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Antitrust, Vol. 24, No. 2, Spring 2010. © 2010 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.

duty to deal enforceable under Section 2. The dispute in Trinko arose out of provisions in the Telecommunications Act Putting the “Squeeze” of 1996, passed by Congress in an effort to break up the his- torical statutory that regional “Baby Bell” com- On Refusal to Deal panies held over local telephone service.5 In order to facilitate entry by competitors into those local telephone markets, the Act required incumbent local telephone companies like the Cases: defendant Verizon to provide competitors with access to their telephone networks and individual elements of those net- works on an “unbundled” basis, thus allowing the competi- Lessons from tors to package and resell the unbundled network elements to customers in with the incumbent provider.6 After certain competitors complained to state regulators and Trinko and linkLine the Federal Communications Commission that Verizon was violating its duties under the Act, the regulators commenced BYELLENMERIWETHER an investigation and, upon finding a violation, entered into a consent decree with Verizon, subjecting it to new per- formance and reporting requirements and imposing mone- tary penalties.7 HEU.S.SUPREMECOURTHAS Following entry of the consent order, plaintiff Trinko, a issued a number of significant antitrust decisions customer of one of Verizon’s competitors, filed a suit under since 2004, in each case ruling in favor of the Section 2, alleging that Verizon’s violation of its duties under defendants, and in each case making it more dif- the Act was part of an anticompetitive scheme to discourage ficult for plaintiffs to commence or maintain customers from remaining or becoming customers of its com- T 1 2 actions arising under the Sherman Act. Trinko and linkLine petitors, thus impeding or blocking market entry by those are the earliest and most recent of these decisions, respectively. competitors. The Supreme Court held that a complaint alleg- In each, the Supreme Court addressed Section 2 monopo- ing that Verizon provided insufficient or discriminatory serv- lization claims in the telecommunications industry chal- ices to rivals did not state a Section 2 claim.8 lenging alleged refusals to deal with a rival, either on any The Court recognized that Congress imposed duties upon the terms or on specified terms sought by the plaintiffs. In defendant to deal with and provide services to its rivals, but linkLine, the Supreme Court eliminated from antitrust pur- held that the existence of this statutory duty to deal does not view an entire class of claims,3 holding that conduct previ- automatically mean that the duty “can be enforced by means ously characterized as a “price squeeze” would not violate of an antitrust claim.”9 In fact, the Court reached the oppo- Section 2 of the Sherman Act unless a plaintiff could prove site conclusion. Although a savings clause in the Act pre- that the defendant had a “duty to deal” with the plaintiff aris- cluded the Court from ruling that the regulated entities were ing under the antitrust laws, or engaged in “shielded from antitrust liability altogether,”10 the Court under the standards established in Brooke Group Ltd. v. Brown relied on the fact that the duty to deal was imposed by statute & Williamson Tobacco Corp.4 In Trinko, the Court severely and was enforceable through the regulatory scheme, to con- limited the circumstances in which a duty to deal arises under clude that the regulated entity ha