Overview of the Monopolizing Conduct Requirement

This chapter and the next address one of the most challenging areas of
antitrust law: the effort to identify monopolizing conduct—that is,
behavior that is illegal for a firm that possesses or seeks to acquire
monopoly power. This chapter addresses, at a general level, the meaning
of Section 2’s conduct element and the policies and tests that courts and
commentators have considered in identifying unlawful monopolizing
conduct. Chapter V reviews how the courts have addressed discrete types
of conduct such as unilateral refusals to deal, exclusive dealing, bundled
discounts, and others.
A. Development of the Section 2 Conduct Requirement
Commentators have long described defining unlawful dominant firm
conduct as “one of the most uncertain areas of antitrust.”1 Others have
compared the judicial approach to the predatory or exclusionary tests of
monopolization law as similar to how Justice Stewart approached the
definition of obscenity: “[t]hey cannot define monopolization but they
know it when they see it.”2 Disagreement over where to draw the line for
unlawful conduct is exemplified by the highly critical response of three
members of the FTC to the Antitrust Division’s September 2008 report on
single firm conduct, and the Division withdrawing the report in May 2009
upon a change in administration.3
1. Robert Pitofsky, Comments to the Antitrust Modernization Commission:
Standards for Exclusionary Behavior Under Section 2 of the Sherman Act
2 (Sept. 9, 2005).
2. Thomas E. Kauper, Section 2 of the Sherman Act: The Search for
Standards, 93 GEO. L.J. 1623, 1624 (2005).
3. See Statement of FTC Commissioners Harbour, Liebowitz, and Rosch on
the Issuance of the Section 2 Report by the Department of Justice 1 (Sept.
8, 2008) [hereinafter FTC Statement] (“[T]he U.S. Supreme Court has
declared that the welfare of consumers is the primary goal of the antitrust
76 Monopolization and Dominance Handbook
Discussed below are differing characterizations of monopolizing
conduct and the role that intent plays in each.
1. Differing Characterizations of Monopolizing Conduct
Over the years, courts and commentators have adopted a variety of
shorthand characterizations that describe conduct as permissible or
impermissible. For example, courts have often described acceptable
conduct as “normal” and unlawful strategies as “unusual” or “abnormal.4
But complex, creative, and novel business strategies often benefit
consumers.5 As the D.C. Circuit observed in United States v. Microsoft
Corp.,6 “[w]hether any particular act of a monopolist is exclusionary, rather
than merely a form of vigorous competition, can be difficult to discern: the
laws.”); see also Karen L. Grimm, General Standards for Exclusionary
Conduct (FTC Working Paper Nov. 3, 2008) at 7-13, available at
2generalstandards.pdf (outlining the controversy). In withdrawing the
Antitrust Division’s 2008 Report, Assistant Attorney General Varney
The Report sounds a call of great skepticism regarding the ability of
antitrust enforcers—as well as antitrust courts—to distinguish
between anticompetitive acts and lawful conduct, and raises the
related concern that the failure to make proper distinctions may
lead to “over-deterrence” with regard to potentially
procompetitive conduct. I do not share these concerns. I strongly
believe that antitrust enforcers are able to separate the wheat from
the chaff in identifying exclusionary and predatory acts.
Ass’t Atty. Gen. Christine A. Varney, Vigorous Antitrust Enforcement in
this Challenging Era, Remarks at the Center for American Progress 5-7
(May 11, 2009) (footnotes omitted) [hereinafter Varney Remarks].
4. Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585, 608
(1985) (“conduct [not] justified by any normal business purpose”);
Instructional Sys. Dev. v. Aetna Cas. & Sur. Co., 817 F.2d 639, 649 (10th
Cir. 1987) (“Section 2 is violated when monopoly power is gained or held
by conduct constituting an abnormal response to market opportunities.”).
5. See Dennis W. Carlton & Ken Heyer, Appropriate Antitrust Policy Toward
Single-Firm Conduct: Extraction Versus Extension, 22 ANTITRUST,
Summer 2008, 50, 58).
6. 253 F.3d 34 (D.C. Cir. 2001).

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