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Case for Compensation - Why Compensatory Components Are Required for Efficient Antitrust Enforcement

NCJ Number
73783
Journal
Georgetown Law Journal Volume: 68 Issue: 5 Dated: (June 1980) Pages: 1113-1120
Author(s)
R G Dorman
Date Published
1980
Length
8 pages
Annotation
The article analyzes the role of compensation in relation to the creation of an antitrust enforcement system and argues that victim compensation is essential to effective enforcement.
Abstract
The article is a response to Professor W. Schwartz's 'An Overview of the Economics of Antitrust Enforcement' (NCJ-73782), which recommends a cost minimization approach to antitrust enforcement issues. Schwartz's analysis rejects compensation of injured parties as costly and uncertain, but favors financial incentives to private prosecutors, particularly lawyers, who bring antitrust offenses to court for their own profit without being the injured party. The present article contends that victim compensation is indispensable to deterrence since the public seeks to avoid harm and values the compensation of injured parties. An examination of common and statute law indicates that injury, either threatened or actual, is the threshold event for every civil litigation and that cases in which individuals received moneys when they had not injured are virtually nonexistent. There is little likelihood that enacted legislation or caselaw developments would separate the concept of injury from antitrust cause of action or that the courts would accept such a separation. Even if such legislation existed, public attitudes would impede the effectiveness of deterrence through financial incentives. While lawyers can successfully plead the case of an injured party to the public jurors, they would have a much harder time obtaining such an award for themselves as non-injured parties. Therefore a system permitting awards to noninjured parties would result in fewer and less substantial awards, thereby reducing many victims' incentives to begin civil action. Consequently the incidence of violations would increase. The article includes bibliographical footnotes.

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