Monopolization comes in many flavors. As we have seen over the years, firms use assorted and creative methods to acquire or maintain dominant positions. Exclusive dealing, predatory pricing, and tying are some of the competitively suspect practices familiar to antitrust lawyers and economists. But the courts have made clear the list of “anticompetitive” or unfair practices that are actionable under the Sherman Act is not a closed set. Deception and other tortious conduct, for instance, can constitute illegal conduct. Given the elasticity of antitrust law, union-busting fits within the Sherman Act’s prohibition on monopolization and should be challenged by public and private enforcers. A class action lawsuit (Mizell v. UPMC) filed by health care professionals in 2024 against UPMC, the dominant hospital system in Western Pennsylvania, offers an excellent vehicle for expanding the scope of monopolization law and competition policy.
Under well-established antitrust doctrine, monopolization has power and conduct elements. To show a violation of the anti-monopolization section of the Sherman Act, plaintiffs need to demonstrate that the defendant has monopoly power and that this power was acquired or maintained through improper conduct, as opposed to “a consequence of a superior product, business acumen, or historic accident.” Firms that acquire their monopolies through the latter methods are at liberty to enjoy the fruits of their market dominance. But firms that use improper means to obtain or perpetuate a monopoly are not so free, and they can face the force of the courts’ broad equitable and legal remedial powers, including radical restructuring. This distinction between permissible and impermissible paths to monopoly reveals one implicit function of the antitrust laws: Pressure firms to grow and succeed by developing “superior product[s]” instead of other less salutary means.
Critically, what constitutes improper conduct is not cast in stone. Courts have applied the concept dynamically and elastically over time. In United States v. Microsoft, the D.C. Circuit wrote, “the means of illicit exclusion, like the means of legitimate competition, are myriad.” In this spirit, the Supreme Court has ruled that practices like deception can constitute illegal monopolization. For instance, in a 1965 decision, the Court ruled that procuring a patent through fraud on the U.S. Patent and Trademark Office can constitute illegal monopolization.
An interesting expression of this theme came in a 2002 decision from the Sixth Circuit. In Conwood v. U.S. Tobacco, the court affirmed a jury verdict in favor of a smokeless tobacco maker that had faced an onslaught of property destruction and theft by the dominant manufacturer. Conwood persuaded a jury that U.S. Tobacco had, among other practices, destroyed its product racks and removed its products at convenience stores and other retailers. While the conduct did not resemble a traditional antitrust violation, the court nonetheless held it ran afoul of the Sherman Act. Rejecting U.S. Tobacco’s argument that tortious conduct could never violate the antitrust laws, the unanimous three-judge panel ruled that it could in “rare gross cases.” Further, tort law did not displace the Sherman Act: “merely because a particular practice might be actionable under tort law does not preclude an action under the antitrust laws as well.” The court concluded the U.S. Tobacco’s misconduct “rose above isolated tortious activity and was exclusionary without a legitimate business justification.”
Expanding the Scope of Unfair Competitive Practices
Given this body of precedent, antitrust practitioners and scholars should treat union-busting as another type of illegal conduct that is actionable under Section 2. Firms that fire union organizers and thwart unionization and other concerted action by workers violate the National Labor Relations Act (NLRA). In other words, union-busting firms violate their employees’ federal statutory rights. Moreover, these scofflaw firms obtain an unfair and illegitimate advantage over rivals that comply with their legal duties under the NLRA, impairing their rivals’ ability to compete effectively in the associated product market. A firm that respects its workers’ right to organize typically has higher wages and overall labor costs than a rival that doesn’t—a major determinant of competitive success in a labor-intensive field like health care. An unscrupulous firm with this ill-gotten cost advantage can undercut high-road rivals and capture market share. This is not competing and succeeding through superior efficiency but competition through lawbreaking. When done by a monopolistic firm, union-busting can help cement the firm’s market dominance and prevent law-abiding competitors from growing.
The University of Pittsburgh Medical Center (UPMC) stands accused of monopolistic conduct of this nature. In Mizell v. UPMC, health professionals currently and formerly employed by the health system are challenging the monopolization and monopsonization of the markets for hospital care and hospital employees, respectively. The bulk of the complaint is focused on UPMC’s serial acquisitions of hospitals and other health care facilities in Western Pennsylvania.
The class action also alleges unfair practices that have given UPMC an unfair competitive edge over rivals. Among these practices are union-busting: UPMC has consistently sought to thwart its workers’ attempts to form unions. The complaint states: “UPMC has faced 133 unfair labor practice charges since 2012 and 159 separate allegations. Approximately seventy-four percent of the violations related to workers’ efforts to unionize, indicating a system-wide suppression of unionization activity.”
This pattern of union-busting has enabled UPMC to maintain a significant and illegitimate competitive edge over its rival in the downstream product market, Allegheny Health Network, many of whose employees are unionized and covered by collective bargaining agreements. Through its alleged union-busting in violation of federal law, UPMC maintains an unfair cost advantage over Allegheny Health Network. As a result of its unfair competitive conduct, UPMC can offer lower rates to payors and patients and maintain its dominant position.
In a 2024 statement of interest in Mizell, the Department of Justice (DOJ) credited union-busting as a potential monopolization theory. The DOJ succinctly described why this conduct is injurious to competitors and potentially runs afoul of Section 2: “[A]nti-unionization tactics by a monopsonist arguably limit unionized rivals’ ability to compete profitably by lowering UPMC’s costs relative to the rival’s.” Union-busting is not an instance of lower costs through superior productive efficiency, but rather lower costs through violation of law.
Why Stop at Labor Law Violations and the Sherman Act?
The UPMC example has broader implications for antitrust law and competition policy. Should federal and state enforcers start treating violations of generally applicable laws as competition problems? As discussed above, such lawbreaking is harmful to the expressly protected class—private-sector workers in the case of the National Labor Relations Act— and also to competitors that comply with the law. Congress appreciated the connection between employment conditions and competition when it enacted the Fair Labor Standards Act (FLSA). In establishing a generally applicable federal standard on wages and hours, Congress declared that underpaying and overworking employees “constitutes an unfair method of competition in commerce.” In line with the DOJ’s statement of interest, the drafters of the FLSA understood that firms can obtain an unfair competitive edge through labor exploitation.
Lawbreaking should be conceived of as not just potential monopolization under the Sherman Act but a broader competition policy concern. In adopting the language of the FTC Act, Congress’s use of “unfair method of competition” in FLSA shows the shared lineage between antitrust and labor. Today, flouting the law, including labor and employment statutes, is a clear competitive strategy for many firms, notably in Silicon Valley. To use one example, Uber acquired its dominance in the ride-hailing business, in part, by misclassifying drivers as independent contractors (and also refusing to acquire cab licenses), while law-abiding rivals faced higher operating expenses. Employers should be disabused of the belief that they can succeed and profit by busting their workers’ unions or depriving them of statutory labor and employment rights entirely.
As I lay out in a forthcoming article in the American University Law Review, the FTC, in a future administration, should challenge large-scale lawbreaking as a competitive strategy. The FTC can protect honest businesses and channel business strategy in socially beneficial directions, such as improvements in operational efficiency, investment in new production capacity, and research and development. In a 2024 essay, then-FTC Commissioner Alvaro Bedoya and his Attorney-Advisor Max Miller called on the FTC to challenge large-scale worker misclassification as an unfair method of competition.
While it lacks a private right of action and the treble damages remedy, the FTC Act has certain advantages over the Sherman Act. Under Supreme Court precedent, the FTC can attack not just traditional violations of the Sherman and Clayton Acts, but also practices that it deems “against public policy for other reasons.” Although the scope of public policy is contestable, federal statutory law undoubtedly constitutes public policy. Further, the broader substantive scope of the FTC Act means that the FTC can challenge large-scale lawbreaking by non-monopolistic firms. The FTC should not target any and all lawbreaking and duplicate the work of other federal agencies. Borrowing from the Conwood decision, the FTC instead should concentrate on instances that rise above isolated misconduct and represent a critical part of a firm’s competitive methods.
Two of the three principal federal antitrust laws are elastic by design. Whereas Congress restricted specific practices such as exclusive dealing and price discrimination in the Clayton Act, the drafters of the Sherman and FTC Acts opted for broad, open-ended language. They understood that attempting to catalog all unfair competitive practices in a statute would be futile. Businesses and their counsel are ever inventive and always looking for new sources of competitive advantage, licit and illicit. The class action against UPMC shows that union-busting is an important competitive tactic. This conduct is harmful to workers and to competitors that respect their workers’ right to organize. The NLRB exists to protect workers from unfair labor practices. To complement the labor agency’s work, the courts and FTC should use their competition powers to protect honest firms from their low-road rivals and pressure businesses to compete in more socially advantageous ways.