Federal Government Cracking Down on Criminal Antitrust Violations

The Department of Justice’s Antitrust Division opened 146 grand jury investigations last year, the most in thirty years. The federal government has requested a budget increase of 9% for the Antitrust Division.

It’s obvious this is going to be a hot area in white collar criminal defense. It’s been 50 years since the DOJ last pursued a criminal monopolization case. 

What counts as an antitrust violation?

Common violations include: 

  • Price fixing
  • Bid rigging
  • Agreements between two companies that they won’t compete over  a certain product, or over certain geographic areas.
  • Tying, which is the practice of refusing to sell Product A without Product B, if you have market power over Product A, thus coercing buyers to buy a product. 
  • Monopolization, which is when a dominant company seeks to maintain or increase market share by engaging in unfair anti-competitive practices. 

What is Section 1 of the Sherman Act?

Section 1 of the Sherman Act is the section of antitrust law that is more commonly approached. This involves making illicit agreements with other companies to engage in price-fixing, bid-rigging, or customer and market allocation. 

These cases usually involve clandestine activity and cover-ups. Normal market fluctuations in prices aren’t what the federal government is looking for. To prove a Section 1 violation, the government must prove, beyond a reasonable doubt, that an agreement existed

What is Section 2 of the Sherman Act?

Section 2 is the section of the Sherman Act that makes it unlawful for any person to “monopolize, attempt to monopolize, or combine or conspire with any other persons to monopolize any part of the trade or commerce among the several States, or with foreign nations. 

Monopolization requires monopoly power and the willful acquisition or maintenance of that power, as separate from growth and development arising as a consequence of having a superior product, business acumen, or historic accident. If a tornado wiped out all of your competitors tomorrow and left your company as the only game in town in a certain market, you cannot be accused under this Act. You must be engaged in specific anti-competitive conduct with a specific intent to monopolize. It is about attempting to destroy competition.

Section 2 has rarely been used to launch a criminal case. It is often difficult to distinguish criminal conduct from perfectly legitimate business practices, and most prosecutors prefer to stick to Section 1 violations as a result. 

Defending Criminal Antitrust Charges

Executives can and do go to jail due to antitrust charges. Each case is different, requiring an in-depth knowledge of business practices and the most effective defenses in your specific case.

If you’re in trouble or think you’re about to be, call our offices for help. Don’t be caught off-guard. You’ll need an experienced federal criminal defense attorney to defend your rights and freedom.

See also:

What is a RICO Charge?

What is a Kickback and Why is it Illegal?

4 Mistakes to Avoid if You’re Under Investigation for White Collar Crime