On December 1 2025, I had finished an article about how the defendant might avoid the application of the per se rule in his upcoming trial for allegedly rigging a bid for a multi-million dollar entertainment facility for a public university in Texas. On December 2, 2025, the President pardoned the defendant. My article did not predict a pretrial Presidential pardon. The article, slightly modified after the pardon, is posted on SSRN: Per Se Rule Related Defenses In Criminal Antitrust Prosecutions, December 10, 2025.
I was thinking of posting excerpts from the article on Cartel Capers and a happy coincidence occurred today. Somone sent me the DOJ Statement of Interest in In Re: Apple Smartphone Antitrust Litigation, Case No. 2:24-md-03113, (D. N.J. June 7, 2024), ECF No 147, filed 12/16/2025. The Statement of Interest argues that United States v. Brewbaker, 87 F. 4th 563 (4th Cir. 2023) was wrongly decided. I agree. Another of the topics in the filing is: “All contracts are concerted action.” The paragraph begins with “By its terms, Section 1 applies to ‘every contract…in restraint of…trade.’ And the Supreme Court long has recognized that every contract restrains trade.” See Bd. Of Trade of Chi v. United States, 246 U.S. 231, 238 (1918) (“Every agreement concerning trade…restrains.”). The Statement of Interest cites other cases for this blackletter law proposition.
In my article I argued that it was unnecessary judicial legislation to modify “restraint of trade” with “unreasonable” because not every contract restrains trade. Am I correct? It happens sometimes. But it’s fairly inconsequential because either way you read Section One, the issue in the case will be whether the agreement in question restrained trade.
Below is the relevant excerpt from my article.
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Some Per Se Rule History: The Road Wrongly Traveled
It is well accepted, but incorrect, that “One problem presented by the language of § 1 of the Sherman Act is that it cannot mean what it says.”[1] This erroneous belief has led the Supreme Court to amend the Sherman Act, first by adding the word “unreasonable” before “restraint of trade”[2] and then by creating two rules: the per se rule and the rule of reason.[3] In doing so the Supreme Court has engaged in unconstitutional judicial legislation.[4] As Justice Gorsuch has said, “If a statute needs repair, there’s a constitutionally prescribed way to do it. It’s called legislation.”[5]But Section 1 of the Sherman Act does not need to be rewritten. To restrain is “to limit” or “to hold back.”[6] Contracts between individuals do not restrain trade in the most natural, ordinary, common sense meaning of the words. It is a rule of statutory construction not to give words an implausible interpretation.[7] A literal reading of the words of the statute which would lead to absurd results is to be avoided when they can be given a reasonable application consistent with their words and with the legislative purpose.[8] Did Senator Sherman intend that if he entered a contract to buy oil to heat his home, he was a criminal? No. It is clear that Congress did not intend to criminalize all commercial contracts, including their own. Moreover, if the drafters intended that all commercial contracts are a restraint of trade, the Sherman Act would simply read, “all agreements in trade are illegal.” But since Congress added the qualifier “in restraint of trade” it rejected the idea that all contracts restrain trade. The statutory construction surplusage canon means Congress added “restraint of trade” for a reason—to limit the notion that all contracts restrain trade.[9]
The “trade” the Sherman Act refers to is what we now call a market—not a single transaction between two parties. Exhibit A, as said by Adam Smith, is perhaps the most famous quote in the antitrust world: “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”[10] (emphasis added). It is clear that Congress used the term “trade” as Smith did, in describing a market—not a contract between two parties. The great trusts of the day motivated passage of the Sherman Act: the Sugar Trust, Oil Trust, and Banking Trust, and others[11] did restrain trade. Thus, there was no reason for the Supreme Court to rewrite the Sherman Act and create the per se rule and rule of reason.
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I’d appreacite any reaction. Thanks for reading.
Bob Connolly bob@reconnollylaw.com
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[1] National Society of Professional Engineers v. United States, 435 U.S. 679, 688 (1978.) See also, Standard Oil Co. of N.J. v. United States, 221 U.S. 1, 63 (1911) (without the standard of reason to limit the language, “the statute would be destructive of all right to contract or agree or combine in any respect whatever.” Board of Trade of City of Chicago v. United States, 246 U.S. 231, 238 (1918) (“Every agreement concerning trade, every regulation of trade, restrains. To bind, to restrain, is of their very essence.”).
[2] Standard Oil v. United States, 221 U.S. 1 (1911).
[3] United Sates v. Trenton Potteries Co. 273 U.S. 392, 398 (1927)(per se); Bd. Of Trade of City of Chicago v. United States, 246 US. 231 (1918) (rule of reason).
[4] In a dissent in Standard Oil v. United States,, 221 U.S. 1 (1911) Justice Harlan objected that the Court, rather than Congress, amended the legislation. Justice Harlan wrote that the Court “has now done what it then said it could not constitutionally do. It has, by mere interpretation, modified the act of Congress.” Id. at 99. (Justice Harlan dissenting). For more detail and color, see, William Kolaksy, Chief Justice Edward Douglass White And the Birth of the Rule of Reason, Antitrust, Vol. 24, No. 3, p. 77, (On the bench, Harlan was even harsher. Those present in thecourtroom reported that Harlan “[h]aving refreshed himself with whiskey . . . denounced his colleagues from the bench in improvised language that is said to have made them blush.”).
[5] Perry v. Merit Systems Protection Board, 137 S. Ct. 1975, 1990 (2017) (Gorsuch dissenting).
[6] Merriam Webster Dictionary: 1a: an act of restraining: the state of being restrained
b(1): a means of restraining : a restraining force or influence
(2): a device that restricts movement., available at https://www.merriam-webster.com/dictionary/restraint.
[7] See Advocate Health Care Network, et al v. Stapleton, 581 U.S. 468, 480 (2017) (“Congress, we feel sure, would not have intended all National Guardsmen to get a benefit that is otherwise reserved for disabled veterans.”).
[8] See Haggar Co. v. Helvering, 308 U.S. 389, 394 (1940).
[9] “A corollary to this point is that the employees’ construction runs aground on the so-called surplusage canon—the presumption that each word Congress uses is there for a reason.” Advoc. Health Care Network v. Stapleton, 581 U.S. 468, 477 (2017).
[10] Adam Smith: The Wealth of Nations (1776), Book I, Chapter X, Part II, p. 152.
[11] “In 1882 S. C. T. Dodd, an attorney for John Rockefeller’s Standard Oil Co., created a trust to facilitate a tight combination of oil refiners that could dictate price and supply while also avoiding state-level taxes and corporate regulations. The use of trusts for industrial consolidation multiplied throughout the 1880s, and in response, several states and the federal government passed antitrust laws to regulate business competition, focusing on coordination among firms and business tactics used to monopolize industries.” Laura Phillips Sawyer, US Antitrust Law and Policy in Historical Perspective, Harvard Business School Working Paper, 19-110 (2019), available at https://www.hbs.edu/faculty/Publication%20Files/19-110_e21447ad-d98a-451f-8ef0-ba42209018e6.pdf.