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Antitrust Laws

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What Is Antitrust Law?

Antitrust laws are designed to ensure free competition in the U.S. marketplace by regulating the ways in which companies conduct their business. Antitrust law prohibits practices that stifle free competition, such as monopolies, lockup agreements, certain types of mergers, and price-fixing.

How Do Antitrust Laws Apply to Business Practices?

Much of the antitrust law is found in the Sherman Act, which is a federal statute that prohibits "every contract, combination, or conspiracy in restraint of trade," and any "monopolization, attempted monopolization, or conspiracy or combination to monopolize."

However, the Supreme Court decided that the Sherman Act does not prohibit every restrain on trade, but only those that are unreasonable. Unreasonable restraints of trade include:

  • Forcing or coercing someone to quit doing business or to change their business so that they won’t compete in the market.
  • Agreeing to fix prices to force other competitors out of business.
  • Creating a monopoly.
  • Creating a non-compete clauses or other contract provisions to keep another out of business.
  • Tortious interference with a contract or business agreement that negatively affects another’s ability to do business freely.

How Are Antitrust Laws Enforced?

Antitrust laws are enforced through the government and the people. There are criminal and civil penalties for any violation of antitrust laws. Individuals that are found in violation of antitrust laws can face penalties such as fines, damage awards and even prison time. The government encourages private individuals to report and take action when they see an antitrust violation, which is why they allow individuals and companies to be able to bring suit. In addition, federal and state antitrust laws provide for triple damages.

What Are Some Examples of Antitrust Laws Being Violated?

Some examples of Anti-trust laws that are being violated are:

  • large price changes of very similar product
  • suspicious statements from seller
  • company having low bidder on all contracts
  • having large unexplainable dollar difference between bids

How Do Antitrust Laws Apply to the Health Care Industry?

Antitrust law in the health care industry have only developed recently, within the past thirty years. Before the 1970s, antitrust laws were generally not applied to "learned professions" like medicine and law. During that time, however, health care expanded from a local profession to a national service. In 1975, the Supreme Court ruled that antitrust law is applicable to the practice of medicine, and other "learned professions."

Do I Need a Business Attorney?

An antitrust attorney will advise you on whether the business practice you are associated with complies with competition and trade regulation. In doing so, an attorney will undertake a broad range of different legal activities, including litigation, government investigation, merger advice, and counseling.

Photo of page author Kourosh Akhbari

, LegalMatch Legal Writer

Last Modified: 01-25-2017 12:36 PM PST

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