Public Policy Rationales Underlying the Doctrine

• Pages: 43-52

CHAPTER III

PUBLIC POLICY RATIONALES UNDERLYING THE

DOCTRINE

As reflected in the Supreme Court’s decisions, the state action

doctrine appears to be rooted in considerations of federalism and state

sovereignty—that is, that Congress did not intend to restrain certain state

regulatory activities in passing the Sherman Act.1 Federalism has been

defined as “the assignment of dual responsibilities for governing to lower

and higher levels of government.”2 The goal of federalism “is a system in

which there is sensitivity to the legitimate interests of both State and

National Governments, and in which the National Government, anxious

though it may be to vindicate and protect federal rights and federal

1. “This refrain ru ns through Supre me Court jurisp rudence up throu gh its

most recent state action opinion.” FTC STAFF, REPOR T OF THE STATE

ACTION TASK FORCE 5 (2003) [hereinafter FTC STATE ACTION REPORT];

see also, e.g., N.C. State Bd. of Dental Exam’rs v. FTC, 135 S. Ct. 1101,

1110 (2015) (Parker “recognized Congress’ purpose to respect the federal

balance and to ‘embody in the Sherman Act the federalism principle that

the States posse ss a significa nt measure of so vereignty u nder our

Constitution.’” (quoting Cmty. Commc’ns Co. v. Boulder, 455 U.S.40, 53

(1982))); FTC v. Ticor Title Ins. Co, 504 U.S. 621, 633 (1992) (“Our

decision [in Parker] was grounded in principles of federalism.”); City of

Columbia v. Omni Outdoor Adver., 499 U.S. 365, 372 (1991) (“[I]n order

to prevent Parker from und ermining the ve ry interests o f federalism it is

designed to protect, it is necessary to adopt a concept of authority broader

than what is applied to deter mine the legality of the municipality’s action

under state law.”); Town of Hallie v. Cit y of Eau Claire, 47 1 U.S. 34, 38

(1985) (“In Parker, relying on principles of federalism and state

sovereignty, the Court refused to construe the Sherman Act as applying to

the anticompetitive conduct of a State acting through its le gislature.”);

ANTITRUST MODERNIZATION COMM’N, REPORT & RECOMMENDATIONS

367 (2007) (“State sovereignty and federalism were, and still are, the

underpinnings o f Supreme Court state action j urisprudence. ”) [hereinafter

AMC REPORT].

2. Robert P. Inman & Daniel L. Rubinfeld, Making Sense of the Antitrust

State Action Doctrine: Balancing Po litical Participation and Economic

Efficiency in Regulatory Feder alism, 75 TEX. L. REV. 1203, 1204 (1997).

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