Chamber Requests High Court to Consider Antitrust Immunity for IPO-Related Conduct

WASHINGTON, D.C.—Companies and financial institutions undertaking IPO-related activities should be granted immunity to antitrust laws, according to the National Chamber Litigation Center (NCLC).

"Applying antitrust laws to IPO-related activities is like using a sledgehammer to kill a fly," said Robin Conrad, NCLC senior vice president. "It's unnecessary and can do more harm than good."

In an amicus brief filed yesterday urging the Supreme Court to hear a relevant case—Credit Suisse First Boston LTD, et al. v. Glen Billing et al—NCLC argued that the Securities and Exchange Commission (SEC) already effectively regulates IPO-related activities. In the case, the Second Circuit panel held that certain practices related to IPOs could be the basis for antitrust lawsuits.

"If the appellate decision stands, the result will chill business arrangements because of fear of costly litigation," said Conrad. "We are at risk of strangling the goose that lays the golden egg—the orderly, transparent, easy formation of capital that makes our economy the envy of the world."

When a company undertakes an IPO, it often does so collaboratively with other financial institutions, such as underwriters and banks, to help manage risk and increase the likelihood of a successful entry into the publicly traded market. These institutions should be immune from antitrust lawsuits while engaged in these activities, according to NCLC.

NCLC noted in its brief that the Second Circuit's ruling flies in the face of not just the SEC's objections, but the Court's precedents on implied immunity. If the decision stands, companies will be deterred from a wide range of activities that the financial community has found useful and the SEC has deemed permissible in the public interest.

The U.S. Chamber is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region. NCLC is a membership organization that advocates fair treatment of business in the courts and before regulatory agencies.

www.uschamber.com

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