Court’s Decision
I. Basis of the court decision
In 1971, Gordon individually filed a suit against the New York Stock Exchange (NYSE) and several other member firms of the Exchanges, arguing that the fixed commission rate NYSE and other exchanges adopted violated federal antitrust laws*.
The District Court stated that the fixed rate commissions were immunized from antitrust laws because it’s under the authority of the Securities and Exchange Commission (SEC). The Second Circuit Court of Appeals upheld. Gordon then appealed to the Supreme Court.
The Supreme Court ruled that the fixed commission rates were not subject to antitrust laws because of the SEC's power to regulate the financial markets. The Court affirmed that the implied exemption of the antitrust laws was necessary with respect to the fixed commission rates, avoiding the possibility of the conflict between the instruction from SEC to exchange and the antitrust law. The court decided that the repeal of the antitrust laws pertaining to the areas covered by the Securities Exchange and enforced by the SEC are necessary for the SEC to adequately enforce the laws.
II. How the decision will play a precedent for other cases.
In Gordon v. New York Stock Exchange, the Court further illustrated clearly the
* Gordon v. New York Stock Exchange, inc., 422 U.S. 659 (1975). Read from http://www.law.cornell.edu/supremecourt/text/422/659 repugnancy standard when determining whether antitrust laws are implicitly repealed in specific aspects of the financial industry*. The Gordon Supreme Court expanded the set of circumstances of implied immunity from antitrust laws.
The Court evaluated the decision on four factors (Rebarber, 2011):
1. Does SEC own generalized authority on the regulatory ...
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...ornfeld, 2014).
Given the complex nature of the financial markets they should be regulated primarily by the SEC. Additionally since there is specific legislation enacted to regulate these markets, and then the SEC’s oversight should be the standard to which the stakeholders are held.
Reference
Gordon v. New York Stock Exchange, inc., 422 U.S. 659 (1975). Read from http://www.law.cornell.edu/supremecourt/text/422/659
Jessica A. Rebarber, (2011), Credit Suisse v. Billing: The Limited Impact on Application of Antitrust Laws in Federally Regulated Industries Following the 2008 Financial Crisis and Beyond, 6 J. Bus. & Tech. L. 417, Retrieved from: http://digitalcommons.law.umaryland.edu/jbtl/vol6/iss2/7
Mark A. Kornfeld, (2014), Tracking New Developments in Securities Litigation, Aspatore, WL 1245076. Retrieved from: https://1-next-westlaw-com.proxy1.library.jhu.edu/
and fair one. Many believe it to be the first anti- trust decision in U.S.
Wallace v. Jaffree. United States Supreme Court. 4 June 1985. Find Law. N.p., n.d. Web. 10 May 2014.
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"Schenck v. United States. Baer v. Same.." LII. Cornell University Law school, n.d. Web. 6 Jan. 2014. .
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