ANTITRUST Music: Isaac Albeniz, Works for Piano (1889-1909) –Performed by Alicia de Larrocha...

ANTITRUST• Music: Isaac Albeniz, Works for Piano (1889-1909)

– Performed by Alicia de Larrocha (1959)

• Today’s Class:1. Introduction to the Course

a) Generallyb) Mechanicsc) Themes

2. Introduction to the Antitrust Lawsa) Passage of the Statutesb) Practices & Concepts Covered in the Coursec) Enforcement: Possible Goals & Brief History

1. Introduction to the Course

a) Generally: Competition Stories v. Monopoly Stories

b) Mechanics

c) Themes


a) Generally: Comp. Stories v. Monopoly Stories

b) Mechanics: Classroom & Preparationi. Basic Theory: MAF as 3L

ii. Course Page

iii. Reading

iv. Lectures

v. Discussion Problems

c) Themes



b) Mechanics: Graded Worki. Project

ii. Exam

iii. Grading Contract

c) Themes



b) Mechanics:

c) Themesi. Lawyers as Engineers of Social Change

ii. Use of Economics in Legal Argument

iii. Conducting Complex Civil Litigation

2. Introduction to the Antitrust Laws

a) Passage of the Statutesi. Text of the Sherman Act

ii. Background to Passage: US in 1890

iii. Passage of the Clayton Act & FTC Act

b) Practices/Concepts Covered by the Course

c) Enforcement: Goals & Brief History

15 USC §1. Trusts, etc., in restraint of trade illegal; penalty. 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 declared to be illegal. Every person who shall make any contract or engage in any combination or conspiracy hereby declared to be illegal shall be deemed guilty of a felony…

15 USC §2. Monopolizing trade a felony; penalty. 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 felony….



ii. Background to Passage: A. US in 1890: End of the Frontier

B. Productivity Gains & Business Cycles

C. Stated Purposes of Sherman Act




1890: Seeds of the Modern World

End of the Frontier

• Oklahoma Territory Created

• Idaho & Wyoming Admitted to Union

• Battle of Wounded Knee in S.Dakota; Sitting Bull killed;

• Cattlemen & sheepherders begin fighting b/c of lack of range space

New Industrial World

• Around the World in 72 Days

• US has 125,000 miles of RR in operation

• First electric underground railway opens in London

• First female staffer in the White House

Introduced in 1890

• Aluminum saucepan

• Army-Navy football

• Corrugated cardboard box

• Daimler Motorworks

• Emily Dickinson’s Poems

• EverReady Batteries

• Electric chair

• Peanut butter

• Poll Tax and Literacy Tests

• Rock Creek Park, Yosemite & Sequoia Natl Parks

• Sunoco

• Tetanus & Diptheria Antitoxins

• US Weather Bureau

• Cy Young

Born in 1890

• Agatha Christie

• Charles deGaulle

• Marjory Stoneman Douglas

• Dwight David Eisenhower

• Rose Fitzgerald Kennedy

• Groucho Marx

• Ho Chi Minh



ii. Background to Passage: A. US in 1890: End of the Frontier

B. Productivity Gains & Business Cycles

C. Stated Purposes of Sherman Act




Stated Purposes of the Sherman Act

• stop theft (high prices)

• break power of trusts: better off w small businesses

• federalize common law of competition

Stated Purposes of the Sherman Act

• stop theft (high prices)

• break power of trusts: better off w small businesses

• federalize common law of competition

• Some see as empty political move



ii. Background to Passage: US in 1890

iii. 1914: Passage of the Clayton Act & FTC Act




a) Passage of the Statutes



SHERMAN ACT §1

(1) CONCERTED ACTION

(2) RESTRAINT OF TRADE

SHERMAN ACT §1(1) CONCERTED ACTION(2) RESTRAINT OF TRADE

- Per Se Rule- Rule of Reason

HORIZONTAL RESTRAINTSHORIZONTAL RESTRAINTS

• PRICE-FIXING

• MARKET DIVISION

• CONCERTED REFUSALS TO DEAL

HORIZONTAL RESTRAINTSHORIZONTAL RESTRAINTS

• PRICE-FIXING

• MARKET DIVISION

• CONCERTED REFUSALS TO DEAL– NAKED BOYCOTT

– JOINT VENTURES

VERTICAL RESTRAINTSVERTICAL RESTRAINTS

• PRICE-FIXING

• MARKET DIVISION

• SALES ENHANCEMENT

ABUSE OF DOMINANT ABUSE OF DOMINANT POSITIONPOSITION

• (ATTEMPTED) MONOPOLIZATION

• TYING


• (ATTEMPTED) MONOPOLIZATION– MARKET POWER

– CONDUCT

• TYING


• (ATTEMPTED) MONOPOLIZATION

• TYING

MERGERSMERGERS

• HORIZONTAL

• VERTICAL

• CONGLOMERATE

MERGERSMERGERS

• CLAYTON ACT §7

• HART-SCOTT-RODINO

Recurring Concepts

• Defining Market/Market Power

• Per Se Rule v. Rule of Reason (§1 Only)


a) Passage of the Statutes



Possible Goals

• Balance Allocative & Productive Efficiency

• Protect Small Businesses– Concern re Survival: “Right” to Profit– Concern re Concentrated Political Power

• Distributive Justice: Prevent Overcharges to Consumers

• Business Ethics: Outlaw Offensive Commercial Practices

Enforcement History

Prior to WWII: Not lots of enforcement or caselaw

1945-75: Anti-big business tilt; heyday of per se rule & merger enforcement.

1975-1992: SCT & fedl govt move to positions of conservative economists

1992-PRESENT: more complex; SCt & agencies

SCOPE & ENFORCEMENT

1. The Reach of the Antitrust Laws

2. Public Enforcement

3. Private Enforcement

4. Relation Between Procedure & Substance

5. Conduct of Large Private Civil Lawsuit

ANTITRUST Music: Isaac Albeniz, Works for Piano (1889-1909) –Performed by Alicia de Larrocha...

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