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Attorney General Janet Reno vowed Thursday to scrutinize all mergers, including those involving the most powerful companies in the country. “Our prosperity depends on strong laws and vigorous enforcement to ensure our markets remain competitive,” Reno told the American Antitrust Institute in her first antitrust policy speech since taking office more than seven years ago. Competition results in better products, more innovation and lower prices, she said, and this is why fair competition is a core American value. “We will continue to work to ensure those transactions that would substantially lessen competition are not allow to harm consumers,” she said. Reno said no company, regardless of political or economic clout, is exempt from antitrust enforcement. As proof, she cited challenges to the mergers of WorldCom and MCI, Cargill and Continental Grain, AT&T Corp. and MediaOne and Lockheed Martin Corp. and Northrup Grumman Corp. “The law must apply to the powerful, just as it applies to us,” she said. Reno rejected the view of some high-technology executives that the antitrust laws do not apply to their industry. Just as the Sherman Antitrust Act guided policy when the country moved from an agrarian to a manufacturing economy, it will guide the country as it moves to an information-based economy, she said. “The enduring principles that underlie our antitrust laws are every bit as relevant today as when the Sherman Antitrust Act was passed 100 years ago,” Reno said. The attorney general praised government efforts to expand ties with competition oversight agencies in other countries. She noted that cooperation with the European Commission, the executive arm of the European Union and its clearinghouse for mergers, has improved significantly in recent years. Reno said more countries are abandoning the concept of national champions-the view that a country should permit one company to dominate its market on the theory that it would be big enough to compete effectively overseas. Instead, they are adopting the U.S. system, which holds that vigorous competition at home ensures companies competing effectively overseas. Reno spoke at a luncheon honoring Assistant Attorney General Joel Klein, who received the AAI’s inaugural “leveling the playing field” award. Earlier, at the American Antitrust Institute’s conference, Federal Trade Commission Chairman Robert Pitofsky questioned whether the balance between intellectual property law and antitrust law is getting out of alignment. Pitofsky said he was worried because a federal appeals court’s recent decision in a case involving Xerox made it easier to use patents to restrict competition. The U.S. Court of Appeals for the Federal Circuit, in Independent Service Organization’s antitrust litigation, established a test to see if the company has a statutory right to exclude competitors from using its products. Previously, the courts would balance the incentive to innovate against the anti-competitive effect of permitting a company to refuse to sell products to competitors. “I think that is an unwise and unfortunate departure from the traditional approach in this area,” Pitofsky said. “I question whether there is reason to believe any such interpretation is necessary to encourage the innovation process.” Copyright �2000 TDD, LLC. All rights reserved.

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