Mission Creep: Antitrust Exemptions and Immunities as Applied to Deregulated Industries
University of Houston Law Center
Utah Law Review, p. 613, 2006
University of Houston Law Center No. 2007-A-01
This article examines the use of statutory and judicially created exemptions and immunities to the antitrust laws in the context of deregulated industries. Historically, certain industries were subject to a traditional-mode of regulation that limited the ability of a monopoly service provider to exit, barred competitor entry, and regulated the rates and service offered by the monopoly. Where this traditional regulation applied, certain types of industry conduct were to some degree immune from antitrust challenge. However, a new type of regulation has in large part supplanted traditional regulation. Regulated industries today are typically regulated only in the parameters under which competition takes place. Thus, the extent to which regulatory agencies are involved in regulation is limited to the establishment of competitive market mechanisms and ex post oversight of market rates.
Ironically, as the level of traditional regulation has declined, so too has the role of antitrust enforcement within those industries. The irony is twofold. First, insofar as antitrust and regulation traditionally have been viewed as substitutes, it would be expected that antitrust law would fill the void left as traditional regulation declines. Second, the policies of deregulation are consistent with the policies of antitrust - namely, the creation and preservation of competition, though the competition that has been created is in part due to the statutory and regulatory framework established. The doctrines of state action, filed rate, primary jurisdiction, implied and express immunity are all implicated in the foreclosure of antitrust law from the realm of deregulated industries.
This article proposes a method of unifying the doctrines of state action, express immunity, implied immunity, primary jurisdiction, and filed rate into a coherent framework that would be applicable to both regulated and deregulated industries. First, the article discusses the historical purpose of each of the doctrines. It then discusses how each doctrine has expanded beyond its original purpose, most poignantly within the confines of deregulated industries. The article next proposes new tests for each doctrine, in the hopes of creating a rational and uniform framework for the application of such doctrines in the context of regulated industries. The article argues that these doctrines, if properly implemented, would be reduced in many instances to implied immunity analysis, an analysis that is patent in older Supreme Court jurisprudence but is missing from modern exemption and immunity analysis in the context of deregulated industries. When combined with primary jurisdiction doctrine, properly applied, the dinosaurs of regulation old would no longer rule the modern deregulated earth. The article concludes that my proposed test for these immunities and exemptions would significantly narrow their scope.
Number of Pages in PDF File: 50
Keywords: antitrust, deregulation, regulated industries, state action, filed rate, immunities
JEL Classification: L4, L5, L43
Date posted: November 20, 2006