Why Some Platform Businesses Face Many Frivolous Antitrust Complaints and What to Do About It
David Evans, Dec 20, 2012
In the last decade a number of internet-based multi-sided platforms have emerged that provide free services to, in some cases, millions of businesses. This article argues that under current norms in adversarial proceedings these platforms are likely to face large numbers of complaints in multiple jurisdictions, a substantial likelihood that at least one of these complaints will result in a false-positive decision against the platform, and material risk of a false-positive decision that results in catastrophic consequences. These effects result from a combination of business users of free services receiving a free litigation option they can pursue if they have any complaints; an adverse-selection problem that results from free services being particularly attractive to start-ups that do not have or want to invest capital in their businesses; and the sheer number of free-business users resulting in a high cumulative probability of at least one false-positive decision. After documenting these phenomena, this article argues that government policymakers, including competition authorities and courts, should adopt a heightened level of scrutiny concerning complaints from free business users. This heightened level of scrutiny is necessary to counteract the impact of excessive litigation on innovation by multi-sided platforms.
Featured News
EU Weighs Potential Role as Competing Bids for Warner Bros. Discovery Intensify
Dec 10, 2025 by
CPI
Trump Opposes Warner Bros. Sale Without CNN
Dec 10, 2025 by
CPI
EU Court Cuts Intel Fine but Confirms Antitrust Breach
Dec 10, 2025 by
CPI
Prediction Markets Emerging as New Flash Point Between Federal and State Regulators
Dec 10, 2025 by
CPI
CoStar Urges Supreme Court to Block Antitrust Claims in CREXi Fight
Dec 10, 2025 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Acqui-hiring
Dec 11, 2025 by
CPI
Anticompetitive Effects of Acquihires: Labor and Product Markets
Dec 11, 2025 by
Heski Bar-Isaac, Justin Johnson & Volker Nocke
Acquihires In the Technology Sector: Antitrust Scrutiny Through the Lens of Economics
Dec 11, 2025 by
Juliette Caminade, Rebecca Kirk Fair, Zsolt Udvari & Jeanne Vellard Smith
M&A in the AI Era: Considerations for Acquihiring
Dec 11, 2025 by
Ingrid Vandenborre, Kenneth Schwartz, Christopher Barlow, Page Griffin, Michael Cardella, Stuart Levi, Taylor Votek, Benjamin Salzer, Lisa G. Liu & Liz Kraus
Lock Them Up, or Take No Prisoners? Merger Policy and Acquiring AI Talent: Human Rights and Other Inconvenient Facts
Dec 11, 2025 by
Simon R. Pritchard