Economists at The Brattle Group have extensive experience applying economic theory and empirical techniques to cases involving exclusive dealing, predatory pricing, product tying and bundling, and refusals to deal in order to distinguish between vigorous competition and illegal attempts to establish a monopoly.
In particular, our economists are adept at using both structural and direct evidence to evaluate whether firms have market power; evaluating firm conduct using both long-standing and more recent economic theories of monopolization; and analyzing efficiency explanations for the firm’s conduct. Where the available evidence indicates that a firm’s conduct illegally led to the creation or maintenance of a monopoly, we are skilled at applying the appropriate empirical techniques for estimating damages.
Economists at The Brattle Group assisted US Airways in its monopolization case against Sabre. The lawsuit pertained to alleged anticompetitive provisions in a contract between the two parties over the distribution of airline tickets. Brattle experts and Nobel Laureates Professors Joseph Stiglitz and Dan McFadden, provided expert witness testimony on liability and damages issues. Our work included an analysis of Sabre’s market power in the distribution of airline tickets and how the challenged contract provisions harmed both the airline and consumers. Most notably, we provided insight into the role of “two sidedness” in thinking about this market. In addition, our team analyzed millions of bookings on US Airways flights to assess the overcharges resulting from the challenged restrictions, based on the analysis of “but-for” prices. The 8-week trial in federal court ended in December 2016, and the jury ruled in favor of US Airways.
Brattle has been involved in numerous high-profile antitrust matters in the payment card industry, involving interchange fees, nondiscrimination rules, foreign transaction fees, dynamic currency conversion, and other practices. We have analyzed efficiency benefits and competitive effects resulting from these practices, developed models to identify the underlying conditions required for either anticompetitive or procompetitive behavior, assessed market performance (including firm profitability), provided statistical analyses relevant to defining relevant product markets, and evaluated alleged damages. Brattle economists recently supported American Express in its successful defense against antitrust claims made by the U.S. Department of Justice and others involving its merchant agreements.
On behalf of the National Hockey League (NHL), Brattle Principal and Nobel Laureate Daniel McFadden provided testimony at a Daubert and class-certification hearing concerning the structural econometric model proffered by the Plaintiffs’ expert to estimate damages arising from restraints imposed on the broadcast rights to the league games. The Court granted the defense’s Daubert motion in part, in a decision that frequently refers to the testimony of Professor McFadden.
Brattle economists provided assistance to Sprint Corporation during the Federal Communications Commission’s (FCC) review of the competitiveness of “Business Data Services” (BDS), the dedicated bandwidth wireline connections for commercial customers. The team supported Professor David Sappington’s testimony on the relationship between BDS prices and costs and the competitiveness of BDS pricing. Brattle economists also submitted direct testimony on empirical evidence regarding the degree of competition faced by incumbent carriers and on the competitiveness of BDS price offerings.
A Brattle economist was retained by a tire distributor alleged to have conspired with a tire manufacturer to provide it with more favorable pricing and exclude a rival distributor from the downstream market. Brattle provided an expert report and testimony demonstrating that it was not in the interest of the manufacturer to exclude the rival distributor, and that competition in the downstream market had not been adversely affected by any differences in pricing as the rival distributor had simply switched to selling other brands of tires.
A producer of software began bundling supporting applications with its base software. On behalf of a competing provider of software applications, Brattle economists built a dynamic model of market behavior to estimate the impact of the product bundling on sales and prices in the marketplace, and the likelihood of the competitor exiting the market.
Complex business and legal matters require intellectually honest and analytically rigorous solutions that are thoughtfully developed and clearly communicated. We apply economic and finance principles with uncompromising quality to achieve clarity in the face of complexity. Independent analysis, responsive execution, and compelling presentation. That’s Brattle. That’s the Power of Economics.