State Action: Parker v. Brown

Parker v. Brown is the leading case proclaiming the State Action doctrine, which holds that state-mandated or -directed restraints are exempted from antitrust liability.

Additional State Action Cases are collected on the antitrust resources web page of the economic consultants C.H. Guernsey.

Freedom Holdings, Inc. v. Spitzer This decision (2d.Cir. 01-06-2004) presents complex state action issues relating to allegations that the State of New York created a cartel among domestic cigarette companies when it passed laws to enforce a nationwide 1998 tobacco settlement. The Second Circuit's decision reviving the Sherman Act claim is described in a New York Law Journal article ("Challenge to Tobacco Settlement Is Revived," by Mark Hamblett, 01-07-04).

FTC State Action Task Force In his wide-ranging speech, entitled "Looking Forward: The Federal Trade Commission and the Future Development of U.S. Competition Policy" (Dec., 2002), FTC Chairman Timothy J. Muris includes a detailed discussion of the need for, activities, and recommentaions of the agency's State Action Task Force. Muris describes the history of the state action doctrine and the potential harm from its overbroad interpretation. He also outlines approaches the FTC might take to direct the development of State Action case law in a manner that promotes competition and enhances consumer welfare (e.g., finding opportunities to clarify the proper interpretation of the doctrine’s "clear articulation" and "active supervision" requirements).

Report of the FTC's State Action Task Force In its Report of the State Action Task Force: Recommendations to Clarify and Reaffirm the Original Purposes of the State Action Doctrine To Help Ensure That Robust Competition Continues to Protect Consumers (September 2003), the Federal Trade Commission’s State Action Task Force concludes that the scope of the antitrust state action doctrine has expanded dramatically since first articulated by the Supreme Court in 1943. The doctrine has become unmoored from its original objectives, the report concludes, and is frequently invoked to protect private commercial efforts with no relation to state policy. Accordingly, the Report recommends a number of specific clarifications of the doctrine, including more rigorous application of the “clear articulation” and “active supervision” requirements.