Conduct Investigations

• Pages: 155-170

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CHAPTER VI

CONDUCT INVESTIGATIONS

A. The Course of an Investigation

Civil conduct, or non-merger, investigations arise and proceed

through the Division in many ways. Some investigations amount to little

more than a staff lawyer examining public sources to assess whether to

recommend undertaking a formal investigation. At the other end of the

spectrum, non-merger civil investigations can last for well over a year,

entail extensive formal discovery of the parties and third parties, and

culminate in a consent decree or litigated challenge.

Most civil non-merger investigations might usefully be thought of as

having four stages.

1. Identifying Violations

First, the Division obtains information suggesting that an antitrust

violation may have occurred. Such information may come to the

Division’s attention through various channels including complaints from

consumers or competitors, the staff’s own ongoing market observations

(via monitoring of trade or general media), or through an inquiry from

Congress or another agency.1 The Division also monitors private

antitrust litigation to assess whether a matter warrants the Division’s

investigative attention.2

2. Information Gathering

Second, Division staff gathers additional information from publicly

available sources to determine whether the nature of the conduct, its

marketplace context, and the magnitude of its impact on consumers and

the competitive process warrant expenditure of the time and resources

1. See U.S. DEP’T OF JU STICE, ANT ITRUST DIV. MANUAL III-6 (5th ed. rev.

August. 2017) [hereinafter Antitrust Div. Manual],

https://www.justice.gov/atr/file/761166/download. For a discussion of the

various channels available, see Chapter III.

2. See Antitrust Div. Manual, supra note 1, at III-6.

156 DOJ Civil Antitrust Practice and Procedure Manual

necessary to conduct a further investigation. During this phase of the

investigation, and prior to the Division initiating a formal investigation,

staff is not permitted to contact participants in the industry (other than

the complainant, if any, who brought the matter to the Division’s

attention), including “individuals and corporations that may be

implicated in the alleged violation.”3 Information gathered at this phase

helps staff determine whether to initiate a preliminary investigation.

3. Preliminary Investigation

Third, if staff regards the matter as warranting further investigation,

it will request opening a preliminary investigation. Staff typically

prepares a preliminary investigation memorandum setting forth the

nature and scope of the investigation.4 The memorandum should contain

detailed information to facilitate the evaluation of the request, to obtain

clearance from the FTC, and to determine whether the conduct is already

under investigation.5

In determining whether to authorize a preliminary investigation the

Division considers (a) whether there is reason to believe that an antitrust

violation occurred, (b) the amount of commerce affected, (c) whether the

investigation will duplicate or interfere with other efforts by the FTC, a

United States Attorney, or a state attorne y general, and (d) w hether the

investigation fits within the goals and resources of the Division.6 A

preliminary investigation requires approval by the appropriate Director

of Civil Enforcement and the responsible Deputy Assistant Attorney

General.7 In addition, all requests for preliminary investigations must

receive FTC clearance.8

3. Id. at III-7.

4. Id. at III-8-III-9. All preliminary investigation memos should contain the

following information on the first page: the commodities or ser vices

under investigation, the allege d illegal practices, all relevant statutes, the

parties involved, the amount of commerce affected on an annual basis,

geographic areas involved, whether the investigation would be an

international matter, and any non-U.S. jurisdictions that have inve stigated

or have shown interest in investigating the matter. Id.

5. Id. at III-9.

6. Id. at III-7.

7. See id. at III-8.

8. Id. at III-10. In the context of civil non-merger inve stigations, the

clearance process has historically given some weight to one agency’s

“initiative” in pur suing a particular in vestigation, but an age ncy’s

initiative will not assure it of obtaining clearance, especially if the