Regulating Beyond the Rule of Reason.

The Federal Trade Commission (“FTC” or “Commission”) is testing the boundaries of its authority with an enforcement policy that departs from the rule of reason in the antitrust laws and a procedural agenda that prescribes general regulations of business practices. Neither proposition is unprecedented. Both have reached the Supreme Court. In its first two decades, the Commission suffered numerous reversals in the courts when it declared business practices unfair without finding unjustifiable harm to competition. Although the Supreme Court has opined in dicta that the prohibitions in the FTC Act extend beyond violations the Sherman and Clayton Acts, it has not upheld a Commission decision on those grounds. The most expansive expression of the FTC’s powers rendered by the Court came with a remand directing the agency to analyze the record in accordance with the approach of the antitrust laws. Empowering the Commission to promulgate rules of competition was considered and rejected by the Congress that passed the FTC Act, and the Supreme Court held a comparable grant in the National Industrial Recovery Act to be an unconstitutional delegation of power. One court, however, did uphold a Commission competition regulation fifty years ago. The vitality of that decision is assessed in light of modern jurisprudence. At stake in the outcome of the Commission’s initiatives are the prices customers will pay and the costs that producers will bear. The Article will review enforcement of the Robinson-Patman Act for evidence of the costs of departures from antitrust norms. [ABSTRACT FROM AUTHOR]