Chapter VI. Attempt to Monopolize and Conspiracy to Monopolize

• Pages: 213-234

213

CHAPTER VI

ATTEMPT TO MONOPOLIZE

AND CONSPIRACY TO MONOPOLIZE

Section 2 of the Sherman Act reaches beyond the offense of

monopolization to prohibit both attempts and conspiracies to

monopolize.1As noted by some commentators, “[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.2Confounded by the absence of a Congressional record and

defined statutory terms, the first judges charged with giving meaning to

Sherman Act claims imported the concepts of “attempt” and

“conspiracy” from criminal law.3From this starting point, the doctrines

of attempted monopolization and conspiracyto monopolize have come to

present some of the most thought-provoking and unsettled issues in

modern antitrust law. This chapter sets forth the elements of attempted

monopolization and conspiracy to monopolize, charts the case law

interpreting these claims, and examines how other countries have

grappled with these types of claims.

A. Attempt to Monopolize

To establish a claim for attempt to monopolize, the plaintiff must

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

anticompetitive conduct4with (2) a specific intent to monopolize and (3)

1. 15 U.S.C. § 2.

2. 3B PHILLIP E. AREEDA &HERBERT HOVENKAMP,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 substantively

214 Monopolization and Dominance Handbook

a dangerous probability of achieving monopoly power.5These elements

trace their origins to Justice Holmes’ opinion in Swift & Co.v. United

States.6In 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 forming

a “combination of dominant proportion” that, among other things,

prevented dealers from bidding against each other for livestock, fixed the

prices at which meat was sold to dealers and consumers, and restricted

output7in an attempt 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.8The Supreme Court disagreed, reasoning that the

alleged acts:

different from the term “monopolizing,” which this handbook uses

generally to refer to conduct that, in violation of Sherman Act Section 2,

unlawfully allows a firm to gain, maintain, or extend monopoly power.

See Chapter IV.A.1.

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

7. Id. at 394.

8. Id. at 395.