Communication is useful and often necessary for rivals to coordinate price and output decisions. All would agree that evidence of communication on these issues is relevant to the issue of whether firms reached an illegal agreement or engaged in concerted action in violation of Section 1 of the Sherman Act. Most courts and commentators would go further and define agreement and concerted action to require communication of one kind or another. I call this view the objective theory of concerted action. Louis Kaplow has recently challenged this approach in three important articles, all of which argue that the focus on communications is misguided. Although he does not propose a fully specified definition, he suggests that a standard of successful oligopolistic interdependence -- in which rivals reach a meeting of the minds -- would provide a superior basis for identifying unlawful agreements. In this essay, I describe this subjective theory of concerted action and identify the equilibria that it includes and excludes. I then consider its likely costs and benefits relative to the current objective theory. I argue that it will deter few durable instances of oligopolistic interdependence that present law would not prohibit. On the other hand, it apparently immunizes some equilibria, even if reached through communication. If so, it would raise the possibility of new and problematic defenses to claims of illegal concerted action. Moreover, Kaplow excludes certain noncompetitive equilibria from the subjective standard on the ground that they do not involve the requisite meeting of minds. But these equilibria differ in only a few ways from other, strategic equilibria that arguably do involve the necessary meeting of minds. Reliance on the concept of a meeting of the minds to distinguish these equilibria would risk significant false positives.
William H. Page, Objective and Subjective Theories of Concerted Action, 79 Antitrust L.J. 215 (2013), available at http://scholarship.law.ufl.edu/facultypub/630