By: Jeffrey J. Amato & Julia Lagnese (Winston & Strawn)

The U.S. Supreme Court has declined a Department of Justice (DOJ) request to review a decision by the U.S. Court of Appeals for the Fourth Circuit, which overturned the bid-rigging conviction of a former engineering firm executive. The Fourth Circuit ruled that the indictment failed to allege a per se antitrust violation.

In 2022, Brent Brewbaker was convicted on five counts of mail and wire fraud and one count of a per se antitrust violation under Section 1 of the Sherman Act for allegedly rigging bids on projects for the North Carolina Department of Transportation. Brewbaker, along with his engineering firm, coordinated bids with the firm’s distributor to submit intentionally higher, losing bids. Before the trial, Brewbaker moved to dismiss the antitrust charge for failure to state an offense, but the district court denied the motion, leading to his conviction.

The appeal centered on the appropriate standard for assessing bid-rigging antitrust violations involving parties that are both competitors and collaborators.

The Sherman Antitrust Act prohibits unreasonable restraints of trade, which are analyzed under either the rule of reason or the per se rule. The rule of reason requires a fact-intensive examination of a restraint’s overall effects, weighing its anticompetitive and procompetitive impacts. The per se rule, in contrast, deems certain restraints categorically unreasonable without assessing potential procompetitive benefits. Generally, vertical price restraints—agreements between parties at different levels of the supply chain—are evaluated under the rule of reason, while horizontal price restraints—agreements among competitors—are subject to the stricter per se rule…

CONTINUE READING…