ANTITRUST AS SPEECH CONTROL.

AuthorGreene, Hillary
PositionSpecial Issue on Antitrust Law

TABLE OF CONTENTS INTRODUCTION 1218 I. FIRST AMENDMENT AND ANTITRUST LANDSCAPE 1219 A. Immunity 1221 B. Remedies 1223 C. Liability 1227 1. Collusion 1228 2. Invitation to Collude 1229 3. Information Sharing Generally 1231 4. Information Sharing and Mergers 1232 5. Information Sharing, Joint Ventures, and Other 1233 Collaborations 6. Industry-Wide Information Sharing 1234 7. Self-Regulatory Initiatives and Professional 1236 Organizations 8. Boycotts 1238 9. Vertical Price Fixing 1241 D. Monopolization and Attempted Monopolization 1243 1. Disparagement 1243 2. Predatory Design 1244 II. PROTECTION OF SPEECH 1246 A. De Facto Protection for the Economic Efficiency Value 1247 of Speech B. The Challenges Associated with Protecting Nonefficiency 1251 Values of Speech 1. Considerations For and Against Broadening First 1252 Amendment Protection 2. Distinguishing Speech Deserving of Solicitude--An 1258 Illustrative Example 3. Balancing 1262 C. A Speculative Look at Future Challenges 1263 CONCLUSION 1266 INTRODUCTION

Antitrust law, at times, dictates who, when, and about what people can and cannot speak. It would seem then that the First Amendment might have something to say about those constraints. And it does, though less than one might expect. (1) The interface between these two areas of law (2) is the subject of this Article.

Navigating the interface of First Amendment and antitrust law has always been challenging (3) and, we argue, is potentially becoming more so. The Supreme Court has couched antitrust in terms of constitutional qualities, such as when it characterized the Sherman Act as the "Magna Carta of free enterprise." (4) The Court has also employed economics-based metaphors in the First Amendment context, such as when it describes the "marketplace of ideas." (5) The two legal regimes are, nonetheless, rooted in different--and incommensurate--systems. This central tension appears throughout precedents that address the interface and has led to the spheres-of-influence solution. (6)

This Article examines these issues by recasting antitrust thinking in terms of speech control. Speech facilitates a substantial portion of conduct that runs afoul of antitrust laws and sometimes constitutes the objectionable conduct itself. (7) Standard analyses of the antitrust-First Amendment interface usually focus on whether the speech of concern is political speech. (8) Such analyses do not examine speech in the context of what seem to be garden-variety antitrust cases. Surveying the broader antitrust landscape with a speech lens, as we do in Part I of this article, allows for that.

Most of antitrust law can be swept into this speech control framework given the strong role of communications in the negotiation and consummation of commercial agreements as well as in mergers and in monopolization conduct that involves communications. (9) Understanding the role of speech in these varied contexts allows one to identify if speech values are directly or indirectly present and, if so, how well they are protected. Furthermore, the analysis highlights the problems posed in complex settings involving "hybrid" speech that has both economic efficiency and nonefficiency impacts. (10)

Part II of the article argues that speech is protected indirectly as a byproduct of antitrust law. Such de facto protection extends to speech that enhances economic efficiency, the core concern of antitrust law, but not to speech furthering noneconomic values. The failure of antitrust thinking to deal forthrightly with speech rights is an increasing concern in an era when information-based activities constitute a critical and growing part of our economy.

  1. FIRST AMENDMENT AND ANTITRUST LANDSCAPE

    Speech is any communication from one party to at least one other party. Its relevance to antitrust law is pervasive as it is used to come to agreements (for example, negotiations to reach an explicit price fixing agreement), (11) facilitate agreements (for example, information about sales that allow firms to monitor possible deviations from a price agreement), (12) and interpret actions (for example, explanation for a capacity decrease). Sometimes speech itself is the anticompetitive conduct (for example, an expressive boycott). (13) Generally, speech is problematic for antitrust purposes when it is part of a pattern of action and communication that together reduces market competition. (14)

    There are a number of ways to conceptualize the value of free speech to society. We divide the value in terms of speech as a "means to an end" and as an "end in itself as described by Smolla and Nimmer, which roughly follows the marketplace and the human dignity/self-fulfillment theories justifying free speech. (15) While the emphasis of the marketplace theory is based on supporting the process of discourse and its value to society, the human dignity theory concerns the value of self-expression without regard to the value to society. (16) As Justice Thurgood Marshall observed, 'The First Amendment serves not only the needs of the polity but also those of the human spirit--a spirit that demands self-expression." (17) This article focuses on the two forms of utilitarian value.

    We adapt these values to the antitrust context by expanding the means to an end value into a utilitarian value which consists of the social utility associated with contributing to improved economic efficiency in the marketplace and the social utility associated with contributing to nonefficiency purposes including augmenting the "marketplace of ideas" which impacts political, social, and economic decisions and understandings. (18) This division mirrors the approach antitrust analysis takes in recognizing economic efficiency that results from the actions in question while not recognizing non-efficiency impacts. (19) While this distinction is often blurred it remains valuable for understanding the interface of antitrust law and speech rights.

    In antitrust cases involving speech rights, First Amendment issues tend to form bookends of sorts. First, there may be consideration of whether the speech or expressive conduct in question warrants immunity based on the First Amendment. (20) When, as is generally the case, there is no immunity, (21) First Amendment issues occasionally reappear to potentially limit remedies that unduly constrain speech. (22) Sandwiched in between is the standard antitrust liability analysis that is typically devoid of overt speech considerations. (23) We examine the bookends, then return to the liability analysis.

    1. Immunity

      Immunity refers to "[a]ny exemption for a duty [or] liability." (24) In this context, immunity refers to protection from antitrust liability under the First Amendment. If the speech or expressive conduct at issue (hereinafter "speech") being challenged on antitrust grounds receives First Amendment immunity, then the matter is dismissed. (25) Two factors are worth noting. First, the Constitutional challenges within this context do not question the legitimacy of the antitrust laws generally but rather their application to specific facts. (26) Second, the speech at issue is ultimately subject to binary treatment. (27) Either the speech at issue receives First Amendment protection and is immunized from antitrust enforcement, or it is subject to the full force of the antitrust laws. There is no middle ground. (28)

      In antitrust law, the most straightforward application of the First Amendment is protection of direct petitioning of government (for example, lobbying). (29) The political character of the speech is self-evident, based on the existence of a government entity to which the communication is directed, and results in immunization. (30)

      Somewhat more challenging issues have arisen regarding boycotts in which the underlying refusal to deal with another party is meant to prompt the government to adopt a particular policy. In Missouri v. National Organization for Women, the National Organization for Women (NOW) organized a boycott of the convention-based industry in Missouri to pressure the state to approve the Equal Rights Amendment. (31) NOWs action was described as "a politically motivated but economically tooled boycott participated in and organized by noncompetitors of those who suffered as a result of the boycott." (32) Though the Eighth Circuit's ultimate decision upholding immunity for the defendants was focused narrowly on the right to petition, the court's decision emphasized that the legislation at issue was not economic legislation, and that the boycotters were not businesses focused on increased profits. (33) This characteristic is important because categorizing the speech at issue as political has, in effect, been deemed essential for immunity and because that designation has been increasingly defined in terms of communications in which the speaker has no economic interest. (34)

      The binary treatment of constitutional defenses to antitrust challenges provides a simple rule to support difficult judicial decisions: is the speech at issue protected and, therefore, immunized from antitrust scrutiny? (35) One advantage of a binary or spheres-of-influence treatment is that it avoids tradeoffs by treating constitutional rights (for example, speech) as trumping the nonconstitutional values of antitrust law. A disadvantage is that it is, alone, a blunt instrument for protecting speech values.

    2. Remedies

      Significantly, just because no First Amendment issues arose or were credited up through the point when antitrust liability is found, does not mean that speech-related considerations do not shape antitrust law. (36) First Amendment-based protection may emerge to prevent unconstitutional restrictions on speech that are a part of the remedy for illegal conduct. Assuming a finding of antitrust liability, if the remedy to the anticompetitive conduct involves a restriction on speech, this restriction must be sufficiently tailored to meet the appropriate level of...

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