Chapter I. Overview and Context of State Antitrust Enforcement

A. Introduction
This book focuses on how state attorneys general exercise their
authority to investigate antitrust concerns and to secure remedies for
antitrust violations.1 State attorneys general have now exercised this
authority for more than a century, and the constitutional issues raised by
opponents have been resolved. Whether one views antitrust enforcement
by state attorneys general as “an important part of the enforcement
network”2 or as “free riding,”3 as achieving “rough justice,”4 or as a force
for “imprecision, duplication and costs,”5 attorneys general are an
1. For a state-by-state analysis of antitrust laws, see ABA SECTION OF
2004) [hereinafter ABA STATE ANTITRUST TREATISE]. A fourth edition
of this treatise is forthcoming. In this three-volume work, practitioners,
government attorneys, and academics cite and analyze the statutes and
case law from each American jurisdiction, provide a historical overview
of state enforcement and private antitrust litigation under state statutes,
and highlight differences between state and federal law. The treatise also
describes the role of state attorneys general in enforcing federal antitrust
laws on behalf of the states and their entities and as parens patriae on
behalf of natural person consumers pursuant to § 4C of the Clayton Act,
15 U.S.C. § 15c. Unlike the ABA State Antitrust Treatise, this Handbook
is organized by substantive topic, rather than by individual state.
Moreover, this book focuses primarily on actual practices o f state
attorneys general, rather than on what they are legally enabled to do.
2. Harry First, Delivering Remedies: The Role of the S tates in Antitrust
Enforcement, 69 GEO. WASH. L. REV. 1004, 1041 (2001).
3. Richard A. Posner, Antitrust in the New Economy, 68 ANTITRUST L.J.
925, 940 (2001).
4. Richard Wolfram & Spencer Weber Waller, Contemporary Antitru st
Federalism: Cluster Bombs or Rough Justice?, in ANTITRUST LAW IN
NEW YORK STATE 1, 1 (Robert Hubbard & Pamela Jones Harbour eds.,
2d ed. 2002).
5. Michael L. Denger & D. Jarrett Arp, Does Our Multifaceted Enforcement
System Promote Sound Competition Policy?, ANTITRUST, Summer 2001,
at 41, 45.
2 State Antitrust Enforcement Handbook
independent force, with independent decision-making authority, and they
must be reckoned with in many antitrust investigations.
The chapters that follow focus on specific aspects of attorney general
authority. Chapter II describes multistate investigations and litigation;
Chapter III analyzes state merger enforcement; Chapter IV, state criminal
enforcement; Chapter V, health care markets; Chapter VI, confidentiality
issues; and Chapter VII, state settlements. This chapter provides an
overview of state enforcement authority as the context for the following
Civil antitrust enforcement by state governments under the state and
federal antitrust laws is a complex system, sometimes involving a
multiplicity of actors, laws, and jurisdictions.6
States have significant rights under federal and state antitrust law.
These rights are exercised in the main by state attorneys general, who
fulfill their enforcement responsibilities within a federal system in which
each state is sovereign.7 Each state has the right to make enforcement
decisions that differ from those of other state and federal enforcers.8
Moreover, state enforcers can rely on state antitrust law, which generally
is not preempted by federal antitrust law even when federal antitrust law
differs from state antitrust law. State enforcers can also assert state-law
claims as supplemental claims in federal court.9
State attorneys general have broad authority to address competition
concerns that affect three constituencies.
6. See generally ABA STATE ANTITRUST TREATISE, supra note 1.
7. The National Association of Attorneys General has 56 members,
including officials from 50 states, 1 district, 2 commonwealths, and 3
territories. The antitrust law and practice in each of these 56 jurisdictions
are detailed in the ABA STATE ANTITRUST TREATISE, supra note 1.
8. Different enforcement decisions can be made for reasons other than the
merits of an antitrust claim, including when one enforcer decides not to
take action in light of an action already being taken by another enforcer.
Different enforcement decisions on the merits can occur in the context of
mergers, such as California v. American Stores Co., 495 U.S. 271 (1990),
in which California secured divestitures beyond those secured by the
Federal Trade Commission (FTC), and Bon-T on Stores v. May
Department Stores, 881 F. Supp. 860 (W.D.N.Y. 1994), in which New
York secured a preliminary injunction even though the FTC had not
issued a second request. Having multiple antitrust enforcers was not an
“afterthought, [but rather] an integral part of the congressional plan for
protecting competition.” American Stores, 495 U.S. at 284.
9. See California v. ARC Am. Corp., 490 U.S. 93, 103 (1989).
Overview and Context 3
First, as chief legal officers of their states, attorneys general often
pursue proprietary claims—that is, claims as direct purchasers of goods
or services—on behalf of state agencies, divisions, and programs.10
Proprietary claims constitute a significant part of state enforcement.11
Second, state attorneys general represent consumers, pursuing
injunctive relief and damages on their behalf under both federal and state
laws.12 Where consumers (including state agencies) areindirect
purchasers who are unable to recover damages under federal law because
of the Supreme Court’s holding in Illinois Brick Co. v. Illinois,13
attorneys general in a number of states can pursue claims on these
consumers’ behalf, primarily under state laws.14
Third, states have broad authority to represent the public interest.
State law often gives state attorneys general criminal authority15 and
broad investigatory powers.16 Moreover, and in addition to the typical
10. See, e.g., N.Y. EXEC. LAW § 61.
11. See, e.g., Texas v. Organon USA Inc. (In re Remeron End-Payor
Antitrust Litig.), No. Civ. 02-2007 FSH, 2005 WL 2230314 (D.N.J.
2005); Ohio v. Bristol-Myers Squibb Co. (In re Buspirone Antitrust
Litig.), No. 1:02-CV-01080(EGS), 2003 WL 21105104 (D.D.C. 2003);
New York v. Aventis, S.A. (In re Cardizem CD Antitrust Litig.), No. 01-
CV-71635 (E.D. Mich. 2003); Alabama v. Bristol-Myers Squibb Co. (In
re Buspirone Antitrust Litig.), No. 01-CV-11401 (S.D.N.Y. 2003). The
settlements in these cases are available at
antitrust/committees/state-antitrust/settlements.html. See also Ohio v.
Bristol-Myers Squibb Co. (In re Buspirone Antitrust Litig.), No. 1:02-
CV-01080(EGS), 2003 WL 21105104 (D.D.C. 2003) (order preliminarily
approving proposed settlement in Buspirone Antitrust Litigation); In re
Cardizem CD Antitrust Litig., 218 F.R.D. 508 (E.D. Mich. 2003)
(approval of settlement in Cardizem Antitrust Litiga tion); Ohio v. Bristol-
Myers Squibb Co. (In re Buspirone Antitrust Litig.), MDL No. 1413,
2003 WL 22330972 (D.D.C. 2003) (amended settlement agreement in
Buspirone Antitrust Litigation).
12. See 15 U.S.C. §§ 15c-15h.
13. 431 U.S. 720 (1977).
14. For example, litigation brought by state attorneys general concerning the
pharmaceutical industry from 2000 to 2005 was based in large part on
state-law claims to recover money for consumers. A recent compilation
of these state-law claims can be found at
15. See the ABA STATE ANTITRUST TREATISE, supra note 1, for a discussion
of criminal authority in each state.
16. See the ABA STATE ANTITRUST TREATISE, supra note 1, for the relevant
statutes in each state.

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT