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© FOLEY & LARDNER LLP 2005
Ten Simple Rules That Everyone Should Know About Antitrust Law
David Simon May 2, 2005
© FOLEY & LARDNER LLP 2005
#10 DO NOT DISCUSS PRICES, PLANNED PRICEINCREASES OR CUSTOMER ORDERS WITHCOMPETITORS.
Price fixing is per se illegal.
Bid rigging is per se illegal.
Allocation of customers is per se illegal.
© FOLEY & LARDNER LLP 2005
#9 AGREEMENTS NOT TO COMPETE CAN BEILLEGAL EVEN IF THEY ARE NOT TRADITIONALPRICE FIXING OR BID RIGGING AGREEMENTS.
– Agreements not to compete as to inputs or quality
– Agreements not to compete as to services offered
– Agreements not to offer certain products to certain customers
© FOLEY & LARDNER LLP 2005
#8 ON THE ANTITRUST WHEEL OF FORTUNE, BOTH HUB AND SPOKE ARE BLAMED FOR THE
FLAT.
– Hub can have a vertical relationship with each supplier.
– Hub can be an “agent” or trade association to which the competitors belong.
© FOLEY & LARDNER LLP 2005
#7 THE THREE WORST WORDS AN ANTITRUSTDEFENDANT CAN HEAR:
“PACK YOUR TOOTHBRUSH.”
– DOJ Antitrust Division Obtained More than $450 million in fines from 11 companies in 2004
– At least 20 individuals were indicted on price fixing charges
– Congress significantly increased penalties in 2004 to up to $100 million fine for a corporation and up to $1 million fine plus 10 years in prison for an individual
© FOLEY & LARDNER LLP 2005
#6 WHEN IT COMES TO RELATIONSHIPS, THEANTITRUST LAWS VIEW VERTICAL AS GOOD
ANDHORIZONTAL AS BAD.
– Something of an exaggeration, but horizontal relationships are viewed suspiciously by antitrust authorities and need to be reviewed carefully.
– Many joint ventures can be pro-competitive
– Some ventures may require firewalls or the use of third parties for review of sensitive data
© FOLEY & LARDNER LLP 2005
#5 YOU SHOULD BE NERVOUS ABOUT TRADE ASSOCIATION MEETINGS AND ACTIVITIES.
Trade associations can create a number of pro-competitive benefits.
“Friendly” settings create opportunities for conversations on pricing, bids, and customers
Risk that a standard set by association blocks new entry
© FOLEY & LARDNER LLP 2005
#4 ROBINSON-PATMAN IS ALIVE, WELL AND LIVING IN LITTLE ROCK.
– Your company does not select where it will be sued – plaintiffs select the courthouse.
– The federal system of appellate courts can result in different legal standards in different parts of the country.
© FOLEY & LARDNER LLP 2005
#3 YOU SHOULD WONDER ABOUT HOW THOSE MEMOS YOU WRITE WILL BE UNDERSTOOD BY A JURY.
– Antitrust trials are heard by juries– Jurors may not understand much of what the
economists and lawyers say, but they can understand the “smoking gun” documents and draw their conclusions accordingly.
© FOLEY & LARDNER LLP 2005
#2 PROSECUTORS AND PLAINTIFFS’ LAWYERSLOVE E-MAILS.
– Requests to produce all e-mails have become a routine part of criminal antitrust cases and civil litigation.
– Subpoenas sent to others (i.e., recipients)
– New cottage industry in electronic file retrieval
© FOLEY & LARDNER LLP 2005
#1 WHEN IN DOUBT, CHECK WITH AN EXPERT
– Consult your company’s antitrust compliance policy for guidance
– Consult counsel if you have any doubt
