State Regulation in the Shadow of Antitrust: FTC v Ticor Title Insurance Co.

Abstract

In FTC v Ticor Title Insurance Co., the Supreme Court denied antitrust immunity to insurers that had participated in state-sanctioned rate-setting activities. Applying the two-part Midcal test for state action, the Court held for the first time that a properly constituted regulatory agency had failed adequately to supervise private firms under a clearly articulated legislative policy. In this article, Professors Page and Lopatka offer a theory of state action immunity that accounts for the seemingly disparate values the Court invoked. They reinterpret Midcal to rely on federalism only as a background norm that counsels a narrow interpretation of the Sherman Act. That Act should be read to allow positive state regulation, but not simple state repeal of antitrust rules. Midcal thus makes a distinction analogous to the one between ancillary and naked restraints, granting immunity if the displacement of antitrust is ancillary to a positive regulatory program, but denying immunity if the state merely nullifies...