Select Page

Wayne State University Law School
Calkins, Stephen

Anybody injured by violation of Antitrust laws can file lawsuit—if win get treble damages (3 times amount of award PLUS Atty’s fees
            SHERMAN ACT §1
Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with Foreign nations, is hereby declared to be illegal
            – Only unreasonable restraints of trade are illegal
– Only those contracts where direct and immediate effect is a restraint upon interstate commerce are illegal
– Rule of Reason – taking all factors into account; facts peculiar to the business, history of the restraint, the reasons why it was imposed – is there an undue restriction of competition?
o Are the restraints ancillary to a legitimate purpose?  If yes = legal. If no = illegal.
o The true test of legality is whether the restraint imposed is such as merely regulates and perhaps thereby promotes competition or whether it is such as may suppress or even destroy competition
o Restraints for the sole purpose and object of restraining competition are illegal. It makes no difference how reasonable prices are, how much competition there was, or what the necessity of preventing financial distress
Price Fixing
– Price fixing with cartels “binds” no one but the members of the cartels
– Decreased quality
– Decreased uncertainty
– Easier entrance to market
– Stable if not increasing wages for employees, consumer search decreases
If NO price fixing: 1) Companies will compete on factors other than price – which may lead to increased quality, 2) Entry more difficult, 3) Increased consumer search
Cartels: agreement among existing firms in the prices they will charge-it doesn’t bind anyone else
            STD OIL v US

renton Potteries—PER SE RULE
Uniform price-fixing by those controlling in any substantial manner a trade or business in interstate commerce is particular prices agreed upon…
Reasonableness is immaterial—agreements to fix prices are per se illegal
Even though D’s did not agree on prices—just to buy distressed gasoline—no difference. There purpose was to maintain and raise spot market prices
Ct: Under the Sherman Act-a combination formed for the purpose and with the effect of fixing prices or contributed to that result is proof of conspiracy under §1
            Hypo: 2 (little) parking lot owners agree to set price of $25
Do not have control over all other lots in Detroit.—Still Illegal