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Antitrust Law By State 

Trusts and monopolies are concentrations of wealth in the hands of a few. Such conglomerations of economic resources are thought to be injurious to the public and individuals because such trusts minimize, if not obliterate normal marketplace competition, and yield undesirable price controls. These, in turn, cause markets to stagnate and sap individual initiative.

To prevent trusts from creating restraints on trade or commerce and reducing competition, Congress passed the Sherman Antitrust Act in 1890. The Sherman Act was designed to maintain economic liberty, and to eliminate restraints on trade and competition. The Sherman Act is the main source of Antitrust law.

In passing the antitrust laws "Congress was dealing with  competition, which it sought to protect, and monopoly, which it sought to prevent."'  Standard Oil Co. FTC, 340 U.S. 231, 249 (1951) Areeda, Antitrust Law, Little Brown, Sec 103 pg 7.

In the Classic Alcoa case (United States v. Aluminum Co., 148 F.2d 416 (2d Cir. 1945)) Judge Learned Habd stated:

      "We have been speaking only of the economic reasons which 
     forbid monopoly; but, as we have already implied, there are 
    others, based  upon the belief that great industrial consolidations 
    are inherently undesirable, regardless of their economic results. 
    In the debates in Congress Senator Sherman himself . . . showed 
    that among the purposes of Congress in 1890 was a desire to 
    put an end to great aggregations of capital because of the 
    helplessness of the individual before them .... Throughout the 
    history of these statutes it has been constantly assumed that one 
    of their purposes was to perpetuate and preserve, for its own 
    sake and in spite of possible cost, an organization of industry 
    in small units which can effectively compete with each other."

The Sherman Act is a Federal statute and as such has a scope limited by Constitutional constraints on the Federal government. The commerce clause, however, allows for a very wide interpretation and application of this act. The Act applies to all transactions and business involved in interstate commerce. If the activities are local, the act applies to transactions affecting interstate commerce. The latter phrase has been interpreted to allow broad application of the Sherman Act.

According to Areeda Antitrust courts are faced with three critical 
policy choices:  

     (1) between competition and the amelioration of economic 
     distress; 
    (2) between efficiency and attempting to preserve large numbers 
      of firms in any given market; and 
      (3) between efficiency and attempting to preserve competition.
       Areeda, Antitrust Law, Little Brown, Sec 103 pg 8.

Most if not all states have comparable statutes prohibiting monopolistic conduct, price fixing agreements, and other acts in restraint of trade having strictly local impact. See, for example, the Massachusetts Antitrust Act.

The Acts forbidden fall into the categories of: 
   A.  Collaboration Among Competitors-Horizontal Restraints
         Examples (a) Price Fixing (2) Divisions of Markets (3)
   B. Vertical Restraints
         Examples: (1) Resale Price maintenance (2) Exclusive Distributorship (3)
         Customer and Territorial Restrictions (4) Tying Agreements
   C.  Mergers and Acquisitions

Generally the terms "merger" and "acquisition" are 
used inter­changeably,  and mean them to include all the legal 
forms by which an amalgamation of assets may be consummated. 
The usual classifications  classification of mergers are horizontal, 
vertical, or conglomerate. We use the following definitions:

A horizontal merger is the acquisition by a producer of the stock 
or assets of a firm producing an identical product or close 
substitute and selling it in the same geographical market.

A vertical merger is the acquisition of the stock or 
assets of a firm that buys the product sold by the acquirer or 
that sells a product bought by the acquirer.

Conglomerate mergers are all other acquisitions. The latter 
category ranges from the pure conglomerate, in which there are 
no discernible economic relationships between the businesses of the 
acquiring and the acquired firm, to a variety of what might be called 
mixed conglomerates, involving "quasi" horizontal or vertical economic 
relationships. Such mixed conglomerates include the acquisition of a 
firm producing the same product as the acquirer in a different 
geographic mar­ket, and the acquisition of a company producing a 
different product but one that involves similar manufacturing, 
distribu­tion channels, or research and development efforts.
 Areeda, Turner, Antitrust Law, An Analysis of Antitrust Principles and Their Application (1980) vol'. 4,  Ch. 9, Sec 900,  pg 1, Little Brown.

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