I. Enacting Antitrust Laws
Sherman Act of 1890
Section 1: Restraints of Trade
“Every contract, combination in the form of trust or otherwise, or conspiracy, in the restraint of trade or commerce among the several states, or with foreign nations, is hereby declared to be illegal.”
i. Need 2 or more actors
ii. Need proof of an agreement
Section 2: Monopolization
“Every person who shall monopolize or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several states, or with foreign nations, shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by fine not exceeding fifty thousand dollars, or by imprisonments not exceeding one year, or by both said punishments, in the discretion of the court.”
i. Deals with unilateral behavior, no need to collaborate
Enforcement
Via—Antitrust Division of DOJ; private parties; there are criminal penalties, injunctions and damage actions
Clayton Act
§2 prohibits price discrimination between different purchasers where the effect is to substantially lessen competition or tend to create a monopoly.
§3 Restrictive Arrangements prohibits sales on condition that buyer not deal with competitors of the seller where the effect may be to lessen competition
§7 Mergers and Acquisitions
§8 Interlocking directorates
Enforcement
Via—Antitrust Division of DOJ; FTC, private parties, no criminal sanctions
Federal Trade Commission Act (FTC)
§5(a) prohibits unfair methods of competition in commerce and unfair or deceptive acts or practices in commerce
courts have held that it’s broad enough to cover any acts that might be found illegal under Sherman Act
FTC tells corp that a particular conduct is unlawful and to stop conduct; if don’tàcontempt of court
No power o
e actual injury; or ready to go into business
ii. need proximate cause
iii. must be an injury of the type the antitrust laws were intended to prevent
c. Sherman Act Violations
i. DOJ: Civil and Criminal actions
ii. Private parties: treble action (via §4 Clayton); injunctive relief
iii. FTC Commission—indirect via cease and desist orders
d. Clayton Act Violations
iv. DOJ: Civil Actions Only
v. FTC: Civil Actions Only
vi. Private Actions—treble and inj. Relief
e. FTC ACT
vii. FTC only
viii. Cease and desist orders; at discretion of FTC
II. Horizontal Restraints: Collaboration among Competitors–§1
Development of the Rule of Reason
1. In everyone of the following cases there was no question of an agreement
2. US v. Trans-Missouri Freight Assn.
