Antitrust and Unfair Competition Law

Competition: Spring 2020, Vol 30, No. 1


By Robert E. Connolly1

"A long habit of not thinking a thing wrong, gives it a superficial appearance of being right, and raises at first a formidable outcry in defense of custom. But, the tumult soon subsides. Time makes more converts than reason." Thomas Paine: Common Sense (1776).


A challenge to the per se rule stalled recently when the Supreme Court denied certiorari in a petition to find the per se rule unconstitutional in criminal antitrust cases.2 The appeal pitted one of the longest standing principles in antitrust law, the per se rule, against the constitutional rights of a criminal defendant to have a jury find the defendant guilty of every element of the offense beyond a reasonable doubt. The per se rule has long dictated that certain agreements (price fixing, bid rigging, and market allocation) are presumed to be an illegal restraint of trade and, even in a criminal case, the jury cannot consider whether the alleged agreement was reasonable.3 More recent Supreme Court decisions interpreting the 5th and 6th amendment,4 however, hold that conclusive presumptions deprive the defendant of his right to have the jury find every element of an offense beyond a reasonable doubt.5 The per se rule is one of those principles that has so long been accepted, the mind balks at thinking it wrong. But a constitutional protection trumps the storied history of the per se rule and one day, but not just yet, the per se rule will fall.

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The first problem with the per se rule is that it cannot be found in Section One of the Sherman Act. Section One condemns agreements in "restraint of trade." From a textualist point of view, the very same words cannot create the per se rule and the rule of reason. The Supreme Court has created, and later reversed, most per se violations while the operative language of the Sherman Act, "restraint of trade," has not changed.6 The per se rule against horizontal price fixing is the last per se rule standing. The Antitrust Division argues that the per se rule is not an evidentiary presumption but an interpretation of the statute: "it is as if the Sherman Act reads price fixing and bid rigging are illegal."7 But, it doesn’t. Textualism will prevail over the "it is as if the Sherman Act read" rule of statutory construction.

The second problem with the per se rule is that it clashes with constitutional protections enjoyed by a defendant in a criminal case. The Sixth Amendment provides that those "accused" of a "crime" have the right to a trial "by an impartial jury." This right, in conjunction with the Due Process Clause, requires that each element of a crime be proved to the jury beyond a reasonable doubt.8 Under the per se rule, however, once the court makes the factual determination that the per se rule applies, the jury is instructed that the government has proven a restraint of trade beyond a reasonable doubt because price fixing is per se illegal.

This article further explains that elimination of the per se rule is not the end of criminal antitrust prosecutions for price fixing and bid rigging ("the supreme evil of antitrust"). The mantra of the Antitrust Division with respect to enforcement of its criminal enforcement program is, "price-fixing is flat out fraud . . . nothing more than theft by well-dressed thieves."9 The most difficult part of criminal antitrust prosecutions is almost always proving the existence of the agreement and that the particular defendant joined the conspiracy. When a conspiracy involves holding meetings with phony agendas, using code words, shredding documents, and lying to customers about the reasons behind price increases, few defendants are going to admit they joined the conspiracy. It will be rare for a cartel member to argue that their secret agreement was actually procompetitive. In limited criminal cases proving, beyond a reasonable doubt, that an agreement restrained trade may be difficult for the prosecution, but with a maximum 10-year jail sentence, the per se rule cannot be justified because it makes the government’s case easier to prove.

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The nutshell argument for why the per se rule is unconstitutional in criminal cases is as follows. There are three elements to a Section One Sherman Act offense: 1) an agreement; 2) in restraint of trade; and 3) that affects interstate or foreign trade or commerce. The statutory text is identical for all Section One cases: an agreement "in restraint of trade . . . . is declared to be illegal." But, in a criminal price fixing case, the jury is instructed by the court that the agreement [if proven] is a restraint of trade and the jury’s function is only to find whether the defendant knowingly joined the agreement. The criminal defendant does not get to offer evidence and ask the jury to decide whether the agreement was "in restraint of trade." Ironically, one would expect that the defendant would have more leeway, not less, in a criminal case to prove he did not violate the Sherman Act. The per se rule, however, forecloses any argument that the agreement was not a restraint of trade.

In the most recent Supreme Court Sherman Act case, Ohio v. American Express Co.10 the Court explained the basis for the per se rule: "A small group of restraints are unreasonable per se because ‘they always or almost always tend to restrict competition and decrease output.’"11 This is perhaps reasonable streamlining/efficiency in a civil case,12 but in a criminal case, the government does not get to prove the defendants are almost always guilty; the prosecution needs to prove that this defendant’s agreement was, in fact, a restraint of trade. Below is a "quick look" at recent and ongoing challenges to the per se rule.

A. Sanchez, et al. v. United States13

In a recent opinion, the Ninth Circuit found the per se rule applied to auction bid rigging.14 United States v. Joyce15 was an appeal by an individual who conspired to rig bids at real estate foreclosure auctions. The Joyce court explained, "If a business arrangement is a type conclusively presumed to be unreasonable, the government is relieved of any obligation to prove the unreasonableness of the specific scheme at issue and any business justification for the defendant’s conduct is neither relevant nor admissible."16 In a similar auction collusion appeal that followed shortly thereafter, United States v. Sanchez,17 the Ninth Circuit again found the per se rule constitutional.18 At oral argument in Sanchez, however, one Ninth Circuit panel judge was sympathetic to the defendants’ position and noted: "I think if it’s going to get straightened out [whether the per se rule is constitutional] it’s going to have to require an en banc panel of this court or more likely the Supreme Court itself."19

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The Sanchez defendants appealed to the Supreme Court.20 In their opening brief, petitioners stated: "The question presented is whether the operation of the per se rule in criminal antitrust cases violates the constitutional prohibition—grounded in the Fifth and Sixth Amendments—against instructing juries that certain facts, presumptively, establish an element of a crime."21 The Fifth and Sixth Amendment require that the jury be the fact-finder in a criminal case of every essential element of the crime. Because the jury was not allowed to decide whether the agreement was a restraint of trade, the defense was barred from proffering procompetitive evidence. Two amicus briefs were filed in support of the Supreme Court taking the case; one by National Association of Criminal Defense Lawyers,22 and another by the Due Process Institute.23

The United States urged the Supreme Court not to take the case, arguing that "the per se rule is an interpretation of the Sherman Act, not an evidentiary presumption, and that it can be constitutionally applied in a criminal antitrust protection."24 The government’s brief recounts the history of major Supreme Court per se rule cases and concludes:

As those decisions illustrate, the per se rule is an interpretation of the Sherman Act; it provides that certain anticompetitive conduct falls "within the purview of Section One as a matter of law because it categorically constitutes an unreasonable restraint of trade." Standard Oil, 221 U.S. at 65; see id. at 59-60 (interpreting the "language of" Section One in light of the common law).25

The Supreme Court denied certiorari on January 13, 2020, ending this challenge to the per se rule.26

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B. Heir Locators

In another recent criminal antitrust case, commonly known as Heir Locators,27 Utah federal district court Judge Sam initially ruled that an indictment alleging a customer allocation scheme would be tried as a rule of reason case.28 The Antitrust Division appealed this ruling and, at the strong urging of the Tenth Circuit,29 the district court reversed his position. Upon reconsideration the "court finds that the agreement in question, known as the ‘Guidelines,’ is a horizontal customer allocation agreement and thus subject to the Per Se approach."30 The defendants subsequently pled guilty.31 The government requested a sentence of 21 months for the individual defendant. The judge declined jail time and sentenced him to one-year probation.32

The judge’s wrestling with whether the per se rule would apply in Heir Locators is a clear example of how the court is the fact-finder in a per se case. In reversing himself, Judge Sam noted: "There certainly may have been other additional reasons for entering into the agreement, as laid out by Defendants; but as laid out in Kemp [the Tenth Circuit decision], if the Per Se approach applies, there is no need to weigh the benefits that could come from such an agreement."33 Judge Sam noted the implications of the per se rule for the defendant: "This [the per se rule] provides an evidentiary shortcut through the Rule of Reason’s minutiae; in such cases, the Per Se approach is justified based on efficiency.

Arizona v. Maricopa Cty. Med. Soc’y., 457 U.S. 332, 344 (1982)."34

A court’s decision regarding whether the facts call for application of the per se rule is often the determining factor of who wins in an antitrust case.35 District courts around the country are currently grappling with whether the per se rule applies in various "no-poach" cases where employers have agreed to not hire each other’s employees.36

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C. Current Per Se Challenges: United States v. Aiyer37 and United States v. Lischewski38

On November 20, 2019, a jury found Akshay Aiyer guilty of knowingly joining a conspiracy to fix prices and rig bids in the foreign exchange market for Central and Eastern European, Middle Eastern, and African ("CEEMEA") currencies.39 In a post-trial motion defending the use of the per se rule, the government wrote: "The per se rule ‘treat[s] categories of restraints as necessarily illegal’ and thereby ‘eliminates the need to study the reasonableness of and individual restraint in light of the real market forces at work.’ Leegin Creative Leather Prods., Inc. v. PSKS., 551 U.S. 877 877 (2007)."40 The defendant will likely appeal the application of the per se rule at his criminal trial to the Supreme Court.

On December 3, 2019, a California federal jury found Bumble Bee Foods LLC’s former CEO Christopher Lischewski guilty of price-fixing on allegations that he conspired with executives at rivals StarKist and Chicken of the Sea to illegally raise the price of canned tuna.41 The defendant challenged the per se rule in a pretrial motion and it will certainly be part of his appeal.42 These cases demonstrate that defendants in criminal antitrust cases will likely continue to raise the argument, until the Supreme Court addresses the issue, that use of the per se rule in a criminal case is unconstitutional.


The per se rule came into use when all cases—criminal or civil—seemed like civil cases because the Sherman Act was a misdemeanor and penalties were almost always a modest financial slap on the wrist. In United States v. Socony Vacuum Oil Co.,43 for example, individuals were convicted but the "harshest" sentence meted out to any individual defendant was $1,0 0 0.44 The consequences to convicted criminal defendants in Sherman Act cases, however, have since increased dramatically. Short jail sentences became a realistic possibility when the Sherman Act became a felony in 1974 with a three-year maximum prison sentence. Today, the maximum term of imprisonment is 10 years.45 The Antitrust Division has actually sought 10-year prison sentences for two convicted defendants.46 Additionally, the Sherman Act is applied extraterritorially. Foreign defendants have lost jobs, been placed on Red Notices, seized by Interpol, and experienced prison conditions in multiple countries while being extradited to face trial and/or prison in the United States:

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Romano Pisciotti spent 669 days in custody. This included two hours in a police station in Lugano, Switzerland; 10 months in a jail in Frankfurt, Germany fighting extradition [on a Sherman Act indictment]; and eight months in a U.S. federal prison in Folkston, Georgia, in a room with around 40 mainly Mexican inmates and a single corner toilet. 47

The Antitrust Division continues to exercise its ability to extradite criminal Sherman Act defendants. In January 2020, a former air cargo executive was extradited from Italy on an indictment returned in 2010.48

Corporate criminal fines have also skyrocketed. In one recent financial crimes cartel prosecution, fines of over $3 billion were imposed collectively against the corporate defendants.49 The per se rule developed at a time when the Sherman Act penalties were a nuisance and a defendants’ Fifth and Sixth Amendment right to have a jury decide every fact necessary for conviction was undeveloped. Times have changed. The greatly increased penalties for convicted Sherman Act criminal defendants will continue to keep the per se rule a subject of defendants’ motions and appeals.

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Section One of the Sherman Act states, "[e]very contract, combination . . . , or conspiracy, in restraint of trade or commerce . . . is declared to be illegal."50 The Supreme Court has said: "the problem presented by the language of Section One of the Sherman Act is that it cannot mean what it says."51 But the Sherman Act can mean exactly what it says if the text is given its natural meaning. A procompetitive (or neutral) agreement does not restrain trade. To restrain is "to limit" or "to hold back."52 If an agreement is pro-competitive, it expands trade; if neither pro nor anticompetitive, it does not restrain trade in the most commonly understood usage of the words, either today or back in 1890. The "trade" the Sherman Act was concerned with was clearly not trade such as a contract between Standard Oil Company and a customer buying a barrel of oil. That contract "restrains" trade only when given a very literal meaning—that the customer is not free to buy that barrel from another vendor. Today, we would say that such contracts generally are procompetitive or at worst neutral—i.e. they allow and expand trade. There is no indication in the legislative history, nor common sense, that the Sherman Act intended to literally outlaw every commercial contract. Congress was concerned with the agreements/trusts that made Standard Oil the equivalent of a modern day cartel. The great trusts of the day motivated passage of the Sherman Act: the Sugar Trust, Oil Trust, and Banking Trust, etc.53 did restrain trade. It is clear that Congress used the term "trade" in the way current antitrust cases use "market." It is a rule of statutory construction not to give words an implausible interpretation.54 The Supreme Court should have found that Congress did not intend that "all" contracts were restraints of trade given that Congress, including Senator Sherman himself, likely had entered into contracts that literally "restrained trade."

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Unfortunately, in 1897 the Supreme Court ruled that virtually any commercial contract restrained trade.55 Of course in one sense it did; the purpose of a contract is to restrain, or limit the parties to the terms of the contract. In the famous Standard Oil56 case of 1911, the Supreme Court dealt with this seemingly absurd result by "amending" the Sherman Act and introducing the "rule of reason," declaring that only unreasonable restraints of trade are illegal. In a dissent, Justice Harlan objected that the Court, rather than Congress, amended the legislation. Justice Harlan wrote that the Court "has now done what it then said it could not constitutionally do. It has, by mere interpretation, modified the act of Congress."57 Adding "unreasonable" to the Sherman Act was, however, "harmless error" since the modification was redundant and only gave the words of the Sherman Act their natural and intended meaning. The real mischief was the Supreme Court’s belief that it was required to amend the Sherman Act because a literal interpretation was non-sensical. The rule of reason was soon followed in 1927 by the establishment of the per se rule in United States v. Trenton Potteries Co.58 Over its history, the Supreme Court has created, and later repealed, per se rules for vertical price fixing, maximum resale price maintenance, vertical non-price restraints, boycotts and tying. There was no legislative basis for doing this. The operative text of the statute, "restraint of trade," has not changed. The inquiry under the Sherman Act Section One must always be whether an agreement (if one is proved) constitutes a restraint of trade because that is what the statute prohibits. The Supreme Court was wrong in United States v. Socony-Vacuum Oil Co.,59 when it held that any horizontal agreement that tampers with price is per se illegal: "[w]hatever economic justification particular price-fixing agreements may be thought to have, the law does not permit an inquiry into their reasonableness."60 The question under the Sherman Act is always whether the agreement restrained trade. In fact, in Broadcast Music, Inc. v. CBS, Inc.61 the Supreme Court held that blanket license issued by American Society of Composers, Authors and Publishers (ASCAP) and Broadcast Music, Inc. (BMI) did not necessarily constitute price fixing—in other words, the per se rule did not apply to these agreements. As Justice Brandies correctly observed nearly a century ago, "[t]he true test of legality is whether the restraint imposed is such as merely regulates and perhaps thereby promotes competition or whether it is such as may suppress or even destroy competition."62 I would add that this is the only test that can be read from the words "restraint of trade."

A look at the checkered history of per se rules undermines the position of the Antitrust Division that "since the per se rules define types of restraints that are illegal without further inquiry into their competitive reasonableness, they are substantive rules of law, not evidentiary presumptions."63 If so, they are substantive laws improperly created by the Supreme Court. The Sherman Act cannot read "as if the act said [resale price maintenance] [maximum resale price fixing][etc.] were illegal," and later, with no change in the language, not read that way anymore. The Supreme Court has found many types of agreements to be per se violations, only later to reverse itself:

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Restraint Per Se Born Per Se Deceased
Vertical Minimum Price Fixing 191164 200765
Vertical Non-Price Restraints 196766 197767
Vertical Maximum Price-fixing Agreements 196868 199769
Group Boycotts 195970 198571 (life support)
Tying 194772 199273 (life support)

The Supreme Court has been creating and dismantling per se rules as evidentiary short cuts, i.e., presumptions, in accordance with what it believed to be the sound economic principles of the day. The operative text of the statute, "restraint of trade" has not changed between Dr. Miles and Leegin.

The Antitrust Division also acts as a fact-finder of what constitutes a per se violation. The Antitrust Division helpfully publishes guidelines setting forth what types of Sherman Act violations it will [currently] prosecute civilly and what types it reserves for criminal per se treatment.74 The standard has changed over time. Recall that the Antitrust Division at one time charged a corporate defendant criminally for vertical price restraints.75 The corporate defendant was precluded from defending itself by arguing that the agreement did not restrain trade because, at the time, the Supreme Court had ruled that vertical price restraints were per se violations. Had the question been put to a jury "did the agreement restrain trade?", perhaps the blanket condemnation of resale price maintenance and other, now extinct, per se rules, would have met an earlier demise.

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Before proceeding to demonstrate why the per se rule is unconstitutional in a criminal case, it is worthwhile to see what the jury is instructed if a judge finds the per se rule applies. In the Sanchez real estate foreclosure auction prosecution, this was part of the per se instruction given to the jury:76

The Sherman Act makes unlawful certain agreements that, because of their harmful effect on competition and lack of any redeeming virtue, are conclusively presumed to be illegal, without inquiry about the precise harm they have caused or the business excuse for their use. Included in this category of unlawful agreements are agreements to rig bids.
Therefore, if you find that the government has met its burden with respect to each of the elements of the charged offense, you need not be concerned with whether the agreement was reasonable or unreasonable, the justifications for the agreement, or the harm, if any, done by it.77

This is a typical jury instruction in a criminal antitrust prosecution.

Likewise, the ABA’s Model Jury Instructions in Criminal Antitrust Cases for Per Se Violations of the Antitrust Laws reads:

The Sherman Act makes unlawful certain agreements that, because of their harmful effect on competition and lack of any redeeming virtue, are conclusively presumed to be an unreasonable restraint on trade and are always illegal, without inquiry about the precise harm they have caused or the business excuse for their use. Included in this category of unlawful agreements are agreements to [fix prices,] [rig bids,] [allocate customers, and] [allocate territories].78

As Judge Robert Bork has written: "Behavior is illegal per se when the plaintiff need prove only that it occurred in order to win his case, there being no other elements to the offense and no allowable defense."79

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While Justice Neil Gorsuch is known as a "textualist;" he is not the only "textualist" on the Supreme Court. Every judge starts with the text of the statute.80 Justice Elena Kagan has said that the Supreme Court is by-and-large a textualist court, having adopted much of the late Justice Antonin Scalia’s judicial reasoning.81 The problem with the per se rule from a textualist point of view is that the per se rule is simply not in the statute. Section One of the Sherman Act declares illegal "[e]very contract . . . or conspiracy in restraint of trade."82 The very same words in the text cannot be read to create two different standards for liability: the per se rule and rule of reason.

In United States v. Brighton Building & Maintenance Co.,83 the Seventh Circuit quoted favorably the position of the Antitrust Division set forth in its appellate brief: "Since the per se rules define types of restraints that are illegal without further inquiry into their competitive reasonableness, they are substantive rules of law, not evidentiary presumptions. It is as if the Sherman Act read: ‘An agreement among competitors to rig bids is illegal.’"84 (emphasis added). The Antitrust Division has repeated "it is as if the Sherman Act read" in one of its most recent filing on a per se challenge.85 To buy this argument, however, one must accept that, at one time, "it was as if the Sherman Act read resale price maintenance is illegal." And then, without any change in the statute, it no longer read that way and the Supreme Court overruled Dr. Miles. The fact is that the Sherman Act simply says, and has always simply said, agreements in "restraint of trade" are illegal. Per se rules have been a judicial creation. The Antitrust Division has conceded this in the past, explaining "the argument that the per se rule is an unconstitutional evidentiary presumption ‘asks us in effect to overrule the Supreme Court’s decisions establishing the per se rule.’" (emphasis added). The Supreme Court agrees that it created per se rules. In Topco v. United States,86 the Supreme Court stated:

The fact is that courts are of limited utility in examining difficult economic problems. Our inability to weigh, in any meaningful sense, destruction of competition in one sector of the economy against promotion of competition in another sector is one important reason we have formulated per se rules.87

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Ironically, in Topco, the Supreme Court applied the per se rule to find an intrabrand territorial allocation scheme to be illegal per se, a decision many commentators believe wrongly condemned a procompetitive agreement.

A recent Supreme Court case illustrates that, good intentions aside, the Supreme Court simply cannot add words to the Sherman Act to create substantive rules. The recent 9-0 opinion in Digital Realty Trust Inc. v. Somers88 involved the statutory construction of SEC whistleblower legislation requiring a whistleblower to report conduct to the SEC in order to be eligible for an award. The whistleblower and the government both argued that to give effect to the legislation, the statute should be interpreted to include rewarding a whistleblower who reported illegal conduct internally within his or her company, but not to the SEC. The Supreme Court did not deny that Somers and the Solicitor General made sound policy arguments but stated: "We next address these concerns and explain why they do not lead us to depart from the statutory text."89 Similarly, in Morrison v. National Australia Bank Ltd.,90 Justice Scalia wrote for the majority that "[i]t is our function to give the statute the effect its language suggests, however modest that may be; not to extend it to admirable purposes it might be used to achieve. . . ."91

The Antitrust Division highlights the fact that the Supreme Court has created two different legal standards—based on one the very same words "restraint of trade." A recent government brief in a per se challenge states:

The Supreme Court, however, has explained that Section 1 "prohibit[s] only unreasonable restraints of trade" and that a restraint is unreasonable if it violates either of two substantive rules of law—the rule of reason or the per se rule. Bus. Elecs. Corp. v. Sharp Elecs. Corp., 485 U.S. 717, 723 (1988).92

The Sherman Act does not set forth two substantive rules of law; the Supreme Court formulated them for the various reasons expressed in the Supreme Court per se jurisprudence.

The Supreme Court and Department of Justice have justified per se rules, likening them to rules against speeding:

The per se rules in antitrust law serve purposes analogous to per se restrictions upon, for example, stunt flying in congested areas or speeding. While some "violations of such rules actually cause no harm," the rules are "justified by the State’s interest in protecting human life and property." [The rules] are "supported . . . by the observation that every speeder and every stunt pilot poses some threat to the community" and that a "bad driver going slowly may be more dangerous than a good driver going quickly, but a good driver who obeys the law is safer still."93

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This is a legitimate argument for Congress to make price fixing per se illegal, but the text of the statute simply cannot be read to mean there is a "rule of reason" speed limit for certain drivers/cars and a per se rule for others. A 70-mile-per-hour speed limit can mean just one thing: "did the driver exceed the limit?" In a Sherman Act Section One case, the inquiry, based on the text of the statute, can only be "did the agreement restrain trade?" In a criminal case, the jury should be the fact-finder on that critical element of the offense.


A look at the rationale behind the per se rule demonstrates why it is inappropriate in a criminal antitrust case:

This principle of per se unreasonableness not only makes the type of restraints that are proscribed by the Sherman Act more certain to the benefit of everyone concerned, but it also avoids the necessity for an incredibly complicated and prolonged economic investigation into the entire history of the industry involved, as well as related industries, in an effort to determine at large whether a particular restraint has been unreasonable—an inquiry so often wholly fruitless when undertaken.95

Put another way, an individual is facing up to 10 years in prison for an alleged Sherman Act violation, but the fact-finder is not going make "an effort to determine at large whether a particular restraint has been unreasonable . . . [because a per se rule] avoids the necessity for an incredibly complicated and prolonged economic investigation. . . ." You can be sure the defendant would like to take the time to determine if the agreement he is charged with was actually a restraint of trade.

Another rationale of the per se rule is:

The anti-competitive potential inherent in all price-fixing agreements justifies their facial invalidation even if procompetitive justifications are offered for some. Those claims of enhanced competition are so unlikely to prove significant in any particular case that we adhere to the rule of law that is justified in is general application.96

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In other words, Mr. Defendant, it is so unlikely that your agreement did not restrain trade that we are just going to skip over that element of the criminal statute. It is true that, in hard-core horizontal price fixing or bid rigging, it is highly unlikely that the defendant will be able to prove, or even try to prove, that the alleged agreement did not restrain trade. Criminal antitrust cases will still predominantly be defended by "there was no agreement" or "I was not a party to the agreement." But if a defendant is charged with an agreement in restraint of trade, the Constitution at least allows the defense the right to argue—to the jury—that the agreement did not restrain trade.

In Sanchez, a real estate foreclosure auction collusion case, the defendants wanted to argue that, given the extraordinary control [i.e., market power] the banks had over the process and the unfair practices the banks employed to the bidders’ disadvantage, coordination was the only way the defendants would have participated in the process:

In short, petitioners sought to show at trial that, given the extraordinary barriers outsiders confronted in California’s foreclosure auction system, they had to coordinate bids in order to participate at all. They sought to show that their coordination efforts, while ostensibly anticompetitive, were actually procompetitive. Petitioners’ defense, moreover, was not based on mere supposition. Their expert witnesses offered empirical analyses showing that, after the government raided petitioners’ businesses and ended the supposed conspiracy, auction prices actually went down.97

In Heir Locators, the defendants argued that they "negotiated a complicated agreement that governed a very limited subset of estates and used profit sharing to incentivize efficiency (pooling resources and avoid duplication)."98 The defendants also noted the uniqueness of the heir locator industry, factors that were adopted by Judge Sam when he initially found the rule of reason would apply to the case.99

In Ohio v. American Express Co.100 the Court explained the per se rule: "A small group of restraints are unreasonable per se because they always or almost always tend to restrict competition and decrease output." 101 By contrast, the rule of reason is a "fact-specific assessment" used "to assess the restraint’s actual effect on competition."102 The Sixth Amendment requires that the jury must make this "fact-specific assessment." In a criminal case, the finding of elements of the offense must always be "assign[ed] solely to the jury."103

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The belief that the per se rule in a criminal antitrust case is unconstitutional is supported by the Supreme Court’s line of Sixth Amendment cases starting with Apprendi v. New Jersey,104 where the defendant was given an enhanced sentence based on a fact found by the sentencing judge, not the jury. The Supreme Court found this to be unconstitutional under the Sixth Amendment right to a jury trial, stating that: "[o]ther than the fact of a prior conviction, any fact that increases the penalty for a crime beyond the prescribed statutory minimum must be submitted to a jury and proved beyond a reasonable doubt."105 Likewise in United States v. Booker106 the Supreme Court ruled that the

Sixth Amendment right to jury trial requires that a defendant’s sentence exceeding the statutory maximum be based only on facts either admitted by the defendant or proved beyond a reasonable doubt by the jury. For example, when the Antitrust Division seeks a corporate fine above the Sherman Act statutory maximum of $100 million, the defendant either has to agree to certain "twice the gain or twice the loss" facts in the plea agreement or the government must charge and prove them to a jury. It would be odd, in the sense that it would be unconstitutional, if the government does not have to prove to the jury that the defendant in fact restrained trade but does have to prove to the amount of loss from the alleged restraint.

The treatment of the "materiality" element of a perjury/false statement trial provides an analogous situation. Historically, in a criminal trial for false statement/perjury, the court decided one element of the offense—whether the alleged a false statement was material. But in United States v. Gaudin107 the Supreme Court held that materiality is an element of the offense, so it must be determined by the jury. Under the Sixth Amendment, a criminal conviction must "rest upon a jury determination that the defendant is guilty of every element of the crime" in question, beyond a reasonable doubt.108 But, under the per se rule, once the Court declares the restraint unreasonable, the jury is left only to find whether the restraint existed.

The Sanchez petitioners discuss Carella v. California,109 another example of the Supreme Court’s heightened attention to a defendant’s Sixth Amendment rights. Carella involved a state law that required juries to be instructed that "intent to commit theft by fraud is presumed from failure to return rented property within 20 days of demand.110 The Supreme Court found that such a "conclusive presumption" violated the Fifth and Sixth Amendment because it "removes the presumed element from the case once the State has proved the predicate facts giving rise to the presumption."111 The Court did not consider whether individuals who keep a rented item for more than 20 days always do, in fact, intend to steal it.112 The mere withdrawal of the intent issue from the jury itself violated the Constitution.

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Textualism and constitutional concerns can create unusual allies on the Supreme Court. To quote one commentator, "progressive" Supreme Court Justice Sonia Sotomayor and "textualist" Justice Neil Gorsuch "are on a mission to restore criminal defendants’ constitutional rights."113 The two justices teamed up to champion Sixth Amendment safeguards against notoriously flawed forensic analysis. They also attacked policing for profit, endorsing Eighth Amendment protections against civil forfeiture. The two joined forces, once again, to stick up for the right to a trial by jury when the government seeks to impose crippling fines in the form of criminal restitution.114 The textualist argument is that the Sherman Act prohibits "restraints of trade;" the constitutional argument is that this element must be found by a jury beyond a reasonable doubt in order to convict. The two propositions will attract enough Justices to overturn the per se rule in criminal cases.


In Leegin Creative Leather Products Inc. v. PSKS Inc.115 the Supreme Court overturned its nearly 100-year per se rule against resale price maintenance. The opinion states that "[s]tare decisis is not as significant in this case, however, because the issue before us is the scope of the Sherman Act."116 In overturning many other long-standing antitrust precedents, the Supreme Court has noted: "[j]ust as the common law adapts to modern understanding and greater experience, so too does the Sherman Act’s prohibition on ‘restraints of trade’ evolve to meet the dynamics of present economic conditions."117 It is not just economic conditions that have changed. The 10-year maximum jail sentence for an antitrust violation, the severe extradition and immigration consequences and corporate fines in the billions for a criminal antitrust conviction should result in a closer look at the constitutional rights of criminal antitrust defendants. This is not your misdemeanor Sherman Act anymore. In a concurrence in Sessions v. Dimaya,118 Justice Gorsuch noted the dramatic increased penalties in civil litigation warranted a stricter approach to vagueness than before when civil penalties were relatively minor.119 The dramatic increase in Sherman Act penalties—and actual sentences imposed—will continue to focus attention on the Sixth Amendment right to a jury. A last, but important, point on stare decisis: "[t]he force of stare decisis is at its nadir in cases concerning procedural rules that implicate fundamental constitutional protections."120

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A finding that the per se rule is unconstitutional will not mean the end to the criminal prosecution of price fixing and bid rigging cartels. The Sherman Act as a criminal statute can be fixed in several ways.

1. Congress Can Amend the Statute

As noted, the Antitrust Division continues to argue that "it is as if the Sherman Act read. . . ." While the Sherman Act does not read that way now, Congress can amend the Sherman Act so that it actually does say that price fixing and bid rigging are illegal per se. Justice Gorsuch wrote in his dissent in Perry v. Merit Systems Protection Board:121 "If a statute needs repair, there’s a constitutionally prescribed way to do it. It’s called legislation."122 While this seems a simple fix, since it involves Congress, it is prudent to offer alternatives.

2. Proceed In Criminal Cases Without the Per Se Rule

Another approach to cure the unconstitutionality of the per se rule for the Supreme Court to overrules this last per se rule standing and allow the jury to decide whether the agreement charged in an indictment was a restraint of trade.123 This does not mean that every price-fixing/bid rigging trial is going to be an unwieldly foray into market share, elasticity of prices and economic theory. Typically, it is the "last man standing" defendant who goes to trial because it is too late to secure immunity or a 5K downward departure124 for cooperation, and without one, the sentencing guidelines can be draconian. Trial may be this defendant’s best "bad" option. Even at trial, only those defendants facing a mountain of evidence tying them to a price-fixing or bid-rigging conspiracy are going to defend by arguing, "Yes, I fixed prices [or rigged bids], but it was procompetitive— and not a restraint of trade!" The secrecy of price fixing and bid rigging (code names, encrypted messages, falsified travel reports, etc.) will make it hard to argue in the alternative that "I wasn’t a member of the conspiracy, but if you find that I was, I assure you it was not a restraint of trade." Former Antitrust Division Assistant Attorney General Bill Baer stated that "price-fixing, bid rigging and market allocation agreements among companies that hold themselves out to the public as competitors are inherently deceptive and defraud consumers who expect the benefit of competition."125 The "restraint of trade" is in the secrecy or deception—customers believe there is competition when in fact there is collusion.126 As long as the Antitrust Division sticks to these kinds of conspiracies to indict criminally, proving that the agreement restrained trade will be harder, of course, without the per se rule, but less daunting a challenge as may first appear.

[Page 134]

The elimination of the per se rule would not open the door to "an incredibly complicated and prolonged economic investigation into the entire history of the industry involved. . . ." The Federal Rules of Evidence on relevance give the judge sufficient latitude to keep the trial manageable and prevent a defendant from bogging down a trial with a complex revisit of the history of an industry. Not every case calls for a full market analysis: "What is required, rather, is an enquiry meet for the case, looking to the circumstances, details, and logic of a restraint.127 Federal Rule of Evidence 401128 provides the court the ability to exclude irrelevant evidence and Federal Rule of Evidence 403129 allows the exclusion of even relevant evidence on the grounds that it is cumulative, confusing or a waste of time. For example, in Trenton Potteries Co, the court held that a price-fixing agreement among competitors is an unreasonable restraint "without the necessity of minute inquiry whether a particular price is reasonable or unreasonable. . . ."130 This would still be a correct statement of law even if the per se rule were abolished because the reasonableness of the price is not relevant to whether trade was restrained.

It is undeniable that going from a presumption that an agreement restrained trade to having to prove it will be more difficult for criminal antitrust prosecutors. But with a potential 10-year jail sentence, the goal should not be to lighten the prosecutors’ burden. To paraphrase "Justice Spiderman," "With great jail sentences come greater constitutional protections."

[Page 135]

3. The Per Se "Plus" Fix

I’ve offered a third solution: "Per Se "Plus:" A Proposal to Revise the Per se Rule in Criminal Antitrust Cases.131 The Antitrust Division can add fraud counts to criminal indictments (as it already sometimes does). The Division prosecutes cartels criminally where "agreements are generally secret, and businesses and consumers are defrauded and misled because the conspirators continue to hold themselves out as competitors."132 As a former Antitrust Division Criminal Deputy Assistant Attorney General has stated when lobbying for 10-year maximum prison sentences, "the [criminal] cases that we are charging and prosecuting are unmistakable fraud."133 If the prosecutor thinks she cannot prove an element of fraud, or convince a jury that the defendant engaged in a restraint of trade, perhaps a civil complaint, not a criminal indictment, is in order.


As a former Antitrust Division prosecutor, when I started researching this issue, I did not expect to reach the conclusion that my former "best friend," the per se rule, was unconstitutional. However, I can relate to something Justice Gorsuch wrote when he was on the Tenth Circuit Court of Appeals: "Indeed, a judge [researcher] who likes every result he reaches is very likely a bad judge [researcher], reaching for results he prefers rather than those the law compels."134 New questions are being raised about the constitutionality of the per se rule that cannot be satisfactorily answered because a fresh look exposes its flaws. Cartels remain "the supreme evil of antitrust,"135 but the per se rule is not a constitutionally permitted way to fight them. The Supreme Court will eventually overturn the per se rule.

[Page 136]



1. Robert E. Connolly was the Chief of the Philadelphia Office of the Antitrust Division, United States Department of Justice, from 1994 until it was closed in 2013. He is now in private practice, at Law Office of Robert Connolly. He writes an ABA award-winning blog, Cartel Capers, available at

2. Sanchez et al. v. United States, No. 19-288, ___ U.S. ___ , 2020 WL 129558 (Jan. 13, 2020) (denying cert. petition).

3. Under the per se rule there is "a conclusive presumption that the restraint is unreasonable." Arizona v. Maricopa Cty. Med. Soc’y., 457 U.S. 332, 344 (1982); see also N. Pac Ry. Co. v United States, 356 U.S. 1, 5 (1958) (price fixing is "conclusively presumed to be unreasonable and therefore illegal without elaborate inquiry as to the precise harm [it] ha[s] caused or the business excuse for [its] use.").

4. The Fifth Amendment to the United States Constitution provides in pertinent part: "No person shall be held to answer for a capital or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury. . . . nor be deprived of life liberty, or property without due process of law. . . ." The Sixth Amendment provides in pertinent part: "In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury. . . ."

5. The Supreme Court has repeatedly held that any jury instruction in a criminal case that takes an element away from jurors by directing them to rely on an "irrebuttable or conclusive presumption" is unconstitutional. Francis v. Franklin, 471 U.S. 307, 317 (1985); see also, e.g., Carella v. California, 491 U.S. 263, 265-66 (1989) (per curiam); Sandstrom v. Montana, 442 U.S. 510, 517 (1979); Morissette v. United States, 342 U.S. 246, 274-75 (1952).

6. Compare this view of the court’s role with that of Justice Gorsuch’s who wrote in one of his last opinions while on the Tenth Circuit Court of Appeals about the court’s job: "[I]t is (or should be) emphatically to apply, not rewrite, the law enacted by the people’s representatives." A.M. ex rel. FM v. Holmes, 830 F.3d 1123, 1170 (10th Cir. 2016).

7. In United States v. Brighton Building & Maintenance Co., 598 F.2d 1101, 1106 (7th Cir. 1979) (As the government put in its brief, "Since the per se rule defines types of restraints that are illegal without further inquiry into their competitive reasonableness, they are substantive rules of law, not evidentiary presumptions. It is as if the Sherman Act read: ‘An agreement among competitors to rig bids is illegal.’"). The Antitrust Division has repeated this position in numerous later appellate briefs discussed herein.

8. Alleyne v. United States, 570 U.S. 99, 104 (2013); United States v. Gaudin, 515 U.S. 506, 510 (1995), In re Winship, 397 U.S. 358 (1970).

9. Joel I. Klein, Assistant Att’y Gen., Antitrust Div., U.S. Dep’t. of Justice, The Antitrust Division’s International Anti-Cartel Enforcement Program, Remarks to ABA Antitrust Section Spring Meeting (Apr. 6, 2000), available at; see also Robert E. Connolly, Per Se "Plus:" A Proposal to Revise the Per se Rule in Criminal Antitrust Cases, 29 Antitrust 105 (Spring 2015).

10. 138 S. Ct. 2274 (2018).

11. Id. at 2283.

12. The per se rule would survive in civil cases, even if it is found unconstitutional in a criminal case, because the constitutional right against conclusive presumptions does not necessarily apply in civil cases if they "bear a sufficiently close nexus with [the] underlying policy objectives." Weinberger v. Safi, 422 U.S. 749, 772 (1975).

13. No. 19-288, On Petition for Writ of Certiorari to the United States Court of Appeal for the Ninth Circuit (Docketed Sept. 4, 2019).

14. United States v. Joyce, 895 F.3d 673, 677 (9th Cir. 2018).

15. Id.

16. Id. at 676-677.

17. United States v. Sanchez, No. 17-10519, 160 Fed. Appx. 533 (9th Cir. 2019) (not-for-publication memorandum).

18. Id. at 535. ("The district court therefore did not err in instructing the jury under the per se rule.").

19. Joshua Sisco, In Foreclosure Auction Appeal, Court Questions Applicability of Per Se Standard, (Behind Pay Firewall) (MLex Jan. 16, 2019).

20. Sanchez v. United States, Petition for a Writ of Certiorari (filed Aug. 30, 2019).

21. Id. at i.

22. Sanchez v. United States, Brief of Amicus Curiae National Association of Criminal Defense Lawyers in Support of Petitioners (filed Oct. 24, 2019).

23. Sanchez v. United States, Brief for Amicus Curiae Due Process Institute in Support of Petitioners (filed Oct. 24, 2019).

24. Sanchez v. United States, Brief for the United States in Opposition (filed Nov. 25, 2019), at 6.

25. Id. at 9-10.

26. Sanchez et al. v. United States, No. 19-288, ___ U.S. ___ , 2020 WL 129558 (Jan. 13, 2020) (denying cert. petition).

27. United States v. Kemp Associates, Inc. and Daniel Mannix, No. 2:16-cr-403-DS (D. Utah). The indictment was returned on August 17, 2016, available at

28. United States v. Kemp & Assocs., Inc., No. 2:16-cr-403-DS, 2017 WL 3720695, at *1 (D. Utah Aug. 28, 2017), rev’d and remanded, 907 F.3d 1264 (10th Cir. 2018).

29. United States v. Kemp & Assocs., Inc., 907 F.3d 1264, 1278 (10th Cir. 2018).

30. United States v. Kemp & Assocs., Inc. and Daniel Mannix, No. 2:16-cr-403-DS, 2019 WL 763796, at *2 (D. Utah Feb. 21, 2019).

31. Heir Location Service Company and Co-Owner Plead Guilty to Antitrust Charge for Long Running Agreement Not to Compete, United States Department of Justice Press Release (July 10, 2019), available at

32. Matthew Perlman, No Prison Time for Heir Locator In Market Splitting Case, LAW360 (Jan. 28, 2020), available at

33. Kemp & Assocs, 2019 WL 763796, at *3.

34. Id. at *2.

35. In Rockford v. Mallinckrodt, 360 F. Supp 3d 730 (N.D. Ill. 2019), the Court ruled that it needed more factual information before deciding whether the rule of reason or per se rule would apply. Id. at 754 (citing CSR Ltd. v. Fed. Ins. Co., 40 F. Supp. 2d 559, 564 (D.N.J. 1998) ("At this early [motion to dismiss] stage of the proceeding, the court does not find it necessary to determine which mode of analysis [per se or rule of reason] it will ultimately employ in evaluating the defendants’ activities."); 2 Areeda & Hovenkamp, Antitrust law ¶ 305(e) (4th ed. 2019) ("Often, however, the decision about which rule is to be employed will await facts that are developed only in discovery.").

36. See, e.g., Butler v. Jimmy John’s Franchise, LLC et al., No. 3:18-cv-00133 (S.D. Ill. 2018).

37. United States v. Aiyer, No. 1:18-cr-00333-JGK (S.D.N.Y.).

38. United States v. Lischewski, No 3:18-cr-00203-EMC (N.D. Cal.).

39. Jeffrey May, Jury Convicts Former Currency Trader in Ongoing FX Probe, Antitrust Law Daily (Nov. 21, 2019), available at

40. United States. v. Aiyer, No. 1:18-cr-00333-JGK (S.D.N.Y.), Memorandum of Law in Support of the United States’ Opposition to Defendant’s Motion for a Judgment of Acquittal or, in the Alternative, for the Declaration of A Mistrial or A New Trial, ECF No. 204, filed Jan. 27, 2020, at 4.

41. Joel Rosenblatt and Eliza Ronals-Hannon, Ex-Bumble Bee CEO Is Latest Catch in Tuna Price-Fixing Hunt, Bloomberg (Dec. 3, 2019), available at

42. United States v. Lischewski, No 3:18-cr-00203 (N.D. Cal), Motion to Dismiss Or, in the Alternative, For An Order that the Rule of Reason Applies, ECF no. 11, filed May 16, 2019.

43. United States v. Socony-Vacuum Oil Co., 310 U.S. 150 (1940).

44. See Daniel A. Crane, The Story of United States v. Socony-Vacuum: Hot Oil and Antitrust in the Two New Deals, Antitrust Stories 107 (Eleanor M. Fox & Daniel A. Crane eds., 2007).

45. The maximum jail sentence was increased to 10-years in the Antitrust Criminal Penalty Act Enhancement and Reform Act of 2004, commonly referred to as ACPERA.

46. The Antitrust Division argued at sentencing that two AU Optronics executives, H.B. Chen and Hui Hsiung, had guidelines ranges of 121 to 151 months. Since this exceeded the Sherman Act 10-year maximum, the Division argued for a sentence of 10-years in jail. See United States’ Sentencing Memorandum at 3-35, United States v. AU Optronics Corp., No. 3:09-0110 (Sept. 20, 2012), available at The court imposed sentences of three years (Chen) and two years (Hsiung).

47. Lewis Crofts and Leah Nylen, Mlex Interview with Romano Pisciotti, MLex (Dec. 9, 2015), available at; see also, Gianni De Stefano, Meet the First Extradited Businessman on Cartel Charges, 8 J.E.C.L. & Pract. 5 (2017), available at

48. See Former Air Cargo Executive Extradited from Italy for Price-Fixing, United States Department of Justice Press Release ( Jan. 13, 2020), available at

49. See BNP Paribas USA, Inc. Pleads Guilty to Antitrust Conspiracy, United States Department of Justice Press Release (Jan. 26, 2018), available at

50. 15 U.S.C § 1.

51. National Soc’y of Prof. Engineers v. United States, 435 U.S. 679, 687 (1978).

52. Merriam Webster Dictionary (definition of restraint: "1a: an act of restraining: the state of being restrained; b(1): a means of restraining: a restraining force or influence; b(2): a device that restricts movement"), available at

53. "In 1882 S. C. T. Dodd, an attorney for John Rockefeller’s Standard Oil Co., created a trust to facilitate a tight combination of oil refiners that could dictate price and supply while also avoiding state-level taxes and corporate regulations. The use of trusts for industrial consolidation multiplied throughout the 1880s, and in response, several states and the federal government passed antitrust laws to regulate business competition, focusing on coordination among firms and business tactics used to monopolize industries." Laura Phillips Sawyer, U.S. Antitrust Law and Policy in Historical Perspective, Harvard Business School Working Paper, 19-110 (2019), available at

54. See Advocate Health Care Network, et al v. Stapleton, 137 S. Ct. 1652, 1660 (2017) ("Congress, we feel sure, would not have intended all National Guardsmen to get a benefit that is otherwise reserved for disabled veterans.").

55. United States v. Trans-Missouri Freight Ass’n, 166 U.S. 290, 312 (1897).

56. Standard Oil v. United States, 221 U.S. 1 (1911).

57. Id. at 99. (J. Harlan dissenting). For more detail and color, see William Kolaksy, Chief Justice Edward Douglass White And the Birth of the Rule of Reason, 24 Antitrust 77 (summer 2010). On the bench, Harlan was even harsher. Those present in the courtroom reported that Harlan "[h]aving refreshed himself with whiskey . . . denounced his colleagues from the bench in improvised language that is said to have made them blush." Id.

58. 273 U.S. 392, 398 (1927).

59. United States v. Socony-Vacuum Oil Co., 310 U.S. 150 (1940).

60. Id. at 224.

61. Broadcast Music, Inc. v CBS, Inc., 441 U.S. 1 (1979).

62. Bd. of Trade of City of Chicago v. United States, 246 U.S. 231, 238 (1918).

63. United States v. Brighton Building & Maintenance Co., 598 F.2d 1101, 1104 (7th Cir. 1979).

64. Dr. Miles Medical Co. v. John D. Park & Sons Co., 220 U. S. 373 (1911).

65. Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551 U.S. 877 (2007).

66. United States v. Arnold, Schwinn & Co., 388 U. S. 365 (1967).

67. Continental T.V., Inc., v. GTE Sylvania Inc., 433 U. S. 36 (1977).

68. Albrecht v. Herald Co., 390 U.S. 145 (1968).

69. State Oil Co., v. Khan, 522 U.S. 3 (1997).

70. Klor’s Inc. v. Broadway-Hale Stores., Inc., 359 U.S. 207 (1959).

71. Northwest Wholesale Stationers, Inc. v. Pacific Statioanery & Printing Co. 472 U.S. 284 (1985).

72. International Salt. Co. Inc v. United States, 332 U.S. 392 (1947).

73. Eastman Kodak Co. v. Image Tech. Serv. Inc. 504 U.S. 451 (1992).

74. United States Department of Justice, Antitrust Division Manual (5th ed. 2012), available at

75. The Department of Justice brought its only felony prosecution of vertical price-fixing in the 1980 case of United States v. Cuisinarts, Inc., No. H80-559, 1981-1 Trade Cas. (CCH) ¶ 63,979 (D. Conn. Mar. 27, 1981); see In re Grand Jury Investigation of Cuisinarts, Inc., 516 F. Supp. 1008, 1010—11 (D. Conn.) (recounting the proceedings in the criminal case, which resulted in a nolo contendere plea and a $250,000 fine), aff’d, 665 F.2d 24 (2d Cir. 1981). A companion civil case was also brought that was resolved by consent decree.

76. See U.S. v. Sanchez, et. al, No. 17:10519, Brief of the United States, ECF No. 37, at 25, n. 4 (filed Aug. 27, 2018).

77. The balance of the Sanchez per se jury charge reads: "It is not a defense that the parties may have acted with good motives, or may have thought that what they were doing was legal, or that the conspiracy may have had some good results. If there was, in fact, a conspiracy as charged in the indictment, it was illegal." Id.

78. Model Jury Instructions in Criminal Antitrust Cases (ABA 2009), Ch. 3, Sec. F.

79. Robert H. Bork, The Antitrust Paradox 18 (1978).

80. See Ryan Lovelace, Elena Kagan: The Supreme Court Is More Like A Textualist Court, Washington Examiner, (Oct. 16, 2017), available at

81. Justice Elena Kagan, in a recent lecture at Harvard Law School, said that thanks to Justice Scalia, "we are all textualists now." See Jonathan R. Siegel, SCOTUS blog (Nov. 14, 2017), available at

82. 15 U.S.C. § 1.

83. 598 F.2d 1101 (7th Cir. 1979).

84. Id. at 1114. See also United States v. Koppers Co., 652 F. 2d 290, 294 (2d Cir. 1981) ("In cases involving behavior such as bid rigging, which has been classified by courts as a per se violation, the Sherman Act will be read as simply saying: ‘An agreement among competitors to rig bids is illegal.’").

85. U.S. v. Sanchez, et. al., No. 17:10519, Answering Brief of the United States, ECF No. 37, at 23 (filed Aug. 27, 2018).

86. 405 U.S. 596 (1972).

87. Id. at 609-610.

88. 138 S. Ct. 767 (2017).

89. Id. at 779.

90. 561 U.S. 247 (2010).

91. Id. at 270.

92. U.S. v. Sanchez, et. al., No. 17:10519, Answering Brief of the United States, ECF No. 37, at 19 (filed Aug. 27, 2018).

93. Sanchez v. U.S., Brief for the United States Opposing Grant of Certiorari, at 10 (citing FTC v. SCTLA, 493 U.S. 411, 433-434 (1990)).

94. The first time I had a "Holy Smokes" moment thinking that the per se rule might be unconstitutional was when I read Charles D. Weller’s The End of Criminal Antitrust Per Se Conclusive Presumptions, 58 Antitrust Bulletin 665-91 (2013). Mr. Weller deserves much credit for raising these issues.

95. Northern Pac. Ry. v. United States, 356 U.S. 1, 5 (1958).

96. Arizona v. Maricopa Cty. Med. Soc., 457 U.S. 332, 351 (1982) (emphasis added).

97. Sanchez v. U.S., Petition for Writ of Certiorari, Petitioners Opening Brief, at 6.

98. Brief for Kemp & Assocs., Inc. and Daniel J. Mannix in the Tenth Circuit Court of Appeals, No. 17-4148, Document: 01019940078 (filed Feb. 2, 2018), at 43.

99. The Kemp & Assocs. appellate brief more fully describes the defendants’ arguments about why the per se rule should not apply and possible procompetitive effects of the agreement and Judge Sam’s agreements with these observations. Id. at 39-48.

100. 138 S. Ct. 2274 (2018).

101. Id. at 2283-84.

102. Id. at 2284.

103. 442 U.S. 510, 523 (1979).

104. 530 U.S. 466 (2000).

105. Id. at 490.

106. 543 U.S. 220 (2005).

107. U.S. v. Gaudin, 515 U.S. 506, 510 (1995).

108. Id.

109. 491 U.S. 263 (1989) (per curiam).

110. Id. at 265 (internal quotation marks omitted).

111. Id. at 266.

112. Id. at 265-66.

113. Joseph Mark Stern, Sotomayor and Gorsuch Resume Their Fight for the Future of the Sixth Amendment, Slate (Jan. 7, 2019), available at; see also Mark Joseph Stern, Neil Gorsuch and Sonia Sotomayor Have Started Teaming Up to Protect Criminal Defendants, Slate (Nov. 19, 2018), available at

114. Joseph Mark Stern, Sotomayor and Gorsuch Resume Their Fight for the Future of the Sixth Amendment, Slate (Jan. 7, 2019).

115. 551 U.S. 877 (2007).

116. Id. at 899.

117. Id.

118. 138 S. Ct. 1204 (2018).

119. Id. at 1229.

120. Alleyne v. U.S., 570 U.S. at 114 n.5.

121. 137 S. Ct 1975 (2017) (J. Gorsuch dissenting).

122. Id. at 1990 (J. Gorsuch dissenting).

123. One purpose of the per se rule, however, was to give notice, a "bright line" of what conduct under the vague Sherman Act was considered criminal. Northern Pac. Ry. v. U.S., 356 U.S. 1, 5 (1958). Without a per se rule it could be argued that the Sherman Act, as a criminal statute, is unconstitutionally vague. As Justice Scalia has written, "One can hardly imagine a prescription more vague than the Sherman Act’s prohibition of contracts, combinations, or conspiracies in restraint of trade." Antonin Scalia, The Rule of Law as a Law of Rules, 56 U. Chi. L. Rev. 1175, 1183 (1989); see also Matthew G. Sipe, The Sherman Act and Avoiding Void-for-Vagueness (May 2017), available at The Supreme Court, however, has upheld the Sherman act against a vagueness challenge. U.S. v. Nash, 229 U.S. 373, 376-77 (1913).

124. United States Sentencing Guidelines § 5K1.1 (also known as a "5K" motion).

125. Letter from Peter J. Kadzik, Principal Deputy Assistant Attorney General, U.S. Department of Justice, to Senator Patrick Leahy Attaching Responses of William Baer, Assistant Attorney General, Antitrust U.S. Department of Justice to Questions for the Record Arising from the Nov. 14, 2013 Hearing of the U.S. Senate Committee on the Judiciary Regarding Cartel Prosecution: Stopping Price Fixers and Protecting Consumers ( Jan. 24, 2014), at 3, available at

126. Even before the Sherman Act, in McMullen v. Hoffman, 174 U.S. 639 (1899) the Supreme Court refused to enforce a contract when one conspirator sued for his portion of the profits from a successful collusive bidding scheme. The Court explained that the agreement "tend[ed] to induce the belief that there really is competition . . . although the truth is there is no such competition." Id. at 646.

127. California Dental Assn. v. FTC, 526 U.S. 756, 781 (1999).

128. Fed. R. Evid. 401 ("Test for Relevant Evidence. Evidence is relevant if: (a) it has any tendency to make a fact more or less probable than it would be without the evidence; and (b) the fact is of consequence in determining the action.").

129. Fed. R. Evid. 403 ("Excluding Relevant Evidence for Prejudice, Confusion, Waste of Time. Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence.").

130. Trenton Potteries Co., 273 U.S. at 397.

131. Robert E. Connolly, "Per Se "Plus:" A Proposal to Revise the Per se Rule in Criminal Antitrust Cases 29 Antitrust 105 (Spring 2015).

132. James M. Griffin, Deputy Assistant Attorney General, Antitrust Division, U.S. Department of Justice, Competition in the Pharmaceutical Marketplace: Antitrust Implications of Patent Settlements, Statement Before the U.S. Senate Committee on the Judiciary (May 24, 2001), available at

133. Scott D. Hammond, Deputy Assistant Attorney General, Antitrust Division, U. S. Department of Justice, Transcript of Testimony Before the United States Sentencing Commission Concerning Proposed 2005 Amendments to Section 2R1.1 (April 12, 2005), at 3, available at

134. A.M. ex rel. FM v. Holmes, 830 F.3d 1123, 1170 (10th Cir. 2016) (J. Gorsuch dissenting).

135. Verizon Communications v. Law Offices of Curtis v. Trinko, 540 U.S. 398, 408 (2004).

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