The Supreme Court has now denied cert in three different challenges to the per se rule in criminal antitrust cases, the latest being the denial of the cross-cert petition by Brent Brewbaker. It is unlikely that a Court of Appeals will overturn the per se rule given the extensive precedent—although it is not impossible. Instead, courts that find fault with the per se rule will likely make an end run around, as has been done in certain labor collusion cases. See e.g., United States v. DaVita Inc., 2022 WL 833368, *2, *5 (D. Colo. 2022) (finding that the DOJ had to show more than that the defendants entered the non-solicitation agreement but would have to prove beyond a reasonable doubt that the defendants entered into an agreement with the purpose of allocating the market” and that the defendants “intended to allocate the market as charged in the indictment.”). The Fourth Circuit also chipped away at the per se rule in United States v. Brewbaker, 87 F.4th 563, 583 (4th Cir. 2023), finding that a vertical component in a relationship between two horizontal competitors who rigged bids on a government contract took the agreement out of the per se rule and into rule of reason land.
It is probably time for me to find a new hobby besides writing on my view of the unconstitutionality of the per se rule. But first, there are a couple of questions to explore: 1) would the lack of a per se rule seriously crimp criminal antitrust enforcement? and 2) if the jury charge did not receive a per se rule charge (i.e. if the court did not instruct the jury that the agreement alleged is an unreasonable restraint of trade) what would the judge charge the jury concerning finding whether the agreement unreasonably restrained trade? The latter question is for later blog post. Below, I share some thoughts on the potential effects of removing the per se rule from criminal antitrust enforcement.
- Would Criminal Antitrust Enforcement be Materially, Negatively Impacted Without the Per Se Rule?
No.. Let’s start with Brewbaker. It was, in most antitrust observers’ opinion, a classic bid rig. One bidder (Pomona) gave its final bid price to another bidder with the understanding that the second bidder (Contech/Brent Brewbaker) would submit an intentionally higher price. In addition to bid rigging, Brewbaker was charged with and convicted on fraud counts which alleged that he falsely and fraudulently certified that the bids his company submitted were competitive and not subject to collusion. This finding makes it highly likely that the jury would also have found Brewbaker guilty of the Sherman Act count if they were the fact finder on whether the alleged agreement was an unreasonable restraint of trade. Of course an...
