Over time, the Supreme Court has adopted a laissez faire attitude toward antitrust enforcement, which now threatens to end vertical enforcement altogether. Since the inception of the Sherman Act, the Court has limited the application of Section 1 to only those contracts that endorse unreasonable restraints on trade. In doing so, the Court voiced a preference for using the defendant-friendly rule of reason over the strict per se standard when determining reasonableness. Then in 2007, the Court took the final step in relaxing vertical enforcement by mandating that courts evaluate all vertical restraints under the rule of reason. Regrettably, the rule of reason often amounts to per se nonliability in practice, thereby frustrating the very objectives that the Sherman Act was enacted to protect. This Article argues that the Court, through its leniency toward vertical enforcement and its failure to provide sufficient guidance about how to apply the rule of reason, has endorsed per se legality for all vertical restraints. It then proposes that in order to resume an optional level of enforcement, the rule of reason should be replaced by a rebuttable presumption of illegality.
An Antitrust Narcotic: How the Rule of Reason Is Lulling Vertical Enforcement to Sleep,
45 Loy. L.A. L. Rev. 1225
Available at: http://digitalcommons.lmu.edu/llr/vol45/iss4/5