California Dental Association v. Federal Trade Commission

526 U.S. 756 (1999)

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California Dental Association v. Federal Trade Commission

United States Supreme Court
526 U.S. 756 (1999)

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Facts

The California Dental Association (CDA) (defendant) was a nonprofit trade association of California dentists. The CDA placed restrictions on its members’ ability to make advertising statements about low prices and fees, even if the statements were truthful. The CDA claimed that these restrictions prevented potentially misleading pricing statements. The CDA also essentially prohibited all advertising statements about the quality of dental services. The CDA claimed that quality statements about professional services, like dentistry, were not readily verifiable and were likely to be false and misleading. The Federal Trade Commission (FTC) (plaintiff) sued the CDA, alleging that the CDA’s advertising restrictions prevented dentists from competing on price and quality, which unlawfully restrained trade in violation of the Sherman Act, § 1, as enforced through the FTC Act, § 5. An administrative-law judge found the CDA’s restrictions unlawful. The FTC affirmed the unlawfulness finding. The Ninth Circuit found that the advertising restrictions were sufficiently anticompetitive on their face that it could use an abbreviated rule-of-reason analysis known as a quick-look analysis to evaluate the restrictions. After this quick look, the Ninth Circuit affirmed the FTC’s unlawfulness finding. The United States Supreme Court granted certiorari.

Rule of Law

Issue

Holding and Reasoning (Souter, J.)

Concurrence/Dissent (Breyer, J.)

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