Settling competition concerns

A. Introduction
Experienced antitrust practitioners representing businesses,
individuals, and public entities routinely dicompetitive concerns by
agreement to avoid litigation. Most competitive concerns are addressed
without litigation and most antitrust litigation, including cases brought by
public enforcers, is resolved by agreement among the parties before trial.
One study found that more than 70 percent of antitrust cases brought by
government agencies between 1973 and 1983 were resolved through
consent decree.1 Another study estimated that 70 to 90 percent of cases
brought by federal enforcement agencies between 1987 and 1996 were
resolved through decree.2 Understanding the process of reaching a
resolution with state enforcers, including both strategic issues and the
nuts and bolts of reaching and documenting the agreement, is thus
crucially important for practitioners.
Settlement takes on added importance in antitrust cases because of
the magnitude of th e issues and damages claims often at stake and the
burdens antitrust litigation imposes. The threat of automatic trebling of
already sizeable potential damages sometimes leads to settlements that
include substantial monetary relief. One study calculated the average
settlement or judgment in an antitrust multidistrict litigation case
between 1973 and 1984 was almost $90 million in 2007 dollars.3
1. Jeffrey M. Perlo ff & Daniel L. Rub infeld, Settlements in Private
Litigation, in PRIVATE ANTITRUST LITIGAT ION 149, 163 (Lawrence J.
White ed., 1988).
2. See Lloyd C. Anderson, Uni ted States v. Microsoft: Antitrust Consent
Decrees and the Need for a Proper Scope of Judicial Review, 65
ANTITRUST L.J. 1, 4 (1996); see also ANTITRUST DIV., U.S. DEPT OF
JUSTICE , WORKLOAD STATISTICS FY 20052014 (2015), available at
2014 (stating cur rent figures).
3. See Steven C. Salop & Lawrence J. White, Economic Analysis of Private
Antitrust Litigation, 74 GEO. L.J. 1001, 1009, 1012 (1986) (reporting a
122 State Antitrust Enforcement Handbook
Antitrust settlements and judgments in the hundreds of millions of
dollars are common today.
Antitrust settlements, of course, also can raise numerous issues
besides the amount of compensation to be paid to resolve an alleged
violation of the antitrust laws. They also can include injunctive relief that
imposes ongoing limitations on conduct, the impact of which can be
significant. Another often contentious issue is the scope of the release,
including the scope of the claims released; whether the release extends to
officers, directors, and employees; and the potential preclusive effect of
the release on claims asserted by other plaintiffs. Finally, state attorneys
general can issue settlement-related press releases that can create public
relations issues.
This Chapter focuses on (1) issues to consider when developing a
settlement strategy, (2) the forms that settlement payments can take, (3)
the process of obtaining court approval for a settlement, and (4) the nuts
and bolts of specific settlement provisions. The Chapter primarily
focuses on the settlement of civil claims brought by state enforcers under
federal antitrust law. State antitrust enforcement has traditionally focused
and still primarily focuses on federal civil antitrust law; and state
antitrust law is often quite similar to federal antitrust law. Merger
settlements are discussed in Chapter VI. State criminal antitrust
enforcement is discussed in Chapter VIII.
Most of the settlement agreements referred to in this Chapter are
available from the National Association of Attorneys General (NAAG)
State Antitrust Litigation Database.4 Pre-2006 settlements are included
among the Committee Resources of the State Enforcement Committee of
the ABA Section of Antitrust Law.5 All of the settlements may also be
found in court dockets and on individual states’ websites.
figure of $44.5 million i n 1984 dollars). The Salop & White study
remains the best large-scale, quantitative analysis of antitrust litigation.
ANTITRUST ENFORCEME NT AND LITIGATION 59 (2012), available at ministrative/antitrust_la
w/2013_agenda_cost_efficiency_kolasky.authcheckdam.p df.
4. NATL ASSN OF ATTORNEYS GEN., NAAG State Antitrust Litigation
5. ABA SECTION OF ANTITRUST LAW, Antitrust Documents, ions/antitrust_law/a
Settling Competition Concerns 123
B. Strategic Considerations
1. Factors That Favor Settlement
a. The Time and Expense of Antitrust Litigation
As the Supreme Court has noted, antitrust litigation can be quite
burdensome.6 According to one study of antitrust litigation in the federal
courts, conducted by Steven Salop and Lawrence White, the average
multidistrict antitrust litigation between 1973 and 1983 lasted
approximately 5.7 years and had 968 docket entries per consolidated
litigation.7 The study also estimated that a large antitrust litigation
generated, on average, legal fees of over $800,000 in 2007 dollars.8
Antitrust litigation remains lengthy and complex today, and a significant
antitrust litigation today will routinely generate millions of dollars in
legal fees.
Moreover, estimates of the burdens of antitrust litigation often
understate the time and expense of an antitrust matter as as they account
for only the costs of civil litigation in the federal courts. The matter as a
whole now often may also include related investigative or criminal
proceedings and separate civil actions in state courts. The cost of
economic and other experts, whose involvement is almost mandatory in
antitrust cases today, is significant and growing. Moreover, the costs of
clients’ executive time consumed by antitrust litigation might well be on
6. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 558 (2007) (“[P]roceeding to
antitrust discovery can be expensive.”). Even ultimately successful
plaintiffs bear significant burdens. The bundled rebates challenged in
LePage’s Inc. v. 3M were implemented in 1992, challenged in 1997, and
resolved after the denial of certiorari in 2004. 324 F.3d 141 (3d Cir.
2003), cert. denied, 542 U.S. 953 (2004).
7. See Salop & White, supra note 3, at 1009. One example of a particularly
protracted case is Matsushita Electric Industrial Co. v. Zenith Radio
Corp., 475 U.S. 574 (1986), in which twelve years elapsed between the
filing of the original complaints and a decision by the Supreme Court that
upheld summary judgment for the defendants. The average private
antitrust litigation these days takes over six years to reach resolution.
Daniel A. Crane, Optimizing Private Antitrust Enforcement, 63 VAN D. L.
REV. 675, 69293 (2010).
8. See Salop & W hite, supra note 3, at 101213 (stating an average fee of
$400,000 in 1984 dollars).

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