice between pleading and summary judgment as points at which a claim can be dismissed. It concludes generally that pleading standards should vary with the evidentiary demands of the associated legal standards and the social costs of litigation. The common law\u27s imposition of higher pleading standards for fraud claims is consistent with this proposition. The theory implies that the rigorous summary judgment standards that have been developed by antitrust courts should lead to a correspondingly rigorous assessment at the pleading stage