Media law refers to the regulations of mass media production and use. It includes various types of media forms such as broadcast television, radio, film, internet, and print; however, broadcast media is the most heavily regulated.
Is there a viable claim under Section 2 of the Sherman Act for price squeeze theories?
This case involves price squeeze claims and whether they are viable under Section 2 of the Sherman Act. In addition, the Court will likely determine if price squeeze claims must be pled and treated in the same way as traditional predatory pricing claims. This claim arose when linkLine, an internet service provider, sued its wholesale DSL supplier, AT&T, for engaging in anticompetitive practices in order to stifle competition in the California telecommunications market. The Ninth Circuit rejected AT&T’s argument that linkLine’s claim was not viable under antitrust jurisprudence, especially in light of the recent Supreme Court decision in Verizon v. Trinko. The Supreme Court’s ruling will determine the status of price squeeze claims in antitrust jurisprudence, and could also clarify how the costs of retail production of a vertically integrated company with a wholesale monopoly should be measured when considering retail predatory pricing claims.
Whether a plaintiff states a claim under Section 2 of the Sherman Act by alleging that the defendant—a vertically integrated retail competitor with an alleged monopoly at the wholesale level but no antitrust duty to provide the wholesale input to competitors—engaged in a “price squeeze” by leaving insufficient margin between wholesale and retail prices to allow the plaintiff to compete.
AT&T and its affiliates (SBC at the time of filing) comprise a “vertically-integrated” monopoly in the California telecommunications market, owning both the local telephone network and the “last mile” lines that connect individual customers to the local network. See linkLine Communications, Inc. v. SBC California, 503 F.3d 876, 877–78 (9th Cir.
