• Examination and evidence of anti-competitive effect (usually through the advice of economic experts); • determine whether the restriction is a mere restriction on price or production (which is not related to another pro-competitive good) or an ancillary restriction for other purposes; • Classification of behaviour in context through market analysis (relevant product and geographic markets); • the offsetting effects of pro-competitive effects; • Compensation for the various competitive effects. See e.B. Todd v. Exxon Corporation, 275 F.3d 191, 198-200 (2nd Cir. 2001). Examples of horizontal behavior that are tested according to the rule of reason are: • Price agreements that actually lead to a new product, such as . B a flat-rate licence. Broadcast Music, Inc.c. Columbia Broadcasting System, 441 U.S. 1, 23-24 (1979). Afl addamax, 152 F.3d 48, 51-53 (1998) (the conduct of a joint venture strictly subordinated to the production of a new product is assessed according to the rule of reason). • Spending restrictions within sports leagues. NCAA v Board of Regents of the University of Oklahoma, 468 U.S.
85, 100-01 (1984). • The simple exchange of price information. United States v. U.S. Gysum Co., 438 U.S. 422, 441, no. 16 (1978); Todd v. Exxon Corporation, 275 F.3d 191, 199 (Cir. 2, 2001). • Joint venture agreements. Palmer v.
BRG of Georgia, 498 U.S. 46 (1990); Addamax, 152 F.3d to 52; Guidelines for cooperation § 3.2. • Joint purchasing agreements. See e.B. Cartrade Inc.c. Ford Dealers Adv. Association, 446 F.2d 289 (9th Cir. 1971). See also Guidelines on Collaboration § 3. • Some refusals to process. See e.B U.S.
Healthcare, Inc.c. HealthSource, Inc., 986 F.2d 589, 593 (1st Cir. 1993). • Commitments not to compete. See e.B. National Society of Professional Engineers v. United States, 435 U.S. 679, 689 (1978). • Pooling of patents. Standard Oil Co.c.
United States, 238 U.S. 163 (1931). 3. Shortened rule of reason If conduct does not in itself fall into an earlier category, but has little to recommend from the point of view of competition law, the Court always has the possibility of shortening the rule of rational analysis. See e.B. FTC v. Indiana Federation of Dentists, 476 U.S. 447, 458 (1986) (Condemnation of the joint refusal of dentists to transmit x-rays to insurers according to the abbreviated analysis of the rule of reason).
But see California Dental Association. v. FTC, 526 U.S. 756 (1999) (the FTC`s “Quick Look” rule of reason test was not sufficient to condemn the professional association guidelines; a full analysis of the rule of reason was required). Some channels only require proof that the defendant`s general business activity affects the trade in some way. See e.B. United States v. ORS, Inc., 997 F.2d 628, 629 (9th Cir.
1993). In the First Circuit, however, the courts require that the impugned activity itself be likely to affect the business. Wells Real Estate v Greater Lowell Board of Realtors, 850 F.2d 803, 808-10 (1st Cir. 1988) (the defendant`s “illegal” activity, not just his “activity in general”, must have an impact on interstate commerce); Cordova & Simonpietri Insurance Agency v Chase Manhattan Bank, 649 F.2d 36, 45 (1st Cir. 1981) (equal). But see Tropical Air Flying Services, Inc.c. Carmen Feliciano De Melecio, 158 F. Supp. 2d 177, 183-84 (D.P.R.
2001) (recognizing that the district was almost unanimous summit health v. Pinhas, 500 U.S. 322 (1991), since there is no specific link requirement); San Juan Cement, Inc.c. Puerto Rican Cement Co., 922 F. Supp. 716, 723 (D.P.R. 1996) (equal). A. Price information It should come as no surprise that the price charged by its competitors is key information for a businessman. That is the nature of competition. Knowing what competitors demand can be pro-competitive because it allows the market participant to approach the information that would be available in a perfectly functioning market. Clearly permissible measures include: • Criteria and decisions for accession to the Union.
Z.B. Thompson v. Metropolitan Multi-List, Inc., 934 F.2d 1566, 1580-81 (11th Cir. 1981); American Bar Association, 934 F. Supp. to 435. • Association “codes” for professional conduct and regulation. Z.B. DM Research Inc.c.
College of American Pathologists, 170 F.3d 53, 57 (1. Cir. 1999). • Standardized product selection and specifications. Id. • Items on the agenda of association meetings. See In re Northwest Airlines, p. 202 (activities and discussions that encouraged members to pay more attention to the fight against customers` “hidden ticketing in town” led to a finding of collusion).
Despite all the preparations in the world for trade association meetings, there will be problematic communications at these association meetings. These comments could include: • “Prices in the industry are too low. We slit our throats. Let`s all become rational and reasonable about the prices we charge. • “[The main customer] weighs his full weight. He doesn`t even pay us our fees. We all need to do something. For our part, we will no longer serve them. • “[New product] Y is a deception; it`s no better than what we have on the market now. There is no reason for us to adjust our product specifications to approve this new product.
In addition to ensuring that each professional association to which your client belongs is advised by a competent antitrust lawyer, you should prepare your client`s business people to deal with comments that resemble those described above. The third rail – The hotel room meeting after the working hour on prices or customers. IV. Final thoughts A. Competitors talk all the time. As a consultant, whether internal or external, you will learn some, but not all, of these contacts without further investigation. B. Inform your customers of what is allowed, what is allowed in certain circumstances, and what is almost never allowed. Certain contacts and interactions are clearly permitted under antitrust laws; some are likely to be authorised if treated correctly; some are very risky if they are not examined substantially and carefully; some are clearly inadmissible – the equivalent of the “third rail” antitrust.
C. Encourage them to come and ask you questions. Most antitrust issues don`t come with a handy label on your desk (“It`s a matter of price and joint boycott under Section 1.”) On the contrary, if you`re lucky, the problems pass in front of your desk, more like this: “I`ve heard that XYZ Corporation will increase its prices for the Deluxe line by almost 5% and it will no longer sell to Customer Corp. Is there a problem with the fact that we have increased our published prices on our Premiere line by 4% at all levels? I am also thinking of cutting this Customer Corp. impassive. Do you have any suggestions on how to do this with as little exposure as possible? D. Don`t accept what customers take at face value – push to find out more. There are no easy answers to practical questions in the business world. Clients have different risk tolerances, different abilities to follow guidelines designed to keep them out of trouble, and different tendencies to be open to advice. For some clients, simply receiving a letter of formal notice or an antitrust CID would be enough to put an end to a questionable practice, as such a company does not want to spend resources defending marginal behavior. Other clients take these demands for granted and have sufficient resources to defend what they consider to be their core practices.
Know the customer. The real wording is that “any treaty, any combination in the form of trust or otherwise or conspiracy, aimed at restricting trade or commerce between different states or with foreign nations, is declared illegal.” Section 1 of the Sherman Act prohibits any contract, combination or conspiracy that restricts interstate trade or trade with foreign countries, provided that such restrictions unreasonably restrict competition in a relevant market. C. Customer Credit Information Competitors in any industry will almost by definition try to serve the same customer/clientele. Every competitor who has served a particular customer has information, which is usually very incomplete, in terms of that customer`s credit profile and history. It therefore seems reasonable for competitors to wish to exchange such information if it allows them to better understand the credit risks associated with selling to a particular customer. A mere restriction on trade is an expressly anti-competitive restriction, such as an agreement that controls the price of a product or production resulting from production. Naked withholding without pro-competitive justification is generally considered illegal in itself. That is to say, these practices are inherently anti-competitive and therefore inherently illegal. A court will not assess the allegedly pro-competitive justifications for such an activity. But the courts have long recognized that not all restrictions can be illegal, because even a simple contract between two parties technically restricts trade to a certain level. .