Proof of the Existence of a Conspiracy

This chapter addresses the question of what proof may be offered to
show the existence of an agreement. The simple answer is that the
existence of an agreement, just like any fact in a case, can be proven by
any relevant evidence, whether direct or circumstantial. While as a legal
matter, an agreement can be established by either direct or circumstantial
evidence, those two types of proof can present very different procedural
requirements and practical challenges. This chapter addresses direct
evidence of a Sherman Act agreement and then focuses on the types of
circumstantial evidence courts have found persuasive in proving such an
A. Proving an Agreement
Direct evidence proves an asserted fact without the need to draw
inferences or conclusions.1 Circumstantial evidence requires the finder of
fact to infer the truth of an asserted fact.
One court explained the difference between direct and circumstantial
proof as follows: “The former is evidence tantamount to an
acknowledgment of guilt; the latter is everything else including ambiguous
statements.”2 Of course, in any particular case, an agreementand the
participation in that agreement by different coconspirators—can be proven
through a combination of direct and circumstantial evidence.3
1. “Direct evidence in a Section 1 conspiracy must be evidence that is explicit
and requires no inferences to establish the proposition or conclusion being
asserted.” In re Baby Food Antitrust Litig., 166 F.3d 112, 118 (3d Cir.
1999); see also Rossi v. Standard Roofing, 156 F.3d 452, 466 (3d Cir.
1998) (direct evidence is evidence for which “the fact finder is not required
to make inferences to establish facts”).
2. In re High Fructose Cor n Syrup Antitrust Lit ig., 295 F.3d 651, 662 (7th
Cir. 2002) (emphasis in original).
3. For example, in Petruzzi’s IGA Supermark ets v. Darling-Delaware Co.,
998 F.2d 1224, 1234 (3d Cir. 1993), the plaintiff offered both direct and
circumstantial evidence against various defendants.
62 Proof of Conspiracy Under Federal Antitrust Laws
B. Using Direct Evidence to Prove an Agreement
Direct evidence is powerful. Any evidence that directly establishes the
existence of an agreementi.e., a conscious commitment to a common
scheme designed to achieve an unlawful objectivewithout the need for
an inference constitutes direct proof.4 Direct evidence speaks for itself,
and, while a factfinder may reject such evidence,5 there should otherwise
be little room for interpretation.6
Direct evidence of an agreement is different from the concept of an
express agreement. It is well settled that, for purposes of Section 1, an
agreement can be expressthat is, explicitly stated or written.7 An
example of an express agreement is the “fully worked out paper plan” in
American Column & Lumber Co. v. United States.8 An express agreement
can be proven by direct or circumstantial evidence. By contrast, implied
or tacit agreements are typically proven through circumstantial evidence.
Direct evidence of a conspiracy is often present in criminal cases in
which there has been a successful amnesty applicant or plea bargain that
4. See, e.g., Baby Food Antitrust Litig., 166 F.3d at 118 (“[W]ith direct
evidence ‘the fact finder is not required to make inferences to establish
facts’” (quoting Ros si, 156 F.3d at 466)).
5. For example, the court rejected a recording as direct evidence of an
unlawful agreement i n United States v. American Airlines, 743 F.2d 1114
(5th Cir. 1984). Dur ing the recorded conve rsation, one airline executive
told a competitor’s executive: “Raise your . . . [expletive deleted] fares
twenty percent. I’ll raise mine the ne xt morning . . . . You’ ll make more
money and I will too.” Id. at 1116. The district court found that the recorded
conversation evinced a solicitation, not an agreement; on appeal, the Fifth
Circuit held, however, that an agreement was not a required element of
attempted monopolization. Id. at 1118-21.
6. Direct evidence of agreement has been offered occasionally in cases in
which competitors banded together to combat a perceived common enemy
or problem. For example, in Fashion Originators’ Guild v. FTC, 312 U.S.
457, 461 (1941), fashion designers admittedly combined to boycott
clothing manufacturers who were believed to be engaging in “style piracy”
(that is, copying the defendants’ designs). The defendants led an effort that
resulted in 12,000 retailers signing express agreements to cooperate with
the boycott. Id. at 461-62.
7. See Chapter II.B.2.a for a discussion of express agreements.
8. 257 U.S. 377, 394 (1921).
Proof of the Existence of a Conspiracy 63
supplies testimony from a coconspirator.9 As a number of courts have
noted, however, in civil cases and criminal cases without a cooperating
witness, direct evidence of an illegal agreement is “frequently difficult for
antitrust plaintiffs to come by.”10 In hard-core price-fixing conspiracies, it
is understandable that coconspirators would avoid creating paper trails or
other direct evidence of their illegal conduct. But the rarity of direct
evidence in the reported cases may be explained by defendants choosing
to litigate where direct evidence is lacking and settle where direct evidence
is both abundant and obvious.
Direct evidence of agreement may take various forms. Examples
include the following:
Witness testimony. Although it may be difficult to obtain, the
concession by a witnesseither in deposition or trial testimonythat he
or she participated in an unlawful conspiracy is powerful direct evidence.
Such evidence has been obtained in a number of noteworthy cases. For
example, in United States v. AU Optronics Corp., employees of several
manufacturers of liquid crystal display manufactuers testified about a
series of meetings called “crystal meetings” where price agreements were
reached.11 The meetings extended over a period of approximately five
9. See United States v. AU Optronics Corp., United States’ Sente ncing
Memorandum, at 32 (filed Sept. 11, 2012), available at (evidence against AU
Optronics and its employees also included testimony from the defendants’
coconspirators regarding meetings at which the defendants agreed to set
TFT-LCD prices and to impose price increases).
10. Rossi, 156 F.3d at 465; see also ES Dev. v. RWM Enters., 939 F.2d 547,
553-54 (8th Cir. 1991) (explaining that conspiracy is “rarely evidenced by
explicit agreements” and must almost always be proved by “inferences that
may be drawn from the be havior of the alleged conspirators” (quoting H.L.
Moore Drug Exch. V. Eli Lilly & Co., 662 F.2d 935 (2d Cir. 1981));
Todorov v. DCH Healthcare Auth., 921 F.2d 1438, 1456 (11th Cir. 1991)
(noting that only in rare cases are conspiracies proven by direct evidence);
United States v. Middlebrooks, 618 F.2d 273, 278 (5th Cir.) (noting that
there is rarely direct evidence of a conspiracy in context of criminal
conspiracy case), modified on other grounds, 624 F.2d 36 (5th Cir. 1980);
United States v. Washin gton, 586 F.2d 1147, 1153 (7th Cir. 1978) (“By its
nature conspiracy is conceived and carried out clandestinely, and direct
evidence of the crime is rarely available”); Paladin Assocs. v. Mont. Power
Co., 97 F. Supp. 2d 1013, 1030 (D. Mont. 2000) (calling direct evidence
the “proverbial ‘smoking gun’”), aff’d, 328 F.3d 1145 (9th Cir. 2003).
11. Supra note 9.

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