NCJ Number
69316
Journal
Utah Law Review Volume: 57 Issue: 1 Dated: (1980) Pages: 57-72
Date Published
1980
Length
15 pages
Annotation
THE EFFECTIVENESS OF ANTITRUST SANCTIONS IS EXAMINED WITH RESPECT TO THE DUAL OBJECTIVES OF DETERRENCE AND COMPENSATION.
Abstract
FROM THE ENACTMENT OF THE SHERMAN ANTITRUST ACT OF 1980 TO THE LATE 1970'S, THE UNDERLYING POLICY OF FEDERAL ANTITRUST LAWS HAS BEEN TO DETER ANTICOMPETITIVE BEHAVIOR AND COMPENSATE ITS VICTIMS. THE SHERMAN ANTITRUST ACT'S CRIMINAL SANCTIONS WERE PRESUMABLY DESIGNED TO DETER ANTITRUST VIOLATIONS. PROVISIONS FOR PRIVATE DAMAGE ACTIONS WERE TO AFFORD FURTHER DETERRENCE AND COMPENSATION TO THOSE INJURED BY PROSCRIBED CONDUCT. HOWEVER, DETERRENCE AS A RESULT OF CRIMINAL SANCTIONS HAS BEEN THE PRIMARY MEANS OF ENFORCING THE ANTITRUST LAWS, YET PRIVATE ENFORCEMENT REQUIRES THE CORPORATION ITSELF TO PAY TREBLE DAMAGES TO VICTIMS. THE INDIVIDUALS WHO ACTUALLY DECIDE TO VIOLATE THE LAW ARE PUNISHED ONLY INDIRECTLY BY PRIVATE ENFORCEMENT. PRIVATE SUITS THUS ADD LITTLE IN THE WAY OF DETERRENCE WHILE THEY OVERCOMPENSATE THE VICTIMS. SINCE INDIVIDUALS MAKE DECISIONS, NOT CORPORATIONS, AND DECISIONS TO VIOLATE THE ANTITRUST LAWS ARE RATIONAL AND DELIBERATE, OPTIMUM DETERRENCE CAN BEST BE ACHIEVED THROUGH THE LEVY OF SIGNIFICANT CRIMINAL SANCTIONS, ESPECIALLY IMPRISONMENT, DIRECTLY ON THE DECISIONMAKER. THE PENALTIES AVAILABLE UNDER THE SHERMAN ACT PROBABLY PROVIDE SUFFICIENT DETERRENT POTENTIAL. NO SIGNIFICANT DETERRENCE WILL BE OBTAINED, HOWEVER, UNTIL THE PENALTIES ARE MORE FREQUENTLY AND MORE FULLY EXERCISED. IF THE JUDICIARY FAILS TO PERCEIVE THIS NEED AND MAKE AN ADJUSTMENT, LEGISLATION IMPOSING MANDATORY SENTENCES MAY BE REQUIRED. BECAUSE TREBLE DAMAGES PRESENTLY FUNCTION AS A DETERRENT, A NEW FOCUS ON INDIVIDUAL SANCTIONS FOR DETERRENCE SHOULD OBVIATE THE NEED FOR TREBLE DAMAGES. ADOPTION OF THESE PROPOSALS WOULD GREATLY DECREASE ANTITRUST VIOLATIONS SINCE THEY WOULD BE DEALT WITH MORE FREQUENTLY. FOOTNOTES ARE PROVIDED. (AUTHOR ABSTRACT MODIFIED)