Competition is an essential part of the American economy, as it drives companies to innovate, keeps prices down and helps to keep them honest. And while it’s generally a good thing when a business does well, sometimes a business does so well that it can potentially stifle competition, hurting the economy. It’s for this reason that antitrust laws were created: to preserve competition and protect consumers from the abuses that might arise in a non-competitive market.
Antitrust law dates to the late 19th century and early 20th century, with laws like the Sherman Act of 1890 and the Clayton Act of 1914. The term “antitrust” comes from massive “trusts” that were, effectively, conglomerates of corporations with a common purpose. These trusts often held sway over entire industries, either stifling or buying up all their competitors. This not only made it impossible to compete, but enabled a variety of shady business practices, including things like price fixing, bid rigging, market allocation, and the creation of monopolies.
Despite its noble intentions, antitrust law has a mixed record of results. The Sherman Act, for example, was often difficult to prosecute against the very trusts it intended to take down and was more often used as a tool for breaking up labor unions when it was first passed. That said, antitrust laws have been used to break up once monolithic entities, such as the Bell System that once controlled the phone networks across the United States, as well as the Standard Oil Company of New Jersey that was ruled to be an oil monopoly.
Antitrust cases have become less common over time, but they remain a potential threat to any business that becomes big enough that it starts to squeeze their competition. The business attorneys at Blodnick, Fazio & Clark have the experience you need to navigate antitrust regulations and protect yourself from legal trouble. If you want assistance in learning how to comply with antitrust laws, or are facing legal trouble related to alleged antitrust violations, please call our Nassau County business lawyers at (516) 280-7105, or, for our Suffolk County business lawyers, call (631) 669-6300.