Law & Economics Working Papers
Three recent appellate decisions—Goldwasser, Trinko and Covad—have addressed the interplay of the 1996 Telecommunications Act and the antitrust laws. This area raises questions of both substantive law and standing. This essay focuses on standing and in particular the question of how the antitrust doctrine in Illinois Brick should apply to situations in which there is an alleged breach of an access duty owed by an incumbent local exchange carrier. That access duty might arise under the 1996 Act itself or under applicable antitrust doctrines, such as the essential facilities doctrine or the duty to deal with competitors seen in Aspen Skiing. The essay sets forth a model of access duties leading to entry and Cournot duopoly and evaluates outcomes when that access duty is breached. The essay discusses various approaches to allocating suit rights depending on the purpose of enforcing the duty. I argue that the Illinois Brick doctrine which bars suits by consumers as indirect purchasers should have little application to the breach of access situation as the de facto compensation rationale of Illinois Brick won't operate when the entrant has been denied the mandated access.
Randal C. Picker, "Understanding Statutory Bundles: Does the Sherman Act Come with the 1996 Telecommunications Act?" (John M. Olin Program in Law and Economics Working Paper No. 177, 2003).