South-Western Legal Studies in Business

No Antitrust Suit May Be Filed in Areas Regulated by Securities Laws

Supreme Court held that for an antitrust suit attacking practices in the securities industry regulated by the SEC to succeed would undermine regulation of the securities industry and weaken the structure of the industry. Securities laws preclude the bringing of such antitrust cases.

Topic Antitrust
Key Words

Securities Regulation; Preclusion

C A S E   S U M M A R Y

A group of investors filed antitrust suits against investment banks. During a three-year period, the banks had acted as underwriters and had formed syndicates to help market initial public offerings (IPO). The plaintiffs claimed this was monopolization of the IPO market that exploited investors by requiring them to buy shares at inflated prices, pay above-normal commissions, and tied the sale of one security to other securities. The district court dismissed the suit, but the appeals court reinstated the action, holding that the suit was not precluded by securities law. Defendants appealed.


Reversed. The securities law are “clearly incompatible” with the antitrust laws. The securities laws implicitly preclude antitrust claims. The Securities and Exchange Commission supervised the activities in question and has authority to regulate all of the conduct complained of in the suit. To permit antitrust action would be to undermine SEC regulation and seriously damage the securities markets.


Credit Suisse Securities (USA) LLC v. Billing, 127 S.Ct. 2383 (Sup. Ct., 2007)

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