Antitrust laws exist to ensure that businesses compete against each other in a reasonable and fair way. Federal and state laws forbid anti-competitive behavior and unfair business practices that damage other businesses and consumers. Examples of these unlawful, anti-competitive practices include:
Predatory pricing: A dominant company temporarily prices a product low enough to end a competitive threat from other businesses in order to protect market share.
Bid-rigging: Bidders agree in advance of the bidding process to designate a particular member to win what was intended to be a competitive bid.
Monopolization: A company dominates a market or service to the ruling out of others.
Private antitrust lawsuits are often brought as class actions. Class actions allow hundreds or thousands of individuals or businesses that are injured by the same anti-competitive behavior to prosecute litigations in a single court. Class actions avoid duplicative time, effort and expense involved in prosecuting many individual actions.
In the United States, there are both state and federal antitrust laws. Enforcement of these laws takes three forms:
The federal government, via both the Antitrust Division of the United States Department of Justice and the Federal Trade Commission, can bring civil lawsuits enforcing the laws. The United States Department of Justice alone may bring criminal antitrust suits under federal antitrust laws. Perhaps the most famous antitrust enforcement actions brought by the federal government were the break-up of AT&T's local telephone service monopoly in the early 1980s and its actions against Microsoft in the late 1990s.
Additionally, the federal government also reviews potential mergers to attempt to prevent market concentration. As outlined by the Hart-Scott-Rodino Antitrust Improvements Act, larger companies attempting to merge must first notify the Federal Trade Commission and the Department of Justice's Antitrust Division prior to consummating a merger. These agencies then review the proposed merger first by defining what the market is and then determining the market concentration using the Herfindahl-Hirschman Index (HHI) and each company's market share. The government looks to avoid allowing a company to develop market power, which if left unchecked could lead to monopoly power.
State attorneys general may file suits to enforce both state and federal antitrust laws.
Private civil suits may be brought, in both state and federal court, against violators of state and federal antitrust law. Federal antitrust laws, as well as most state laws, provide for triple damages against antitrust violators in order to encourage private lawsuit enforcement of antitrust law. Thus, if a company is sued for monopolizing a market and the jury concludes the conduct resulted in consumers' being overcharged $200,000, that amount will automatically be tripled, so the injured consumers will receive $600,000. The United States Supreme Court summarized why Congress authorized private antitrust lawsuits in the case Hawaii v. Standard Oil Co. of Cal., 405 U.S. 251, 262 (1972):
Every violation of the antitrust laws is a blow to the free-enterprise system envisaged by Congress. This system depends on strong competition for its health and vigor, and strong competition depends, in turn, on compliance with antitrust legislation. In enacting these laws, Congress had many means at its disposal to penalize violators. It could have, for example, required violators to compensate federal, state, and local governments for the estimated damage to their respective economies caused by the violations. But, this remedy was not selected. Instead, Congress chose to permit all persons to sue to recover three times their actual damages every time they were injured in their business or property by an antitrust violation. By offering potential litigants the prospect of a recovery in three times the amount of their damages, Congress encouraged these persons to serve as "private attorneys general."
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If you think you might have an Antitrust case, you are encouraged to contact the law firm of Audet & Partners, LLP at 800.965.1461 to speak to an attorney. The call is free, and there is no obligation. You may also email us. Act now, as delays can harm your case.