Wednesday, February 20, 2008

The Proper Role of Courts: Why the Supreme Court Got it Wrong in Leegin

Posted by D. Daniel Sokol

Lance McMillian of John Marshall Law School discusses The Proper Role of Courts: Why the Supreme Court Got it Wrong in Leegin in an upcoming issue of the Wisconsin Law Review.

ABSTRACT: Separation of powers matters. Accordingly, each branch of the federal government should remain faithful to its institutional role. However, in the 2007 case of Leegin Creative Leather Products v. PSKS, Inc., the Supreme Court betrayed this founding principle. In Leegin, the Court disturbed nearly 100 years of antitrust jurisprudence by overruling Dr. Miles Medical Co. v. John D. Park & Sons Co. The issue before the Court centered on this question: should minimum resale pricing agreements between manufacturer and distributor be considered per se illegal? Dr. Miles said yes; in Leegin, the Court said no. This disagreement is hardly remarkable. The Court frequently reverses its prior precedent.

The twist in Leegin, though, is that Congress expressly endorsed the Dr. Miles rule. In passing the Consumer Goods Pricing Act of 1975, Congress clearly indicated its policy preference that the practice of vertical price-fixing should remain unlawful. It is axiomatic that responsibility for framing economic policy for the nation rests with Congress and the President, not the Supreme Court. Nevertheless, in the field of antitrust, because of the Sherman Act's broad generalities, the Court has always had more leeway to fill in the blanks left open by Congress. But this freedom to fill the void when faced with legislative silence does not give legitimacy to the Court taking the next step, namely substituting its own judgment over a contrary judgment of Congress. And this next step is exactly the path the Court traveled down in Leegin. The Article explains the mistakes made by the Court in embarking on this journey. Moreover, the Article discusses the perils that follow when the Court decides it is accountable to no other branch but itself.

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