The Roberts Court and Supreme Court's New Antitrust Law for the Global Knowledge and Entrepreneurial Economy in a “Perfect Storm” of Danger—And Opportunity

Date01 March 2009
Published date01 March 2009
Subject MatterEconomics
The Roberts Court and Supreme Court’s
new antitrust law for the global knowledge
and entrepreneurial economy in a “perfect
storm” of danger—and opportunity
In 1905, new facts had emerged that changed science forever.
The greatest theory then known to science, Newtonian physics,
failed to explain them.
“All of my attempts to adapt the theoretical foundation of physics
to this knowledge failed completely,” Albert Einstein explained. “The
ground had been pulled out from under us, with no firm foundation
to be seen anywhere.”1
Einstein accepted the new facts and crafted an entirely new the-
ory. His theory explained the new facts regarding the photoelectric
effect, something Newtonian physics could not do, and was the basis
for his only Nobel Prize. He was twenty-six years old.2
Similarly in the fall of 2008, in the midst of the greatest financial
turmoil since the 1980s and the Great Depression, borrowing Ein-
THE ANTITRUST BULLETIN:Vol. 54, No. 1/Spring 2009 :157
ATB Spring 2009 article by: Weller 06-25-2009 Rev.
* Charles D. Weller, LLC, Cleveland, Ohio
2Id. at 96–101.
© 2009 by Federal Legal Publications, Inc.
stein’s words, the ground has again been pulled out from under us
and no firm foundation is seen anywhere. In the words of the “pre-
eminent management thinker of our time,”3Peter Drucker, we are in
an “age of discontinuity,” the “foundations have shifted under our
feet,”4and the best known theories in antitrust, economics, govern-
ment, and other fields cannot be assumed to work adequately with
the new facts—like Newtonian physics in 1905. Three facts cited by
Drucker are especially promising, and in ways revolutionary:
Global Knowledge Economy is Replacing National Industrial Economies.
“Knowledge has become the central economic resource” for creat-
ing wealth, in the U. S. and internationally.5
New Entrepreneurial Economy. The “most significant and hopeful
event to have occurred in recent economic and social history” is
“the emergence of a truly entrepreneurial economy in the United
States,” starting in the 1970s and now spreading worldwide.6
Knowledge is Changing From Disciplines to Application. “What is
totally new,” and “in contradiction to all the modern university
has ever believed,” is the “shift away from disciplines as the center
of teaching and learning” to organization by applications, which
was “bound to happen as application became central to knowl-
edge.”7This shift also makes each discipline accountable to some-
thing beyond its own walls and its own members—areas of
application, just as science and law are accountable to an outside
measure, factual reality.
These new factual realities can unleash a “perfect storm” of
opportunity for the United States and for people around the world.
Palpable proof of the opportunity in these doom and gloom times
includes these examples:
158 :THE ANTITRUST BULLETIN:Vol. 54, No. 1/Spring 2009
3Amanda Bennett, Management Guru, WALL ST. J., July 28, 1987, at 1. See
Peter Drucker,T
HE ECONOMIST, Oct. 17, 2008,
(“Peter Drucker is the one guru to whom other gurus kowtow.”).
Drucker on the New Business Realities, in Symposium: New Foundations for Joint
Ventures and Antitrust, 44 ANTITRUST BULL.787, 799 (1999).
5DRUCKER, supra note 4, at 40.
7DRUCKER, supra note 4, at 350.
ATB Spring 2009 article by: Weller 06-25-2009 Rev.
Google did not exist ten years ago. Today it has cash revenues of
$20 billion and a market capitalization of $150 billion.
Apple’s iPod/iTunes did not exist five years ago. Today they gener-
ate $10 billion in revenue and have helped Apple’s stock grow from
a market capitalization of $1 billion in 2003 to $150 billion in 2008.
Manufacturing companies like Cleveland’s Parker-Hannifin and
Nordson Corp., Canton, Ohio’s Timken Co. and Akron’s B. W.
Rogers Co., have switched from cost-plus pricing to customer-
value pricing to prosper in the global economy. (See part V.)
At the same time, the new factual realities of a global knowl-
edge and entrepreneurial economy raise critical questions about the
assumptions of antitrust law and policy crafted in another eco-
nomic era. Moreover, they provide a fundamentally new factual
foundation for antitrust law and policy. This article explores the
application and implications of these new factual realities for
antitrust law and policy under the Roberts Court since 2005 and in
the future, as well as the sea-change in applicable law by the
Supreme Court since 1977.
Part I highlights some of the key factual differences between a
global knowledge and entrepreneurial economy and the national
industrial economy facts upon which U.S. antitrust law and policy of
the past rest.
Part II shows that the Roberts Court since 2005 and the Supreme
Court since 1977, like Einstein responding to new facts, have already
significantly revised antitrust law and litigation.
As to antitrust litigation, part II.A shows that the Roberts Court
2007 Twombly 8decision is just the tip of the iceberg of the Supreme
Court’s major changes in litigation law impacting antitrust from
inside and outside antitrust, as if responding to the stunningly low
regard with which World Economic Forum surveys of over 10,000
people doing business internationally rank the U.S. state and federal
judicial systems. (See part II. A.).
As to substantive antitrust law, part II.B shows that the Roberts
Court since 2005 has continued what the Supreme Court started in
8Bell Atl. Corp. v. Twombly, 127 S. Ct. 1955 (2007).
ATB Spring 2009 article by: Weller 06-25-2009 Rev.

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