ch46

West's Business Law with Online Research Guide, 9th Edition

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FEDERAL ANTITRUST LAW: OVERVIEW The Sherman Antitrust Act prohibits (1) contracts, combinations, and conspiracies in restraint of interstate trade or commerce , and (2) actual or attempted monopolization of interstate trade or commerce by one or more persons. The Clayton Act (as amended by the Robinson-Patman Act ) prohibits any person engaged in interstate commerce from (1) practicing price discrimination among customers that cannot be justified by differences in production costs, transportation costs, or other cost differences; (2) entering into exclusive dealing or tying arrangements that restrain interstate trade or commerce; and (3) effecting any merger the effect of which may be to substantially lessen competition. The Federal Trade Commission Act prohibits “unfair methods of competition” and “unfair or deceptive acts or practices” in or affecting interstate commerce. Ch. 46: Antitrust Law - No. 1 West’s Business Law (9th ed.)
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TESTING ALLEGED VIOLATIONS Alleged violations of the Sherman and Clayton Acts are tested against one of two standards: Per Se Violation: Certain anticompetitive acts or agreements ( e.g. , a price fixing agreement among competitors) are considered to be so injurious to the public that there is no need to determine whether competition is actually reduced or otherwise injured – they are violations of the Sherman Act per se ; and Rule of Reason: Acts or agreements that are not considered to be illegal per se are analyzed by comparing their positive effects ( e.g. , efficiency) against their potentially anticompetitive effects. If the act or agreement is found not to unreasonably restrain trade , it will not be considered a violation of the Sherman Act. Less Restrictive Means: Courts will often look to see if the parties could have achieved the same benefits using means that would have had a less restrictive effect on competition. Ch. 46: Antitrust Law - No. 2 West’s Business Law (9th ed.)
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HORIZONTAL RESTRAINTS Horizontal Restraint: Any agreement that restrains competition between rival firms operating in the same geographic or product market. Price Fixing: An agreement between competitors to fix the prices of products or services. Such agreements are illegal per se . Group Boycott: An agreement between sellers to boycott, or refuse to deal with, a particular person or group of persons. Such agreements are illegal per se . Market Division: An agreement between sellers to divide territories or customers into smaller, exclusive markets. Such agreements are illegal per se . Trade Association:
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ch46 - FEDERAL ANTITRUST LAW: OVERVIEW The Sherman...

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