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131 Yale L. J. 1483 (2021-2022)
The Antitrust Duty to Deal in the Age of Big Tech

handle is hein.journals/ylr131 and id is 1537 raw text is: ERIK HOVENKAMP The Antitrust Duty to Deal in the Age of Big Tech A B S T R A C T. The antitrust duty to deal is perhaps the most confounding and controversial form of antitrust intervention. It is sought in situations where a monopolist controls a critical input (or essential facility) and unilaterally refuses to sell access to rivals. Courts have substantially nar- rowed the doctrine in recent decades. However, the rise of dominant platforms like Google, Face- book, and Amazon has provoked intense debate over whether the antitrust duty to deal needs a revival. Many such platforms are accused of refusing to deal with (or discriminating against) rivals in adjacent markets. At present, all unilateral refusals are evaluated under a common standard, which is virtually impossible to satisfy. This paper identifies an important economic distinction between two types of refusal cases; it argues that they raise very different theories of harm and demand different standards of liability. In one line of cases, the defendant's conduct raises essentially the same theory of harm as tying or related vertical restraints. However, formalistic doctrine prevents courts from evaluating them as such. As a result, these cases do not receive meaningful scrutiny. This is prob- lematic, because a large majority of meritorious refusal-to-deal cases fall into this category, as do almost all cases involving dominant platforms. In a separate line of cases, intervention is much harder to justify on economic policy grounds, as it risks chilling investment in valuable new technologies. Courts often acknowledge this invest- ment concern in dicta, but the liability standard they apply-which focuses myopically on exclu- sion-ignores it. This has led to a major internal contradiction: courts are emphatic that a duty to deal is almost never warranted, but simple economic arguments show that the refusals in these cases are routinely exclusionary in precisely the sense that the law purports to condemn. This con- tradiction has spurred courts to erect suffocating evidentiary requirements, which now do most of the heavy lifting in practice. These rules bear little logical connection to exclusion, but they excel at reining in liability. The problem is, they also kill off all the meritorious cases. This Article argues that any effective reform must begin by disentangling these distinct lines of cases. Subjecting them to different liability standards would help to address many of the key concerns raised on both sides of the debate. The justifications for this approach are manifold. First, it protects investment incentives without needlessly stifling enforcement in meritorious cases. Sec- ond, it naturally limits antitrust scrutiny to cases in which intervention is most likely to be admin- istrable. Third, it is exactly analogous to the way antitrust already treats other forms of unilateral conduct. Finally, this approach would allow for meaningful antitrust scrutiny of unilateral conduct by dominant platforms -an objective that has recently received bipartisan support in Congress - while remaining faithful to core antitrust principles. 1483

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