Douglas H. Ginsburg

White House Review of Agency Rulemaking

Since the earliest days of the Republic, presidents have taken the steps they deemed necessary to maintain some control over the activities of the executive branch—to ensure that officials’ statements and actions followed presidential policies and were consistent with each other. For example, President Jefferson reported approvingly that President Washington had routinely reviewed the correspondence prepared by his cabinet officials before it was mailed, a practice that Jefferson resumed.[1] With the growth of the executive branch, later presidents took more formal steps to maintain their influence over the executive bureaucracy. In 1921, the Bureau of the Budget was created to consolidate all executive branch budget submissions. Shortly thereafter, agency positions on proposed legislation were also routed through the Bureau of the Budget. In the 1970s, growing dissatisfaction with government regulation led to formal presidential oversight of executive branch rulemaking. This oversight function was eventually entrusted to the Office of Management and Budget (OMB) within the Executive Office of the President. The same rationale applied: the president wanted to ensure that regulations were consistent with each other and with administration policies and priorities. Modest initial efforts during the Nixon administration have been strengthened and expanded by each president who followed.[2] President Reagan’s regulatory review program evolved from these earlier efforts and extended them in two crucial respects. First, the initial programs directed agencies to assess the social costs and benefits of their rules; the Reagan program directs agencies to decide regulatory

Ernst Freund and the First Amendment Tradition

The decision in Debs v. United States1 was handed down by the United States Supreme Court some fifty-four years ago. It is happily no longer good law; it is not likely to become law again. It is with little exception not studied in the law schools, and it is rarely cited or noted in even the more elaborate casebooks or treatises on constitutional law. It might seem, therefore, an antiquarian indulgence for a busy law review to devote some pages to it, especially for the primary purpose of reprinting an article from the New Republic, an article which is also fifty-four years old.3 But the opinion in Debs was written by Justice Holmes; and the article in the New Republic is a criticism of the case written by Ernst Freund. Taken together these facts provide important clues to the intellectual history of the first amendment tradition, a history we had better understand if we are to hang on to the tradition today. We would do well to be aware of how far we have traveled and how difficult it was

Monetary Penalties in China and Japan

Recent solicitations for comments on monetary penalties in China and Japan highlight opportunities to improve the deterrent effect of antitrust law by more closely aligning penalties with economic theory and evidence. When monetary penalties are not based upon economic analysis and clearly linked to identified harms, they are likely to generate costly errors, either by overdetering welfare-enhancing behavior or underdetering anticompetitive behavior. On June 17, 2016, China’s Anti-Monopoly Commission of the State Council requested comments on Draft Guidelines issued by the National Development and Reform Commission (NDRC) for the calculation of illegal gains (disgorgement) and setting of fines issued. On July 13, 2016, the Japan Fair Trade Commission (JFTC) requested comments on introducing flexibility into their administrative surcharge system, developing a settlement program, and reforming due process in conjunction with surcharge reform. Both proposed monetary penalty systems would benefit from a deeper grounding in economics. The NDRC’s Draft Guidelines provided only for the optional use of economic analysis in calculating illegal gains and appear to create a presumption that disgorgement would apply in addition to fines in nearly all cases. The JFTC’s consultation acknowledged that the current inflexible surcharge system could give rise to “unreasonable or unfair�? surcharges, but did not require economic analysis to determine appropriate monetary penalties. In both countries, monetary penalties are applied broadly and are not based upon identified harms, although the JFTC’s consultation invited comments on whether differentiation by type of infringement was necessary.

Actavis and Multiple ANDA Entrants: Beyond the Temporary Duopoly

This paper examines the economics of litigation and settlement of patent disputes arising from Paragraph IV ANDA filings under the Drug Price Competition and Patent Term Restoration Act (“Hatch-Waxman Act”) within the framework set out in FTC v. Actavis. Recent economic analyses of reverse payment settlements are based upon a monopoly-to-duopoly model that assumes a single generic entrant. These analyses have been used to support antitrust rules that would enjoin reverse payments that exceed the cost of litigation. We demonstrate that the simple monopoly-to-duopoly models providing the analytical basis for the litigation cost benchmark for analyzing reverse payment settlements is incomplete. Our key institutional insight is the fact that entry by multiple firms follows the invalidation of a patent. Accounting for this critical institutional detail in a more generalized monopoly-to-duopoly model results in important and different implications for patent settlements, welfare, and application of the rule of reason pursuant to Actavis. The result is a broader settlement range than under the monopoly-to-duopoly model that yields robust incentives for the brand and generic entrant to settle the case. This broad settlement range makes attempts to regulate the size of patent settlements ineffective at achieving consumer welfare increasing settlements, or inducing the invalidation of “bad” patents through higher litigation rates. Incorporating multiple serial entrants also decouples the litigation-adjusted expected value of the patent and the consumer welfare standard, and further weakens the relationship between patent strength and the size of the settlement which has motivated numerous calls to deem presumptively unlawful all payments greater than anticipated litigation costs.

The Federal Trade Commission's Hearings on Competition and Consumer Protection in the 21st Century, the Consumer Welfare Standard in Antitrust Law, Comment of the Global Antitrust Institute, Antonin Scalia Law School, George Mason University

This comment is submitted by the Global Antitrust Institute (GAI) at Scalia Law School at George Mason University to the U.S. Federal Trade Commission regarding its hearings on Competition and Consumer Protection in the 21st Century, The Consumer Welfare Standard in Antitrust Law. The GAI Competition Advocacy Program provides a wide range of recommendations to facilitate adoption of economically sound competition policy.

Antitrust Analysis Involving Intellectual Property and Standards: Implications from Economics

There is a significant industrial organization (IO) economics literature on the economics of innovation and intellectual property (IP) protection. As some courts and antitrust agencies have recognized, the IO economics toolkit for business arrangements (e.g., vertical restraints, tying and bundling, etc.) involving IP rights is sufficiently flexible to be applied in high-technology areas involving antitrust and IP. In this Article, the authors explain the economics of innovation and IP protection, licensing, and compulsory licensing, with specific applications to standards development and to standard-essential patents. The authors then propose first-best approaches based on the implications of the economics that courts and agencies can apply at each stage of an antitrust inquiry, from market definition and market power to the assessment of particular business practices. The authors conclude by providing a summary of the approach applied in each major antitrust jurisdiction—China, the European Union, India, Japan, Korea, and the United States.

Comment of the Global Antitrust Institute, Antonin Scalia Law School, George Mason University, on the Anti-Monopoly Commission of the State Council's Anti-Monopoly Guidelines against Abuse of Intellectual Property Rights

This comment is submitted by the Global Antitrust Institute (GAI) at Scalia Law School, George Mason University in response to the Anti-Monopoly Commission of the State Council of the Peoples Republic of China’s public consultation on its draft Anti-Monopoly Guidelines Against Abuse of Intellectual Property Rights. The GAI Competition Advocacy Program provides a wide-range of recommendations to facilitate adoption of economically sound competition policy, including how to analyze antitrust matters involving intellectual property rights.

Comment of the Global Antitrust Institute, Antonin Scalia Law School, George Mason University, on the Communication from the Commission on Standard Essential Patents for a European Digitalised Economy

This comment is submitted by the Global Antitrust Institute (GAI) at Scalia Law School at George Mason University in response to the Communication from the Commission on Standard Essential Patents for a European Digitalized Economy. The GAI Competition Advocacy Program provides a wide-range of recommendations to facilitate adoption of economically sound competition policy, including how to analyze antitrust matters involving intellectual property rights and standard-essential patents.

Comment of the Global Antitrust Institute, Antonin Scalia Law School, George Mason University, on the Japan Fair Trade Commission’s Draft Guidelines Concerning Distribution Systems and Business Practices Under the Antimonopoly Act

This comment is submitted by The Global Antitrust Institute (GAI) at Scalia Law School at George Mason University in response to the Japan Fair Trade Commission’s consultation on its Draft Guidelines Concerning Distribution Systems and Business Practices Under the Antimonopoly Act. The GAI Competition Advocacy Program provides a wide-range of recommendations to facilitate adoption of economically sound competition policy, including how to analyze antitrust matters involving multi-sided platforms and vertical restraints.

Comment of the Global Antitrust Institute, George Mason University School of Law, on the Japan Fair Trade Commission's Consultation on the Administrative Surcharge System

This comment is submitted in response to the Japan Fair Trade Commission’s request for comments on its Summary of Issues Concerning the Modality of the Administrative Surcharge System. The Global Antitrust Institutes Competition Advocacy Program provides a wide-range of recommendations to facilitate adoption of economically sound competition policy.