April 30, 2010, Newsletter Issue #16: What Laws Govern Antitrust Litigation?

Tip of the Week

Both state and federal laws are in place for antitrust matters. The laws are in place to prevent companies and individuals from creating monopolies. If a company or an individual creates a monopoly, the market might become stagnant, and that company can also charge more than a fair price for services and products.

The first antitrust law enacted was the Sherman Antitrust Act of 1890. The Sherman Antitrust Act, enacted by Congress, removes limits on competitive trade. This Act covers interstate business transactions.

The Federal Trade Commission Act also has antitrust laws. These laws deal with a number of antitrust matters including unfair methods of competition. Since it does not define unfair methods, this is left open to interpretation. This leaves openings for many antitrust lawsuits that may or may not work in the plaintiff’s favor, depending on the circumstances of the lawsuit. The Federal Trade Commission enforces its antitrust laws and looks at each case on its own merits.

The Clayton Act is another antitrust law. The Clayton Act covers mergers and acquisitions, and disallows a merger or acquisition that, if formed, creates a monopoly. The Clayton Act, like the Federal Trade Commission antitrust law, is applied on a case-by-case basis.

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