Question 1

The Local Government Antitrust Act of 1984 eliminates damage actions against municipalities and their officers,agents,and employees for antitrust violations and makes injunctive relief the sole remedy in such cases.

Accepted Answer

The Local Government Antitrust Act of 1984 eliminates damage actions against municipalities and their officers,agents,and employees for antitrust violations and makes injunctive relief the sole remedy in such cases.

Question 2

There are no criminal penalties for violating the Clayton Act.

Accepted Answer

Because the Clayton Act focuses on probable harms to competition,there are no criminal penalties for violating its provisions.

Question 3

In a Clayton Act Section 7-based challenge to a merger,the court's adoption of a broad relevant market definition will usually enhance the government's or private plaintiff's difficulty in demonstrating the challenged merger's probable anticompetitive effect.

Accepted Answer

In a Clayton Act Section 7-based challenge to a merger,the court's adoption of a broad relevant market definition will usually enhance the government's or private plaintiff's difficulty in demonstrating the challenged merger's probable anticompetitive effect.

Question 4

The Justice Department and the Federal Trade Commission (FTC)share responsibility for enforcing the Clayton Act.

Accepted Answer

The Justice Department and the Federal Trade Commission (FTC)share responsibility for enforcing the Clayton Act.

Question 5

The Robinson-Patman Act applies if a Texas manufacturer discriminated as to the sales price to two Texas customers.

Accepted Answer

At least one of the discriminatory acts complained of must take place in interstate commerce for the Robinson-Patman Act to apply.Thus,the Act probably would not apply if a Texas manufacturer discriminated as to the sales price to two Texas customers.

Question 6

The Robinson-Patman Act outlawed secondary and tertiary price discrimination.

Accepted Answer

The Robinson-Patman Act amended the Clayton Act to outlaw secondary and tertiary level of price discrimination.

Question 7

In the European Union (EU),the European Commission has considerable authority to quash a merger through its own action.

Accepted Answer

Under U.S.law,the FTC or the Justice Department normally must take legal action in court in order to block a planned merger,whereas in the EU,the European Commission has considerable authority to quash a merger through its own action.

Question 8

The Robinson-Patman Act prohibits sellers from making discriminatory payments to competing customers for such customer-performed services as advertising and promotional activities.

Accepted Answer

Section 2(d)of the Robinson-Patman Act prohibits sellers from making discriminatory payments to competing customers for such customer-performed services as advertising and promotional activities or such customer-provided facilities as shelf space.

Question 9

The McCarran-Ferguson Act does not exempt all actions by insurance companies from antitrust liability.

Accepted Answer

The McCarran-Ferguson Act exempts from federal antitrust scrutiny those aspects of the business of insurance that are subject to state regulation.The Act provides,however,that state law cannot legitimize any agreement to boycott,coerce,or intimidate others.

Question 10

The Robinson-Patman Act applies to discriminatory acts that occur in trade and commerce.

Accepted Answer

The Robinson-Patman Act applies only to discriminatory acts that occur "in commerce." As such,at least one of the discriminatory acts complained of must take place in interstate commerce for the Robinson-Patman Act to apply.

Question 11

Ordinarily,a higher degree of proof of likely competitive injury is required in cases involving secondary level price discrimination.

Accepted Answer

Traditionally,courts have required a higher degree of proof of likely competitive injury in cases involving primary level price discrimination (which may damage the seller's competitors)than in cases involving secondary or tertiary level discrimination (which threatens competition among the seller's customers or its customers' customers).

Question 12

Section 7 of the Clayton Act prohibits mergers of companies that would lessen competition in the market or create a monopoly.

Accepted Answer

Section 7 of the Clayton Act was design to attack mergers.Section 7 prohibits mergers that affect commerce or create a monopoly.

Question 13

Vertical mergers directly result in an increase in concentration.

Accepted Answer

Vertical mergers,unlike horizontal mergers,do not directly result in an increase in concentration.

Question 14

If Acme Corp.and Bogus,Inc.both manufacture product X but no other products,the relevant product market for purposes of an antitrust challenge to a merger between Acme and Bogus will not be a crucial consideration.

Accepted Answer

The federal government's merger guidelines indicate that the relevant market includes those products that consumers view as good substitutes at prevailing prices.Therefore,if Acme Corp.and Bogus,Inc.both manufacture product X but no other products,the relevant product market for purposes of an antitrust challenge to a merger between Acme and Bogus will be a crucial consideration.

Question 15

According to the Clayton Act,labor unions and their activities can be construed as illegal.

Accepted Answer

The Clayton Act provides that labor unions are not conspiracies in restraint of trade and their behavior is not considered illegal.

Question 16

There are three major defenses to price discrimination under the Robinson-Patman Act.

Accepted Answer

There are three major statutory defenses to liability under the Robinson-Patman Act: cost justification,changing conditions,and meeting competition in good faith.

Question 17

The Noerr-Pennington doctrine provides an exception to the Clayton Act.

Accepted Answer

In the Noerr and Pennington cases,the Supreme Court held that "the Sherman Act does not prohibit two or more persons from associating together in an attempt to persuade the legislature or the executive to take particular action with respect to a law that would produce a restraint or a monopoly." As such,the Noerr-Pennington doctrine provides an exception to the Sherman Act.

Question 18

The Foreign Sovereign Immunities Act (FSIA)provides that all commercial activities of foreign sovereigns and their agents are exempt from antitrust liability.

Accepted Answer

The Foreign Sovereign Immunities Act (FSIA)provides that the governmental actions of foreign sovereigns and their agents are exempt from antitrust liability.The commercial activities of foreign sovereigns,however,are not included within this sovereign immunity exemption.

Question 19

The relevant geographic markets in the case of merger between competitors are the markets in which they actually compete.

Accepted Answer

To determine a particular merger's probable anticompetitive effect on a section of the country,courts have traditionally asked where the effects of the merger will be direct and immediate.This means that the relevant geographic market may not be as broad as the markets in which the acquiring and acquired firms actually operate or,in the case of a merger between competitors,the markets in which they actually compete.

Question 20

Bob and Evan both own tanning salons in Ridgemont,California.They form the "Slow Growth Society of Ridgemont" as a lobbying group to persuade Ridgemont City Council to pass a zoning ordinance that would effectively prohibit new personal services businesses such as tanning salons in Ridgemont.This is prohibited under the Sherman Act.

Accepted Answer

Bob and Evan are essentially trying to associate together in an attempt to persuade the legislature or the executive to take particular action with respect to a law (zoning ordinance)that would produce a restraint or a monopoly.This is not prohibited under the Sherman Act as held by the Supreme Court in the Noerr and Pennington cases.

Quiz 50: The Clayton Act, the Robinsonpatman Act, and Antitrust Exemptions and Immunities

The Local Government Antitrust Act of 1984 eliminates damage actions against municipalities and their officers,agents,and employees for antitrust violations and makes injunctive relief the sole remedy in such cases.

There are no criminal penalties for violating the Clayton Act.

In a Clayton Act Section 7-based challenge to a merger,the court's adoption of a broad relevant market definition will usually enhance the government's or private plaintiff's difficulty in demonstrating the challenged merger's probable anticompetitive effect.

The Justice Department and the Federal Trade Commission (FTC)share responsibility for enforcing the Clayton Act.

The Robinson-Patman Act applies if a Texas manufacturer discriminated as to the sales price to two Texas customers.

The Robinson-Patman Act outlawed secondary and tertiary price discrimination.

In the European Union (EU),the European Commission has considerable authority to quash a merger through its own action.

The Robinson-Patman Act prohibits sellers from making discriminatory payments to competing customers for such customer-performed services as advertising and promotional activities.

The McCarran-Ferguson Act does not exempt all actions by insurance companies from antitrust liability.

The Robinson-Patman Act applies to discriminatory acts that occur in trade and commerce.

Ordinarily,a higher degree of proof of likely competitive injury is required in cases involving secondary level price discrimination.

Section 7 of the Clayton Act prohibits mergers of companies that would lessen competition in the market or create a monopoly.

Vertical mergers directly result in an increase in concentration.

If Acme Corp.and Bogus,Inc.both manufacture product X but no other products,the relevant product market for purposes of an antitrust challenge to a merger between Acme and Bogus will not be a crucial consideration.

According to the Clayton Act,labor unions and their activities can be construed as illegal.

There are three major defenses to price discrimination under the Robinson-Patman Act.

The Noerr-Pennington doctrine provides an exception to the Clayton Act.

The Foreign Sovereign Immunities Act (FSIA)provides that all commercial activities of foreign sovereigns and their agents are exempt from antitrust liability.

The relevant geographic markets in the case of merger between competitors are the markets in which they actually compete.