Clayton Act (1914)

The Clayton Act was passed to clarify and strengthen the Sherman Act. It outlawed tying contracts (in which
a customer is forced to buy product B if she wants product A) it ruled price discrimination and exclusive dealings illegal; it banned inter directorates (in which some people would be directors of more than one firm in the same industry) and formed by acquiring common stock of competitors. These practices were not illegal per se (meaning “in themselves”) but only when they might, substantially lessen competition. The Clayton Act emphasized prevention as well as punishment. Another important element of the Clayton Act was that it specifically provided antitrust immunity to labor unions.