Southern Rate Conf. v. United States,
471 U.S. 48 (1985)

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U.S. Supreme Court

Southern Rate Conf. v. United States, 471 U.S. 48 (1985)

Southern Motor Carriers Rate Conference, Inc. v. United States

No. 82-1922

Argued November 26, 1984

Decided March 27, 1985

471 U.S. 48


Petitioner Southern Motor Carriers Rate Conference and petitioner North Carolina Motor Carriers Association (petitioners), "rate bureaus" composed of motor common carriers operating in North Carolina, Georgia, Tennessee, and Mississippi, submit, on behalf of their members, joint rate proposals to the Public Service Commission in each State. This collective ratemaking is authorized, but not compelled, by the respective States. The United States, contending that petitioners' collective ratemaking violates the federal antitrust laws, filed an action in Federal District Court to enjoin it. Petitioners responded that their conduct was immune from the federal antitrust laws by virtue of the "state action" doctrine of Parker v. Brown, 317 U. S. 341. The District Court entered a summary judgment in the Government's favor. The Court of Appeals affirmed, holding that compulsion is a threshold requirement to a finding of Parker immunity. The court reasoned that the two-pronged test of California Retail Dealers Assn. v. Midcal Aluminum, Inc., 445 U. S. 97, for determining whether state regulation of private parties is shielded from the federal antitrust laws -- the challenged restraint must be one clearly articulated and affirmatively expressed as a state policy, and the State must supervise actively any private anticompetitive conduct -- is inapplicable to suits against private parties; that even if Midcal is applicable, private conduct that is not compelled cannot be taken pursuant to a "clearly articulated state policy" within the meaning of Midcal's first prong; and that, because Goldfarb v. Virginia State Bar, 421 U. S. 773, which held that a State Bar, acting alone, could not immunize from the federal antitrust laws its anticompetitive conduct in fixing minimum fees for lawyers -- was cited with approval in Midcal, the Midcal Court endorsed the continued validity of a "compulsion requirement."

Held: Petitioners' collective ratemaking activities, although not compelled by the respective States, are immune from federal antitrust liability under the state action doctrine. The Midcal test should be used to determine whether the private rate bureaus' collective ratemaking activities are protected under the federal antitrust laws. Moreover, the actions of a private party can be attributed to a "clearly articulated state

Page 471 U. S. 49

policy," within the meaning of the Midcal test's first prong, even in the absence of compulsion. The anticompetitive conduct is taken pursuant to a "clearly articulated state policy" under the first prong of the Midcal test. Here, North Carolina, Georgia, and Tennessee statutes expressly permit collective ratemaking. Mississippi, while not expressly approving of collective ratemaking, has clearly articulated its intent to displace price competition among common carriers with a regulatory structure. Because the Government conceded that there was adequate state supervision, both prongs of the Midcal test are satisfied. Pp. 471 U. S. 55-66.

702 F.2d 532, reversed.

POWELL, J., delivered the opinion of the Court, in which BURGER, C.J., and BRENNAN, MARSHALL, BLACKMUN, REHNQUIST, and O'CONNOR, JJ., joined. STEVENS, J., filed a dissenting opinion, in which WHITE, J., joined, post p. 471 U. S. 66.

Page 471 U. S. 50

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