Article:
Richard S. Markovits, Tie-Ins and Reciprocity: A Functional,
Legal, and Policy Analysis, 58 Texas L. Rev. 1363 (1980).
Abstract:
A tie-in is a contract in which a buyer and seller of a product
agree to act in the same capacities with regard to a second
product. Tie-ins involving patented products have been held per
se illegal on the basis that the function is to permit sellers
to exercise monopolistic leverage that results in economic harm
to the competition. Courts have progressively extended this
leverage theory to other contexts. Reciprocity is the practice
of two firms conditioning their relations with regard to one
product on their buyer and seller roles being in another
transaction involving another good.
This Article outlines various non-leverage functions that
tie-ins and reciprocal trading agreements can perform. It then
investigates the competitive impact and legality of such
agreements. The Article then analyzes the allocative efficiency
and desirability of these agreements.