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ARTICLE · 03 MAY 2023

Trademark Settlement Agreements: Do They Violate Antitrust Laws?

Romano Law
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The recent 1-800 Contacts v. The Federal Trade Commission ruling by the Second Circuit Court of Appeals has been a significant win for trademark registrants.

United StatesIntellectual Property
Carlianna Dengel
Carlianna Dengel
Jari Wilson
Jari Wilson

The recent 1-800 Contacts v. The Federal Trade Commission ruling by the Second Circuit Court of Appeals has been a significant win for trademark registrants. The court held that trademark settlement agreements do not breach the Sherman Antitrust Act. As a result, this decision may encourage more aggressive trademark enforcement efforts.

What Is the Sherman Antitrust Act?

The Sherman Antitrust Act, established in 1890, aims to prevent detrimental business practices and maintain a competitive marketplace. The Federal Trade Commission (FTC) and private citizens can take legal action against businesses engaged in anticompetitive conduct that violates the Sherman Act. To establish a violation, a contract, combination or conspiracy that unreasonably restrains trade must exist.

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