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ch19 - Chapter 19 Antitrust Law Antitrust Law competitors a

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Chapter 19 Antitrust Law
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Antitrust Law Antitrust law addresses  prohibitions on attempts  by competitors to  restrain  competition  and  injure  competitors. Antitrust statutes require  the  courts  to determine  what really constitutes  antitrust law  - therefore  “Antitrust Law” refers to  antitrust statutes and the  interpretation of these  statutes by the courts.
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Federal Antitrust Legislation Major Laws: Sherman Act Clayton Act (amended by Robinson-Patman) Federal Trade Commission Act Courts generally must decide how they will be applied; most major cases brought by FTC or Department of Justice
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The Sherman Act Passed by Congress in  1890 Regarded largely as a way  to reduce concerns that  large business interests  dominated Congress. The major sections of the  Act are so broad that one  could find almost any  business activity to be  illegal.
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Exemptions NOT ALL BUSINESSES ARE SUBJECT TO ANTITRUST LAWS Clayton Act   exempts some activities of nonprofit and certain  agricultural/horticultural organizations Labor unions, baseball. Covenants not to compete. Patents, copyrights. Interstate Commerce Act   allows the federal government to  regulate motor, rail, air, and ship common carriers  (public  transport).  If the government approves the actions of the  businesses, the businesses are exempt.  If they do not approve,  antitrust laws apply. The Export Trading Company Act   allows limited antitrust immunity  for export sellers who join together to enhance their ability to  export (not very effective or much used). Parker doctrine  allows state government to restrict competition in  public utilities & transportation and professional services (the state  action doctrine).  
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The Sherman Act Basically, two provisions: Prohibits Agreements  in Restraint of Trade; Need more than one party to have an agreement; Prohibits monopolies or attempts to monop.
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The Sherman Act Prohibits Agreements in Restraint of Trade; Need more than one party to have an agreement. Law prohibits all restraints of trade.Cannot  possibly be done, so Rule of Reason: Courts held that only  unreasonable restraints were illegal. Per se violations: Violations that are so  anticompetitive, that they are automatically  illegal.  No defense.
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The Sherman Act Per se violations: 1.  Horizontal price fixing :  Two or more competitors  at the same level of distribution agree to charge the  same price for competing goods.
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