What Is The Sherman Anti-Trust Act Or Modern Competition Law?
Introduction
It is a well settled notion in common law that agreements which impose restraints on trade are not enforceable. This notion was developed further in the late 19th century and late 20th century and made applicable to what we call ‘competition law’ in the USA. It is important to note that the enactment of the Sherman Anti-trust Act, 1890 was a reason for this development.
What is the correlation between ‘restraint of trade doctrine’ and ‘modern competition law’? This article seeks to examine the relationship between the two by tracing back cases when the Sherman Act was newly enacted and the interpretation given by the US Supreme Court. The article has two parts. Part I deals with the doctrine of restraint of trade in order to …show more content…
As a result of this, one of the great accomplishments of Taft’s Addyston Pipe opinion was to fuse the neoclassical model of competition with the legal doctrine of combinations in restraint of trade. In the process Judge Taft created the illusion that the law of combinations in restraint of trade had always been concerned with “competition,” neoclassically defined. The result was a thoroughly neoclassical Sherman Act. Taft’s analysis so overwhelmed future antitrust case law that Holmes’s dissenting position in Northern Securities , six years later, although historically more correct, was all but …show more content…
The answer depended, according to the defendants, on whether the Association was illegal at common law, and they supported their view by pointing to the title of the act, which reads, “to protect trade and commerce against unlawful restraints and monopolies.” But Peckham, speaking for the majority of the Court, maintained that the title did not refer to restraints and monopolies that were illegal by common-law principles but to those that were “made unlawful in the body of the statute.” Contracts in restraint of trade, Peckham reasoned, were a familiar category at common law, and had come to be divided into two classes. “Some of such contracts have been held void and unenforceable in the courts by reason of their restraint being unreasonable, while others have been held valid because they were not of that nature. A contract may be in restraint of trade and still be valid at common law.” But the Sherman Act had erased this distinction.
When, therefore, the body of an act pronounces as illegal every contract or combination in restraint of trade or commerce among the several States, etc., the plain and ordinary meaning of such language is not limited to that kind of contract which is in unreasonable restraint of trade, but all contracts are included in such language, and no exception or limitation can be added without
It is a well settled notion in common law that agreements which impose restraints on trade are not enforceable. This notion was developed further in the late 19th century and late 20th century and made applicable to what we call ‘competition law’ in the USA. It is important to note that the enactment of the Sherman Anti-trust Act, 1890 was a reason for this development.
What is the correlation between ‘restraint of trade doctrine’ and ‘modern competition law’? This article seeks to examine the relationship between the two by tracing back cases when the Sherman Act was newly enacted and the interpretation given by the US Supreme Court. The article has two parts. Part I deals with the doctrine of restraint of trade in order to …show more content…
As a result of this, one of the great accomplishments of Taft’s Addyston Pipe opinion was to fuse the neoclassical model of competition with the legal doctrine of combinations in restraint of trade. In the process Judge Taft created the illusion that the law of combinations in restraint of trade had always been concerned with “competition,” neoclassically defined. The result was a thoroughly neoclassical Sherman Act. Taft’s analysis so overwhelmed future antitrust case law that Holmes’s dissenting position in Northern Securities , six years later, although historically more correct, was all but …show more content…
The answer depended, according to the defendants, on whether the Association was illegal at common law, and they supported their view by pointing to the title of the act, which reads, “to protect trade and commerce against unlawful restraints and monopolies.” But Peckham, speaking for the majority of the Court, maintained that the title did not refer to restraints and monopolies that were illegal by common-law principles but to those that were “made unlawful in the body of the statute.” Contracts in restraint of trade, Peckham reasoned, were a familiar category at common law, and had come to be divided into two classes. “Some of such contracts have been held void and unenforceable in the courts by reason of their restraint being unreasonable, while others have been held valid because they were not of that nature. A contract may be in restraint of trade and still be valid at common law.” But the Sherman Act had erased this distinction.
When, therefore, the body of an act pronounces as illegal every contract or combination in restraint of trade or commerce among the several States, etc., the plain and ordinary meaning of such language is not limited to that kind of contract which is in unreasonable restraint of trade, but all contracts are included in such language, and no exception or limitation can be added without