United States v. Hilton Hotels Corp.

 

U.S. v. Hilton Hotels Corp. Hotel was convicted of a violation of the Sherman Act (Anittrust!) for increasing purchases of hotels who paid to attend their convention and curtailing the purchases of those who did not. The hotel manager was to take no part in the boycott but disobeyed orders and threatened a supplier with loss of the hotel’s business unless the supplier paid the association assessment.

• A corporation is liable for the acts of its agents even if the actions are contrary to the corporation’s policies.
• The corporation is liable for the behavior of its agents acting within the scope of their employment if the agent is acting in the corporation's behalf in performance of the agent's general line of work," including "not only that which has been authorized by the corporation, but also that which outsiders could reasonably assume the agent would have authority to do."
  • Identification of the particular agents responsible for a violation is especially difficult, and their conviction and punishment is ineffective as a deterrent. At the same time, conviction and punishment of the business entity itself is likely to be both appropriate and effective. (Under Anti-trust, employee really gets no benefits – he’s violating law for company. If they REALLY wanted him to not engage in anti competitive behavior, they could have supervised his activities better. Hilton should have been watching!