Rethinking The Key Role of Private Antitrust Enforcement

Abstract

US antitrust policy is increasingly undergoing a once-in-a-generation shift. Yet, reforms primarily focus on public enforcement. They leave private litigation—once a major avenue for detecting and pursuing violations—in its current neutered state. This is an anomaly: US competition policy was designed to operate in a world in which public and private litigation work alongside one another to achieve meaningful compliance.

This article focuses on the institutional design of American competition policy. It argues that any long-term effective revival of US antitrust policy requires a better acknowledgement of the key and irreplaceable role played by private litigation, and proposes a rethink of private antitrust enforcement policy. 

To unpack the nuanced interconnection between public and private competition enforcement, the paper begins by tracing the rise and fall of private antitrust. It builds on a novel, hand-coded and comprehensive analysis of the entire Supreme Court antitrust track record—all 474 decisions over 130 years—to outline how an ideologically mixed coalition of anti-enforcement justices seized on private cases to, in effect, reform US competition policy writ large. Indeed, almost all Supreme Court decisions that significantly changed US antitrust laws after the mid-1970s were private litigation cases. Over time, a weakened competition policy led to more unchecked abuses of market power in the US economy. A growing recognition of these abuses motivates current calls for an antitrust revival.

Relying on insights from political economy, this article then explores the root political causes of these changes at the Supreme Court level and the key role played by private plaintiffs in the enforcement ecosystem. Reformers face a challenge: Too little private litigation exposes competition policy to the risks of long-term political gaming, while too much private litigation risks triggering the type of judicial antagonism that helped undermine the system over the past decades. 

Resolving this tension requires a renewed focus on second-best solutions that rethink the role of private actors in the antitrust enforcement mix. To reinvigorate antitrust enforcement over the long haul, the creation of “antitrust super-complainants” and the expansion of standing rights, combined with stricter motion practice rules, are ways to strike such a balance.

Keywords: Antitrust, Private Enforcement, Political Economy, Supreme Court

JEL Classification: K21, L40, P16