Tuesday, July 15, 2003

Antitrust News: Models Unite!

Antitrust class actions always produce some interesting claims. Here's just one example:
NEW YORK (Reuters) - Thousands of models can launch a unified attack on management agencies they say conspired to cheat them by charging inflated commission fees and expenses, a U.S. judge ruled on Tuesday.

U.S. District Judge Harold Baer granted class action status to a complaint against defendants including Elite Model Management and Ford Models Inc. The class is expected to be made up of thousands of models.

The suit, filed in Manhattan federal court, alleges the agencies fixed models' commission rates at 20 percent, twice the 10 percent allowed by state law for employment agencies. The models alleged that the defendants conspired to evade state pricing regulations by calling themselves model management companies.
Here we have an antitrust claim on top of a government price control scheme. This provides further proof that antitrust laws do not serve their stated purpose of protecting the "free" market, since the management agencies are defending an alleged scheme to circumvent government price controls. Certainly such price controls are not "competitive" since they are arbitrarily determined by govermnent authorities outside the marketplace.

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