Facts
- The United States sued a corporate director and six corporations under the Clayton Act, alleging unlawful interlocking directorates between three pairs of competing corporations in violation of § 8 (15 U.S.C. § 19).
- The government sought orders ending the interlocks and an injunction preventing future § 8 violations.
- After the suits were filed, the director resigned from certain boards, terminating the challenged interlocks.
- Defendants filed affidavits confirming the resignations and stating they did not intend to resume the interlocking directorates.
- Defendants moved to dismiss on the ground that the resignations made the cases moot.
Issues
- Whether the Federal Trade Commission’s enforcement authority under Clayton Act § 11 makes FTC enforcement of § 8 exclusive, or whether district courts have jurisdiction under § 15 to prevent and restrain § 8 violations.
- Whether voluntary termination of the challenged interlocking directorates and disclaimers of intent to resume render the government’s request for injunctive relief moot.
- If not moot, whether the district court abused its discretion in denying an injunction and dismissing the actions.
Decision
- The Supreme Court affirmed the judgment dismissing the actions.
- The Court held that district courts have jurisdiction under § 15 to prevent and restrain Clayton Act violations; FTC authority under § 11 to enforce § 8 is not exclusive.
- The Court held the cases were not moot merely because defendants voluntarily ended the interlocks; voluntary cessation does not automatically eliminate a live controversy.
- The Court held the district court did not abuse its discretion in refusing injunctive relief given the resignations, sworn disclaimers, and lack of evidence indicating likely recurrence.
Legal Principles
- Clayton Act enforcement reflects a scheme of concurrent enforcement: FTC authority under § 11 does not displace federal court jurisdiction under § 15 to restrain violations.
- Voluntary cessation of challenged conduct does not, by itself, moot a case; the party asserting mootness bears the burden to show there is no reasonable expectation of recurrence.
- Injunctive relief is not automatic upon proof of past illegality; a court should grant an injunction only if there is a cognizable danger of recurrent violation, more than a mere possibility.
- Appellate review of a trial court’s decision to grant or deny an injunction proceeds under an abuse-of-discretion standard.
Conclusion
The Court confirmed that federal courts share Clayton Act enforcement authority with the FTC, held that voluntary cessation does not automatically moot an antitrust injunction suit, and affirmed dismissal because the record supported the district court’s discretionary determination that future § 8 violations were not sufficiently likely to justify injunctive relief.