ABSTRACT
The American Tobacco case was initially thought to be a major breakthrough in antitrust policy. In 1960, however, the industry was caught red-handed breaking the antitrust laws, and the formal overt agreements fell apart as firms were fined and executives were sent to prison. Through a series of antitrust consent decrees, the defendants were enjoined from entering into any further overt attempts to fix prices. Conscious parallelism remains a practice that is for the most part beyond the reach of the antitrust laws. Trade associations present a unique set of problems for antitrust enforcement. The professions represented one of the few major new areas of antitrust action in the 1970s, and the strict interpretation adopted by a fairly conservative Supreme Court suggests that no Court is likely to change significantly the strict restrictions against agreements that affect price. Higher profits associated with collusion may be necessary to encourage research and development.
