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In the 1960s, size was a major concern for many companies. Whatever they
planned had to be viewed threw the lens of an expected significant impact
upon the strength of competition in the markets they served. Illustratively,
in one consumer products extreme situation, a question was raised whether,
considering the extent of its stockholder population, and a shareholder’s
inherent loyalty to the company’s products, a stock split could have Sherman
Act implications if it was followed by a significant shift in its market
share. It was an unusual issue even then, when markets had not yet begun to
be thought of as global and some in the Antitrust Division of the Department
of Justice and in the FTC would have been thrilled to consider a street
intersection to be a relevant geographic market.
Today size is likely to be much less an issue. Many of our largest companies
are, for now at least, coming upon hard times. Mergers that would have been
condemned out of hand five years ago might be welcomed as saving failing
companies today. Other than that, we can expect size to be an issue under
antitrust theories that are more directly addressed to today’s crisis
issues. A company too big to be allowed to fail, for instance, could receive
antitrust scrutiny for the very reason that its size suggests that much of
what it does has potential competition lessening potentialities. This could
be expected even where there are other regulatory schemes more directly
applicable to the specific situation that is of current concern.
Trade association issues and practices other than price fixing will in all
likelihood be viewed more as cartel practices where the business served by
the association is highly concentrated in the sense that perhaps five
companies account for as much as 50 % of the “market”. As markets seem more
global than local, one might expect enforcement policy to consider lower
levels of concentration to be thresholds of cartel treatment enforcement
attitudes. The importance of IP in an industry will play a major role in
scrutiny decisions, and most IP attorneys today are very sensitive to the
manner of standards setting in an antitrust context as well as in the
context of patent abuse issues under the Patent Code. Cross licensing and
patent pooling will receive greater consideration by association counsel as
well as enforcement agencies where concentration is an issue and there is a
constituency of complainants. These and any other nuances of trade
association activities will again be more sensitive than they have been for
a rather long time.
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