A PYMNTS Company

Joint State and Federal Enforcement of the Antitrust Laws: More Historic than Conflicting

 |  November 26, 2012

Posted by D. Daniel Sokol

James A. Donahue, III (Pennsylvania Office of Attorney General) addresses Joint State and Federal Enforcement of the Antitrust Laws: More Historic than Conflicting.

ABSTRACT: The concept of a statute to temper or eradicate the market power of trusts and cartels of businesses that agreed not to compete against one another first arose in state legislatures, notably Missouri and Kansas, prior to the passage of the Sherman Act in 1890. These statutes codified and expanded common law prohibitions on monopolies and restraints of trade that had their foundation in the common law of England.

The Sherman Act and the Clayton Act, passed in 1912, vested, in the federal government, the authority the states had exercised to break up trusts and monopolies. With the passage of these laws state enforcement waned until the passage of the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

That act provided funding for states to start, or restart, an antitrust enforcement unit. The event prompting such funding was the rejection of several classes where consumers were the ultimate victims of an antitrust violation, but the court refused to certify a class. The Hart-Scott-Rodino Act addressed that problem through two prongs, one funding state antitrust enforcement and another allowing Attorneys General to bring damages actions as parens patriae on behalf of natural person consumers for violations of the Sherman and Clayton Acts.