Pictures at the New Economy Exhibition : Why the Antitrust Modernization Commission Got it (Mostly) Right

Is antitrust law up to the task of addressing the "New Economy"? That is the question many have asked in recent years. And that is one of the key questions addressed by the Antitrust Modernization Commission ("AMC"), a commission that Congress established in 2002 "to examine whether the need exists to modernize the antitrust laws." Because antitrust in fact is able to address the new economy, the AMC got the big picture right. The related middle picture is whether the antitrust laws - primarily sections 1 and 2 of the Sherman Act and section 7 of the Clayton Act - can take into account innovation and intellectual property ("IP"). Because they can, the AMC also was right in concluding that the statutes do not need to be revised. The little picture involves more specific issues that the AMC did not address. One neglected issue, which the AMC had promised to review, involved "innovation markets," or markets for research and development. The Commission also sidestepped the most contentious issue in the IP-antitrust intersection today: patent settlement agreements between brand-name pharmaceutical firms and generic drug manufacturers. The wrong picture is composed of patents. The AMC, made up of antitrust attorneys and economists, offered no particular expertise in addressing the complicated topic of patent reform. But the Commission tiptoed into the area to offer one substantive recommendation. Given that it considered nine patent reforms, the AMC's sole focus on the "nonobviousness" doctrine demonstrates that it included a wrong picture in the new economy exhibition