The Power of Antitrust Personhood

35 Pages Posted: 10 Feb 2023 Last revised: 13 Jun 2023

See all articles by Herbert Hovenkamp

Herbert Hovenkamp

University of Pennsylvania Carey Law School; University of Pennsylvania - The Wharton School

Date Written: June 13, 2023


Antitrust law addresses conspiracy, or collaborative conduct, more harshly than it does unilateral conduct. One person acting alone can get away with far more than groups of firms acting by agreement. In most cases that distinction is justified. Creating substantial market power unilaterally is difficult and relatively uncommon, but it can be created in a moment’s time by an agreement among firms.

But how do antitrust tribunals determine when conduct is unilateral rather than collaborative? Often the ansawer is obvious, but sometimes it is not. Two statutory provisions were intended to be the umpire of such decisions. A section of the Sherman considered so important that it was re-enacted in the Clayton Act provides that corporations and associations authorized by state law should be treated as “persons,” or single actors. The provisions address the core problems about internal corporate structure, including the single-entity status of holding companies, the legitimacy or not of suits between shareholders or employees and their firm, or the status of professional associations. The fact that the Sherman Act’s corporate personhood provision was re-enacted virtually verbatim in the Clayton Act is significant, because the intervening quarter century had witnessed a fierce debate over the power and reach of the business corporation. The statutory definitions do not include natural persons but they must be there by implication, because the Sherman Act includes prison sentences among its punishments and only biological persons can go to prison.

The personhood provisions are incomplete, however. While corporations and wholly owned subsidiaries are clearly a single person, the provisions fail to account for many situations where the precise boundaries of the corporation become ambiguous, including partial ownership, stock holders with independent business interests, or disloyal agents. Nor do they provide a solution to the problem of how to address labor disputes between an employer and its own employees. Further, and inadvertently, the statutes have encouraged certain types of industry structures that are not mandated by good competition policy, including the tendency to merge in order to avoid harsh rules about collusion, and the tendency to integrate vertically by ownership even when contractual integration might be superior.

Keywords: Antitrust, Monopoly, Conspiracy, Conspiratorial Capacity, Mergers, Vertical Integration

Suggested Citation

Hovenkamp, Herbert, The Power of Antitrust Personhood (June 13, 2023). U of Penn, Inst for Law & Econ Research Paper No. 23-09, Univ. Penn. J. Bus. L. (2023), Available at SSRN: or

Herbert Hovenkamp (Contact Author)

University of Pennsylvania Carey Law School ( email )

3501 Sansom Street
Philadelphia, PA 19104
United States
319-512-9579 (Phone)

University of Pennsylvania - The Wharton School ( email )

3641 Locust Walk
Philadelphia, PA 19104-6365
United States

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