Search Site
Menu
The Federal Antitrust Law Exemption for State Action

Federal antitrust laws are considered inapplicable to economic regulation by the States. In Parker v. Brown, 317 U.S. 341 (1943), the Supreme Court reasoned that in the “dual system of government” of the United States, any subtraction by Congress from the sovereign powers of the states must be explicitly stated. Nothing in the Sherman Act (the first federal antitrust law) or in the legislative history of the Sherman Act indicated a Congressional intent to subject state regulatory activities to the Sherman Act.

Federal antitrust laws, thus, are directed at private conduct generally rather than state conduct, and state action in effect is exempted from federal antitrust law. To the extent that anticompetitive conduct can be shown to be the result of state activity, federal antitrust laws will be considered inapplicable.

The state action doctrine has provided the basis for rulings that various types of conduct were permissible under federal antitrust laws due to state involvement. For example, bar association conduct regarding lawyers has been considered exempt state action due to the bar’s function in enforcing rules of the state’s Supreme Court. Awards of exclusive state contracts have been considered exempt from application of federal antitrust laws despite the anticompetitive effect of such awards.

The state action doctrine has limits. Thus, actions of a municipality may not be considered exempt from application of federal antitrust laws unless the actions can be tied to requirements or policies of the state or its agencies. Before anticompetitive actions of a municipality or other entity may be deemed exempt under the state action doctrine from federal antitrust law, it must be shown that the actions were taken pursuant to a clearly expressed state policy. For example, a general grant of home rule to a local government has been considered insufficient to shield the local government’s actions from application of federal antitrust law.

Specificity in a state’s policy to displace competition is required to shield activities from federal antitrust law under the state action doctrine. If there is such specificity, then even private anticompetitive activity may be permissible under the state action doctrine if it is shown that the activity was pursuant to a clearly announced state policy and was actively supervised by the state.

Copyright 2012 LexisNexis, a division of Reed Elsevier Inc.

Contact a Dedicated Texas Business Lawyer To Schedule a Consultation
Call 281-367-1222 or contact us online to schedule a meeting.

Strong In Action

  • Spring 2019

    The Strong Firm represents borrower in $42.3 million HUD construction loan for multifamily real estate development in Walton County, Florida.

    Read More
  • Spring 2019

    The Strong Firm acts as legal counsel for borrower in $32.1 million HUD construction loan for multifamily real estate development in Conroe, Texas.

    Read More
  • Spring 2019

    The Strong Firm aids borrower in $31.7 million HUD construction loan for multifamily real estate development in Nueces County, Texas.

    Read More
  • Spring 2019

    The Strong Firm represents borrower in the refinancing of a $3.57 million commercial mortgage-backed security for a commercial office facility in Montgomery County, Texas.

    Read More
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
  • Peer Rated 2019 Award

Recent Blog Posts

The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) and the Bankruptcy Provisions Therein

Last Friday, Congress passed and President Trump executed the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act” of “Stimulus Bill”) granting a significant and admirable level of support to the U.S. economy that has been left reeling by the one-two punch of the COVID-19 pandemic and OPEC’s… posturing.  While
Read More
The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) and the Bankruptcy Provisions Therein

Combating Consumer Scams Amid COVID-19

As Texans, we have weathered our share of crises and disaster, although, here in southeast Texas, it’s usually in the form of a hurricane. Times of crisis and uncertainty, such as the current COVID-19 outbreak, tend to bring out not only the very best in people, but also the very
Read More
Combating Consumer Scams Amid COVID-19

Considerations for Commercial Property Owners and COVID-19

The novel coronavirus (COVID-19) has wreaked havoc on the world and our nation, casting widespread uncertainty and hardship in seemingly every corner of the economy. With many commercial tenants in dire financial straits – particularly those who rely upon customer interaction (i.e. retail, restaurant, and entertainment) – commercial landlords are
Read More
Considerations for Commercial Property Owners and COVID-19

Small Business Owner’s Guide to the CARES Act

The U.S. Senate Committee on Small Business & Entrepreneurship has put together the below summary of programs and assistance available to small business owners and certain nonprofit organizations through the Small Business Administration (“SBA”) under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”).  The following information is current
Read More
Small Business Owner’s Guide to the CARES Act
  • Video Vault


    Watch videos done by our legal team to gain a better understanding of your legal needs. Our lawyers give video insight into areas such as Real Estate, Business Law, Mergers & Acquisitions and much more.

Pay Retainer Online

Use our easy-to-use and secure online payment feature.
We accept all major credit cards.

Pay Your Retainer

Contact us

Quick Contact Form