ABA’s Antitrust Magazine: Necessity as the Mother of Invention? Streamlining the Evaluation of Competitor Collaborations

August 10, 2020

O’Melveny Antitrust and Competition Practice co-chair Ian Simmons and associate George Bashour co-authored this Antitrust Magazine article on alternative collaboration assessments in response to the COVID-19 crisis.

“Traditionally, two criteria govern the assessment of collaborations of the ‘type that always or almost always tend to raise price or reduce output,’” Simmons and Bashour write. “First, whether the collaboration is ancillary to a legitimate efficiency-enhancing integration of the competitors’ assets or operations—such as a bonafide joint venture. Second, whether the scope of the collaboration resides in a cordon sanitaire so that any information sharing pursuant to the collaboration does not 'spill over' into the competitors’ competing businesses and facilitate coordination or collusion. We suggest that during exigent circumstances, these two criteria ought to be assessed in a practical, dynamic, and inverse light; proponents of a competitor collaboration should bear the burden of persuasion of explaining why, ‘but for’ the collaboration, prices would be higher, output would be less, or quality worse. Going to these ‘bottom lines’ may suggest that less analytical time should be spent on the integration of assets.”

American Bar Association Antitrust Magazine subscribers can read the full article here.