June 29, 2007
Supreme Court Overturns Per Se Rule; "Crazies" Rejoice
Bryan CaplanPrice-fixing is no longer per se illegal, at least according to the New York Times. Decades after the big academic debate on resale price maintainence (RPM), five justices are convinced:
The court struck down the 96-year-old rule that resale price maintenance agreements were an automatic, or per se, violation of the Sherman Antitrust Act. In its place, the court instructed judges considering such agreements for possible antitrust violations to apply a case-by-case approach, known as a “rule of reason,” to assess their impact on competition. The new rule is considerably more favorable to defendants.Since I'm what Larry White of NYU (not to be confused with Larry White of the University of Missouri) calls "the 'antitrust crazies' who want to repeal of [sic] all antitrust laws," you know where I stand.The decision was handed down on the last day of the court’s term, which has been notable for overturning precedents and for victories for big businesses and antitrust defendants.
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