Feature Article Considers Antitrust Enforcement and the Bazaarvoice Ruling

August 20, 2014

An article adapted from Managing Principal Rebecca Kirk Fair's May 2014 panel discussion at the New York State Bar Association Antitrust Law Section considers the implications of the January 2014 ruling in United States v. Bazaarvoice. The article, "Sizing Up the Competition: Antitrust Enforcement and the Bazaarvoice Ruling," notes that "high-profile or highly profitable firms are no longer the sole targets of post-merger divestitures by antitrust enforcers." It demonstrates that in this case two firms, Bazaarvoice and PowerReviews, that were both operating at a loss in the small ratings and review market drew the scrutiny of the U.S. Department of Justice due to the nature of competition in the industry, "including barriers to entry and the anticompetitive potential for long-run harm to consumers." The article highlights the court's curious focus on entry threat and its simultaneous dismissal of related pricing policies. In this case, actual prices and the absence of customer concerns were much less relevant than Bazaarvoice's own internal documents to the ultimate outcome. In particular, the article argues that the inflammatory paper trail created by senior executives played a significant role in Bazaarvoice's ultimate divestiture of all of its PowerReviews assets.

Read the article