Parallel Conduct and Section 1 of the Sherman Act

Antitrust Byte

Section 1 of the Sherman Act, 15 U.S.C. § 1, prohibits “[e]very contract, combination … or conspiracy, in restraint of trade or commerce.” Determining whether such a “contract, combination … or conspiracy” (i.e., the agreement element of a Section 1 claim) actually exists is a fact-intensive inquiry.

Parties frequently assume that evidence that the alleged conspirators engaged in parallel conduct (e.g., they adopted the same pricing or economic terms) is sufficient to satisfy the agreement element of a Section 1 violation. However, the Supreme Court of the United States has stated that “[a] statement of parallel conduct, even conduct consciously undertaken, needs some setting suggesting the agreement necessary to make out a § 1 claim; without that further circumstance pointing toward a meeting of the minds, an account of a defendant’s commercial efforts stays in neutral territory.”

The necessary “setting suggesting the agreement” (referred to as “plus factors”) can come in many forms. Some courts have stated that plus factors may fall into one of the following categories: (1) evidence of motive to enter into the agreement, (2) evidence that the defendants acted contrary to their own interests, or (3) evidence implying a traditional conspiracy. Importantly, absent a “plus factor,” parallel conduct generally will not give rise to a viable antitrust claim.

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For additional information about the issues discussed above, or if you have any other antitrust concerns, please contact the Epstein Becker Green attorney who regularly handles your legal matters, or one of the authors of this Antitrust Byte:

E. John Steren
Member of the Firm
[email protected]

Patricia Wagner
Member of the Firm,
Chief Privacy Officer
[email protected]