During the “Deconstructing Social Media Guidelines” session at the ASAE Annual Meeting, the topic of antitrust came up a few times. I was facilitating the meeting with my Team SocialFish buds, Maddie Grant and Lindy Dreyer, and got to talk about my favorite topic, risk. The fear of social media just won’t seem to go away, so we preach your social media policy as a guide for people’s online behavior and a way to mitigate these risks. But when it comes to antitrust issues, your social media policy needs to support your association’s antitrust policy and compliance guide.

While monitoring your association’s social media sites, you find members discussing the fee or price to be charged for a specific service or product. Is that antitrust activity?  What should you do? First, you need to understand the antitrust laws and how they apply to your association.

What is antitrust?
Antitrust actions are an inherent risk for associations. An association, whether professional or trade, is a community of competitors where it is easy for members to engage in inappropriate conversations. So what is antitrust? Antitrust consists of any action that could result in an unreasonable restraint of trade such as discussions of pricing, salaries, boycotts, allocation of territorial divisions, bid rigging or “tying” agreements (to get this you have to buy that first). The purpose of the antitrust laws is to preserve competition so any action that tries to hinder competition is viewed as antitrust.

Perhaps the scariest part of antitrust activity is that it does not have to end with a written contract or express agreement that the participants will charge a certain price, refuse to deal with particular vendors or swap territories. Members can violate the laws through informal conversations that have an implied understanding or by mere parallel conduct – everyone does the same thing (raise prices) without a formal agreement to do so.

The penalties for engaging in restraint of trade or unfair competition practices can be severe. The Federal Trade Commission has more resources than your association and can pursue these types of cases aggressively. Mark Alcorn, an association industry lawyer and management consultant wrote in his Association Law Blog about the financial ruin of two dentists in New Jersey that agreed to not do business with an insurance company. The Sherman Antitrust Act is a criminal conspiracy statute so the person can face criminal as well as civil actions. A conviction can carry stiff fines of $100,000 for individuals and $1 million fines for the association per offense.

The risk isn’t new, association discussion forums and meetings have always given members the opportunity to behave badly. The rise of social media just offers additional communication channels and formats in which members can seek an unfair competitive advantage. People often forget that social media activities occur online and electronic information never disappears, it leaves a nice a trail for government prosecutors to follow.

Antitrust Resources
So what does this mean to your association? Your association needs an antitrust policy and compliance guide. You also need to monitor your social media channels for violations of the policy. If your association does not have an antitrust policy and compliance guide, create one immediately. If you are a member of ASAE, its Knowledge Center has many resources:

Board of Directors Resources: Policies
Legal Forms and Models
Policies: Antitrust

Mark Alcorn’s Facts Association Executives Need to Know About Antitrust offers an overview of antitrust with a sample antitrust policy.

What To Do
If your association does have an antitrust policy, review it to ensure it addresses any changes due to social media (probably not). Depending upon your corporate culture, antitrust may not be in the forefront, so you may need to remind your members of its dangers.  An educational campaign may help members to remember the types of conversations they should avoid.

Next, as you monitor the social media conversations, immediately stop any conversations teetering on the edge, or blatantly illegal antitrust discussions. A gentle reminder to the participants will frequently be enough to bring these to an end. [If your association manages a listserv, you may already have some language to this effect in your terms of use or staff monitoring guidelines.]  If the members continue the discussion, than you should refer the issue to the person responsible for antitrust compliance.  Those seemingly innocent inquiries about salaries, what fees or prices are charged for a service, or discussion of vendors may lead to allegations of antitrust activities. Make sure your staff and members understand this issue and continue to monitor your social media channels to interrupt any illegal or inappropriate activity.