VERIZON COMMUNICATIONS INC. v. LAW OFFICES OF CURTIS V. TRINKO, LLP

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398 OCTOBER TERM, 2003
Syllabus
VERIZON COMMUNICATIONS INC. v. LAW OFFICES
OF CURTIS V. TRINKO, LLP
certiorari to the united states court of appeals for
the second circuit
No. 02–682. Argued October 14, 2003—Decided January 13, 2004
The Telecommunications Act of 1996 imposes upon an incumbent local ex-
change carrier (LEC) the obligation to share its telephone network with
competitors, 47 U. S. C. § 251(c), including the duty to provide access to
individual network elements on an “unbundled” basis, see § 251(c)(3).
New entrants, so-called competitive LECs, combine and resell these un-
bundled network elements (UNEs). Petitioner Verizon Communica-
tions Inc., the incumbent LEC in New York State, has signed intercon-
nection agreements with rivals such as AT&T, as § 252 obliges it to do,
detailing the terms on which it will make its network elements available.
Part of Verizon’s § 251(c)(3) UNE obligation is the provision of access to
operations support systems (OSS), without which a rival cannot fill its
customers’ orders. Verizon’s interconnection agreement, approved by
the New York Public Service Commission (PSC), and its authorization to
provide long-distance service, approved by the Federal Communications
Commission (FCC), each specified the mechanics by which its OSS obli-
gation would be met. When competitive LECs complained that Veri-
zon was violating that obligation, the PSC and FCC opened parallel
investigations, which led to the imposition of financial penalties, remedi-
ation measures, and additional reporting requirements on Verizon. Re-
spondent, a local telephone service customer of AT&T, then filed this
class action alleging, inter alia, that Verizon had filled rivals’ orders on
a discriminatory basis as part of an anticompetitive scheme to discour-
age customers from becoming or remaining customers of competitive
LECs in violation of § 2 of the Sherman Act, 15 U. S. C. § 2. The Dis-
trict Court dismissed the complaint, concluding that respondent’s allega-
tions of deficient assistance to rivals failed to satisfy § 2’s requirements.
The Second Circuit reinstated the antitrust claim.
Held: Respondent’s complaint alleging breach of an incumbent LEC’s 1996
Act duty to share its network with competitors does not state a claim
under § 2 of the Sherman Act. Pp. 405–416.
(a) The 1996 Act has no effect upon the application of traditional anti-
trust principles. Its saving clause—which provides that “nothing in
this Act . . . shall be construed to modify, impair, or supersede the appli-
cability of any of the antitrust laws,” 47 U. S. C. § 152, note—preserves

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claims that satisfy established antitrust standards, but does not create
new claims that go beyond those standards. Pp. 405–407.
(b) The activity of which respondent complains does not violate pre-
existing antitrust standards. The leading case imposing § 2 liability for
refusal to deal with competitors is Aspen Skiing Co. v. Aspen Highlands
Skiing Corp., 472 U. S. 585, in which the Court concluded that the de-
fendant’s termination of a voluntary agreement with the plaintiff sug-
gested a willingness to forsake short-term profits to achieve an anticom-
petitive end. Aspen is at or near the outer boundary of § 2 liability, and
the present case does not fit within the limited exception it recognized.
Because the complaint does not allege that Verizon ever engaged in a
voluntary course of dealing with its rivals, its prior conduct sheds no
light upon whether its lapses from the legally compelled dealing were
anticompetitive. Moreover, the Aspen defendant turned down its com-
petitor’s proposal to sell at its own retail price, suggesting a calculation
that its future monopoly retail price would be higher, whereas Verizon’s
reluctance to interconnect at the cost-based rate of compensation avail-
able under § 251(c)(3) is uninformative. More fundamentally, the Aspen
defendant refused to provide its competitor with a product it already
sold at retail, whereas here the unbundled elements offered pursuant to
§ 251(c)(3) are not available to the public, but are provided to rivals
under compulsion and at considerable expense. The Court’s conclusion
would not change even if it considered to be established law the “essen-
tial facilities” doctrine crafted by some lower courts. The indispensable
requirement for invoking that doctrine is the unavailability of access to
the “essential facilities”; where access exists, as it does here by virtue
of the 1996 Act, the doctrine serves no purpose. Pp. 407–411.
(c) Traditional antitrust principles do not justify adding the present
case to the few existing exceptions from the proposition that there is no
duty to aid competitors. Antitrust analysis must always be attuned to
the particular structure and circumstances of the industry at issue.
When there exists a regulatory structure designed to deter and remedy
anticompetitive harm, the additional benefit to competition provided by
antitrust enforcement will tend to be small, and it will be less plausible
that the antitrust laws contemplate such additional scrutiny. Here Ver-
izon was subject to oversight by the FCC and the PSC, both of which
agencies responded to the OSS failure raised in respondent’s complaint
by imposing fines and other burdens on Verizon. Against the slight
benefits of antitrust intervention here must be weighed a realistic as-
sessment of its costs. Allegations of violations of § 251(c)(3) duties are
both technical and extremely numerous, and hence difficult for antitrust
courts to evaluate. Applying § 2’s requirements to this regime can
readily result in “false positive” mistaken inferences that chill the very

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400 VERIZON COMMUNICATIONS INC. v. LAW OFFICES
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Syllabus
conduct the antitrust laws are designed to protect. Matsushita Elec.
Industrial Co. v. Zenith Radio Corp., 475 U. S. 574, 594. Pp. 411–416.
305 F. 3d 89, reversed and remanded.
Scalia, J., delivered the opinion of the Court, in which Rehnquist,
C. J., and O’Connor, Kennedy, Ginsburg, and Breyer, JJ., joined.
Stevens, J., filed an opinion concurring in the judgment, in which Souter
and Thomas, JJ., joined, post, p. 416.
Richard G. Taranto argued the cause for petitioner. With
him on the briefs were John Thorne, Michael K. Kellogg,
Mark C. Hansen, Aaron M. Panner, and Henry B. Gutman.
Solicitor General Olson argued the cause for the United
States et al. as amici curiae urging reversal. With him on
the brief were Acting Assistant Attorney General Pate,
Deputy Solicitor General Clement, Jeffrey A. Lamken,
Catherine G. O’Sullivan, Nancy C. Garrison, and David
Seidman.
Donald B. Verrilli, Jr., argued the cause for respondent.
With him on the brief were Alice McInerney, Bruce V.
Spiva, Ian Heath Gershengorn, Marc A. Goldman, Elaine
J. Goldenberg, and Chester T. Kamin.*
*Briefs of amici curiae urging reversal were filed for the Common-
wealth of Virginia et al. by Jerry W. Kilgore, Attorney General of Virginia,
William H. Hurd, State Solicitor, Maureen Riley Matsen and William
E. Thro, Deputy State Solicitors, Judith Williams Jagdmann, Deputy At-
torney General, C. Meade Browder, Jr., Senior Assistant Attorney Gen-
eral, and Sarah Oxenham Allen and Raymond L. Doggett, Jr., Assistant
Attorneys General, and by the Attorneys General for their respective
States as follows: William H. Pryor, Jr., of Alabama, M. Jane Brady of
Delaware, Steve Carter of Indiana, Jon Bruning of Nebraska, Peter
W. Heed of New Hampshire, W. A. Drew Edmondson of Oklahoma, and
Mark L. Shurtleff of Utah; for BellSouth Corp. et al. by Stephen M. Sha-
piro, John E. Muench, Jeffrey W. Sarles, Marc Gary, Marc W. F. Galonsky,
and William M. Schur; for the Communications Workers of America by
Patrick M. Scanlon, Andrew D. Roth, and Laurence Gold; for the Tele-
communications Industry Association by Donald I. Baker; for United Par-
cel Service, Inc., et al. by Drew S. Days III, W. Stephen Smith, Beth
S. Brinkmann, Paul T. Friedman, and Peter M. Kreindler; for the United

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Opinion of the Court
Justice Scalia delivered the opinion of the Court.
The Telecommunications Act of 1996, Pub. L. 104–104, 110
Stat. 56, imposes certain duties upon incumbent local tele-
phone companies in order to facilitate market entry by com-
petitors, and establishes a complex regime for monitoring
and enforcement. In this case we consider whether a com-
plaint alleging breach of the incumbent’s duty under the 1996
Act to share its network with competitors states a claim
under § 2 of the Sherman Act, 26 Stat. 209.
States Telecom Association by William T. Lake, James F. Rill, James
W. Olson, and Michael T. McMenamin; and for the Washington Legal
Foundation by Steven G. Bradbury, Daniel J. Popeo, and David A. Price.
Briefs of amici curiae urging affirmance were filed for the State of
New York et al. by Eliot Spitzer, Attorney General of New York, Caitlin
J. Halligan, Solicitor General, Michelle Aronowitz, Deputy Solicitor Gen-
eral, Daniel J. Chepaitis, Assistant Solicitor General, and Jay L. Himes,
Susanna M. Zwerling, Richard L. Schwartz, and Keith H. Gordon, Assist-
ant Attorneys General, by Robert J. Spagnoletti, Corporation Counsel of
the District of Columbia, and by the Attorneys General for their respec-
tive jurisdictions as follows: Terry Goddard of Arizona, Richard Blumen-
thal of Connecticut, G. Steven Rowe of Maine, J. Joseph Curran, Jr., of
Maryland, Michael A. Cox of Michigan, Mike Hatch of Minnesota, Jere-
miah W. (Jay) Nixon of Missouri, Mike McGrath of Montana, Hardy
Myers of Oregon, Anabelle Rodrı´guez of Puerto Rico, William Sorrell of
Vermont, Darrell V. McGraw, Jr., of West Virginia, and Peggy A. Lauten-
schlager of Wisconsin; for Allegiance Telecom, Inc., et al. by Richard
M. Rindler, Eric J. Branfman, Rebecca P. Dick, Christopher A. Holt,
and Richard Metzger; for the American Antitrust Institute by Jonathan
L. Rubin and Albert A. Foer; for AT&T Corp. et al. by David W. Carpenter
and Stephen T. Perkins; for the Consumers Union et al. by Michael
D. McNeely and Patrick J. O’Connor; for Covad Communications Co., Inc.,
by Alfred C. Pfeiffer, Jr.; for Economics Professors by Carter G. Phillips
and C. Frederick Beckner III; for Law Professors by Steven Semeraro;
for the National Association of State Utility Consumer Advocates by Ger-
ald A. Norlander and Robert S. Tongren; and for Z-Tel Technologies, Inc.,
by Christopher J. Wright.
Robert H. Bork filed a brief for the Project to Promote Competition and
Innovation in the Digital Age as amicus curiae.

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Opinion of the Court
I
Petitioner Verizon Communications Inc. is the incumbent
local exchange carrier (LEC) serving New York State. Be-
fore the 1996 Act, Verizon,1 like other incumbent LECs, en-
joyed an exclusive franchise within its local service area.
The 1996 Act sought to “uproo[t]” the incumbent LECs’ mo-
nopoly and to introduce competition in its place. Verizon
Communications Inc. v. FCC, 535 U. S. 467, 488 (2002).
Central to the scheme of the Act is the incumbent LEC’s
obligation under 47 U. S. C. § 251(c) to share its network with
competitors, see AT&T Corp. v. Iowa Utilities Bd., 525
U. S. 366, 371 (1999), including provision of access to indi-
vidual elements of the network on an “unbundled” basis.
§ 251(c)(3). New entrants, so-called competitive LECs, re-
sell these unbundled network elements (UNEs), recombined
with each other or with elements belonging to the LECs.
Verizon, like other incumbent LECs, has taken two sig-
nificant steps within the Act’s framework in the direction
of increased competition. First, Verizon has signed inter-
connection agreements with rivals such as AT&T, as it is
obliged to do under § 252, detailing the terms on which it will
make its network elements available. (Because Verizon and
AT&T could not agree upon terms, the open issues were sub-
jected to compulsory arbitration under §§ 252(b) and (c).) In
1997, the state regulator, New York’s Public Service Com-
mission (PSC), approved Verizon’s interconnection agree-
ment with AT&T.
Second, Verizon has taken advantage of the opportunity
provided by the 1996 Act for incumbent LECs to enter
the long-distance market (from which they had long been
excluded). That required Verizon to satisfy, among other
things, a 14-item checklist of statutory requirements, which
1 In 1996, NYNEX was the incumbent LEC for New York State.
NYNEX subsequently merged with Bell Atlantic Corporation, and the
merged entity retained the Bell Atlantic name; a further merger produced
Verizon. We use “Verizon” to refer to NYNEX and Bell Atlantic as well.

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includes compliance with the Act’s network-sharing duties.
§§ 271(d)(3)(A) and (c)(2)(B). Checklist item two, for exam-
ple, includes “[n]ondiscriminatory access to network ele-
ments in accordance with the requirements” of § 251(c)(3).
§ 271(c)(2)(B)(ii). Whereas the state regulator approves an
interconnection agreement, for long-distance approval the in-
cumbent LEC applies to the Federal Communications Com-
mission (FCC). In December 1999, the FCC approved Veri-
zon’s § 271 application for New York.
Part of Verizon’s UNE obligation under § 251(c)(3) is the
provision of access to operations support systems (OSS), a
set of systems used by incumbent LECs to provide services
to customers and ensure quality. Verizon’s interconnection
agreement and long-distance authorization each specified the
mechanics by which its OSS obligation would be met. As
relevant here, a competitive LEC sends orders for service
through an electronic interface with Verizon’s ordering sys-
tem, and as Verizon completes certain steps in filling the
order, it sends confirmation back through the same interface.
Without OSS access a rival cannot fill its customers’ orders.
In late 1999, competitive LECs complained to regulators
that many orders were going unfilled, in violation of Veri-
zon’s obligation to provide access to OSS functions. The
PSC and FCC opened parallel investigations, which led to a
series of orders by the PSC and a consent decree with the
FCC.2 Under the FCC consent decree, Verizon undertook
2 Order Directing Improvements To Wholesale Service Performance,
MCI WorldCom, Inc. v. Bell Atlantic-New York, Nos. 00–C–0008, 00–C–
0009, 2000 WL 363378 (N. Y. PSC, Feb. 11, 2000); Order Directing Market
Adjustments and Amending Performance Assurance Plan, MCI World-
Com, Inc. v. Bell Atlantic-New York, Nos. 00–C–0008, 00–C–0009, 99–C–
0949, 2000 WL 517633 (N. Y. PSC, Mar. 23, 2000); Order Addressing OSS
Issues, MCI WorldCom, Inc. v. Bell Atlantic-New York, Nos. 00–C–0008,
00–C–0009, 99–C–0949, 2000 WL 1531916 (N. Y. PSC, July 27, 2000); In re
Bell Atlantic-New York Authorization Under Section 271 of the Commu-
nications Act to Provide In-Region, InterLATA Service In the State of
New York, 15 FCC Rcd. 5413 (2000) (Order); id., at 5415 (Consent Decree).

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to make a “voluntary contribution” to the U. S. Treasury in
the amount of $3 million, 15 FCC Rcd. 5415, 5421, ¶ 16 (2000);
under the PSC orders, Verizon incurred liability to the com-
petitive LECs in the amount of $10 million. Under the con-
sent decree and orders, Verizon was subjected to new per-
formance measurements and new reporting requirements to
the FCC and PSC, with additional penalties for continued
noncompliance. In June 2000, the FCC terminated the con-
sent decree. Enforcement Bureau Announces that Bell At-
lantic Has Satisfied Consent Decree Regarding Electronic
Ordering Systems in New York (June 20, 2000), http://www.
fcc.gov/eb/News_Releases/ bellatlet.html (all Internet mate-
rials as visited Dec. 12, 2003, and available in Clerk of Court’s
case file). The next month the PSC relieved Verizon of
the heightened reporting requirement. Order Addressing
OSS Issues, MCI WorldCom, Inc. v. Bell Atlantic-New York,
Nos. 00–C–0008, 00–C–0009, 99–C–0949, 2000 WL 1531916
(N. Y. PSC, July 27, 2000).
Respondent Law Offices of Curtis V. Trinko, LLP, a New
York City law firm, was a local telephone service customer
of AT&T. The day after Verizon entered its consent decree
with the FCC, respondent filed a complaint in the District
Court for the Southern District of New York, on behalf of
itself and a class of similarly situated customers. See App.
12–33. The complaint, as later amended, id., at 34–50, al-
leged that Verizon had filled rivals’ orders on a discrimina-
tory basis as part of an anticompetitive scheme to discourage
customers from becoming or remaining customers of compet-
itive LECs, thus impeding the competitive LECs’ ability to
enter and compete in the market for local telephone service.
See, e. g., id., at 34–35, 46–47, ¶¶ 1, 2, 52, 54. According
to the complaint, Verizon “has filled orders of [competi-
tive LEC] customers after filling those for its own local
phone service, has failed to fill in a timely manner, or not at
all, a substantial number of orders for [competitive LEC]
customers . . . , and has systematically failed to inform [com-

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petitive LECs] of the status of their customers’ orders.”
Id., at 39, ¶ 21. The complaint set forth a single example of
the alleged “failure to provide adequate access to [competi-
tive LECs],” namely, the OSS failure that resulted in the
FCC consent decree and PSC orders. Id., at 40, ¶ 22. It
asserted that the result of Verizon’s improper “behavior with
respect to providing access to its local loop” was to “deter
potential customers [of rivals] from switching.” Id., at 35,
47, ¶¶ 2, 57. The complaint sought damages and injunctive
relief for violation of § 2 of the Sherman Act, 15 U. S. C. § 2,
pursuant to the remedy provisions of §§ 4 and 16 of the Clay-
ton Act, 38 Stat. 731, as amended, 15 U. S. C. §§ 15, 26. The
complaint also alleged violations of the 1996 Act, § 202(a) of
the Communications Act of 1934, 48 Stat. 1064, as amended,
47 U. S. C. § 151 et seq., and state law.
The District Court dismissed the complaint in its entirety.
As to the antitrust portion, it concluded that respondent’s
allegations of deficient assistance to rivals failed to satisfy
the requirements of § 2. The Court of Appeals for the Sec-
ond Circuit reinstated the complaint in part, including the
antitrust claim. 305 F. 3d 89, 113 (2002). We granted cer-
tiorari, limited to the question whether the Court of Appeals
erred in reversing the District Court’s dismissal of respond-
ent’s antitrust claims. 538 U. S. 905 (2003).
II
To decide this case, we must first determine what effect
(if any) the 1996 Act has upon the application of traditional
antitrust principles. The Act imposes a large number of du-
ties upon incumbent LECs—above and beyond those basic
responsibilities it imposes upon all carriers, such as assuring
number portability and providing access to rights-of-way, see
47 U. S. C. §§ 251(b)(2), (4). Under the sharing duties of
§ 251(c), incumbent LECs are required to offer three kinds
of access. Already noted, and perhaps most intrusive, is the
duty to offer access to UNEs on “just, reasonable, and non-

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discriminatory” terms, § 251(c)(3), a phrase that the FCC has
interpreted to mean a price reflecting long-run incremental
cost. See Verizon Communications Inc. v. FCC, 535 U. S.,
at 495–496. A rival can interconnect its own facilities with
those of the incumbent LEC, or it can simply purchase serv-
ices at wholesale from the incumbent and resell them to con-
sumers. See §§ 251(c)(2), (4). The Act also imposes upon
incumbents the duty to allow physical “collocation”—that is,
to permit a competitor to locate and install its equipment on
the incumbent’s premises—which makes feasible intercon-
nection and access to UNEs. See § 251(c)(6).
That Congress created these duties, however, does not au-
tomatically lead to the conclusion that they can be enforced
by means of an antitrust claim. Indeed, a detailed regula-
tory scheme such as that created by the 1996 Act ordinarily
raises the question whether the regulated entities are not
shielded from antitrust scrutiny altogether by the doctrine
of implied immunity. See, e. g., United States v. National
Assn. of Securities Dealers, Inc., 422 U. S. 694 (1975); Gor-
don v. New York Stock Exchange, Inc., 422 U. S. 659 (1975).
In some respects the enforcement scheme set up by the 1996
Act is a good candidate for implication of antitrust immunity,
to avoid the real possibility of judgments conflicting with the
agency’s regulatory scheme “that might be voiced by courts
exercising jurisdiction under the antitrust laws.” United
States v. National Assn. of Securities Dealers, Inc., supra,
at 734.
Congress, however, precluded that interpretation. Sec-
tion 601(b)(1) of the 1996 Act is an antitrust-specific saving
clause providing that “nothing in this Act or the amendments
made by this Act shall be construed to modify, impair, or
supersede the applicability of any of the antitrust laws.”
110 Stat. 143, 47 U. S. C. § 152, note. This bars a finding of
implied immunity. As the FCC has put the point, the saving
clause preserves those “claims that satisfy established anti-
trust standards.” Brief for United States and the Federal

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Communications Commission as Amici Curiae Supporting
Neither Party in No. 02–7057, Covad Communications Co.
v. Bell Atlantic Corp. (CADC), p. 8.
But just as the 1996 Act preserves claims that satisfy
existing antitrust standards, it does not create new claims
that go beyond existing antitrust standards; that would be
equally inconsistent with the saving clause’s mandate that
nothing in the Act “modify, impair, or supersede the applica-
bility” of the antitrust laws. We turn, then, to whether the
activity of which respondent complains violates pre-existing
antitrust standards.
III
The complaint alleges that Verizon denied interconnection
services to rivals in order to limit entry. If that allegation
states an antitrust claim at all, it does so under § 2 of the
Sherman Act, 15 U. S. C. § 2, which declares that a firm shall
not “monopolize” or “attempt to monopolize.” Ibid. It is
settled law that this offense requires, in addition to the pos-
session of monopoly power in the relevant market, “the will-
ful acquisition or maintenance of that power as distinguished
from growth or development as a consequence of a superior
product, business acumen, or historic accident.” United
States v. Grinnell Corp., 384 U. S. 563, 570–571 (1966). The
mere possession of monopoly power, and the concomitant
charging of monopoly prices, is not only not unlawful; it is an
important element of the free-market system. The opportu-
nity to charge monopoly prices—at least for a short period—
is what attracts “business acumen” in the first place; it in-
duces risk taking that produces innovation and economic
growth. To safeguard the incentive to innovate, the posses-
sion of monopoly power will not be found unlawful unless
it is accompanied by an element of anticompetitive conduct.
Firms may acquire monopoly power by establishing an in-
frastructure that renders them uniquely suited to serve their
customers. Compelling such firms to share the source of
their advantage is in some tension with the underlying pur-

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pose of antitrust law, since it may lessen the incentive for the
monopolist, the rival, or both to invest in those economically
beneficial facilities. Enforced sharing also requires anti-
trust courts to act as central planners, identifying the proper
price, quantity, and other terms of dealing—a role for which
they are ill suited. Moreover, compelling negotiation be-
tween competitors may facilitate the supreme evil of anti-
trust: collusion. Thus, as a general matter, the Sherman Act
“does not restrict the long recognized right of [a] trader or
manufacturer engaged in an entirely private business, freely
to exercise his own independent discretion as to parties with
whom he will deal.” United States v. Colgate & Co., 250
U. S. 300, 307 (1919).
However, “[t]he high value that we have placed on the
right to refuse to deal with other firms does not mean that
the right is unqualified.” Aspen Skiing Co. v. Aspen High-
lands Skiing Corp., 472 U. S. 585, 601 (1985). Under certain
circumstances, a refusal to cooperate with rivals can consti-
tute anticompetitive conduct and violate § 2. We have been
very cautious in recognizing such exceptions, because of the
uncertain virtue of forced sharing and the difficulty of identi-
fying and remedying anticompetitive conduct by a single
firm. The question before us today is whether the allega-
tions of respondent’s complaint fit within existing exceptions
or provide a basis, under traditional antitrust principles, for
recognizing a new one.
The leading case for § 2 liability based on refusal to cooper-
ate with a rival, and the case upon which respondent under-
standably places greatest reliance, is Aspen Skiing, supra.
The Aspen ski area consisted of four mountain areas. The
defendant, who owned three of those areas, and the plaintiff,
who owned the fourth, had cooperated for years in the issu-
ance of a joint, multiple-day, all-area ski ticket. After re-
peatedly demanding an increased share of the proceeds, the
defendant canceled the joint ticket. The plaintiff, concerned
that skiers would bypass its mountain without some joint

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offering, tried a variety of increasingly desperate measures
to re-create the joint ticket, even to the point of in effect
offering to buy the defendant’s tickets at retail price. Id.,
at 593–594. The defendant refused even that. We upheld
a jury verdict for the plaintiff, reasoning that “[t]he jury may
well have concluded that [the defendant] elected to forgo
these short-run benefits because it was more interested in
reducing competition . . . over the long run by harming its
smaller competitor.” Id., at 608.
Aspen Skiing is at or near the outer boundary of § 2 liabil-
ity. The Court there found significance in the defendant’s
decision to cease participation in a cooperative venture. See
id., at 608, 610–611. The unilateral termination of a volun-
tary (and thus presumably profitable) course of dealing
suggested a willingness to forsake short-term profits to
achieve an anticompetitive end. Ibid. Similarly, the de-
fendant’s unwillingness to renew the ticket even if compen-
sated at retail price revealed a distinctly anticompetitive
bent.
The refusal to deal alleged in the present case does not fit
within the limited exception recognized in Aspen Skiing.
The complaint does not allege that Verizon voluntarily en-
gaged in a course of dealing with its rivals, or would ever
have done so absent statutory compulsion. Here, therefore,
the defendant’s prior conduct sheds no light upon the mo-
tivation of its refusal to deal—upon whether its regula-
tory lapses were prompted not by competitive zeal but by
anticompetitive malice. The contrast between the cases is
heightened by the difference in pricing behavior. In Aspen
Skiing, the defendant turned down a proposal to sell at its
own retail price, suggesting a calculation that its future mo-
nopoly retail price would be higher. Verizon’s reluctance to
interconnect at the cost-based rate of compensation available
under § 251(c)(3) tells us nothing about dreams of monopoly.
The specific nature of what the 1996 Act compels makes
this case different from Aspen Skiing in a more fundamental

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way. In Aspen Skiing, what the defendant refused to pro-
vide to its competitor was a product that it already sold at
retail—to oversimplify slightly, lift tickets representing a
bundle of services to skiers. Similarly, in Otter Tail Power
Co. v. United States, 410 U. S. 366 (1973), another case relied
upon by respondent, the defendant was already in the busi-
ness of providing a service to certain customers (power
transmission over its network), and refused to provide the
same service to certain other customers. Id., at 370–371,
377–378. In the present case, by contrast, the services al-
legedly withheld are not otherwise marketed or available to
the public. The sharing obligation imposed by the 1996 Act
created “something brand new”—“the wholesale market for
leasing network elements.” Verizon Communications Inc.
v. FCC, 535 U. S., at 528. The unbundled elements offered
pursuant to § 251(c)(3) exist only deep within the bowels of
Verizon; they are brought out on compulsion of the 1996 Act
and offered not to consumers but to rivals, and at consider-
able expense and effort. New systems must be designed
and implemented simply to make that access possible—in-
deed, it is the failure of one of those systems that prompted
the present complaint.3
We conclude that Verizon’s alleged insufficient assistance
in the provision of service to rivals is not a recognized anti-
trust claim under this Court’s existing refusal-to-deal prec-
edents. This conclusion would be unchanged even if we
considered to be established law the “essential facilities” doc-
trine crafted by some lower courts, under which the Court
of Appeals concluded respondent’s allegations might state a
claim. See generally Areeda, Essential Facilities: An Epi-
3 Respondent also relies upon United States v. Terminal Railroad Assn.
of St. Louis, 224 U. S. 383 (1912), and Associated Press v. United States,
326 U. S. 1 (1945). These cases involved concerted action, which presents
greater anticompetitive concerns and is amenable to a remedy that does
not require judicial estimation of free-market forces: simply requiring that
the outsider be granted nondiscriminatory admission to the club.

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thet in Need of Limiting Principles, 58 Antitrust L. J. 841
(1989). We have never recognized such a doctrine, see
Aspen Skiing Co., 472 U. S., at 611, n. 44; AT&T Corp. v.
Iowa Utilities Bd., 525 U. S., at 428 (opinion of Breyer, J.),
and we find no need either to recognize it or to repudiate
it here. It suffices for present purposes to note that the
indispensable requirement for invoking the doctrine is the
unavailability of access to the “essential facilities”; where ac-
cess exists, the doctrine serves no purpose. Thus, it is said
that “essential facility claims should . . . be denied where a
state or federal agency has effective power to compel sharing
and to regulate its scope and terms.” P. Areeda & H. Ho-
venkamp, Antitrust Law, p. 150, ¶ 773e (2003 Supp.). Re-
spondent believes that the existence of sharing duties under
the 1996 Act supports its case. We think the opposite: The
1996 Act’s extensive provision for access makes it unneces-
sary to impose a judicial doctrine of forced access. To the
extent respondent’s “essential facilities” argument is distinct
from its general § 2 argument, we reject it.
IV
Finally, we do not believe that traditional antitrust princi-
ples justify adding the present case to the few existing ex-
ceptions from the proposition that there is no duty to aid
competitors. Antitrust analysis must always be attuned to
the particular structure and circumstances of the industry
at issue. Part of that attention to economic context is an
awareness of the significance of regulation. As we have
noted, “careful account must be taken of the pervasive fed-
eral and state regulation characteristic of the industry.”
United States v. Citizens & Southern Nat. Bank, 422 U. S.
86, 91 (1975); see also IA P. Areeda & H. Hovenkamp, Anti-
trust Law, p. 12, ¶ 240c3 (2d ed. 2000). “[A]ntitrust analysis
must sensitively recognize and reflect the distinctive eco-
nomic and legal setting of the regulated industry to which
it applies.” Concord v. Boston Edison Co., 915 F. 2d 17,

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22 (CA1 1990) (Breyer, C. J.) (internal quotation marks
omitted).
One factor of particular importance is the existence of a
regulatory structure designed to deter and remedy anticom-
petitive harm. Where such a structure exists, the addi-
tional benefit to competition provided by antitrust enforce-
ment will tend to be small, and it will be less plausible
that the antitrust laws contemplate such additional scrutiny.
Where, by contrast, “[t]here is nothing built into the regula-
tory scheme which performs the antitrust function,” Silver
v. New York Stock Exchange, 373 U. S. 341, 358 (1963), the
benefits of antitrust are worth its sometimes considerable
disadvantages. Just as regulatory context may in other
cases serve as a basis for implied immunity, see, e. g., United
States v. National Assn. of Securities Dealers, Inc., 422
U. S., at 730–735, it may also be a consideration in deciding
whether to recognize an expansion of the contours of § 2.
The regulatory framework that exists in this case dem-
onstrates how, in certain circumstances, “regulation signif-
icantly diminishes the likelihood of major antitrust harm.”
Concord v. Boston Edison Co., supra, at 25. Consider, for
example, the statutory restrictions upon Verizon’s entry into
the potentially lucrative market for long-distance service.
To be allowed to enter the long-distance market in the first
place, an incumbent LEC must be on good behavior in its
local market. Authorization by the FCC requires state-by-
state satisfaction of § 271’s competitive checklist, which as
we have noted includes the nondiscriminatory provision of
access to UNEs. Section 271 applications to provide long-
distance service have now been approved for incumbent
LECs in 47 States and the District of Columbia. See FCC
Authorizes SBC to Provide Long Distance Service in Illinois,
Indiana, Ohio and Wisconsin (Oct. 15, 2003), http://hraunfoss.
fcc.gov/edocs_ public/attachmatch/DOC-239978A1.pdf.
The FCC’s § 271 authorization order for Verizon to provide
long-distance service in New York discussed at great length
Verizon’s commitments to provide access to UNEs, including

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the provision of OSS. In re Application by Bell Atlantic
New York for Authorization Under Section 271 of the Com-
munications Act To Provide In-Region, InterLATA Service
in the State of New York, 15 FCC Rcd. 3953, 3989–4077,
¶¶ 82–228 (1999) (Memorandum Opinion and Order) (herein-
after In re Application). Those commitments are enforce-
able by the FCC through continuing oversight; a failure to
meet an authorization condition can result in an order that
the deficiency be corrected, in the imposition of penalties, or
in the suspension or revocation of long-distance approval.
See 47 U. S. C. § 271(d)(6)(A). Verizon also subjected itself
to oversight by the PSC under a so-called “Performance
Assurance Plan” (PAP). See In re New York Telephone
Co., 197 P. U. R. 4th 266, 280–281 (N. Y. PSC, 1999) (Order
Adopting the Amended PAP). The PAP, which by its terms
became binding upon FCC approval, provides specific finan-
cial penalties in the event of Verizon’s failure to achieve de-
tailed performance requirements. The FCC described Veri-
zon’s having entered into a PAP as a significant factor in its
§ 271 authorization, because that provided “a strong financial
incentive for post-entry compliance with the section 271
checklist,” and prevented “ ‘backsliding.’ ” In re Applica-
tion 3958–3959, ¶¶ 8, 12.
The regulatory response to the OSS failure complained of
in respondent’s suit provides a vivid example of how the reg-
ulatory regime operates. When several competitive LECs
complained about deficiencies in Verizon’s servicing of or-
ders, the FCC and PSC responded. The FCC soon con-
cluded that Verizon was in breach of its sharing duties under
§ 251(c), imposed a substantial fine, and set up sophisticated
measurements to gauge remediation, with weekly reporting
requirements and specific penalties for failure. The PSC
found Verizon in violation of the PAP even earlier, and im-
posed additional financial penalties and measurements with
daily reporting requirements. In short, the regime was an
effective steward of the antitrust function.

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Against the slight benefits of antitrust intervention here,
we must weigh a realistic assessment of its costs. Under
the best of circumstances, applying the requirements of § 2
“can be difficult” because “the means of illicit exclusion, like
the means of legitimate competition, are myriad.” United
States v. Microsoft Corp., 253 F. 3d 34, 58 (CADC 2001) (en
banc) (per curiam). Mistaken inferences and the resulting
false condemnations “are especially costly, because they chill
the very conduct the antitrust laws are designed to protect.”
Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475
U. S. 574, 594 (1986). The cost of false positives counsels
against an undue expansion of § 2 liability. One false-
positive risk is that an incumbent LEC’s failure to provide a
service with sufficient alacrity might have nothing to do with
exclusion. Allegations of violations of § 251(c)(3) duties are
difficult for antitrust courts to evaluate, not only because
they are highly technical, but also because they are likely to
be extremely numerous, given the incessant, complex, and
constantly changing interaction of competitive and incum-
bent LECs implementing the sharing and interconnection
obligations. Amici States have filed a brief asserting that
competitive LECs are threatened with “death by a thousand
cuts,” Brief for New York et al. as Amici Curiae 10 (internal
quotation marks omitted)—the identification of which would
surely be a daunting task for a generalist antitrust court.
Judicial oversight under the Sherman Act would seem des-
tined to distort investment and lead to a new layer of in-
terminable litigation, atop the variety of litigation routes
already available to and actively pursued by competitive
LECs.
Even if the problem of false positives did not exist, conduct
consisting of anticompetitive violations of § 251 may be, as
we have concluded with respect to above-cost predatory
pricing schemes, “beyond the practical ability of a judicial
tribunal to control.” Brooke Group Ltd. v. Brown & Wil-
liamson Tobacco Corp., 509 U. S. 209, 223 (1993). Effective

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remediation of violations of regulatory sharing requirements
will ordinarily require continuing supervision of a highly de-
tailed decree. We think that Professor Areeda got it ex-
actly right: “No court should impose a duty to deal that it
cannot explain or adequately and reasonably supervise. The
problem should be deemed irremedia[ble] by antitrust law
when compulsory access requires the court to assume the
day-to-day controls characteristic of a regulatory agency.”
Areeda, 58 Antitrust L. J., at 853. In this case, respondent
has requested an equitable decree to “[p]reliminarily and
permanently enjoi[n] [Verizon] from providing access to the
local loop market . . . to [rivals] on terms and conditions that
are not as favorable” as those that Verizon enjoys. App.
49–50. An antitrust court is unlikely to be an effective day-
to-day enforcer of these detailed sharing obligations.4
* * *
The 1996 Act is, in an important respect, much more ambi-
tious than the antitrust laws. It attempts “to eliminate the
monopolies enjoyed by the inheritors of AT&T’s local fran-
chises.” Verizon Communications Inc. v. FCC, 535 U. S.,
at 476 (emphasis added). Section 2 of the Sherman Act, by
contrast, seeks merely to prevent unlawful monopolization.
It would be a serious mistake to conflate the two goals. The
Sherman Act is indeed the “Magna Carta of free enterprise,”
United States v. Topco Associates, Inc., 405 U. S. 596, 610
(1972), but it does not give judges carte blanche to insist that
a monopolist alter its way of doing business whenever some
4 The Court of Appeals also thought that respondent’s complaint might
state a claim under a “monopoly leveraging” theory (a theory barely dis-
cussed by respondent, see Brief for Respondent 24, n. 10). We disagree.
To the extent the Court of Appeals dispensed with a requirement that
there be a “dangerous probability of success” in monopolizing a second
market, it erred, Spectrum Sports, Inc. v. McQuillan, 506 U. S. 447, 459
(1993). In any event, leveraging presupposes anticompetitive conduct,
which in this case could only be the refusal-to-deal claim we have rejected.

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other approach might yield greater competition. We con-
clude that respondent’s complaint fails to state a claim under
the Sherman Act.5
Accordingly, the judgment of the Court of Appeals is re-
versed, and the case is remanded for further proceedings
consistent with this opinion.
It is so ordered.
Justice Stevens, with whom Justice Souter and Jus-
tice Thomas join, concurring in the judgment.
In complex cases it is usually wise to begin by deciding
whether the plaintiff has standing to maintain the action.
Respondent, the plaintiff in this case, is a local telephone
service customer of AT&T. Its complaint alleges that it has
received unsatisfactory service because Verizon has engaged
in conduct that adversely affects AT&T’s ability to serve its
customers, in violation of § 2 of the Sherman Act. 15 U. S. C.
§ 2. Respondent seeks from Verizon treble damages, a rem-
edy that § 4 of the Clayton Act makes available to “any per-
son who shall be injured in his business or property.” 15
U. S. C. § 15. The threshold question presented by the com-
plaint is whether, assuming the truth of its allegations, re-
spondent is a “person” within the meaning of § 4.
Respondent would unquestionably be such a “person” if
we interpreted the text of the statute literally. But we have
eschewed a literal reading of § 4, particularly in cases in
which there is only an indirect relationship between the de-
fendant’s alleged misconduct and the plaintiff ’s asserted in-
jury. Associated Gen. Contractors of Cal., Inc. v. Carpen-
ters, 459 U. S. 519, 529–535 (1983). In such cases, “the
importance of avoiding either the risk of duplicate recoveries
5 Our disposition makes it unnecessary to consider petitioner’s alterna-
tive contention that respondent lacks antitrust standing. See Steel Co. v.
Citizens for Better Environment, 523 U. S. 83, 97, and n. 2 (1998); Na-
tional Railroad Passenger Corporation v. National Assn. of Railroad
Passengers, 414 U. S. 453, 456 (1974).

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Stevens, J., concurring in judgment
on the one hand, or the danger of complex apportionment of
damages on the other,” weighs heavily against a literal read-
ing of § 4. Id., at 543–544. Our interpretation of § 4 has
thus adhered to Justice Holmes’ observation that the “gen-
eral tendency of the law, in regard to damages at least, is
not to go beyond the first step.” Southern Pacific Co. v.
Darnell-Taenzer Lumber Co., 245 U. S. 531, 533 (1918).
I would not go beyond the first step in this case. Al-
though respondent contends that its injuries were, like the
plaintiff ’s injuries in Blue Shield of Va. v. McCready, 457
U. S. 465, 479 (1982), “the very means by which . . . [Verizon]
sought to achieve its illegal ends,” it remains the case that
whatever antitrust injury respondent suffered because of
Verizon’s conduct was purely derivative of the injury that
AT&T suffered. And for that reason, respondent’s suit, un-
like McCready, runs both the risk of duplicative recoveries
and the danger of complex apportionment of damages. The
task of determining the monetary value of the harm caused
to respondent by AT&T’s inferior service, the portion of that
harm attributable to Verizon’s misconduct, whether all or
just some of such possible misconduct was prohibited by the
Sherman Act, and what offset, if any, should be allowed to
make room for a recovery that would make AT&T whole, is
certain to be daunting. AT&T, as the direct victim of Veri-
zon’s alleged misconduct, is in a far better position than re-
spondent to vindicate the public interest in enforcement of
the antitrust laws. Denying a remedy to AT&T’s customer
is not likely to leave a significant antitrust violation un-
detected or unremedied, and will serve the strong interest
“in keeping the scope of complex antitrust trials within ju-
dicially manageable limits.” Associated Gen. Contractors,
459 U. S., at 543.
In my judgment, our reasoning in Associated General
Contractors requires us to reverse the judgment of the
Court of Appeals. I would not decide the merits of the § 2

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claim unless and until such a claim is advanced by either
AT&T or a similarly situated competitive local exchange
carrier.