Friday, January 17, 2014

National Society of Professional Engineers v. United States case brief

National Society of Professional Engineers v. United States case brief

The Society’s canon of ethics prohibited competitive bidding by its members in order to minimize the risk that engineers would produce inferior work and endanger public safety in order to win bids. 

The Court ruled that, even under the rule of reason, arguments that suggest competition is unsuited to a particular industry or area of trade are prohibited as a defense of violation of the Sherman Act and are better addressed to Congress. The purpose of the rule of reason is to form a judgment about the competitive significance of the restraint.

  • The Court noted that an attempt to show that competition forms a threat to public safety is “nothing less than a frontal assault on the basic policy of the Sherman Act.”
  • This was decided one year before Broadcast Music, when antitrust analysis was still controlled by the traditional bi-polar rule: either strict per se or traditional rule of reason.

  • This decision suggests that per se rules are really interpretative rules within the broader rule of reason; Standard Oil indicates that there is always a reasonableness analysis going on.
  • This decision also appears to be a “quick look” into the effect on competition, since the court doesn’t trouble itself to define a market and examine competitive effects, merely shows that this has no positive effects on competition (and the NSPE did not appear to effectively deny the allegation).

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