Attempt to Monopolize and Conspiracy to Monopolize

• Pages: 207-231

207

CHAPTER VI

ATTEMPT TO MONOPOLIZE

AND CONSPIRACY TO MONOPOLIZE

Section 2 of the Sherman Act reaches beyond the offense of ordinary

monopolization to prohibit both attempts and conspiracies to monopolize.1

Just as Section 2 does not specify specific types of unlawful

monopolization conduct, “[n]either the statutory text nor the legislative

history [of the Sherman Act] is particularly illuminating” as to what

constitutes an attempt or conspiracy to monopolize.2 Faced with this lack

of guidance, the first judges charged with giving meaning to Sherman Act

claims imported the concepts of “attempt” and “conspiracy” from criminal

law.3 This chapter sets forth the elements of attempted monopolization and

conspiracy to monopolize and examines how other countries have

grappled with similar types of claims.

A. Attempt to Monopolize

In Spectrum Sports v. McQuillan , the Supreme Court’s most recent

opportunity to consider allegations of attempted monopolization, the

Court held that to establish a claim for attempt to monopolize, the plaintiff

must demonstrate that (1) the defendant has engaged in predatory or

anticompetitive conduct4 with (2) a specific intent to monopolize and (3)

a dangerous probability of achieving monopoly power in a relevant

1. 15 U.S.C. § 2.

2. 3B PHILLIP E. AREEDA & HERBERT HOVEN KAMP, ANTITRUST LAW ¶ 804

(3d ed. 2008).

3. See Michael D. Paley, Prosecuting Failed Attempts to Fix Prices as

Violations of the Mail and Wire Fraud Statutes: Elliot Ness Is Back!, 73

WASH. U. L.Q. 333, 343 (1995) (“In deciding cases of attempted

monopolization, courts frequently look to general principles of criminal

attempt law.”).

4. The phrase “predatory or anticompetitive” is used here because this is the

phrase that courts use to identify the first element of attempt to monopolize,

but this terminology should not be viewed as a substantive categorization.

208 Monopolization and Dominance Handbook

market.5 The Court in Spectrum Sports resolved much confusion in lower

courts regarding whether a plaintiff was required to establish that the

defendant must have had a dangerous probability of achieving monopoly

power in a properly-defined relevant market, with the Court firmly holding

that a dangerous probability of success and the definition of a relevant

market are essential elements of an attempted monopolization claim.6

The elements of attempted monopolization trace their origins to

Justice Holmes’ opinion in Swift & Co. v. United States.7 In Swift & Co.,

the defendants—who comprised approximately sixty percent of

corporations, firms, and individuals purchasing livestock and selling fresh

meat in the United States—were charged with attempting to monopolize

the market for fresh meat. On appeal, the defendants argued that the

charges should be dismissed, in part because several of the constituent acts

were lawful regardless of the defendants’ intent.8 The Supreme Court

disagreed, reasoning that:

5. See Spectrum Sports v. McQuillan, 506 U.S. 447, 456 (1993); Christy

Sports, LLC v. Deer Valley Resort Co., 555 F.3d 1188, 1192 (10th Cir.

2009); Broadcom Corp. v. Qualcomm, Inc., 501 F.3d 297, 317 (3d Cir.

2007); HDC Medical, Inc. v. Minnetech Corp., 474 F.3d 543, 549 (8th Cir.

2007); Heerwagen v. Clear Channel Commc’ns, 435 F.3d 219, 227 (2d Cir.

2006); Spirit Airlines v. Northwest Airlines, 431 F.3d 917, 932 (6th Cir.

2005); Spanish Broad. Sys. of Fla. v. Clear Channel Commc’ns, 376 F.3d

1065, 1074 (11th Cir. 2004); In re Microsoft Corp. Antitrust Litig., 333

F.3d 517, 534 (4th Cir. 2003); Paladin Assocs. v. Montana Power Co., 328

F.3d 1145, 1163 n.22 (9th Cir. 2003); United States v. Microsoft Corp.,

253 F.3d 34, 80 (D.C. Cir. 2001) (en banc) (per curiam); Queen City Pizza

v. Domino’s Pizza, 124 F.3d 430, 442 (3d Cir. 1997); Abcor Corp. v. AM

Int’l, 916 F.2d 924, 926 (4th Cir. 1990); H.J., Inc. v. Int’l Tel. & Tel. Corp.,

867 F.2d 1531, 1540-41 (8th Cir. 1989); H.L. Hayden Co. of N.Y. v.

Siemens Med. Sys., 879 F.2d 1005, 1017 (2d Cir. 1989); Col. Interstate

Gas Co. v. Nat. Gas Pipeline Co. of Am., 885 F.2d 683, 693 (10th Cir.

1989); Int’l Dist. Ctrs. v. Walsh Trucking Co., 812 F.2d 786, 790 (2d Cir.

1987); Great Escape, Inc. v. Union City Body Co., 791 F.2d 532, 540 (7th

Cir. 1986); Transam. Computer Co. v. IBM, 698 F.2d 1377, 1382 (9th Cir.

1983).

6. 3B AREEDA & HOVENKAMP, supra note 2, ¶ 807(b).

7. 196 U.S. 375 (1905).

8. Id. at 395.