According to federal and state regulations, antitrust laws aim to limit unfair practices by companies as they artificially change prices for the consumer. These regulations are important as they help the continued growth of economies, but also prevent harms to consumers through price fixing. While there are federal acts dealing with antitrust, California can also rely on the protections and regulations under the Cartwright Act.
The Cartwright Act parallels federal acts like the Sherman and Clayton Antitrust Acts. The Cartwright Act’s main goal is to prohibit activity and agreements among different business with regards to price fixing or other restraints in order to reduce competition for the businesses’ goods and/or services. These agreements can be unfair to businesses, not a party to the agreements, and to consumers who will end up paying higher prices than they should. Some of the activity prohibited by the Cartwright Act include price fixing, boycotting, exclusive deals, division schemes, and other forms of discrimination.
For example, two or more people/businesses may decide to agree between themselves that certain products or services should be bought or sold at a fixed price. Said price fixing will allow these businesses to unfairly outcompete other competitors in the market. Moreover, businesses cannot decide to divide the market up between themselves. Competitors cannot divide up markets or areas based on their own liking in order to generate greater profits; market division is prohibited in California. If a business is found to be practicing unfairly, either the state attorney, on behalf of California, can sue the business or consumers can bring forth a lawsuit in order to receive damages.
