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30 Case W. Res. L. Rev. 381 (1979-1980)
The Efficiency Defense under Section 7 of the Clayton Act

handle is hein.journals/cwrlrv30 and id is 387 raw text is: Case Western Reserve Law Review Volume 30 Spring 1980 Number 3 The Efficiency Defense Under Section 7 of the Clayton Act Timothy J. Muris* Though seemingly affundamental issue throughout antitrust law, eiciency has neverplayed much of a role in the analysis of mergers challenged under section 7 of the Clayton Act. It appears that the reasons for the underplay given that potential justyifcation arefour: That such a defense is incompatible with economic theory, that the legislative history of section 7 reveals a congressional desire to forbid such a defense, that the Supreme Court has in its section 7 opinions precluded such a de- fense, and that the admissibility of.fciency evidence would unduly complicate trials. Professor Muris categorically challenges each ofthose arguments and concludes that an efficiencyjust[ fication should be, andis, available to defendants whose acquisitions are challenged under the Clayton Act. INTRODUCTION THAT THE antitrust laws should promote efficiency would seem beyond question.' Society benefits from lower costs, innova- tion, and higher quality.2 Indeed, in speaking of the basic anti- * Associate Professor of Law, University of Miami School of Law and Law & Eco- nomics Center. B.A., San Diego State Univ. (1971); J.D., University of California at Los Angeles (1974). I would like to thank the Law & Economics Center of the University of Miami-where the bulk of the work for this article was completed-and the University of Chicago Law School-where the final draft was completed while the author was a Law and Economics Fellow-for their financial support. I also wish to thank Yale Brozen, Kenneth Dam, Frank Easterbrook, William MacLeod, Henry Manne, Fred McChesney, Judith Miley, Thomas Morgan, Richard Posner, and Calvin Roush for their comments on a previous draft. Special thanks are due Randy Chartash for research assistance and David Lundin, with whom I first studied the legislative history of section 7. I. Efficiency is so engrained in antitrust that any argument on the subject generally concerns whether efficiency is the only relevant value. See, e.g., Antitrust Jurisprudence: A Symposium on the Economic, Political and Social Goals ofAntitrust Policy, 125 U. PA. L. REV. 1182 (1977). 2. For a discussion of the meaning of efficiency, see notes 14-19 & 175-86 infra and accompanying text.

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