The Supreme Court Should Grant Certiorari in FTC v. McWane

Posted by Social Science Research Network

The Supreme Court Should Grant Certiorari in FTC v. McWane

Joshua D. Wright (George Mason University)

Abstract:     Exclusive dealing is the last vestige of the pre-economic era of antitrust. And it shows. The Supreme Court’s decision in GTE Sylvania nearly 40 years ago was the turning point for the evolution of modern antitrust law in the United States because it made clear “that the analysis of economic effects provided the proper basis for evaluating conduct under the antitrust laws.” In the area of vertical restraints in particular, the critical lesson that has emerged from the economic revolution in antitrust law has been that such conduct must not be condemned without economic evidence of harm to competition. The Supreme Court should grant certiorari in FTC v. McWane because, unfortunately, it is a vivid demonstration of the fact that exclusive dealing law remains untouched by the intellectual revolution in antitrust doctrine since the Supreme Court’s decision in GTE Sylvania. The Federal Trade Commission’s analysis in FTC v. McWane, and thus the Eleventh Circuit opinion, are not only in significant tension with the modern antitrust approach to vertical restraints, they reject it altogether. McWane presents a unique and timely opportunity for the Supreme Court to bring exclusive dealing law in line with modern antitrust law and economic analysis, to recalibrate the doctrine to focus on harm to competition, and to provide guidance to lower courts with respect to the application of rule of reason analysis in cases involving exclusive dealing arrangements.