THE EVOLUTION OF ANTITRUST ARBITRATION

By Christopher R. Leslie¹

Until the 1920s, arbitration was not generally an option for legal disputes being heard in federal court. But then Congress enacted the Federal Arbitration Act (the FAA) in 1925 to allow inter-merchant disputes to be decided in private arbitration. For the next sixty years, federal courts held that pre-dispute arbitration clauses were unenforceable with regards to federal statutory claims, including antitrust lawsuits. Beginning in the 1980s, however, the Supreme Court imagined a new revisionist history of the FAA as creating an omnibus federal pro-arbitration regime. Federal courts began enforcing arbitration clauses and compelling the arbitration of antitrust claims. In many ways, the expansion of antitrust arbitration has undermined America’s antitrust law regime. This evolution compels courts and Congress to reevaluate aspects of antitrust doctrine that were premised on the non-arbitrability of antitrust claims. This Essay traces the relationship between antitrust law and private arbitration.

I. THE 1920S: THE EARLY DAYS OF PRE-DISPUTE BINDING ARBITRATION

In the early years of the Sherman Act, antitrust claims were not arbitrated because, broadly speaking, almost nothing was arbitrated. Although private arbitration is older than the country,² until the twentieth century arbiters’ decisions were unenforceable without a court order.³ Arbitration decisions and awards were not self-executing, but instead required judicial enforcement, which American judges often resisted because they viewed "irrevocable arbitration agreements as ‘ousting’ the courts of jurisdiction."⁴ And, further, the parties retained the power to revoke their promise to arbitrate,⁵ and either party could "repudiate arbitration agreements at any time before the arbitrator’s award was made."⁶ Some merchants in disputes with other merchants — such as retailers purchasing products or produce from wholesalers or distributors — preferred arbitration over litigation. Arbitrators chosen for their knowledge of the trade at issue were seen as better equipped to interpret contract terms and apply appropriate remedies.⁷ Acceding to the merchants’ requests, some states — most notably New York and New Jersey — enacted laws to enforce predispute arbitration agreements.⁸

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Even as states in 1920s began to make arbitration agreements enforceable in state court, federal courts remained hostile to arbitration whether the claims arose from federal law or arrived in federal court through diversity jurisdiction.⁹ Because their inter-merchant contractual disputes could end up in federal court through diversity jurisdiction, these business interests sought federal legislation that would make their arbitration agreements enforceable in federal court.¹⁰ They championed the Federal Arbitration Act of 1925 (the FAA). The key provision of the FAA — Section 2 — provides that some predispute arbitration clauses "shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract."¹¹

The promoters of arbitration in Congress highlighted private arbitration’s advantages over litigation, including its efficiency, speed, and lower costs.¹² The FAA advocates stressed the importance of expeditiousness in resolving commercial disputes,¹³ particularly when the dispute involves perishable goods.¹⁴ These arguments proved persuasive and Congress enacted the FAA with no speeches in opposition and no dissenting votes.¹⁵ While revolutionary, the FAA was extremely limited. Throughout the hearings, deliberations, and voting, every witness and every report emphasized that they were discussing only the arbitration of inter-merchant disputes, not consumer or labor claims.¹⁶ For example, when clarifying that the FAA would not make labor disputes subject to arbitration, W.H.H. Piatt, Chairman of the Committee on Commerce, Trade, and Commercial Law of the American Bar Association, explained that the FAA "is purely an act to give the merchants

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the right or the privilege of sitting down and agreeing with each other as to what their damages are, if they want to do it. Now, that is all there is in this."¹⁷ These inter-merchant disputes could involve either breach of contract and maritime claims.¹⁸ The FAA’s narrow reach did not extend to statutory or constitutional claims. The FAA’s prime advocate, Julius Henry Cohen, the general counsel of the New York State Chamber of Commerce, noted that arbitration was "’not the proper method for deciding points of law of major importance involving constitutional questions or policy in the application of statutes.’"¹⁹ While arbiters from the trade may be better positioned to decide certain factual issues, the FAA’s proponents acknowledged that questions of statutory interpretation were "better left to the determination of skilled judges with a background of legal experience and established systems of law."²⁰ Furthermore, the FAA’s drafters and proponents explicitly rejected the notion that the act would apply to contracts of adhesion.²¹

Neither the drafters of the Sherman Act nor the FAA ever considered that private antitrust claims were subject to arbitration.

II. THE 1930S: ARBITRATION AS ANTITRUST VIOLATION

In its first opinion considering the intersection of antitrust law and arbitration in the post-FAA period, the Supreme Court condemned concerted efforts by defendants to impose arbitration clauses. In 1930, the Court in Paramount Famous Lasky Corp. v. United States,²² held that an agreement among ten movie distributors to impose upon all theaters a standard contract that included mandatory arbitration of all contractual disputes violated Section One. Using language evocative of the per se rule, the Court held that the distributors’ agreement "necessarily and directly tends to destroy ‘the kind of competition to which the public has long looked for protection.’"²³ The Court cast a skeptical eye on both arbitration and rivals that sought to collectively impose arbitration on their customers. The Justices were right to condemn this form of collusion because a conspiracy among competitors to impose arbitration clauses inflicts antitrust injury by denying consumers and employees the option of entering a superior contract that does not force them to waive their rights. In many contexts, these arbitration-laden contracts

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constitute inferior products.²⁴ The federal court adjudicating an alleged conspiracy to arbitrate among banks to only issue credit cards burdened by arbitration clauses with class action waivers explained that "[t]he mere existence of the clauses, diminishes the cards’ value by foreclosing the opportunity for cardholders to go to court and address grievances through class action litigation."²⁵ By agreeing to impose mandatory arbitration, firms are agreeing not to compete on product quality.²⁶

Beyond a standalone conspiracy, members of a traditional price-fixing conspiracy may agree to also impose mandatory arbitration clauses on all of their customers. Such a move may help the illegal cartel in many ways. First, it can help conceal the cartel because consumers suspicious of price fixing who bring an antitrust claim will be denied the relatively generous discovery afforded in federal court.²⁷ Because antitrust plaintiffs generally require more discovery than antitrust defendants, discovery limitations favor the defendant.²⁸ Not only does arbitration offer less capacious discovery than litigation, price-fixing conspirators can draft their uniform arbitration clauses to explicitly limit discovery.²⁹ Second, price-fixing conspirators may attempt to use arbitration clauses to undermine various pro-plaintiff aspects of antitrust law, including treble damages, attorneys’ fees, and reasonable costs for successful plaintiffs.³⁰

III. FROM THE 1920S TO THE 1980S: SIXTY YEARS OF SOLITUDE WHEN ANTITRUST CLAIMS WERE NON-ARBITRABLE

For its first six decades of existence, federal courts recognized the limited scope of the FAA and refused to enforce arbitration clauses in the context of federal statutory claims.³¹ In 1953, for example, the Supreme Court in Wilko v. Swan held that federal securities claims were not subject to mandatory arbitration because Congress "enacted the Securities Act to protect the rights of investors and has forbidden a waiver of any of those rights."³² The Court reasoned that arbitration may work fine for inter-merchant contractual disputes, but Congress never intended the FAA to apply to legal disputes

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arising from the sale of securities.³³ The lower federal courts applied Wilko’s holding and reasoning to antitrust law, declining to enforce arbitration clauses in antitrust litigation. In the most influential opinion of this era, the Second Circuit in American Safety Equipment Corp. v. J.P. Maguire & Co.³⁴ held that arbitration claims had to be adjudicated by federal judges, not private arbiters, regardless of whether the parties had entered a pre-dispute arbitration agreement.³⁵ The Second Circuit articulated four independent reasons why pre-dispute arbitration agreements did not apply to antitrust claims:³⁶

(1) deference to private arbitration agreements could lessen the plaintiffs’ incentive to pursue antitrust actions, weakening the use of "private attorneys general" as a foundation of Sherman Act enforcement; (2) arbitration clauses often result from adhesion contracts, and Congress intended that these matters be heard in the courts; (3) arbitrators may be incompetent to comprehend complex antitrust issues; and (4) arbitrators may be biased business people unable to reach fair outcomes.³⁷

The American Safety doctrine became the law of the land as every circuit to consider the issue held that arbitration clauses did not cover antitrust claims.³⁸ For the next two decades, the American Safety doctrine was uncontroversial.

IV. THE 1980S: AN IMAGINED LEGISLATIVE HISTORY AND THE DAWN OF THE NEW ERA OF ANTITRUST ARBITRATION

This well-established body of law — and understanding of the FAA — underwent a sea-level change when the Supreme Court began rewriting the history of the FAA in the 1980s. The Court chipped away at the overreaching rule against arbitration of federal statutory claims by holding some³⁹ — and, later all⁴⁰ — private federal securities claims

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were arbitrable. In the middle of this brief arc of securities cases, the Court pared back the American Safety doctrine.

In Mitsubishi Motors Corporation v. Soler Chrysler-Plymouth Inc.,⁴¹ the Supreme Court held that the American Safety rule should not prevent the international arbitration of antitrust claims. The international context proved dispositive, as the Court emphasized that "concerns of international comity, respect for the capacities of foreign and transnational tribunals, and sensitivity to the need of the international commercial system for predictability in the resolution of disputes require that we enforce the parties’ agreement, even assuming that a contrary result would be forthcoming in a domestic context."⁴² As written, the Court’s holding was limited to international arbitration. In theory, the American Safety doctrine of non-arbitrability of domestic antitrust claims survived Mitsubishi. Although the Court also critiqued the Second Circuit’s reasoning in American Safety,⁴³ the Court found it "unnecessary to assess the legitimacy of the American Safety doctrine as applied to agreements to arbitrate arising from domestic transactions."⁴⁴ Yet, despite the Court’s explicit restraint, lower federal courts took Mitsubishi’s reasoning and applied it to domestic arbitration of antitrust claims.⁴⁵ Some lower courts treated Mitsubishi as "effectively overrul[ing] American Safety and its progeny."⁴⁶ Consequently, an opinion limited to international arbitration effectively made all antitrust claims subject to arbitration.⁴⁷ Lower courts took their cue from the Mitsubishi opinion’s critique of American Safety and its revisionist legislative history of the FAA. The Mitsubishi Court fashioned a new legislative intent behind the FAA, asserting, without evidence, that the FAA embodied an "emphatic federal policy in favor

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of arbitral dispute resolution."⁴⁸ This echoed the Court’s proclamation a year earlier in Moses H. Cone Memorial Hospital v. Mercury Construction Corp.,⁴⁹ a non-antitrust case, that "questions of arbitrability must be addressed with a healthy regard for the federal policy favoring arbitration."⁵⁰ The Court created this so-called pro-arbitration policy from whole cloth. Congress never intended the FAA to signal a federal policy in favor of arbitration writ large.⁵¹ Congress passed the FAA in response to pressure and persuasion from business interests, primarily in New York, that sought a more efficient mechanism for resolving inter-merchant disputes.⁵² The legislative history of the FAA clearly demonstrates the intent of legislators and witnesses to allow only the arbitration of disputes between merchants, not employment contracts or disputes involving customers.⁵³ The Mitsubishi Court, however, provided antitrust plaintiffs with one safety net: the Effective Vindication Doctrine. The foundation of the Mitsubishi opinion rests on the majority’s statement that "so long as the prospective litigant effectively may vindicate its statutory cause of action in the arbitral

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forum, the statute will continue to serve both its remedial and deterrent function."⁵⁴ Under the Effective Vindication Doctrine, the "arbitration of the claim will not be compelled if the prospective litigant cannot effectively vindicate his statutory rights in the arbitral forum."⁵⁵ In theory, the Effective Vindication Doctrine should prevent antitrust defendants from using arbitration to thwart antitrust claims.

V. ARBITRATION AND CLASS ACTION WAIVERS

The Supreme Court’s simultaneous endorsement of a federal policy favoring private arbitration agreements and the Effective Vindication Doctrine had important implications for antitrust class action litigation. Through the Effective Vindication Doctrine, the Mitsubishi Court made antitrust claims arbitrable only if plaintiffs could effectively vindicate their rights in private arbitration. A litigant could resist a motion to compel arbitration by showing that forcing its claims into arbitration would prevent effective vindication of the plaintiff’s underlying rights.⁵⁶

Class action litigation plays an important role in ensuring that antitrust laws are effectively enforced. Antitrust violations often injure millions of consumers, none of whom suffer damages that are sufficiently high to warrant an individual lawsuit.⁵⁷ Eliminating class action litigation and classwide arbitration can effectively eliminate the right to seek redress for antitrust violations altogether by leaving victims with no choice but a net-loss lawsuit (even if it’s successful) or no lawsuit at all.⁵⁸ Even individuals with ironclad antitrust claims may lack the resources to initiate and endure a lawsuit.⁵⁹

In order to prevent class action litigation, many firms have inserted class action waivers into their arbitration clauses. A class action waiver is a contract term that forbids an individual — such as consumer or employee — from participating in class action litigation against the defendant. When the expected cost of pursuing an individual lawsuit exceeds the expected (or maximum) damage award, if firms can prevent class action litigation,

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they can effectively immunize themselves from liability for their illegal conduct. Whether the liability lies in tort, contract, or antitrust, firms can evade responsibility. Despite the importance of collective action by antitrust plaintiffs, in 2010, the Supreme Court in Stolt-Nielsen SA v. AnimalFeeds International Corp.,⁶⁰ placed hurdles before antitrust plaintiffs forced into arbitration to have their claims adjudicated on a classwide basis. Although class-wide arbitration secures many of the benefits of class action litigation, the Supreme Court in Stolt made it harder for arbiters to replace hundreds or thousands or more individual arbitration with a single, more efficient class-wide arbitration. The Stolt majority held that "a party may not be compelled under the FAA to submit to class arbitration unless there is a contractual basis for concluding that the party agreed to do so."⁶¹ The Court invalidated a decision by an arbitration panel to use class arbitration to settle antitrust claims because the parties had not previously agreed to do so.

Three years later, the Supreme Court began the wholesale dismantling of the Effective Vindication Doctrine. In American Express Co. v. Italian Colors Restaurant,⁶² an antitrust case, the Supreme Court eviscerated the Effective Vindication Doctrine by enforcing an arbitration clause with a class action waiver even though "the plaintiff’s cost of individually arbitrating a federal statutory claim exceeds the potential recovery."⁶³ Under Scalia’s reasoning, no rational antitrust plaintiff would pursue her claims because the arbitration costs would exceed the maximum possible recovery.⁶⁴ The Effective Vindication Doctrine, which the Mitsubishi Court used to justify subjecting antitrust claims to arbitration has become a dead letter. Between Stolt and Italian Colors, antitrust plaintiffs are denied the most efficient mechanism to resolve antitrust disputes.

VI. THE CONSEQUENCES OF ANTITRUST ARBITRATION ERA

In the modern era in which federal courts generally enforce arbitration clauses, competing firms may pursue their collective interest in making arbitration clauses with class action waivers the industry standard, leaving consumers and workers no choice but to forego their rights to litigate. Entire industries — from cell phone service to credit cards — are governed by arbitration clauses, such that consumers cannot avoid mandatory arbitration.⁶⁵ Market-wide arbitration clauses signal a failure of competitive markets.

A. Arbitration Clauses as Vehicles for Anti-Consumer Terms

As courts have encouraged deference to arbitration clauses, firms have increasingly included terms in their arbitration clauses that could otherwise be unenforceable if they resided in a traditional contract, such as provisions to shorten statutes of limitations, to

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limit damages, and to prevent injunctive remedies altogether.⁶⁶ Standard arbitration clauses now often contain a litany of pro-defendant terms. This is hardly surprising as firms craft their mandatory arbitration with an eye towards being sued by their customers and employees. Conversely, these firms are unlikely to sue their customers or employees and are, thus, unlikely to be at the plaintiffs’ table in an arbitration. Although businesses do sue each other, firms impose mandatory arbitration on their customers, and employees rarely put arbitration clauses in their business-to-business contracts.⁶⁷

B. The Risk of Arbitration Conspiracies

The pro-business nature of arbitration clauses increases the importance of antitrust law. No firm could unilaterally impose such terms without losing customers and employees to their rivals. But if every major firm agreed to pursue the same path, all firms would be better off. Thus, competing firms have a motive to collude to impose identical anti-consumer arbitration clauses. The incentive is particularly strong if firms are already colluding to fix prices, rig bids, or otherwise violate Section One of the Sherman Act.

Absent antitrust law, price-fixing conspirators may collude to draft identical arbitration clauses that circumvent the pro-plaintiff aspects of antitrust law that Congress designed to encourage and reward antitrust plaintiffs. For example, although Congress adopted mandatory treble damages for successful antitrust plaintiffs in order to maximize deterrence, to "compensate victims of antitrust violations for their injuries,"⁶⁸ and to "encourage private enforcement of the anti-trust laws,"⁶⁹ many firms put detrebling provisions in their arbitration clauses.⁷⁰ If enforced, such provisions encourage antitrust violations.⁷¹ In addition to reducing money damages, firms may attempt to deny arbitrators the authority to order injunctive relief,⁷² an inherent power that cannot be stripped from federal judges.⁷³ Price-fixing conspirators may also attempt to use the terms of their arbitration clauses to block antitrust’s pro-plaintiff fee shifting provisions.⁷⁴

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Additionally, conspirators may use arbitration clauses to truncate antitrust law’s four-year statute of limitations.⁷⁵ For example, some antitrust defendants have drafted their arbitration clauses to require that arbitration for antitrust violations be brought within one year of plaintiffs’ discovery.⁷⁶ Other antitrust defendants have used arbitration clause language to shorten the four-year statute of limitations to one or two years, a move permitted by some federal judges.⁷⁷ Using the terms in arbitration clauses in this fashion not only increases the likelihood of valid antitrust claims being barred entirely, it potentially reduces the plaintiff’s available damages even when a claim is filed in time.⁷⁸

Finally, and most insidiously, firms in a price-fixing conspiracy may collude to impose class action waivers on their customers and employees. Antitrust class actions are the most potent weapon that consumers have to hold price fixers accountable and to receive compensation for their antitrust injuries.⁷⁹ Absent the class action, no single plaintiff may bring suit because individual lawsuits are unlikely to be worth the effort.⁸⁰ Recognizing this, price-fixing conspirators may agree to impose arbitration clauses with class action waivers. With the Supreme Court’s opinions in Italian Colors and Stolt as a shield, antitrust defendants can block their victims from both court and collective action and, thus, retain their ill-gotten cartel profits. Conspiracies to impose arbitration clauses with class action waivers can effectively prevent the victims of antitrust violations from pursuing their claims through litigation or arbitration because litigation is contractually forbidden and individual arbitration is prohibitively expensive or impractical.

In theory, conspiracies to arbitrate could be easily thwarted by federal judges denying defendants’ motion to compel arbitration. At the beginning of the modern era of antitrust arbitration, courts continued to recognize that firms could not conspire to impose arbitration provisions in their consumer contracts.⁸¹ Even though federal judges are necessary participants

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in the conspiracy’s success, too many judges seem more than willing to unwittingly join the conspiracy. For example, the Fifth Circuit has held that "[e]ven if the district court were to find that such an antitrust conspiracy [to impose arbitration clauses] existed, this finding would not compel the invalidation of the agreement to arbitrate…"⁸² Other federal judges have held that private arbitrators approved by the defendants should determine whether federal claims alleging a conspiracy to arbitrate are valid.⁸³ Although federal courts should be interpreting antitrust law to thwart such conspiracies, judges often misapply equitable doctrines in ways that reinforce conspiracies among competitors to impose arbitration clauses and collectively block all customers for seeking redress in court. First, some courts interpret equitable principles to require antitrust plaintiffs to arbitrate their claims against members of a conspiracy with whom they have no contractual relations whatsoever, bootstrapping the arbitration clause that they signed with one member of the alleged conspirators to protect all of the co-conspirators as well.⁸⁴ Second, courts in antitrust cases apply arbitration clauses retroactively, including to antitrust violations that occurred before the defendants inserted the arbitration clauses into their contracts.⁸⁵ Such opinions afford antitrust defendants the opportunity to block antitrust litigation after the violation has been exposed, limiting antitrust plaintiffs’ remedies and perhaps forcing plaintiffs into less convenient forums.⁸⁶ As always, judges deciding antitrust cases assert that "the underlying federal policy in favor of arbitration lead[s] to the conclusion that these clauses apply retroactively."⁸⁷ Thus, the misconception that Congress intended the FAA to create a pro-arbitration federal policy blocks antitrust plaintiffs from being able to pursue their claims in federal court.

Even when they do hear antitrust claims involving arbitration conspiracies, courts seem ill-equipped to address the issue. In Ross v. American Express Co.,⁸⁸ a federal judge presided over a bench trial on claims that a group of banks had conspired to impose mandatory arbitration clauses with class action waivers on their customers. The banks had formed

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a group, called "the Arbitration Coalition,"⁸⁹ which held almost thirty meetings.⁹⁰ The members shared their arbitration-related documents with each other,⁹¹ including their non-public plans.⁹² They discussed how to prevent their customers from opting out or changing the arbitration provisions.⁹³ At times, they seemed to seek assurances that other banks were imposing similar arbitration clauses.⁹⁴At one meeting, a consultant working with the Arbitration Coalition "exhorted the group that ‘class actions are getting out of hand’ and have become ‘a gaming business’ and a ‘shakedown racket,’ but that the group could ‘beat’ the problem ‘by working together.’"⁹⁵ Although at first only two of the banks had class-action-barring arbitration clauses in their card member agreements, after all of the members of the Arbitration Coalition eventually imposed similar arbitration clauses with class action waivers, the Coalition disbanded.⁹⁶

The trial judge ruled for the defendants, finding no conspiracy to impose arbitration clauses in violation of Section One. To reach this result, however, the judge committed a series of mistakes.⁹⁷ More important than any individual error, however, was the judge’s inability to see that he had, in fact, found the agreement that he claimed the plaintiffs failed to prove. Summarizing the evidence in the case, the judge concluded that "[d]irect evidence … abounds" that the defendant "Banks had an agreement to explore collective advocacy efforts aimed at expanding the enforceability of arbitration clauses and to establish class-action-barring arbitration as an industry norm."⁹⁸ That is the conspiracy alleged by the plaintiffs: that the defendants "had an agreement … to establish class-action-barring arbitration as an industry norm."⁹⁹ Why did the judge simultaneously find the agreement and hold there was no agreement? His judgment was perhaps clouded by his sympathetic view toward arbitration. For example, in declining to treat conspiracies to impose arbitration clauses as per se illegal, as the Supreme Court had intimated in Paramount Famous Lasky,¹⁰⁰ the judge quoted the 1980s

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era Supreme Court cases that asserted the "federal policy favoring arbitration."¹⁰¹ Ultimately, the Ross case exemplifies how judges may view evidence through a pro-arbitration lens that distorts antitrust analysis.

VII. RESPONDING TO THE PROBLEM OF ANTITRUST ARBITRATION

The expansion of arbitration warrants reconsidering certain antitrust doctrines and policies. This section considers two areas of antitrust enforcement: (1) the Illinois Brick rule that denies antitrust standing to plaintiffs who are indirect purchasers, and (2) the relationship between antitrust arbitration and merger review.

C. Reconsidering Illinois Brick

The proliferation of mandatory arbitration clauses invites reconsideration of the Illinois Brick rule. In Illinois Brick Co. v. State of Illinois,¹⁰² the Supreme Court limited antitrust standing to direct purchasers, reasoning that they were the most motivated and the best situated plaintiffs to bring appropriate antitrust claims.¹⁰³ The Court also worried allowing indirect purchasers to pursue antitrust claims "would create a serious risk of multiple liability for defendants."¹⁰⁴

The Supreme Court’s pro-arbitration jurisprudence undermines the underlying logic of the Illinois Brick doctrine. Because direct purchasers are more likely to be bound by arbitration clauses — including those with class action waivers — cases like American Express v. Italian Colors¹⁰⁵ make it significantly less likely that direct purchasers will be able to sue antitrust violators in federal court.¹⁰⁶ The Illinois Brick majority assumed that antitrust claims would be litigated, not arbitrated, and that class actions were available to ensure that direct purchasers were able to combine their monetarily insignificant individual claims into one significant, cost-justified lawsuit.¹⁰⁷ But these assumptions are no longer valid. Direct purchasers are apt to be bound by arbitration clauses that prevent the most direct victims of antitrust violations from being able to litigate their claims. Ironically, the "privity of contract" that the Supreme Court in Associated General Contractors. v. California State Council of Carpenters considered a positive factor for determining antitrust standing may become a negative factor when that privity of contract results in the consumer being contractually prohibited from litigating or participating in a class

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action.¹⁰⁸ Because indirect purchasers are less likely to be hamstrung by arbitration clauses, they may be better positioned to hold antitrust violators accountable.

The Illinois Brick Court’s concerns about multiple recoveries are also less pertinent in the new arbitration era. When direct purchasers are effectively blocked from pursuing antitrust damages because of arbitration clauses with class action waivers, they are less likely to receive any recovery at all. Affording standing to indirect purchasers creates the opportunity for at least one set of plaintiffs to recover.¹⁰⁹ And even these damages are unlikely to exceed single damages.¹¹⁰ As a result, even if indirect purchasers are granted standing, antitrust violators will not pay more than treble damages. In sum, the Supreme Court’s arbitration jurisprudence provides more ammunition for overruling Illinois Brick.¹¹¹

D. Merger Review Policy

The ubiquity of antitrust arbitration also has implications for merger policy. After coming to play a dominant role in private antitrust litigation, arbitration has begun to insinuate itself into merger review. When the DOJ Antitrust Division sought to block Novelis’ acquisition of Aleris Corp. in 2019 — fearing diminished competition in the market for flat-rolled aluminum — the government eschewed litigation. Instead of litigating the case in federal court, the DOJ filed a notice with the court that "because this merger challenge would turn on a single dispositive issue [product market definition], the parties have agreed to refer this issue to binding arbitration … to lessen the burden on the Court and reduce litigation costs."¹¹² This represented the first time the DOJ Antitrust Division had used arbitration to resolve a merger dispute.¹¹³

Although the DOJ won the arbitration,¹¹⁴ the use of private arbitration to resolve merger disputes raises important issues of public accountability. For example, the arbitration agreement between the DOJ and the parties had significant redactions. In making his opinion, the arbiter rejected expert evidence of both parties’ experts, reasoning that "the underlying data used by both economists was not sufficiently verifiable to be definitively relied upon."¹¹⁵ Yet, no clear

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established process for reviewing these decisions exists. Donald Trump’s Assistant Attorney General for the Antitrust Division, Makan Delrahim, supported increasing usage of arbitration in DOJ antitrust matters, stating that DOJ "look[s] forward to applying the learning from this case to future matters."¹¹⁶

Instead of treating the merger review process as an opportunity to expand antitrust arbitration, competition policy goals would be better served if antitrust officials used the merger review process as a means of rolling back anti-consumer arbitration clauses. During the merger review process, antitrust enforcement officials have leverage over major firms. Attorneys at the Federal Trade Commission and the Antitrust Division of the Department of Justice can negotiate specific conditions in exchange for not challenging a proposed merger in court. Using the leverage during merger review makes sense because it focuses on arbitration in concentrated industries, where the anticompetitive and anti-consumer effects of mandatory arbitration are most stark.¹¹⁷

Government enforcement agencies can pursue structural or behavioral conditions. While traditional behavioral conditions often involve commitments to act — like licensing intellectual property¹¹⁸ — the federal agencies could request commitments to refrain from certain actions. The agencies could, for example, insist that the merged firm not impose or enforce mandatory arbitration clauses generally, not impose class action waivers, or — at a minimum — not enforce pre-dispute arbitration clauses in antitrust disputes.¹¹⁹ While parties in an antitrust dispute could still agree to shift their litigation to arbitration if both parties agree post-dispute to use an arbiter, that would be an informed decision agreed to at arm’s length upon the advice of counsel, a much better scenario than consumers unwittingly surrendering their right to litigate by accepting a contract of adhesion that includes an arbitration clause.

VII. CONCLUSION

Courts justify their repeated embrace of antitrust arbitration because of the FAA’s purported announcement of a federal policy favoring arbitration. But no such policy exists. America’s antitrust regime depends on private litigation.¹²⁰ The evolution of arbitration to include antitrust claims risks undermining the development of antitrust common law and makes it exceedingly hard for private antitrust plaintiffs to pursue their claims. This reduces the likelihood of the victims of antitrust violations to receive compensation for their injuries and it undermines deterrence of antitrust violations. Judges, antitrust enforcement officials, and policymakers should be reticent to embrace shifting antitrust claims from litigation to arbitration. The risks of this transition identified by the Second Circuit in its American Safety opinion over half a century ago remain true today.

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Notes:

^1. Chancellor’s Professor of Law, University of California, Irvine School of Law.

^2. James E. Berger & Charlene Sun, The Evolution of Judicial Review under the Federal Arbitration Act, 5 N.Y.U. J. L. & Bus. 745, 748 (2009).

^3. Id.

^4. Scherk v. Alberto-Culver Co., 417 U.S. 506, 510 n.4 (1974). See, e.g., Home Ins. Co. v. Morse, 87 U.S. 445, 451 (1874).

^5. Christopher R. Leslie, The Arbitration Bootstrap, 94 TEX. L. REV. 265, 300 (2015) ("Under the so-called revocability doctrine, either party could, at its will, refuse to honor the arbitration agreement.").

^6. Southland Corp. v. Keating, 465 U.S. 1, 32 (1984) (O’Connor, J., dissenting).

^7. Leslie, supra note 5 at 308.

^8. Id. at 301.

^9. Id.

^10. Id. For a brief history of the personalities behind the push for the FAA, see id. at 302-06.

^11. 9 U.S.C. § 2.

^12. Leslie, supra note 5 at 302-06; David S. Clancy & Matthew M.K. Stein, An Uninvited Guest: Class Arbitration and the Federal Arbitration Act’s Legislative History, 63 BUS. LAW. 55, 61 (2007) ("After the 1923 and 1924 hearings, the House Judiciary Committee and the Senate Judiciary Committee each generated a report recommending passage of the FAA. Those reports make clear that, when it enacted the FAA, Congress understood arbitration to be something inherently prompt, inexpensive, and streamlined—in other words, just the type of proceeding that had been described by the witnesses during the pre-enactment hearings.").

^13. Leslie, supra note 5 at 303 (noting that "supporters argued that the FAA was necessary to speed up dispute resolution in commercial matters"); Sales and Contracts to Sell in Interstate and Foreign Commerce, and Federal Commercial Arbitration: Hearing on S. 4213 and S. 4214 Before a Subcomm. of the S. Comm. on the Judiciary, 67th Cong. 5 (1923) [hereinafter Arbitration Hearings] (statement of Charles I. Bernheimer) ("But the merchant finds that arbitration is a very direct and very expeditious method. Our courts are so clogged that it is sometimes years before they can reach a settlement: but the arbitration makes a prompt settlement.").

^14. Leslie, supra note 5 at 304 ("Representatives of producers and shippers of vegetables and fruits testified in favor of the bill, asserting that arbitration would benefit business and ‘the whole country.’"); Arbitration of Interstate Commercial Disputes: Joint Hearings on S. 1005 and H.R. 646 Before the Subcomms. of the Comms. on the Judiciary, 68th Cong. 28-29 (1924) (statement of Henry L. Eaton).

^15. Leslie, supra note 5 at 305 ("Not a single senator or representative voted against it. This is not surprising; nobody spoke or wrote in opposition to the legislation.").

^16. Id. ("The most important fact about the testimony, hearings, and reports leading up to congressional enactment of the FAA is that every witness, every Senator, and every Representative discussed one issue and one issue only: arbitration of contract disputes between merchants."). See also Cohen & Dayton, The New Federal Arbitration Law, 12 VA. L. REV. 265, 281 (1926) (Arbitration "is not the proper method for deciding points of law of major importance involving . . . policy in the application of statutes.").

^17. Arbitration Hearings, supra note 13 at 9 (statement of W. Piatt) (emphasis added); see Margaret L. Moses, Statutory Misconstruction: How the Supreme Court Created a Federal Arbitration Law Never Enacted by Congress, 34 FLA. ST. U. L. REV. 99, 106 (2006) (describing Piatt’s statement as "the central concept behind the Act: to provide for enforceability of arbitration agreements between merchants").

^18. Moses, supra note 17 at 139 ("Moreover, the FAA was never described in the legislative history as applying to any claims other than contract and maritime claims.").

^19. Id. at 111.

^20. Cohen & Dayton, supra note 16 at 281.

^21. Leslie, supra note 5 at 309 ("For example, in colloquy"); Moses, supra note 16 at 107 ("Cohen and his fellow supporters thus indicated that this bill would not apply in adhesion contracts for several reasons. First, there were protections written into law; second, protective requirements were issued by federal agencies; and third, that was simply not the intent of the legislation, which was specifically aimed at voluntary resolution of disputes between merchants.").

^22. 282 U.S. 30 (1930).

^23. Id. at 43 (quoting United States v. Am. Oil Co., 262 U.S. at 390) (emphasis added). See also Christopher R. Leslie, Conspiracy to Arbitrate, 96 N.C. L. REV. 381, 402-03 (2018) (explaining how the Supreme Court took a per se approach in Paramount Famous Lasky).

^24. Leslie, supra note 23 at 410 ("Primary conspiracies to arbitrate inflict antitrust injury because consumer contracts with arbitration clauses– especially those that include class-action waivers–are inferior products.").

^25. Ross v. Am. Express Co., 35 F. Supp. 3d 407, 434 (S.D.N.Y. 2014).

^26. See Ross v. Bank of Am., N.A. (USA), 524 F.3d 217, 224 (2d Cir. 2008) ("[T]he alleged conspiracy to limit the cardholders to cards that require arbitration of disputes also diminished the present value of the cards offered to the cardholders. A card that limits the holder to arbitration is less valuable (all other factors being equal) than a card that offers the holder a choice between court action or arbitration.").

^27. Leslie, supra note 23 at 412-13.

^28. Mark A. Lemley & Christopher R. Leslie, Antitrust Arbitration and Merger Approval, 110 Nw. U. L. Rev. 1, 15-16 (2015); In re Uranium Antitrust Litig., 480 F. Supp. 1138, 1155 (N.D. Ill. 1979) (citation omitted) ("the heart of any American antitrust case is the discovery of business documents. Without them, there is virtually no case.").

^29. Leslie, supra note 23 at 413.

^30. See infra notes 68-80 and accompanying text.

^31. Wilko v. Swan, 346 U.S. 427, 438 (1953) overruled by Rodriguez de Quijas v. Shearson/Am. Express, Inc., 490 U.S. 477 (1989).

^32. Id.

^33. Id.

^34. 391 F.2d 821 (2d Cir. 1968).

^35. Id. at 827-28.

^36. Id.

^37. Steven R. Swanson, Antisuit Injunctions in Support of International Arbitration, 81 TUL. L. REV. 395, 409 (2006); Nghiem v. NEC Elec., Inc., 25 F.3d 1437, 1440-42 (9th Cir. 1994) ("In American Safety, the Second Circuit held that antitrust claims cannot be arbitrated because of the public interest in enforcing antitrust laws, the potential bias and limited expertise of arbitrators, the complexity of antitrust law, and the procedural differences between trials and arbitrations.").

^38. Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 620-21 (1985). See, e.g., Lake Commc’ns, Inc. v. ICC Corp., 738 F.2d 1473, 1479 (9th Cir. 1984); Lee v. Ply*Gem Indus., Inc., 593 F.2d 1266, 1274 (D.C. Cir. 1979); Cobb v. Lewis, 488 F.2d 41, 47 (5th Cir. 1974) ("antitrust claims are not appropriate subjects of arbitration"); Applied Digit. Tech., Inc. v. Cont’l Cas. Co., 576 F.2d 116, 117-119 (7th Cir. 1978); Helfenbein v. Int’l Indus., Inc., 438 F.2d 1068, 1070 (8th Cir. 1971); In the Matter of Arbitration between Aimcee Wholesale Corp. v. Tomar Prods., Inc., 21 N.Y.2d 621, 289 N.Y.S.2d 968, 237 N.E.2d 223 (1968); Power Replacements, Inc. v. Air Preheater Co., 426 F.2d 980 (9th Cir. 1970); A. & E. Plastik Pak Co. v. Monsanto Co., 396 F.2d 710 (9th Cir. 1968); Coenen v. R. W. Pressprich & Co., 453 F.2d 1209, 1215 (2nd Cir. 1972); A. & E. Plastik Pak Co. v. Monsanto Co., 396 F.2d 710 (9th Cir. 1968).

^39. Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 223 (1985).

^40. Rodriguez de Quijas v. Shearson/Am. Express, Inc., 490 U.S. 477 (1989).

^41. 473 U.S. 614, 632-35 (1985).

^42. Mitsubishi, 473 U.S. at 629.

^43. Id. at 632 (expressing "skepticism of certain aspects of the American Safety doctrine"); see also Donald I. Baker & Mark R. Stabile, Arbitration of Antitrust Claims: Opportunities and Hazards for Corporate Counsel, 48 BUS. LAW. 395, 406 (1993) ("Although the Court’s holding in Mitsubishi is limited to the international arena, its logic is not.").

^44. Mitsubishi 473 at 629.

^45. See Lemley & Leslie, supra note 28 (collecting cases).

^46. Nghiem v. NEC Elec., Inc., 25 F.3d 1437, 1442 (9th Cir. 1994).

^47. See, e.g., Seacoast Motors of Salisbury, Inc. v. DaimlerChrysler Motors Corp., 271 F.3d 6 (1st Cir. 2001) (expressly rejecting American Safety in view of Mitsubishi); Kotam Elecs., Inc. v. JBL Consumer Prods., Inc., 93 F.3d 724, 725-28 (11th Cir.1996) ("In light of Mitsubishi and its progeny…, we hold that … arbitration agreements concerning domestic antitrust claims are enforceable."); Nghiem, 25 F.3d at 1442 (9th Cir. 1994) (same); see also HCI Techs., Inc. v. Avaya, Inc., 446 F. Supp. 2d 518, 524 (E.D. Va. 2006) ("A review of subsequent case law reveals that while the grim reaper may not yet have found American Safety‘s address, he is certainly in the neighborhood."); DJ Mfg. Corp v. Tex-Shield, Inc., 998 F. Supp 140, 145 (D.P.R. 1998) ("[W]e also hold that domestic antitrust disputes … are arbitrable."); Hunt v. Up N. Plastics, Inc., 980 F. Supp. 1046, 1049 (D. Minn. 1997) (same); Acquaire v. Canada Dry Bottling, 906 F. Supp. 819, 837 (E.D.N.Y. 1995); Syscomm Int’l Corp. v. Synoptics Commc’ns, 856 F. Supp. 135, 139 (E.D.N.Y. 1994) ("While American Safety has not been explicitly overruled, this Court believes that … domestic antitrust claims are arbitrable"); Hough v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 757 F. Supp. 283, 286 (S.D.N.Y. 1991) ("[T]he reasoning of Mitsubishi should apply with equal force to domestic claims"), aff’d, 946 F.2d 883 (2d Cir. 1991); W. Int’l Media Corp. v. Johnson, 754 F. Supp. 871, 873-74 (S.D. Fla. 1991) ("Although the Court supported its rejection of some of these concerns on grounds tied to the principles involved in international commercial transactions, the Court’s reliance on arbitration principles and the legislative histories of antitrust provisions suggests that the result arrived at in Mitsubishi would be forthcoming in the domestic situation.").

^48. Mitsubishi, 473 U.S. at 631.

^49. 460 U.S. 1, 24 (1983).

^50. Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983).

^51. Craft v. Campbell Soup Co., 177 F.3d 1083, 1089 (9th Cir. 1998) ("Specifically, the legislative history demonstrates that the Act’s purpose was solely to bind merchants who were involved in commercial dealings."), abrogated by Circuit City Stores, Inc. v. Adams, 532 U.S. 105 (2001); IMRE SZALAI, OUTSOURCING JUSTICE 192-99 (2013); Edward Brunet, Arbitration and Constitutional Rights, 71 N.C. L. REV. 81, 117 (1992) (noting that the writings of the drafter of — and moving force behind — the FAA "reveals an intent to devise a remedy entirely for commercial disputes … between ‘merchants.’"); Sarah Rudolph Cole, Incentives and Arbitration: The Case Against Enforcement of Executory Arbitration Agreements Between Employers and Employees, 64 UMKC L. REV. 449, 467 (1996) ("The unrebutted legislative history created prior to the FAA’s passage establishes that only disputes arising out of commercial contracts were to be arbitrable; no agreements to arbitrate employment disputes in any industry were to be included."); Moses, supra note 17 at 106-08 (legislative hearings of the FAA ""make clear that the focus of the Act was merchant-to-merchant arbitrations, never merchant-to-consumer arbitrations"); David S. Schwartz, Enforcing Small Print to Protect Big Business: Employee and Consumer Rights Claims in an Age of Compelled Arbitration, 1997 WIS. L. REV. 33, 81 (1997) (analyzing legislative history of FAA and concluding "that enforcement of arbitration clauses was intended to remain within the sphere of the commercial paradigm" of contracts between merchants); Jean R. Sternlight, Creeping Mandatory Arbitration: Is It Just?, 57 STAN. L. REV. 1631, 1636 (2005) (noting that "to the limited extent that the possibility of [business-consumer or employer-employee] arbitration was considered by Congress in 1925, when it passed the FAA, those few who spoke on the issue made clear that they did not view such a use of arbitration as appropriate."); Jean R. Sternlight, Compelling Arbitration of Claims Under the Civil Rights Act of 1866: What Congress Could Not Have Intended, 47 U. KAN. L. REV. 273, 310 (1999) ("When Congress passed the FAA in 1925, it did not intend to allow employers or sellers of goods or services to require employees or consumers of such goods or services to resolve civil rights disputes through arbitration rather than in court. Nothing in the wording of the statute or in its legislative history supports such an interpretation."); Katherine Van Wezel Stone, Rustic Justice: Community and Coercion Under the Federal Arbitration Act, 77 N.C. L. REV. 931, 992 (1999) ("In the 1920s, most supporters of the FAA and the state arbitration laws intended the new statutes to apply to disputes between members of the same trade association or between participants in a common line of business."); Imre Stephen Szalai, Correcting A Flaw in the Arbitration Fairness Act, 2013 J. DISP. RESOL. 271, 278 (2013) (explaining why "the FAA was not intended to cover consumer disputes").

^52. Leslie, supra note 5 at 300-06.

^53. See, e.g., Arbitration Hearings, supra note 13 at 10 (FAA applies to disputes involving "a contract between merchants one with another, buying and selling goods") (statement of W. H. H. Piatt) (emphasis added)); Leslie, supra note 22 at 388 ("All of the Congressional testimony, hearings, and reports demonstrate that the FAA applied only to commercial disputes between merchants.").

^54. Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 637 (1985).

^55. In re Cotton Yarn Antitrust Litig., 505 F.3d 274, 282-83 (4th Cir. 2007) (citing Green Tree Fin. Corp.-Alabama v. Randolph, 531 U.S. 79, 90 (2000)); Am. Express Co. v. Italian Colors Rest., 570 U.S. 228, 242 (2013) (Kagan, J., dissenting) (The Effective Vindication Doctrine provides that "[a]n arbitration clause will not be enforced if it prevents the effective vindication of federal statutory rights, however it achieves that result.").

^56. Cotton Yarn Antitrust, 505 F.3d at 282-83 (noting that the Effective Vindication Doctrine provides that the "arbitration of the claim will not be compelled if the prospective litigant cannot effectively vindicate his statutory rights in the arbitral forum.").

^57. See In re Domestic Air Transp. Antitrust Litig., 137 F.R.D. 677, 693-94 (N.D. Ga. 1991) ("The Court finds a class action the only fair method of adjudication for plaintiffs. The individual claims of many class members are so small that the cost of individual litigation would be far greater than the value of those claims.").

^58. Carnegie v. Household Int’l, Inc., 376 F.3d 656, 661 (7th Cir. 2004) ("The realistic alternative to a class action is not 17 million individual suits, but zero individual suits, as only a lunatic or a fanatic sues for $30."); Myriam Gilles, Opting Out of Liability: The Forthcoming, Near-Total Demise of the Modern Class Action, 104 MICH. L. REV. 373, 407 (2005) (noting how class action waivers prevent the "spreading across multiple plaintiffs the costs of experts, depositions, neutrals’ fees, and other disbursements [, which] forces the individual claimant to assume financial burdens so prohibitive as to deter the bringing of claims").

^59. Kristian v. Comcast Corp., 446 F.3d 25, 54-55 (1st Cir. 2006).

^60. 559 U.S. 662 (2010).

^61. Id. at 684. Of course, the drafters and legislators behind the FAA never considered class-wide arbitration because they intended the law to apply only to individual inter-merchant disputes.

^62. 570 U.S. 228 (2013).

^63. Id. at 231.

^64. Lemley & Leslie, supra note 28 at 10-13.

^65. Homa v. Am. Express Co., 494 F. App’x. 191, 197 (3d Cir. 2012); CONSUMER FINANCIAL PROTECTION BUREAU, ARBITRATION STUDY: REPORT TO CONGRESS, PURSUANT TO DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT § 1028(a) at 1-10, § 1.4.1 (2015).

^66. Leslie, supra note 5 at 282-92.

^67. Theodore Eisenberg, Geoffrey P. Miller & Emily Sherwin, Arbitration’s Summer Soldiers: An Empirical Study of Arbitration Clauses in Consumer and Nonconsumer Contracts, 41 U. MICH. J.L. REFORM 871, 876 (2008) (For firms that impose arbitration clauses on their customers and employees, "less than 10% of their negotiated non-consumer, non-employment contracts included arbitration clauses.").

^68. Illinois Brick Co. v. Illinois, 431 U.S. 720, 746 (1977).

^69. Pollock & Riley, Inc. v. Pearl Brewing Co., 498 F.2d 1240, 1242-43 (5th Cir. 1974) (citing Bruce’s Juices, Inc. v. American Can Co., 330 U.S. 743, 751-52 (1947)).

^70. Lemley & Leslie, supra note 28 at 24-25 (citing examples).

^71. Leslie, supra note 23 at 414.

^72. James J. Calder et al., A New Alternative to Antitrust Litigation: Arbitration of Antitrust Disputes, 3 ANTITRUST 18, 18, 19-20 ("Parties to an arbitration generally. . . can limit the remedies available to the arbitrator." For example, an attorney representing a traditional antitrust defendant … might find it desirable "if the remedies available to the arbitrators are limited so as to exclude injunctive relief.").

^73. Arthur S. Langenderfer, Inc. v. S.E. Johnson Co., 729 F.2d 1050, 1059 (6th Cir. 1984) (quoting In re Multidistrict Vehicle Air Pollution, 538 F.2d 231, 234 (9th Cir. 1976)).

^74. See, e.g., James C. Just. Cos., Inc., v. Deere & Co., No. 5:06-CV-00287, 2008 WL 828923, at *5 (S.D. W.Va. Mar. 27, 2008) ("Court cannot conclude that the Dealership Agreement’s limitation on attorney’s fees and costs is inconsistent with the policies of the Sherman Act.").

^75. 15 U.S.C. § 15b.

^76. See, e.g., Kristian v. Comcast Corp., 446 F.3d 25, 43 (1st Cir. 2006); In re Cotton Yarn Antitrust Litig., 505 F.3d 274, 287 (4th Cir. 2007). See id. at 299 ( Johnston, J., concurring in part and dissenting in part).

^77. Charles E. Buffon & Joshua D. Wolson, Antitrust Arbitration Counseling, 19 ANTITRUST 31, 35 (2004) (citing Morrison v. Circuit City Stores, Inc., 70 F. Supp. 2d 815, 826-27 (S.D. Ohio 1999)) ("Thus, an arbitration agreement that requires the parties to file their claim within one year after becoming aware of a claim has been held enforceable, even when the statute of limitations period would otherwise be longer."); see, e.g., James C. Just., 2008 WL 828923 at *5.

^78. Leslie, supra note 23 at 417 (explaining reducing the statute of limitations from four years to one year effectively reduces damages by three-quarters); In re Cotton Yarn Antitrust Litig., 505 F.3d 274, 299-300 (4th Cir. 2007) (Johnston, J. concurring in part and dissenting in part) ("[W]hile the Antitrust Act effectively requires a four year look-back period, the contract at issue would only allow the arbitrator to consider one year of anti-competitive behavior.").

^79. In re NASDAQ Market-Makers Antitrust Litig., 169 F.R.D. 493, 527 (S.D.N.Y. 1996) (noting that "a class action is not only the most efficient and convenient method to resolve this controversy, it is the only ‘fair’ and ‘efficient’ means to adjudicate this controversy").

^80. See id. at 527 ("Moreover, although a large number of individuals may have been injured, no one person may have been damaged to a degree which would induce him to institute litigation solely on his own behalf.") (citing Green v. Wolf Corp., 406 F.2d 291, 296 (2d Cir. 1968)).

^81. See Kartell v. Blue Shield of Mass., Inc., 749 F.2d 922, 930 (1st Cir. 1984) (Breyer, J.) ("Competitors cannot agree, for example, to insist that their contracts . . . contain arbitration clauses, even though each individual competitor can make up his own mind to insist upon such a term in any, or all, of his contracts.").

^82. Dillard v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 961 F.2d 1148, 1155 (5th Cir. 1992) (affirming district court order compelling arbitration).

^83. In re Universal Serv. Fund Tel. Billing Pracs. Litig., No. 02-MD-1468, 2003 WL 21254765, at *6 (D. Kan. May 27, 2003) ("In sum, the court rejects plaintiffs’ argument that the arbitration clauses in this case are not enforceable because they are allegedly the product of an antitrust conspiracy.").

^84. Valspar Corp. v. E.I. DuPont de Nemours and Co., 15 F. Supp. 3d 928, 933-34 (D. Minn. 2014); In re Titanium Dioxide Antitrust Litig., 962 F. Supp. 2d 840 (D. Md. 2013); In re Universal Serv. Fund, 300 F. Supp. 2d at 1140; Leslie, supra note 22 at 429.

^85. Kristian v. Comcast Corp., 446 F.3d 25, 64 (1st Cir. 2006); In re Titanium Dioxide, 962 F. Supp. 2d at 854-55.

^86. TradeComet.com LLC v. Google, Inc., 435 F. App’x 31, 34 (2d Cir. 2011); Leslie, supra note 23 at 434; Leslie, supra note 5 at 289-90.

^87. In re Titanium Dioxide Antitrust, 962 F. Supp. 2d at 854-55; Kristian, 446 F.3d at 35 (applying arbitration clause retroactively in decision that notes the "strong federal policy of resolving any doubts concerning arbitrability in favor of arbitration"); In re Currency Conversion Fee Antitrust Litig., 230 F.R.D. 303, 312 (S.D.N.Y. 2004), modified on reconsideration, 2005 WL 1705285 (S.D.N.Y. July 22, 2005); In re Universal Serv. Fund, 300 F. Supp. 2d at 1124 (citing 9 U.S.C. § 2 and collecting cases) (claiming that "[t]he FAA specifically gives full force and effect to such retroactive arbitration provisions.").

^88. 35 F. Supp. 3d 407, 415 (S.D.N.Y. 2014), aff’d sub nom., Ross v. Citigroup, Inc., 630 F. App’x 79 (2d Cir. 2015), as corrected (Nov. 24, 2015).

^89. Id. at 416.

^90. Id. at 439.

^91. Id. at 418.

^92. Id. at 419.

^93. Id. at 426, 429.

^94. Leslie, supra note 23 at 437 ("These facts suggest that some banks were reluctant to impose arbitration clauses unless all of their major competitors were doing so as well, and that they wanted some assurances that all of the members of the Coalition were imposing arbitration clauses on their customers.").

^95. Ross, 35 F. Supp. 3d. at 424.

^96. Id. at 439.

^97. Leslie, supra note 22 at 440-48 (noting how Ross court failed to appreciate how antitrust conspiracies operate, impermissibly used evidence of legal activity to counterbalance illegal activity, misunderstood the antitrust law for inferring an agreement, misapplied the analysis of individual plus factors, mishandled the defendants’ inability to explain their suspicious activity, and improperly compartmentalized the plaintiffs’ evidence).

^98. Ross, 35 F. Supp. 3d at 452.

^99. Id.

^100. See supra note 23.

^101. Ross v. Am. Express Co., 35 F. Supp. 3d 407, 455 (S.D.N.Y. 2014), aff’d sub nom.. Ross v. Citigroup, Inc., 630 F. App’x 79 (2d Cir. 2015), as corrected (Nov. 24, 2015) (quoting Volt Info. Scis., Inc. v. Bd. of Trustees of the Leland Stanford Junior Univ., 489 U.S. 468, 476 (1989); Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983)).

^102. 431 U.S. 720 (1977).

^103. See id. at 745 (noting that apportioning damages among direct and indirect purchasers would create "additional uncertainty [that] would further reduce the incentive to sue).

^104. Id. at 730.

^105. 570 U.S. 228 (2013).

^106. Mark A. Lemley & Christopher R. Leslie, Antitrust Arbitration and Illinois Brick, 100 IOWA L. REV. 2115, 2116 (2015).

^107. Id. at 2122 ("At the time of the Illinois Brick decision, antitrust arbitration was not a possibility.").

^108. Associated Gen. Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S. 519, 533 (1983).

^109. See Lemley & Leslie, supra note 106 at 2131 ("Because direct purchasers are less likely to bring claims after Italian Colors, the Illinois Brick Court’s worry about double compensation is also substantially reduced.").

^110. Christopher R. Leslie, De Facto Detrebling: The Rush to Settlement in Antitrust Class Action Litigation, 50 ARIZ. L. REV. 1009 (2008).

^111. Lemley & Leslie, supra note 106 at 2132.

^112. Plaintiff United States’ Explanation of Plan to Refer this Matter to Arbitration, United States v. Novelis, Inc. et al., No. 1:19-cv-02033-CAB (N.D. Ohio Sept. 9, 2019), https://www.justice.gov/atr/case-document/file/1200821/download.

^113. Press Release, U.S. Dep’t of Justice Antitrust Div., Justice Department Sues to Block Novelis’s Acquisition of Aleris (Sept. 4, 2019), https://www.justice.gov/opa/pr/justice-department-sues-block-noveliss-acquisition-aleris-1.

^114. Press Release, U.S. Dep’t of Justice Antitrust Div., Justice Department Wins Historic Arbitration of a Merger Dispute (Mar. 9, 2020), https://www.justice.gov/opa/pr/justice-department-wins-historic-arbitration-merger-dispute.

^115. United States v. Novelis, Inc. et al., No. 1:19-cv-02033-CAB (N.D. Ohio Sept. 9, 2019) (Arquit, Arb.), https://www.justice.gov/atr/case-document/file/1257031/download.

^116. Press Release, U.S. Dep’t of Justice Antitrust Div., Justice Department Wins Historic Arbitration of a Merger Dispute (Mar. 9, 2020), https://www.justice.gov/opa/pr/justice-department-wins-historic-arbitration-merger-dispute.

^117. Lemley & Leslie, supra note 28 at 56.

^118. See, e.g., United States v. Google Inc., No. 1:11-cv-00688 (RLW), at 13-21 (D.D.C. Oct. 5, 2011), http://www.justice.gov/atr/cases/f275800/275897.pdf; In re Silicon Graphics, No. C-3626 (F.T.C. Nov. 14, 1995).

^119. Lemley & Leslie, supra note 28.

^120. Joshua P. Davis & Robert H. Lande, Defying Conventional Wisdom: The Case for Private Antitrust Enforcement, 48 GA. L. REV. 1, 26 (2013).