The Sherman Antitrust Act of 1890 is a United States antitrust law which prescribes the rule of free competition among those engaged in commerce and consequently prohibits unfair monopolies. It was passed by Congress and is named for Senator John Sherman, its principal author.
In the United States, antitrust law is a collection of mostly federal laws that regulate the conduct and organization of businesses in order to promote competition and prevent unjustified monopolies. The three main U.S. antitrust statutes are the Sherman Act of 1890, the Clayton Act of 1914, and the Federal Trade Commission Act of 1914. These acts serve three major functions. First, Section 1 of the Sherman Act prohibits price fixing and the operation of cartels, and prohibits other collusive practices that unreasonably restrain trade. Second, Section 7 of the Clayton Act restricts the mergers and acquisitions of organizations that may substantially lessen competition or tend to create a monopoly. Third, Section 2 of the Sherman Act prohibits monopolization.
United States v. Paramount Pictures, Inc., 334 U.S. 131 (1948), was a landmark United States Supreme Court antitrust case that decided the fate of film studios owning their own theatres and holding exclusivity rights on which theatres would show their movies. It would also change the way Hollywood movies were produced, distributed, and exhibited. It also opened the door for more foreign and independent films to be shown in U.S. theaters. The Supreme Court affirmed the United States District Court for the Southern District of New York's ruling that the existing distribution scheme was in violation of United States antitrust law, which prohibits certain exclusive dealing arrangements.
A civil conspiracy is a form of conspiracy involving an agreement between two or more parties to deprive a third party of legal rights or deceive a third party to obtain an illegal objective. A form of collusion, a conspiracy may also refer to a group of people who make an agreement to form a partnership in which each member becomes the agent or partner of every other member and engage in planning or agreeing to commit some act. It is not necessary that the conspirators be involved in all stages of planning or be aware of all details. Any voluntary agreement and some overt act by one conspirator in furtherance of the plan are the main elements necessary to prove a conspiracy.
Block booking is a system of selling multiple films to a theater as a unit. Block booking was the prevailing practice in the Hollywood studio system from the turn of the 1930s until it was outlawed by the U.S. Supreme Court's decision in United States v. Paramount Pictures, Inc. (1948). Under block booking, "independent ('unaffiliated') theater owners were forced to take large numbers of a studio's pictures without knowing much about them. Those studios could then parcel out B movies along with A-class features and star vehicles, which made both production and distribution operations more economical." The element of the system involving the purchase of unseen pictures is known as blind bidding.
Loewe v. Lawlor, 208 U.S. 274 (1908), also referred to as the Danbury Hatters' Case, is a United States Supreme Court case in United States labor law concerning the application of antitrust laws to labor unions. The Court's decision effectively outlawed the secondary boycott as a violation of the Sherman Antitrust Act, despite union arguments that their actions affected only intrastate commerce. It was also decided that individual unionists could be held personally liable for damages incurred by the activities of their union.
Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), was a decision of the Supreme Court of the United States involving antitrust law and civil procedure. Authored by Justice David Souter, it established that parallel conduct, absent evidence of agreement, is insufficient to sustain an antitrust action under Section 1 of the Sherman Act. It also heightened the pleading requirement for federal civil cases by requiring for plaintiffs to include enough facts in their complaint to make it plausible, not merely possible or conceivable, that they will be able to prove facts to support their claims. The latter change in the law has been met with a great deal of controversy in legal circles, as evidenced by the dissenting opinion from Justice John Paul Stevens.
Fashion Originators' Guild of America v. FTC, 312 U.S. 457 (1941), is a 1941 decision of the United States Supreme Court sustaining an order of the Federal Trade Commission against a boycott agreement among manufacturers of "high-fashion" dresses. The purpose of the boycott was to suppress "style piracy". The FTC found the Fashion Guild in violation of § 5 of the FTC Act, because the challenged conduct was a per se violation of § 1 of the Sherman Act.
Spectrum Sports, Inc. v. McQuillan, 506 U.S. 447 (1993), was a case in which the Supreme Court of the United States rejected the assertion that attempted monopolization may be proven merely by demonstration of unfair or predatory conduct. Instead, conduct of a single firm could be held to be unlawful attempted monopolization only when it actually monopolized or dangerously threatened to do so. Thus, the Court rejected the conclusion that injury to competition could be presumed to follow from certain conduct. The causal link must be demonstrated.
Bigelow v. RKO Radio Pictures, Inc., 327 U.S. 251 (1946), was a decision by the United States Supreme Court allowing an action to recover compensatory damages under the antitrust statutes. The jury had returned a verdict for $120,000 in petitioner's favor, covering a five-year period where plaintiff suffered due to respondents' antitrust conspiracy. The trial court, sitting in the Northern District of Illinois, gave judgment for treble damages, as prescribed by § 4 of the Clayton Act. The 7th Circuit reversed on the sole ground that the evidence of damage was not sufficient for submission to the jury, and directed the entry of judgment for respondents non obstante veredicto. The Supreme Court granted certiorari to determine whether the evidence of damage was sufficient to support the verdict. Respondents argued that any measure of damages would be too speculative and uncertain to afford an accurate measure of the amount of the damage. The Supreme Court disagreed, not wanting to let the respondent defeat a remedy because its antitrust violation was so effective and complete. The Court held that the jury could return a verdict for the plaintiffs, even though damages could not be measured with the exactness which would otherwise have been possible, so long as the jury made a "just and reasonable estimate of the damage based on relevant data". The judgment of the district court was affirmed and the judgment of the court of appeals was reversed.
In law, a conspiracy theory is a theory of a case that presents a conspiracy to be considered by a trier of fact. A basic tenet of "traditional 'conspiracy theory'" is that each co-conspirator is liable for acts of co-conspirators "during the existence of and in furtherance of the conspiracy". Procedures and proof requirements for conspiracy theory litigation as well as the definition of 'conspiracy' vary by jurisdiction and body of law. In civil litigation, it can offer advantages relative to aiding-and-abetting or joint tortfeasor case theories.
Walker Process Equipment, Inc. v. Food Machinery & Chemical Corp., 382 U.S. 172 (1965), was a 1965 decision of the United States Supreme Court that held, for the first time, that enforcement of a fraudulently procured patent violated the antitrust laws and provided a basis for a claim of treble damages if it caused a substantial anticompetitive effect.
United States v. Parke, Davis & Co., 362 U.S. 29 (1960), was a 1960 decision of the United States Supreme Court limiting the so-called Colgate doctrine, which substantially insulates unilateral refusals to deal with price-cutters from the antitrust laws. The Parke, Davis & Co. case held that, when a company goes beyond "the limited dispensation" of Colgate by taking affirmative steps to induce adherence to its suggested prices, it puts together a combination among competitors to fix prices in violation of § 1 of the Sherman Act. In addition, the Court held that when a company abandons an illegal practice because it knows the US Government is investigating it and contemplating suit, it is an abuse of discretion for the trial court to hold the case that follows moot and dismiss it without granting relief sought against the illegal practice.
United States v. Motion Picture Patents Co., 225 F. 800, was a civil antitrust prosecution overlapping to some extent with the issues in the decision in the Supreme Court's Motion Picture Patents case. After the trial court found that the defendants violated §§ 1 and 2 of the Sherman Act by establishing control over "trade in films, cameras, projecting machines, and other accessories of the motion picture business," by their patent licensing practices and other conduct, they appealed to the Supreme Court. After the Supreme Court's 1917 decision in Motion Picture Patents Co. v. Universal Film Manufacturing Co., however, the parties dismissed the appeal by stipulation in 1918 that the decision had made the defendants' appeal futile.
Lorain Journal Co. v. United States, 342 U.S. 143 (1951), is a decision of the United States Supreme Court that is often cited as an example of a monopolization violation being based on unilateral denial of access to an essential facility although it in fact involved concerted action. When the Lorain Journal monopoly over advertising in the Lorain, Ohio, area was threatened by the establishment of a competing radio station, the newspaper's publisher refused to accept advertising from those who advertised over the radio station and required them to advertise only in the Journal. The purpose of the publisher was to eliminate the competition of the radio station. The Supreme Court held that the publisher had attempted to monopolize trade and commerce in violation of § 2 of the Sherman Antitrust Act and was properly enjoined from continuing its conduct.
United States v. United States Gypsum Co. was a patent–antitrust case in which the United States Supreme Court decided, first, in 1948, that a patent licensing program that fixed prices of many licensees and regimented an entire industry violated the antitrust laws, and then, decided in 1950, after a remand, that appropriate relief in such cases did not extend so far as to permit licensees enjoying a compulsory, reasonable–royalty license to challenge the validity of the licensed patents. The Court also ruled, in obiter dicta, that the United States had standing to challenge the validity of patents when a patentee relied on the patents to justify its fixing prices. It held in this case, however, that the defendants violated the antitrust laws irrespective of whether the patents were valid, which made the validity issue irrelevant.
A hub-and-spoke conspiracy is a legal construct or doctrine of United States antitrust and criminal law. In such a conspiracy, several parties ("spokes") enter into an unlawful agreement with a leading party ("hub"). The United States Court of Appeals for the First Circuit explained the concept in these terms:
In a "hub-and-spoke conspiracy," a central mastermind, or "hub," controls numerous "spokes," or secondary co-conspirators. These co-conspirators participate in independent transactions with the individual or group of individuals at the "hub" that collectively further a single, illegal enterprise.
United States v. Masonite Corp., 316 U.S. 265 (1942), is a United States Supreme Court decision that limited the scope of the 1926 Supreme Court decision in the General Electric case that had exempted patent licensing agreements from antitrust law's prohibition of price fixing. The Court did so by applying the doctrine of the Court's recent Interstate Circuit hub-and-spoke conspiracy decision.
United States v. Line Material Co., 333 U.S. 287 (1948), is a decision of the United States Supreme Court limiting the doctrine of the 1926 General Electric decision, excusing price fixing in patent license agreements. The Line Material Court held that cross-licenses between two manufacturer competitors, providing for fixing the prices of the licensed products and providing that one of the manufacturers would license other manufacturers under the patents of each manufacturer, subject to similar price fixing, violated Sherman Act § 1. The Court further held that the licensees who, with knowledge of such arrangements, entered into the price-fixing licenses thereby became party to a hub-and-spoke conspiracy in violation of Sherman Act § 1.
United States v. Dentsply Int'l, Inc., was a 2005 Third Circuit antitrust decision in the United States finding that Dentsply, a monopolist manufacturer-supplier of dental supplies, used its exclusive dealing policy to keep rival firms' sales "below the critical level necessary for any rival to pose a real threat to Dentsply's market share,".
