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An appeal will consider whether there is some evidence to support the decision but will not balance the evidence to measure whether the right findings were reached.
In other words, Intel will not get a new trial where it can present evidence that the appeal court could examine the conflicting evidence and make a new determination for the findings of fact.
If Intel could show that its ability to present evidence was so impaired that there was a violation of law, then it might be able to get a reversal. But that will be very difficult to impossible to establish. The notions of due process are quite different in Europe than in the US.
In civil law jurisdictions such as France, a criminal defendant is guilty unless they prove innocence.
Note that AMD makes the top ten in the analysis and is thought to be in worse trouble than Spansion -- already in Chapter 11 -- who only earns an honorable mention.
It is always a battle to win an appeal unless there is a clear error of law. In the Case of the EC they are currently making the rules of what constitutes "abuse of dominant position" and then the EC applies the new rule retroactively.
Sorry for the misdirection, my comment was just sarcastic snark.
However, the EC deserves a lot of criticism for not publishing a redacted copy of the 500 page decision immediately. The long delay in publishing the decision is an incredibly amateur performance and says a lot about the quality of the EC procedures.
The EC will publish its 500 page ruling after the time for Intel to appeal has passed. This will make it a little more difficult for Intel to formulate its appeal but that is a proper handicap for a company in a dominant position in order to "level the playing field" for AMD.
One of the things that you might try to remember is that Brooke is a decision of the Supreme Court, the highest court in the United States. So the Brooke rule really is "set in stone" until such time as the Supreme Court decides to overrule or modify the decision.
When trying to understand the law, it is always a good idea to pay serious attention to Supreme Court decisions that are directly on point. Once you do this you can understand that the Brooke Rule totally kills all of AMD's antitrust claims. The Intel brief accurately and concisely describes the legal principle of Brooke.
http://download.intel.com/pressroom/legal/1443_Opening%20Brief%20in%20Support%20re%201442%20Motion_Intel.pdf
Legal Principal I However Articulated, All Claims That Intel Took Business From AMD By Making Price Concessions Must Fail As A Matter Of Law If Intel's Prices Exceeded Its Costs
A. In Brooke Group And Subsequent Decisions, The Supreme Court Has Firmly Entrenched The Bright Line Principle That above-Cost Price Cutting Is Per Se Legal, Regardless Of The Form It Takes, And Regardless Of The Impact It May Have On A Rival
B. The Brooke Group Safe Harbor Applies Whenever The Average Price For All Goods Sold Exceeds Their Average Cost, And Permits No Different Analysis Where A Plaintiff Claims That Some Portion Is "Uncontestable."
Must be a special (read, dismissable) case, huh?
You should read the link and then you won't embarrass yourself. The President of Puget systems said "This number [is quite typical with system builders."
HP is a system builder -- not a board vendor. And it was HP who AMD tried to bribe with free processors.
The easily dismissible "special case" is your citation of a board vendor who sells to a very different set of customers.
was there ANY OTHER REASON why HP would leave free CPUs on the table other than those rebates
Well, here is a great big screaming reason why HP would not want free AMD processors:
"So why, then, did Intel receive 93.5% of our CPU sales in 2008?"
Reason No. 1:
"Customers are not asking for AMD CPUs"
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=38117005
A good place to start with an analysis is to point out that the author is a consultant for AMD and gets paid by AMD and is an advocate for AMD.
His views are those of an advocate and have about the same weight as those of Tom McCoy was was a highly skilled trial attorney for O'Melveny & Myers in a prior life.
Due process in France under the civil law system finds that an accused is guilty unless they prove their innocence. Seriously, that is not a joke.
Louisiana is the only state that uses the civil law system here in the US but it has a slightly different meaning. In non-criminal cases the law means if you are not from Louisiana you lose
It is always hard to overturn an initial decision on appeal. As Sewell said the initial decision maker gets the benefit of the doubt. The appellate court will not substitute its judgment for that of the agency ween if they would make a different call if they were looking at the case
In the US, the standard for review of an administrative agency decision -- the FTC for example -- is whether there is substantial evidence to support the agency decision. If so the appeal is denied. It is a big burden for the appellant to meet the standard for reversing the decision.
It sounds to me like the i7 machine is more of a toy for you than a workstation for your daughter
I think that Intel can comply by dropping loyalty discounts.
However, the next step for the EC is to find that volume discounts are illegal too. The charge would be something like this"
EC Charge for the first 100,000 units in a quarter the price is X. For units > than 100K per quarter it is X-10%.
For Company A 100k units represents 85% of needs. Clearly, this is an exclusionary condition for AMD products -- it is a prohibited loyalty discount aka fidelity discount. Intel was warned and still they won't obey. Double the fine for the repeat violation to 2 billion Euros, payable immediately while the appeal on the May 2009 charge is still pending.
The Howrey law firm is one of the firms representing Intel. Howrey has roots in DC but now has a global reach and it has an office in Brussels, Belgium. The Howrey lawyers in Brussels speak excellent English, much better than Neelie the Great.
http://www.howrey.com/brussels/
Neelie the Great issued a proclamation that Intel must immediately "comply with the law". However, the EC has not specified the specific conduct that it must stop. A decision has not even been published identifying the alleged misconduct but in Neelie's words "Intel must obey".
I guess that the law according to Neelie the Great means that Intel must not abuse AMD. According to Neelie this means that Intel must stop the introduction of i7. The introduction of this set of Intel innovations is just too much for an efficient competitor, like AMD, to match.
A single socket i7 based server performs as well as a 2 socket AMD based server. As Neelie said, "This horrible abuse of AMD by Intel can not be tolerated. Intel must stop the tick tock abuse and allow AMD to catchup".
The EU Commission has a Q & A that covers some money issues. Presumably, if Intel wins the appeal the money and interest in the escrow account are returned to Intel. If the Commission prevails, the money goes to the EU general fund.
http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/09/235&format=HTML&aged=0&language=EN&guiLanguage=en
Does Intel have to pay the fine immediately?
The fine must be paid within three months of the date of notification of the Decision.
Where does the money go?
Once final judgment has been delivered in any appeals before the Court of First Instance (CFI) and the Court of Justice, the money goes into the EU’s central budget, thus reducing the contributions that Member States pay to the EU.
Does Intel have to pay the fine if it appeals to the European Court of First Instance (CFI)?
Yes. In case of appeals to the CFI, it is normal practice that the fine is paid into a blocked bank account pending the final outcome of the appeals process. Any fine that is provisionally paid will produce interest based on the interest rate applied by the European Central Bank to its main refinancing operations. In exceptional circumstances, companies may be allowed to cover the amount of the fine by a bank guarantee at a higher interest rate.
AMD on Intel's EU Fine
The CNBC commentator noted that he bought a PC with an AMD chip at Best Buy and asked Tom McCoy how AMD was excluded or customers were harmed if their product was on the shelf and sales people were touting it. McCoy had no answer and returned to his canned message.
http://www.cnbc.com/id/15840232?video=1122146605&play=1
I think that Intel will work harder and accelerate the pace of innovation -- product and process -- to leave AMD further behind. Neelie the Great can then watch those market share numbers shrink and study her master work of competition control.
Tecate found a great piece by a DOJ attorney discussing differences between the EU law on competition Article 82 and the US law in Section 2. It is a very good read. The part on fidelity discounts aka loyalty discounts is particularly on point.
http://www.usdoj.gov/atr/public/speeches/210873.htm
Re: I hope you can understand how I feel about Neelie the Terrible ...
Oh, I can understand that 'cause I have about the same thoughts
Congratulations!! I think that is your first post of the day that doesn't have a right wing snarl included.
If down was up then yes indeedy, lower prices would mean higher prices.
AMD is in really BIG trouble now. Intel has brought to bear its secret weapon: the Israeli Team.
Tom McCoy of AMD: "the industry will benefit from an end to Intel’s monopoly-inflated pricing"
Except the EU found that Intel gave pricing DISCOUNTS. Someone needs to tell McCoy that discounts do not increase pricing, they lower pricing.
The Bush administration basically shut down antitrust enforcement, The DOJ antitrust division under Varney can restart enforcement activity but it can't change the antitrust law the DOJ or its sister agency the FTC is enforcing.
http://competition.law360.com/registrations/user_registration?article_id=98368&concurrency_check=false
DOJ Monopoly Crackdown May Hit Hurdles In Courts
Law360, New York (May 12, 2009) -- Even as the U.S. Department of Justice flexes its tough new enforcement policy on monopoly abuses, experts say the plan puts the Antitrust Division on a potential collision course with federal courts that in recent years have been less than friendly to claims brought under Section 2 of the Sherman Act.
In a strongly worded speech Monday at left-leaning think tank the Center for American Progress, Assistant Attorney General Christine Varney revealed that the Antitrust Division will aggressively pursue cases where...
I agree that The Commission will almost certainly rule against Intel. And you are correct that it will take years to resolve the appeal(s). For a benchmark, consider the Microsoft case.
As to the $1 billion Euro fine, I doubt that the Commission will go that high but that may be wishful thinking on my part. In any event, I take the under on that bet.
I am afraid that I have to disagree. The decision by the Commission will have a good deal of significance. It is always difficult to get much help on appeal. The next step before the Court of First Instance should provide Intel with a fair hearing for the first time but it is an appellate proceeding.
As a case in point, consider how little relief if any Microsoft was able to obtain on appeal in the EU.
What will not matter much at all, is the rebate rules that the Commission will apparently issue. My bet is that the restrictions won't slow Intel at all. The EU countries do not have class actions so the speculation in the press that Intel will get hit with class actions has no merit.
The only thing that an adverse Commission will do is to cause Intel to redouble its resolve to proceed full speed with product design and process development that will leave AMD trailing further and further behind.
What you were doing is engaging in a right wing rant about the Fairness Doctrine and Rush Limbaugh. What that has to do with the antitrust law is beyond me. You really need to go read Intel's legal brief so you can understand the legal principles.
And you might wake up and figure out that the Obama administration does not have the power to "change the law".
The new sheriff will not make new law but will enforce the existing law. The loyalty rebates used by Intel are squarely within the Brooke case which is the law set forth by the US Supremes.
You need to do a little reading and less blowing of smoke. Start with the McDonald speech which is a good primer on competition law and then read the Intel brief. Tecate did the work to find the material. Now you need to do your homework so you can catch up with the rest of the class.
http://www.usdoj.gov/atr/public/speeches/210873.htm
http://download.intel.com/pressroom/legal/1443_Opening%20Brief%20in%20Support%20re%201442%20Motion_Intel.pdf
Craig was not directly in charge of the sales force during the time in question but Otellini was. So if their is executive blame to be assigned -- and I think that none is appropriate -- the arrow would probably point to Otellini.
If the European Commission comes out against loyalty rebates as expected, the Commission is coming up with a new rule for regulating competition. It is very clear the the actual goal of the Commission is to regulate market share. But the Commission lacks the power to assign market share quotas. As a result, the Commission will assign restrictions on competition that produces a loser in the market share race. The desired result is to give the loser a market share that is larger than the loser would earn in a competitive market.
After the Commission restraints on Microsoft were in effect for several years, Neelie Kroes publicly spoke to express regret that the Microsoft restrictions did not have the desired effect on market.
Kroes made the mistake of speaking the truth about Commission intent to regulate market share and that needed an glossy corrective explanation from the political system. Commission staff immediately issued clarifications to state that what Kroes really meant was restrictions were directed only at regulating competition market share was not intended to regulate market share.
Great find. The article does a good job of explaining the differences in competition law between the EU and the US. The section on fidelity discounts is directly on point.
The Virgin Airways decisions where a loyalty discount was a violation in the EU but the same conduct was permissible in the US is probably a harbinger of what will happen with AMD vs Intel.
The latest news articles on the size of an EU fine are not even based on a rumor. The original NY Times article was based on the opinion of a UK attorney who managed to garner a lot of attention for his comment. The attention is precisely what he desired.
http://www.nytimes.com/2009/04/30/technology/companies/30chip.html?_r=2
In the Intel case, “I’d be surprised if the fine isn’t as high or higher than in the Microsoft case,” said Howard Cartlidge, the head of the European Union and competition group at the law firm Olswang in London. “Technology markets are where the European Commission has perceived particular problems due to dominant companies.”
Some legal experts speculate that Intel’s fine could reach about a billion euros, or $1.3 billion. Intel’s annual sales were $37.6 billion in 2008.
Unless we are willing to accept the always powerful speculation of "some legal experts", we will just have to wait for the EC decision
Will ARM netbooks be competitive?
http://blogs.zdnet.com/computers/?p=607
"Even by netbook standards, the Alpha 680 looks under-powered. It is based on a 7-inch display with a resolution of 800 by 480 pixels, even as most netbooks are moving to 10-inch, 1024-by-576 displays (several are now offering 1366×768 displays as well). It will have 128MB of memory (expandable to 256MB) and a 1GB SSD (also expandable, to 4GB). Even with this low-end configuration, the Alpha 680 will start around $250. That’s less than any 10-inch netbook, of course. But you can pick up the Dell Inspiron Mini 9 with an 8.9-inch LED-backlit display (1,024×600), 1.6GHz Intel Atom N270, 1GB of memory, 4GB SSD and Ubuntu Linux for $279."
The only thing that I can infer from a forecast size of 500 pages is that the report would be unbelievably huge and virtually impossible to analyze -- a total mish mash of junk.
Before anyone can make a meaningful comment, we really need is some solid information. About all we have now is a rumor that the decision is 1) no more rebates and 2) a fine.
Even the accuracy of the rumor is unknown. However, I suspect that the rumor of a decision is accurate but we will have to wait for details. It is possible that the fine is small and the prohibited rebate is a minimal business practice change. If that is the case, you could have a decision that looks a lot like Japan.
If the decision is 500 pages long, at least it will be in English so it can be read and understood by those here with an interest and a very strong stomach to plow through that huge mass of material.
Start cracking open a cold one... It is after 5:00 pm on the East Coast
http://blogs.zdnet.com/hardware/?p=4154&tag=nl.e539
ZDNet: Building a high-performance Windows 7 PC
With Windows 7 release candidate just around the corner, the other day I was asked to spec out a high performance PC suitable for Windows 7 64-bit, This system would also be a great Vista system.
Note: Just to clarify that this is a “high performance” PC, and not a “sky’s the limit, money no object” system. I am therefore choosing parts that offer the best bang for the buck at the high end, and not the very best, bleeding edge components.
Here’s the spec I came up with:
CPU
Choosing an Intel CPU is a no-brainer when it comes to high performance PCs. Intel’s current Core i7 silicon offer the very best performance going. However, if you go for the top of the line 965 Extreme Edition then you are going to be spending a thousand dollars on the CPU alone. While some people are happy to spend such sums on just the CPU, I feel that the cost outweighs the performance gains and that the cheapest Core i7, the 2.66GHz 920, which retails at a more reasonable $290 is a better option.
As you figured out, a news brief from Law360 will alert you to an event and you can often find a news report that is not behind the subscription wall.
What you see in the news item post is all you will get. The rest is hidden behind an expensive subscription wall at Law360.
You can subscribe to a Competition Law360 daily newsletter that will get the Intel antitrust suit news but all you will get is a brief teaser paragraph for each news Item:
http://competition.law360.com/
There are other Law360 sections on Technology and IP law that will also collect Intel and industry news. There is a fair amount of overlap so news items will often appear in multiple sections
Sun can accept IBM's offer... or it can go bankrupt
http://blogs.zdnet.com/open-source/?p=3918&tag=nl.e539
McNealy thinks he is Manny Ramirez, has another think coming