Professional Documents
Culture Documents
Community Communications Co. v. Boulder, 455 U.S. 40 (1982)
Community Communications Co. v. Boulder, 455 U.S. 40 (1982)
2d 810
102 S.Ct. 835
455 U.S. 40
Syllabus
Respondent city of Boulder is a "home rule" municipality, granted by the
Colorado Constitution extensive powers of self-government in local and
municipal matters. Petitioner is the assignee of a permit granted by a city
ordinance to conduct a cable television business within the city limits.
Originally, only limited service within a certain area of the city could be
provided by petitioner, but improved technology offered petitioner an
opportunity to expand its business into other areas, and also offered
opportunities to potential competitors, one of whom expressed interest in
obtaining a permit to provide competing service. The City Council then
enacted an "emergency" ordinance prohibiting petitioner from expanding
its business for three months, during which time the Council was to draft a
model cable television ordinance and to invite new businesses to enter the
market under the terms of that ordinance. Petitioner filed suit in Federal
District Court, alleging that such a restriction would violate 1 of the
Sherman Act, and seeking a preliminary injunction to prevent the city
from restricting petitioner's proposed expansion. The city responded that
its moratorium ordinance could not be violative of the antitrust laws
because, inter alia, the city enjoyed antitrust immunity under the "state
action" doctrine of Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed.
315. The District Court held that the Parker exemption was inapplicable
and that the city was therefore subject to antitrust liability. Accordingly,
the District Court issued a preliminary injunction. The Court of Appeals
reversed, holding that the city's action satisfied the criteria for a Parker
exemption.
The question presented in this case, in which the District Court for the District
of Colorado granted preliminary injunctive relief, is whether a "home rule"
municipality, granted by the state constitution extensive powers of selfgovernment in local and municipal matters, enjoys the "state action" exemption
from Sherman Act liability announced in Parker v. Brown, 317 U.S. 341, 63
S.Ct. 307, 87 L.Ed.2d 315 (1943).
From 1966 until February 1980, due to the limited service that could be
provided with the technology then available, petitioner's service consisted
essentially of retransmissions of programming broadcast from Denver and
Cheyenne, Wyo. Petitioner's market was therefore confined to the University
Hill area. However, markedly improved technology became available in the
late 1970's, enabling petitioner to offer many more channels of entertainment
than could be provided by local broadcast television. 3 Thus presented with an
opportunity to expand its business into other areas of the city, petitioner in May
1979 informed the City Council that it planned such an expansion. But the new
technology offered opportunities to potential competitors, as well, and in July
1979 one of them, the newly formed Boulder Communications Co. (BCC),4
also wrote to the City Council, expressing its interest in obtaining a permit to
provide competing cable television service throughout the city.5
The City Council's response, after reviewing its cable television policy, 6 was
the enactment of an "emergency" ordinance prohibiting petitioner from
expanding its business into other areas of the city for a period of three months.7
The City Council announced that during this moratorium it planned to draft a
model cable television ordinance and to invite new businesses to enter the
Boulder market under its terms, but that the moratorium was necessary because
petitioner's continued expansion during the drafting of the model ordinance
would discourage potential competitors from entering the market.8
5
Petitioner filed this suit in the United States District Court for the District of
Colorado, and sought, inter alia, a preliminary injunction to prevent the city
from restricting petitioner's proposed business expansion, alleging that such a
restriction would violate 1 of the Sherman Act.9 The city responded that its
moratorium ordinance could not be violative of the antitrust laws, either
because that ordinance constituted an exercise of the city's police powers, or
because Boulder enjoyed antitrust immunity under the Parker doctrine. The
District Court considered the city's status as a home rule municipality, but
determined that that status gave autonomy to the city only in matters of local
concern, and that the operations of cable television embrace "wider concerns,
including interstate commerce . . . [and] the First Amendment rights of
communicators." 485 F.Supp. 1035, 1038-1039 (1980). Then, assuming,
arguendo, that the ordinance was within the city's authority as a home rule
municipality, the District Court considered City of Lafayette v. Louisiana
Power & Light Co., 435 U.S. 389, 98 S.Ct. 1123, 55 L.Ed.2d 364 (1978), and
concluded that the Parker exemption was "wholly inapplicable," and that the
city was therefore subject to antitrust liability. 485 F.Supp., at 1039.10
Petitioner's motion for a preliminary injunction was accordingly granted.
On appeal, a divided panel of the United States Court of Appeals for the Tenth
Circuit reversed. 630 F.2d 704 (1980). The majority, after examining Colorado
law, rejected the District Court's conclusion that regulation of the cable
television business was beyond the home rule authority of the city. Id., at 707.
The majority then addressed the question of the city's claimed Parker
exemption. It distinguished the present case from City of Lafayette on the
ground that, in contrast to the municipally operated revenue-producing utility
companies at issue there, "no proprietary interest of the City is here involved."
630 F.2d, at 708. After noting that the city's regulation "was the only control or
active supervision exercised by state or local government, and . . . represented
the only expression of policy as to the subject matter," id., at 707, the majority
held that the city's actions therefore satisfied the criteria for a Parker
exemption, 630 F.2d, at 708.11 We granted certiorari, 450 U.S. 1039, 101 S.Ct.
1756, 68 L.Ed.2d 236 (1981). We reverse.
II
A.
7
Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315 (1943), addressed
the question whether the federal antitrust laws prohibited a State, in the exercise
of its sovereign powers, from imposing certain anticompetitive restraints. These
took the form of a "marketing program" adopted by the State of California for
the 1940 raisin crop; that program prevented appellee from freely marketing his
crop in interstate commerce. Parker noted that California's program "derived its
authority . . .
from the legislative command of the state," id., at 350, 63 S.Ct., at 313, and
went on to hold that the program was therefore exempt, by virtue of the
Sherman Act's own limitations, from antitrust attack:
"We find nothing in the language of the Sherman Act or in its history which
suggests that its purpose was to restrain a state or its officers or agents from
activities directed by its legislature. In a dual system of government in which,
under the Constitution, the states are sovereign, save only as Congress may
constitutionally subtract from their authority, an unexpressed purpose to nullify
a state's control over its officers and agents is not lightly to be attributed to
Congress." Id., at 350-351, 63 S.Ct., at 313-314.
10
11
This Court affirmed. In doing so, a majority rejected at the outset petitioners'
claim that, quite apart from Parker, "Congress never intended to subject local
governments to the antitrust laws." 435 U.S., at 394, 98 S.Ct., at 1127. A
plurality opinion for four Justices then addressed petitioners' argument that
"Cities are not themselves sovereign; they do not receive all the federal
deference of the States that create them. Parker limitation of the exemption to
'official action directed by a state,' is consistent with the fact that the States'
subdivisions generally have not been treated as equivalents of the States
themselves. In light of the serious economic dislocation which could result if
cities were free to place their own parochial interests above the Nation's
economic goals reflected in the antitrust laws, we are especially unwilling to
presume that Congress intended to exclude anticompetitive municipal action
from their reach." 435 U.S., at 412-413, 98 S.Ct., at 1136-1137 (footnote and
citations omitted).
13
The opinion emphasized, however, that the State as sovereign might sanction
anticompetitive municipal activities and thereby immunize municipalities from
antitrust liability. Under the plurality's standard, the Parker doctrine would
shield from antitrust liability municipal conduct engaged in "pursuant to state
policy to displace competition with regulation or monopoly public service." 435
U.S., at 413, 98 S.Ct., at 1137. This was simply a recognition that a State may
frequently choose to effect its policies through the instrumentality of its cities
and towns. It was stressed, however, that the "state policy" relied upon would
have to be "clearly articulated and affirmatively expressed." Id., at 410, 98
S.Ct., at 1135. This standard has since been adopted by a majority of the Court.
New Motor Vehicle Board of California v. Orrin W. Fox Co., 439 U.S. 96, 109,
99 S.Ct. 403, 411-12, 58 L.Ed.2d 361 (1978); California Retail Liquor Dealers
Assn. v. Midcal Aluminum, Inc., 445 U.S. 97, 105, 100 S.Ct. 937, 943, 63
L.Ed.2d 233 (1980).14
B
14
affirmatively expressed state policy, see City of Lafayette, Orrin W. Fox Co.,
and Midcal. Boulder argues that these criteria are met by the direct delegation
of powers to municipalities through the Home Rule Amendment to the
Colorado Constitution. It contends that this delegation satisfies both the Parker
and the City of Lafayette standards. We take up these arguments in turn.
(1)
15
16
Respondent city's Parker argument emphasizes that through the Home Rule
Amendment the people of the State of Colorado have vested in the city of
Boulder " 'every power theretofore possessed by the legislature . . . in local and
municipal affairs.' "15 The power thus possessed by Boulder's City Council
assertedly embraces the regulation of cable television, which is claimed to pose
essentially local problems.16 Thus, it is suggested, the city's cable television
moratorium ordinance is an "act of government" performed by the city acting
as the State in local matters, which meets the "state action" criterion of
Parker.17
17
We reject this argument: it both misstates the letter of the law and
misunderstands its spirit. The Parker state-action exemption reflects Congress'
intention to embody in the Sherman Act the federalism principle that the States
possess a significant measure of sovereignty under our Constitution. But this
principle contains its own limitation: Ours is a "dual system of government,"
Parker, 317 U.S., at 351, 63 S.Ct., at 313 (emphasis added), which has no place
for sovereign cities. As this Court stated long ago, all sovereign authority
"within the geographical limits of the United States" resides either with
18
"the Government of the United States, or [with] the States of the Union. There
exist within the broad domain of sovereignty but these two. There may be cities,
counties, and other organized bodies with limited legislative functions, but they
are all derived from, or exist in, subordination to one or the other of these."
United States v. Kagama, 118 U.S. 375, 379, 6 S.Ct. 1109, 1111, 30 L.Ed. 228
(1886) (emphasis added).
19
The dissent in the Court of Appeals correctly discerned this limitation upon the
federalism principle: "We are a nation not of 'city-states' but of States." 630
F.2d, at 717. Parker itself took this view. When Parker examined Congress'
intentions in enacting the antitrust laws, the opinion, as previously indicated,
noted that: "[N]othing in the language of the Sherman Act or in its history . . .
suggests that its purpose was to restrain a state or its officers or agents from
activities directed by its legislature. . . . [And] an unexpressed purpose to
nullify a state's control over its officers and agents is not lightly to be attributed
Boulder first argues that the requirement of "clear articulation and affirmative
expression" is fulfilled by the Colorado Home Rule Amendment's "guarantee
of local autonomy." It contends, quoting from City of Lafayette, 435 U.S., at
394, 415, 98 S.Ct., at 1127, 1138, that by this means Colorado has
"comprehended within the powers granted" to Boulder the power to enact the
challenged ordinance, and that Colorado has thereby "contemplated" Boulder's
enactment of an anticompetitive regulatory program. Further, Boulder contends
that it may be inferred, "from the authority given" to Boulder "to operate in a
particular area"here, the asserted home rule authority to regulate cable
television"that the legislature contemplated the kind of action complained
of." (Emphasis supplied.) Boulder therefore concludes that the "adequate state
mandate" required by City of Lafayette, supra, at 415, 98 S.Ct., at 1138, is
present here.18
22
Respondents argue that denial of the Parker exemption in the present case will
have serious adverse consequences for cities, and will unduly burden the
federal courts. But this argument is simply an attack upon the wisdom of the
longstanding congressional commitment to the policy of free markets and open
competition embodied in the antitrust laws.19 Those laws, like other federal
laws imposing civil or criminal sanctions upon "persons," of course apply to
municipalities as well as to other corporate entities. 20 Moreover, judicial
enforcement of Congress' will regarding the state-action exemption renders a
State "no less able to allocate governmental power between itself and its
political subdivisions. It means only that when the State itself has not directed
or authorized an anticompetitive practice, the State's subdivisions in exercising
their delegated power must obey the antitrust laws." City of Lafayette, 435 U.S.,
at 416, 98 S.Ct., at 1138. As was observed in that case:
24
25
The judgment of the Court of Appeals is reversed, and the action is remanded
26
It is so ordered.
27
28
29
The Court's opinion, which I have joined, explains why the city of Boulder is
not entitled to an exemption from the antitrust laws. The dissenting opinion
seems to assume that the Court's analysis of the exemption issue is tantamount
to a holding that the antitrust laws have been violated. The assumption is not
valid. The dissent's dire predictions about the consequences of the Court's
holding should therefore be viewed with skepticism.1
30
In City of Lafayette v. Louisiana Power & Light Co., 435 U.S. 389, 98 S.Ct.
1123, 55 L.Ed.2d 364, we held that municipalities' activities as providers of
services are not exempt from the Sherman Act. The reasons for denying an
exemption to the city of Lafayette are equally applicable to the city of Boulder,
even though Colorado is a home-rule State. We did not hold in City of Lafayette
that the City had violated the antitrust laws. Moreover, that question is quite
different from the question whether the city of Boulder violated the Sherman
Act because the character of their respective activities differs. In both cases, the
violation issue is separate and distinct from the exemption issue.
31
A brief reference to our decision in Cantor v. Detroit Edison Co., 428 U.S. 579,
96 S.Ct. 3110, 49 L.Ed.2d 1141, will identify the invalidity of the dissent's
assumption. In that case, the Michigan Public Utility Commission had
approved a tariff that required the Detroit Edison Co. to provide its customers
free light bulbs. The company contended that its light bulb distribution program
was therefore exempt from the antitrust laws on the authority of Parker v.
Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315. See 428 U.S., at 592, 96
S.Ct., at 3118. The Court rejected the company's interpretation of Parker and
held that the plaintiff could proceed with his antitrust attack against the
company's program. We surely did not suggest that the members of the
Michigan Public Utility Commission who had authorized the program under
attack had thereby become parties to a violation of the Sherman Act. On the
contrary, the plurality opinion reviewed the Parker case in great detail to
emphasize the obvious difference between a charge that public officials have
violated the Sherman Act and a charge that private parties have done so.2
32
33
34
The Court's decision in this case is flawed in two serious respects, and will
thereby impede, if not paralyze, local governments' efforts to enact ordinances
and regulations aimed at protecting public health, safety, and welfare, for fear
of subjecting the local government to liability under the Sherman Act, 15
U.S.C. 1 et seq. First, the Court treats the issue in this case as whether a
municipality is "exempt" from the Sherman Act under our decision in Parker v.
Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315 (1943). The question
addressed in Parker and in this case is not whether state and local governments
are exempt from the Sherman Act, but whether statutes, ordinances, and
regulations enacted as an act of government are pre-empted by the Sherman
Act under the operation of the Supremacy Clause. Second, in holding that a
municipality's ordinances can be "exempt" from antitrust scrutiny only if the
enactment furthers or implements a "clearly articulated and affirmatively
expressed state policy," ante, at 52, the Court treats a political subdivision of a
State as an entity indistinguishable from any privately owned business. As I
read the Court's opinion, a municipality may be said to violate the antitrust
laws by enacting legislation in conflict with the Sherman Act, unless the
legislation is enacted pursuant to an affirmative state policy to supplant
competitive market forces in the area of the economy to be regulated.
35
37
With this distinction in mind, I think it quite clear that questions involving the
so-called "state action" doctrine are more properly framed as being ones of preemption rather than exemption. Issues under the doctrine inevitably involve
state and local regulation which, it is contended, are in conflict with the
Sherman Act.
38
Our decision in Parker v. Brown, supra, was the genesis of the "state action"
doctrine. That case involved a challenge to a program established pursuant to
the California Agricultural Prorate Act, which sought to restrict competition in
the State's raisin industry by limiting the producer's ability to distribute raisins
through private channels. The program thus sought to maintain prices at a level
higher than those maintained in an unregulated market. This Court assumed that
the program would violate the Sherman Act were it "organized and made
effective solely by virtue of a contract, combination or conspiracy of private
persons, individual or corporate," and that "Congress could, in the exercise of
its commerce power, prohibit a state from maintaining a stabilization program
like the present because of its effect on interstate commerce." 317 U.S., at 350,
63 S.Ct., at 313. In this regard, we noted that "[o]ccupation of a legislative field
by Congress in the exercise of a granted power is a familiar example of its
constitutional power to suspend state laws." Ibid. We then held, however, that "
[w]e find nothing in the language of the Sherman Act or in its history which
suggests that its purpose was to restrain a state or its officers or agents from
activities directed by its legislature. In a dual system of government in which,
under the Constitution, the states are sovereign, save only as Congress may
constitutionally subtract from their authority, an unexpressed purpose to nullify
a state's control over its officers and agents is not lightly to be attributed to
Congress." Id., at 350-351, 63 S.Ct., at 313-14.
39
40
Our two most recent Parker doctrine cases reveal most clearly that the "state
action" doctrine is not an exemption at all, but instead a matter of federal preemption.
41
In New Motor Vehicle Bd. of California v. Orrin W. Fox Co., 439 U.S. 96, 99
S.Ct. 403, 58 L.Ed.2d 361 (1978), we examined the contention that the
California Automobile Franchise Act conflicted with the Sherman Act. That
Act required a motor vehicle manufacturer to secure the approval of the
California New Motor Vehicle Board before it could open a dealership within
an existing franchisee's market area, if the competing franchisee objected. By
so delaying the opening of a new dealership whenever a competing dealership
protested, the Act arguably gave effect to privately initiated restraints of trade,
and thus was invalid under Schwegmann Bros. v. Calvert Distillers Corp., 341
U.S. 384, 71 S.Ct. 745, 95 L.Ed. 1035 (1951). We held that the Act was outside
the purview of the Sherman Act because it contemplated "a system of
regulation, clearly articulated and affirmatively expressed, designed to displace
unfettered business freedom in the matter of the establishment and relocation of
automobile dealerships." 439 U.S., at 109, 99 S.Ct., at 411-412. We also held
that a state statute is not invalid under the Sherman Act merely because the
statute will have an anticompetitive effect. Otherwise, if an adverse effect upon
competition were enough to render a statute invalid under the Sherman Act, "
'the States' power to engage in economic regulation would be effectively
destroyed.' " Id., at 111, 99 S.Ct., at 412 (quoting Exxon Corp. v. Governor of
Maryland, 437 U.S., at 133, 98 S.Ct., at 2218). In New Motor Vehicle Bd., we
held that a state statute could stand in the face of a purported conflict with the
Sherman Act.
42
In California Retail Liquor Dealers Assn. v. Midcal Aluminum, Inc., 445 U.S.
97, 100 S.Ct. 937, 63 L.Ed.2d 233 (1980), we invalidated California's winepricing system in the face of a challenge under the Sherman Act. We first held
that the price-setting program constituted resale price maintenance, which this
Court has consistently held to be a "per se" violation of the Sherman Act. Id., at
102-103, 100 S.Ct., 941-42. We then concluded that the program could not fit
within the Parker doctrine. Although the restraint was imposed pursuant to a
clearly articulated and affirmatively expressed state policy, the program was not
actively supervised by the State itself. The State merely authorized and
enforced price fixing established by private parties, instead of establishing the
prices itself or reviewing their reasonableness. In the absence of sufficient state
supervision, we held that the pricing system was invalid under the Sherman
Act. 455 U.S., at 105-106, 100 S.Ct., at 943-944.
43
Unlike the instant case, Parker, Midcal, and New Motor Vehicle Bd. involved
challenges to a state statute. There was no suggestion that a State violates the
Sherman Act when it enacts legislation not saved by the Parker doctrine from
invalidation under the Sherman Act. Instead, the statute is simply
unenforceable because it has been pre-empted by the Sherman Act. By
contrast, the gist of the Court's opinion is that a municipality may actually
violate the antitrust laws when it merely enacts an ordinance invalid under the
Sherman Act, unless the ordinance implements an affirmatively expressed state
policy.1 According to the majority, a municipality may be liable under the
Sherman Act for enacting anticompetitive legislation, unless it can show that it
is acting simply as the "instrumentality" of the State.
44
Viewing the Parker doctrine in this manner will have troubling consequences
for this Court and the lower courts who must now adapt antitrust principles to
Most troubling, however, will be questions regarding the factors which may be
examined by the Court pursuant to the Rule of Reason. In National Society of
Professional Engi- neers v. United States, 435 U.S. 679, 695, 98 S.Ct. 1355,
1367, 55 L.Ed.2d 637 (1978), we held that an anticompetitive restraint could
not be defended on the basis of a private party's conclusion that competition
posed a potential threat to public safety and the ethics of a particular profession.
"[T]he Rule of Reason does not support a defense based on the assumption that
competition itself is unreasonable." Id., at 696, 98 S.Ct., at 1368. Professional
Engineers holds that the decision to replace competition with regulation is not
within the competence of private entities. Instead, private entities may defend
restraints only on the basis that the restraint is not unreasonable in its effect on
competition or because its procompetitive effects outweigh its anticompetitive
effects. See Continental T.V., Inc. v. GTE Sylvania Inc., 433 U.S. 36, 97 S.Ct.
2549, 53 L.Ed.2d 568 (1977).
46
the stabilization program would violate the Sherman Act if organized and
effected by private persons). Unless the municipality could point to an
affirmatively expressed state policy to displace competition in the given area
sought to be regulated, the municipality would be held to violate the Sherman
Act and the regulatory scheme would be rendered invalid. Surely, the Court
does not seek to require a municipality to justify every ordinance it enacts in
terms of its procompetitive effects. If municipalities are permitted only to enact
ordinances that are consistent with the procompetitive policies of the Sherman
Act, a municipality's power to regulate the economy would be all but destroyed.
See Exxon Corp. v. Governor of Maryland, 437 U.S., at 133, 98 S.Ct., at 22172218. This country's municipalities will be unable to experiment with
innovative social programs. See New State Ice Co. v. Liebmann, 285 U.S. 262,
311, 52 S.Ct. 371, 386-387, 76 L.Ed. 747 (1932) (Brandeis, J., dissenting).
47
48
Before this Court leaps into the abyss and holds that municipalities may violate
the Sherman Act by enacting economic and social legislation, it ought to think
about the consequences of such a decision in terms of its effect both upon the
very antitrust principles the Court desires to apply to local governments and
upon the role of the federal courts in examining the validity of local regulation
of the economy.
49
50
II
52
"The people of each city or town of this state, having a population of two
thousand inhabitants . . ., are hereby vested with, and they shall always have,
power to make, amend, add to or replace the charter of said city or town, which
shall be its organic law and extend to all its local and municipal matters.
"Such charter and the ordinances made pursuant thereto in such matters shall
supersede within the territorial limits and other jurisdiction of said city or town
any law of the state in conflict therewith.
*****
"It is the intention of this article to grant and confirm to the people of all
municipalities coming within its provisions the full right of self-government in
both local and municipal matters. . . .
"The statutes of the state of Colorado, so far as applicable, shall continue to
apply to such cities and towns, except insofar as superseded by the charters of
such cities and towns or by ordinance passed pursuant to such charters."
2
Regarding this letter, the District Court noted that "BCC outlined a proposal for
a new system, acknowledging the presence of [petitioner] in Boulder but stating
that '(w)hatever action the City takes in regard to [petitioner], it is the plan of
BCC to begin building its system as soon as feasible after the City grants BCC
its permit.' " Id., at 1037.
6
The Council reached this conclusion despite BCC's statement to the contrary,
see n.5, supra.
10
The District Court also held that no per se antitrust violation appeared on the
record before it, and that petitioner was not protected by the First Amendment
from all regulation attempted by the city. Id., at 1039-1040.
11
The majority cited California Retail Liquor Dealers Assn. v. Midcal Aluminum,
Inc., 445 U.S. 97, 100 S.Ct. 937, 63 L.Ed.2d 233 (1980), as support for its
reading of City of Lafayette, and concluded "that City of Lafayette is not
applicable to a situation wherein the governmental entity is asserting a
governmental rather than proprietary interest, and that instead the ParkerMidcal doctrine is applicable to exempt the City from antitrust liability." 630
F.2d, at 708.
The dissent urged affirmance, agreeing with the District Court's analysis of the
antitrust exemption issue. Id., at 715-718 (Markey, C. J., United States Court of
Customs and Patent Appeals, sitting by designation, dissenting). The dissent
also considered the city's actions to violate "[c]ommon principles of contract
law and equity," id., at 715, as well as the First Amendment rights of petitioner
and its customers, both actual and potential, id., at 710-714. The petition for
certiorari did not present the First Amendment question, and we do not address
it in this opinion.
12
asserted use of that power may be too tenuous to permit the conclusion that the
entity's intended scope of activity encompassed such conduct. . . . A district
judge's inquiry on this point should be broad enough to include all evidence
which might show the scope of legislative intent." 532 F.2d, at 434-435
(footnote and citation omitted).
13
14
15
Denver Urban Renewal Authority v. Byrne, Colo., 618 P.2d 1374, 1381 (1980),
quoting Four-County Metropolitan Capital Improvement District v. Board of
County Comm'rs, 149 Colo. 284, 294, 369 P.2d 67, 72 (1962) (emphasis in
original). The Byrne court went on to state that "by virtue of Article XX, a
home rule city is not inferior to the General Assembly concerning its local and
municipal affairs." Colo., 618 P.2d, at 1381. Petitioner strongly disputes
respondent city's premise and its construction of Byrne, citing City and County
of Denver v. Sweet, 138 Colo. 41, 48, 329 P.2d 441, 445 (1958), City and
County of Denver v. Tihen, 77 Colo. 212, 219-220, 235 P. 777, 780-781 (1925),
and 2 E. McQuillin, Municipal Corporations 9.08a, p. 638 (1979), as contrary
authority. But it is not for us to determine the correct view on this issue as a
matter of state law. Parker affords an exemption from federal antitrust laws,
based upon Congress' intentions respecting the scope of those laws. Thus the
Boulder cites the decision of the Colorado Supreme Court in Manor Vail
Condominium Assn. v. Vail, 199 Colo. 62, 66-67, 604 P.2d 1168, 1171-1172
(1980), as authority for the proposition that the regulation of cable television is
a local matter. Petitioner disputes this proposition and Boulder's reading of
Manor Vail, citing in rebuttal United States v. Southwestern Cable Co., 392
U.S. 157, 168-169, 88 S.Ct. 1994, 2000-2001, 20 L.Ed.2d 1001 (1968), holding
that cable television systems are engaged in interstate communication. In this
contention, petitioner is joined by the State of Colorado, which filed an amicus
brief in support of petitioner. For the purposes of this decision we will assume,
without deciding, that respondent city's enactment of the moratorium ordinance
under challenge here did fall within the scope of the power delegated to the city
by virtue of the Colorado Home Rule Amendment.
17
Respondent city urges that the only distinction between the present case and
Parker is that here the "act of government" is imposed by a home rule city
rather than by the state legislature. Under Parker and Colorado law, the
argument continues, this is a distinction without a difference, since in the
sphere of local affairs home rule cities in Colorado possess every power once
held by the state legislature.
18
Boulder also contends that its moratorium ordinance qualifies for antitrust
immunity under the test set forth by THE CHIEF JUSTICE in his City of
Lafayette concurrence, see n. 13, supra, because the challenged activity is
clearly a "traditional government function," rather than a "proprietary
enterprise."
19
Antitrust laws in general, and the Sherman Act in particular, are the Magna
Carta of free enterprise. They are as important to the preservation of economic
freedom and our free-enterprise system as the Bill of Rights is to the protection
of our fundamental personal freedoms. And the freedom guaranteed each and
every business, no matter how small, is the freedom to competeto assert with
vigor, imagination, devotion, and ingenuity whatever economic muscle it can
muster." United States v. Topco Associates, Inc., 405 U.S. 596, 610, 92 S.Ct.
1126, 1135, 31 L.Ed.2d 515 (1972).
20
Cf. Cantor v. Detroit Edison Co., 428 U.S. 579, 615, 96 S.Ct. 3110, 3129, 49
L.Ed.2d 1141 (Stewart, J., dissenting) (the Court's holding "will surely result in
disruption of the operation of every state-regulated public utility company in
the Nation and in the creation of 'the prospect of massive treble damage
liabilities' ") (quoting Posner, The Proper Relationship Between State
Regulation and the Federal Antitrust Laws, 49 N.Y.U.L.Rev. 693, 728 (1974)).
See also United States Railroad Retirement Bd. v. Fritz, 449 U.S. 166, 176,
n.10, 101 S.Ct. 453, 460, n.10, 66 L.Ed.2d 368.
See Bates v. State Bar of Arizona, 433 U.S. 350, 361, 97 S.Ct. 2691, 2697, 53
L.Ed.2d 810 ("[O]bviously, Cantor would have been an entirely different case
if the claim had been directed against a public official or public agency, rather
than against a private party").
1
During the Lochner era, this Court's interpretation of the Due Process Clause
complemented its antitrust policies. This Court sought to compel competitive
behavior on the part of private enterprise and generally forbade government
interference with competitive forces in the marketplace. See Strong, The
Economic Philosophy of Lochner: Emergence, Embrasure and Emasculation,
15 Ariz.L.Rev. 419, 435 (1973).
Since a municipality does not violate antitrust laws when it enacts legislation
pre-empted by the Sherman Act, there will be no problems with the remedy.
Pre-empted state or local legislation is simply invalid and unenforceable.
The Midcal standards are not applied until it is either determined or assumed
that the regulatory program would violate the Sherman Act if it were conceived
and operated by private persons. See Parker v. Brown, 317 U.S., at 350, 63
S.Ct., at 313; California Retail Liquor Dealers Assn. v. Midcal Aluminum Inc.,
445 U.S. 97, 102-103, 100 S.Ct. 937, 941-942, 63 L.Ed.2d 233 (1980). A
statute is not pre-empted simply because some conduct contemplated by the
statute might violate the antitrust laws. See Joseph E. Seagram & Sons, Inc. v.
Hostetter, 384 U.S. 35, 45-46, 86 S.Ct. 1254, 1260-61, 16 L.Ed.2d 336 (1966).
Conversely, reliance on a state statute does not insulate a private party from
liability under the antitrust laws unless the statute satisfies the Midcal criteria.
Seeing this opportunity to recapture the power it has lost over local affairs, the
State of Colorado, joined by 22 other States, has supported petitioner as amicus
curiae. It is curious, indeed, that these States now seek to use the Supremacy
Clause as a sword, when they so often must defend their own enactments from
its invalidating effects.