Relaxing whilst doing Competition Law is not an Oxymoron

Archive for July 2012

Microsoft v Commission (T-167/08) – The Magill-IMS Health Re-Animator?

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I was about to fall asleep reading the Microsoft judgment of last week (T-167/08), when I stumbled into paragraph 139.

This paragraph implicitly reverses the CFI’s Microsoft I ruling on the legal standard of abusive refusal to supply (CFI, Case T-201/04, Microsoft Corp. v Commission, ECR [2007] II-3601).

Remember, in this judgment the CFI had departed from the IMS Health and Magillnew product” condition.

It had held that:

“§647. the circumstance relating to the appearance of a new product, as envisaged in Magill and IMS Health . . . cannot be the only parameter which determines whether a refusal to license an intellectual property right is capable of causing prejudice to consumers within the meaning of [Article 102(b) TFEU]”.

The CFI further added that it was sufficient for the Commission to prove that the refusal to supply interoperability information gave rise to a “limitation […] of technical development”.

This new concept was (and still is) rightly criticized by scholars and practitioners as a loose, elusive and murky legal standard. Many expressed regrets over the disappearance of the simple three-pronged  Magill-IMS Health test. Others argued that the CFI’s “technical development” standard was wholly inapplicable, and advised to rely on the Magill and IMS Health judgments of the upper ECJ. Finally, some practitioners (amongst others, D. Waelbroeck) talked of a lex specialis Microsoft.

Interestingly, the latest Microsoft judgment no longer talks of the “limitation of technical development“.

Rather, in what reads like an obiter dictum, the GC explicitly refers to the “new product” condition, and quotes IMS Health as the sole source of precedent on refusals to supply involving IPRs.

Ҥ139. In that regard, it should be recalled that, in order for the refusal by an undertaking which owns a copyright to give access to a product or service indispensable for carrying on a particular business to be regarded as abuse, it is sufficient that three cumulative conditions be satisfied, namely that that refusal is preventing the emergence of a new product for which there is a potential consumer demand, that it is unjustified and that it is such as to exclude any competition on a secondary market

Of course, the Court would not acknowledge that it applied a wrong legal standard in 2007.

It thus goes on to state at §140 that those three conditions were met in the Microsoft I case (they were not).

That said, paragraph 139 marks a welcome evolution of the case-law on abuse.

Written by Nicolas Petit

5 July 2012 at 6:15 pm

Posted in Case-Law, Uncategorized

Case C-128/11 UsedSoft v Oracle

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Note by Alfonso: The Court of Justice has published yesterday its long-awaited decision in UsedSoft v. Oracle. Even though the matters are issue are mainly IP-related (they concern the application of the so-called  “exhaustion doctrine” to computer programs), they have important competition law implications. Marcos Araujo  (a friend of ours and a partner at Garrigues) has followed closely this case as well all others concerning the intersection of IP and competition law. We’ve asked him to provide us with his first views on this very fresh Judgment. Here they are:

In a Grand Chamber judgment, the ECJ has taken a determined stance in favour of THE free movement of goods and the exhaustion doctrine. Today’s Judgment has dismissed not only Oracle’s arguments, but also those raised by the Commission and by the various intervening Member States, and has affirmed vigorously the right of licence holders to “resell” their rights of use of computer programs, supporting intermediaries and end customers in the way.

The case had attracted much attention given the contradictions in this area of European Law, which on the one hand declares that the sale of computer programs exhausts the rights of the owner (art. 4.2 of Directive 2009/24) and therefore that the program can freely be re-sold, and, on the other hand, states that the provision of services over the Internet does not cause exhaustion of rights (Recital 29, Directive 2001/29). In this situation, software companies which license (and arguably do not “sell”) software over the internet may claim that their IP rights should not be deemed to become “exhausted”, as they would be providing a service rather than selling a product.

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Written by Alfonso Lamadrid

4 July 2012 at 5:28 pm

Intel Hearing at the General Court today

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The Court hearing in the Intel case started today in Luxembourg.

Aoife White from Bloomberg has written a piece on it in which she quotes my view that, following the Tomra Judgment, Intel’s chances of having the fine annulled or reduced appear to lie more on procedural than on substantive grounds.

Thanks to a a very kind Luxembourg-based reader of this blog we can make the Court’s report for the hearing available to you: Intel Report Hearing

Written by Alfonso Lamadrid

3 July 2012 at 2:45 pm

Posted in Case-Law, Events

Chuck Norris Antitrust Facts

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  • If Chuck Norris had been Commissioner for competition in the 1980s’, Microsoft would have never achieved dominance
  • Chuck Norris can dismantle barriers to entry with a roundhouse kick
  • Areeda and Turner did not invent the price-cost test for predatory pricing cases, Chuck Norris told them to do so

If you think of more Chuck Norris Antitrust Facts, pls send them to us.

Written by Nicolas Petit

2 July 2012 at 9:13 pm

Posted in Jokes