USA Law and Practice Contributed by: Emily Hughes, Charles Kalil, Cori Lable and Ryan Raybould, Kirkland & Ellis
Individual violators face up to 20 years’ imprisonment and a USD250,000 fine per violation. Entities face up to a USD500,000 fine per violation. If a financial insti - tution was affected, violators face 30 years’ imprison - ment and a USD1 million fine. 3.7 Cartels and Criminal Competition Law The Antitrust Division of the DOJ enforces federal The Sherman Antitrust Act is a federal statute that prohibits contracts, conspiracies or combinations of business interests that restrict foreign or interstate trade (15 USC Section 1). Federal courts evaluate claims under a so-called rule of reason, which requires proof that a defendant with market power unreason - ably engaged in anti-competitive conduct (eg, shar - ing competitive information, “tying arrangements”, “exclusive dealing arrangements”). criminal competition laws. The Sherman Antitrust Act In contrast, per se violations involve anti-competitive arrangements that are considered illegal on their face, such as an agreement among competitors to fix prices, divide markets or rig bids. It also prohibits the monopolising of trade or commerce among states or with other countries (15 USC Section 2). Elements of a violation are possessing or attempting to possess monopoly power in the relevant market and wilfully acquiring or maintaining that power, as opposed to growth resulting from a superior product, business strategy or historic accident. Violators face criminal penalties of up to USD100 million for corporations and USD1 million for individuals, imprisonment of up to ten years, or both. The DOJ, state Attorneys General and private parties can also bring civil actions and win The Clayton Act prohibits a seller from discriminating in price between purchasers of goods of similar qual - ity when doing so may result in substantial competi - tive injury, and from making promotional payments or services available only to some customers (15 USC Section 13a). Violators face fines of USD5,000 and imprisonment of up to one year, or both. treble damages. The Clayton Act
Section 7 of the Clayton Act prohibits any merger or acquisition that will result in substantially less compe - tition or a monopoly within a relevant market (15 USC Section 18). The DOJ and FTC are both authorised to enforce it, and private parties may also seek injunc - tive relief against a transaction that would result in a Section 7 violation (15 USC Section 26). The Clayton Act is enforceable through civil actions by the DOJ and through administrative proceedings before and by the FTC, which can also seek injunctive relief (15 USC Sections 21, 25 and 53 (b)). 3.8 Consumer Criminal Law The FTC Bureau of Consumer Protection regulates business practices including advertising and financial practices, data security, high-tech fraud and telemar - keting. The FTC investigates and brings civil actions against violators and also co-ordinates with the DOJ and state prosecutors to bring criminal suits. The Consumer Financial Protection Bureau, the US Food and Drug Administration and the DOJ also enforce various consumer protection laws, including: • the Dodd-Frank Act;
• the Consumer Financial Protection Act; • the Fair Debt Collection Practices Act; • the Fair Credit Reporting Act; • the Fair Housing Act; • the Truth in Lending Act; • the Gramm-Leach-Bliley Act; and • the Food, Drug, and Cosmetic Act.
State Attorneys General prosecute consumer fraud violations under a variety of state laws. Many states have adopted the Uniform Deceptive Trade Practices Act, which prohibits fraudulent business practices and misleading advertising. 3.9 Cybercrimes, Computer Fraud and Protection of Company Secrets The Computer Fraud and Abuse Act prohibits inten - tionally obtaining access to computers “without authorization” or by “exceeding authorized access” with the intent to defraud, cause damage or extort (18 USC Section 1030). Sanctions include up to ten years’ imprisonment and a USD250,000 fine.
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