Dworkinian Antitrust

Author:John O. McGinnis & Andrew M. Meerkins
Position:George C. Dix Professor, Northwestern Pritzker School of Law/Associate, Shook, Hardy & Bacon LLP
Pages:1-59
SUMMARY

In this paper we offer a jurisprudential explanation of the structure and evolution of antitrust law, arguing that it provides the best example of Ronald Dworkin's famous theory of integrity in action. Dworkin's jurisprudence describes antitrust law strikingly well because it chooses right answers by considering what guiding principle best fits and justifies the relevant law. In antitrust, the principle of consumer-welfare promotion provides the best fit for antitrust statutes as a whole because, although legislators mentioned other objectives, they did not believe they were in conflict with the... (see full summary)

 
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1
Dworkinian Antitrust
John O. McGinnis* & Andrew M. Meerkins**
ABSTRACT: In this paper we offer a jurisprudential explanation of the
structure and evolution of antitrust law, arguing that it provides the best
example of Ronald Dworkin’s famous theory of integrity in action. Dworkin’s
jurisprudence describes antitrust law strikingly well because it chooses right
answers by considering what guiding principle best fits and justifies the
relevant law. In antitrust, the principle of consumer-welfare promotion
provides the best fit for antitrust statutes as a whole because, although
legislators mentioned other objectives, they did not believe they were in conflict
with the first and overriding objective of consumer welfare. Moreover, even if
other principles—say, the protection of small businesses—can compete with
consumer-welfare promotion in terms of fit, such other principles cannot
compete in terms of justification, because they cannot be coherently achieved
by judges in antitrust cases and are better undertaken by other kinds of
legislation. In contrast, legal positivism—the dominant jurisprudential
theory to which Dworkin’s integrity played the foil—cannot explain antitrust
law, because antitrust decisions often cannot be generated by the sparse
statutory text available, even when combined with policy discretion.
Dworkinian jurisprudence thus explains why court decisions in antitrust rely
on economic principles rather than statutory text or ad hoc policy. Economic
principles provide the most reliable and consistent path to promoting
consumer welfare. This distinctive jurisprudence also explicates many
unusual features of antitrust doctrine. For instance, the Supreme Court is
unusually willing to overrule long-established cases, lower courts sometimes
fail to follow older Supreme Court precedent, and courts treat Department of
Justice guidelines in the area as powerful determinants of their own decisions.
This breakdown of the hierarchy of precedent and the judicial/executive
branch cross-pollination cannot be understood through the positivist
framework. If economic principles are immanent in law , however, these
practices make sense. When the pull of such principles is strong, both the
executive and judiciary at all levels are engaged in a joint enterprise of
explaining and applying the economics to challenged business practices and
agreements, rather than guarding rival areas of policy discretion as typical in
our separation-of-powers system.
Dworkin’s integrity is not only the best explanation of antitrust jurisprudence,
but also an attractive jurisprudence in this area. As a general matter,
2 IOWA LAW REVIEW [Vol. 102:1
Dworkin’s theory has been sharply criticized as unworkable, because it is
argued that judges have no way of discovering the principles that ought to
guide their decision-making. Moreover, people simply disagree about the
principles’ content or application. While these criticisms have substantial
merit in fields like constitutional law, in antitrust, microeconomics does
provide consensus principles that can be relatively objectively applied to decide
cases.
I. INTRODUCTION .................................................................................... 3
II. ANTITRUSTS JURISPRUDENTIAL EVOLUTION ....................................... 9
A. ANTITRUSTS FORMATIVE YEARS .................................................. 9
B. PROGRESSIVES, NEW DEALERS, AND THE WARREN AND BURGER
COURT: A DOCTRINAL THICKET ................................................ 12
C. CONSUMER WELFARE, CONSENSUS, AND THE CHICAGO SCHOOL .. 18
III. DWORKINS JURISPRUDENCE OF PRINCIPLE ....................................... 21
A. LAW AS INTEGRITY AND THE MYTH OF JUDICIAL DISCRETION ...... 21
1. Rules Versus Principles ................................................... 22
2. Principles Versus Policies ............................................... 23
3. Doing Integrity ................................................................ 24
4. Reading Statutes with Integrity ...................................... 27
B. ATTACKS ON INTEGRITY ............................................................ 28
IV. INTEGRITY AND ANTITRUST ............................................................. 31
A. THE DWORKINIAN FIT AND JUSTIFICATION OF CONSUMER
WELFARE IN MODERN ANTITRUST .............................................. 31
1. Antitrust’s Fit with Consumer Welfare ............................ 31
2. Consumer Welfare as a Dworkinian Justification ........... 35
B. INTEGRITY EXPLAINS MODERN ANTITRUST JURISPRUDENCE ........ 37
1. The Supreme Court’s Willingness to Discard
Precedent ......................................................................... 38
2. The Supreme Court’s Willingness to Ignore Bad
Precedents ....................................................................... 39
3. Lower Courts’ Willingness to Innovate .......................... 40
4. The Weakness of Separation Powers in Antitrust ......... 41
C. TRANSCENDING INTEGRITYS CRITICS ......................................... 43
V. SOME OBJECTIONS AND PROBLEMS ..................................................... 45
A. ECONOMIC PRINCIPLES AS DWORKINIAN PRINCIPLES ................... 45
B. ECONOMIC PRINCIPLES AS OBJECTIVE PRINCIPLES ....................... 46
C. HARDEST CASES ......................................................................... 48
2016] DWORKINIAN ANTITRUST 3
VI. CONSENSUS IN THE COURTS ............................................................. 49
A. DATA ........................................................................................ 50
B. ANTITRUST AS PERCENTAGE OF THE DOCKET .............................. 53
C. DISSENT RATE IN ANTITRUST CASES ........................................... 55
VII. INTEGRITYS PROVINCE ..................................................................... 56
A. REQUIREMENTS ......................................................................... 57
B. AREAS LIKELY SUITABLE FOR INTEGRITY ..................................... 57
VIII. C ONCLU SION .................................................................................. 59
“In view of these circumstances, it must be confessed that there is no
consistent or intelligible policy embodied in our law by which public officials
and business men may distinguish bona fide pursuit of industrial efficiency
from an illicit program of industrial empire building.”
—Robert H. Jackson & Edward Dumbauld1
“[T]here is widespread agreement today among courts, antitrust-enforcement
agencies, and antitrust practitioners and scholars about the goals of the
antitrust enterprise. . . . [M]ost contentious issues in antitrust are
nonideological and no longer require appealing to endogenous preferences or
foundational views about the legitimacy of the capitalist order . . . .”
—Daniel A. Crane2
I. INTRODUCTION
Justice Jackson and Professor Crane were talking about the same
statutes—and they were both right. America’s competition law dramatically
changed course in the 20th century. Once trumpeted as a populist rallying
cry, antitrust now is the law that most relentlessly reflects economic analysis.
Yet this shift did not flow from statutory revisions by Congress, but from a new
way of interpreting the same statutes by the courts and the executive branch.
The federal judiciary, at times taking its lead from the Department of Justice
Antitrust Division and the Federal Trade Commission (“FTC”), now sketches
the boundaries of our competition law. It does so with a sparse statutory
framework that provides concepts that appear to defy precise definition like
* George C. Dix Professor, Northwestern Pritzker School of Law. Thanks to Robert
Burns, Josh Fischman, Andrew Koppelman, Stephane Mechoulan, Lindsey Simon, and
participants in workshops at Northwestern and William and Mary law schools for comments, and
to Joseph Delich for research assistance.
** Associate, Shook, Hardy & Bacon LLP.
1. Rob ert H . Jac kson & Edw ard D umbau ld, Monopolies an d the Courts, 86 U. PA. L. REV. 231,
237 (1938).
2. See Daniel A. Crane, Technocracy an d Antitrust, 86 TEX. L. REV. 1159, 1211–12 (2008)
(citation omitted).

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