DEFINITION

• Antitrust Law is the body of law designed to protect trade and commerce from unfair restraints, monopolies and price-fixing. Antitrust law is primarily governed by two federal laws: the Sherman Act and the Clayton Act.

• Most states have antitrust laws patterned on the federal laws.

• Civil and criminal penalties may apply if a company is determined to be in violation of antitrust laws. Criminal acts are punishable by large fines and/or imprisonment. The Department of Justice (DOJ) investigates antitrust matters and is authorized to convene a grand jury. Civil remedies include injunctions, divestiture and/or cancellation of contracts.

• The Federal Trade Commission (FTC) is the agency of the federal government that seeks to promote free and fair competition in interstate commerce. The FTC also retains exclusive jurisdiction to prohibit unfair competition and unfair or deceptive acts in or affecting commerce.

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RELATED PRACTICE AREAS

Intellectual Property Law
Business & Commercial Law
Health & Health Care Law

BUZZWORDS

Clayton Act - An amendment to the Sherman Act, the Clayton Act prohibits price discrimination, exclusive dealing contracts and mergers where the effect may lessen competition or tend to create a monopoly in commerce. (15 U.S.C. Sec. 12-27)

Department of Justice (DOJ) - An executive department of the federal government, headed by the Attorney General. Seeks to enforce, investigate and detect violation of federal laws.

Federal Trade Commission (FTC) - The agency of the federal government that seeks to promote free and fair competition in interstate commerce through prevention of trade restraints such as price-fixing agreements, false advertising, illegal combinations of competitors and other unfair methods of competition.

Monopoly - A privilege or advantage held by one or more companies, consisting of the exclusive power to carry on a business or trade, manufacture an article or control the sale or supply of a particular commodity. A form of market structure in which one or only a few firms dominate the total sales of a product or service.

Price-Fixing - A business relationship formed for the purpose of raising, depressing, fixing or stabilizing the price of a commodity.

Restraint of Trade - Contracts designed to eliminate or stifle competition, effect a monopoly, artificially maintain prices, or otherwise hamper or obstruct the course of trade and commerce as it would be carried out if left to the control of natural economic forces.

Sherman Act - A federal law that prohibits any unreasonable interference with the ordinary, usual and freely competitive pricing or distribution system of the open market in interstate trade. (15 U.S.C. Sec. 1-7)

Unfair Competition - Dishonest rivalry in trade and commerce. The body of law protecting the first user of a name, brand, size, shape or other distinctive characteristic against an imitating or counterfeiting competitor.

PRACTICE AREA NOTES

• Attorneys who practice Antitrust Law are either corporate counsel for a large company, employed by a firm that handles corporate clients and their interests, or legal counsel for the Department of Justice (DOJ) or Federal Trade Commission (FTC).
• Current topics in Antitrust Law include consumer protection in cyberspace, antitrust issues in the medical field (unionization of doctors, mergers of healthcare facilities), and deregulation of utilities.