In 1890, Congress passed the Sherman Anti-Trust Act in an effort to prevent unfair competition through monopolies and trusts (trade contracts). A monopoly exists when one business controls all, or the majority of, a particular market.
Monopolies are harmful to competition because when one firm or agency controls a particular market the lack of competition adversely affects consumers. For example, a firm with a monopoly can charge whatever they want for their good or service because there is no competition to drive down prices.
Does the Sherman Act Apply to All Businesses?
The Constitution limits the application of the Act to any activities related to interstate commerce. This includes local business and transactions that have an "affect" on interstate commerce. So the Sherman Act is broadly interpreted to protect consumers from monopolistic activities.
What Are the Penalties for Violating the Sherman Act?
It is considered a felony for an individual or corporation to monopolize any part of interstate trade or commerce. Also included are attempts to monopolize, or conspiring to monopolize trade. If found guilty, an individual can face a fine of up to $350,000 and imprisonment of up to three years. Corporations can face a fine of up to $10,000,000. The government also has the power to seize any property related to the unlawful trade practice.
Do I Need a Lawyer for My Sherman Act Problem?
Antitrust and Unfair Competition law is a very complicated area of the law. An experienced business lawyer can help guide you through the legal process and make sure all of your rights are protected. An antitrust attorney can also protect you from prosecution by the government.