Antitrust Compliance Guidelines

Introduction

As an institution of higher learning, SMU is committed to complying with federal and state antitrust and competition laws (each an “Antitrust Law,” and together “Antitrust Laws”).  We are proud of the University’s accomplishments, many of which are the products of full and fair competition, and the University demands no less of itself and its employees in all the University’s endeavors.  Antitrust Laws aim to protect the benefits of this competition from being undermined by anticompetitive practices.     

Broadly speaking, Antitrust Laws prohibit any agreement (express or implied, written or verbal) that harms competition.  These laws aim to prevent competitors from fixing prices, dividing markets, coordinating certain behavior, exchanging competitively sensitive information, and from taking concerted action that may lessen free and independent competition.  Importantly, employees may create liability for both the University and themselves by violating Antitrust Laws.  SMU places the responsibility of complying with the Antitrust Laws on each and every member and representative of the University. 

The following guidelines are intended to protect employees and the University from violating Antitrust Laws, and to help its members identify and avoid situations that may raise potential antitrust concerns.  If you or any member of the University are ever in doubt about whether certain activity is inconsistent with Antitrust Laws, contact the Office of Legal Affairs immediately.

Prohibited Conduct.  A bedrock principle of Antitrust Law is that all competitors must act independently of one another.  This principle applies to educational institutions as well.  In our context, topics related to tuition, financial aid, salaries, or terms of employment (such as overtime pay, compensation time, and employee benefits), recruiting practices, and admissions practices (together “Antitrust Sensitive Topics,” while we refer to the information related to Antitrust Sensitive Topics as “Sensitive Information”) are examples of sensitive topics that may raise antitrust concerns. SMU and its members should not enter into any agreements or understandings with other universities, colleges, schools, foundations, or similar organizations (together “Potential Competitors”) to:

• Fix tuition, planned tuition changes, financial aid packages, financial aid criteria, and costs of housing;

• Fix salaries or other terms of compensation (e.g., overtime pay, employee benefits, compensation time);

• Divide “markets,” such as through the use of recruiting or other hiring practices (e.g., we will not recruit in area X if you agree not to recruit in area Y);

• Limit competition for employees (e.g., through the use of “no poach” and “no solicitation” agreements);

• Fix the number of admission slots for students and student-athletes, or any-related-criteria for admissions;

• Fix bids for grants or third-party research opportunities; or

• Agree with any Potential Competitor to boycott another institution or similar organization for its unwillingness to take any contemplated action concerning Antitrust Sensitive Information.

These types of agreements are facially illegal and expose you as an individual and SMU as an institution to criminal penalties and civil liability. In fact, the mere existence of these agreements is illegal, even if the institutions involved did not act upon them or even if you think that any action taken under them would enhance competition rather than harm it. 

Importantly, an actual agreement—whether formal (e.g., a contract) or informal (e.g., a handshake)—is not a necessary precondition to an antitrust violation.  An agreement can be inferred from conduct or other circumstances.  Consequently, it’s important to be careful during meetings and other gatherings with Potential Competitors and to avoid discussions or any conduct that may be misconstrued by others to imply that you or the University may be a party to an anticompetitive agreement. 

The easiest way to avoid these risks is to always act independently and in the best interests of SMU alone.  Never subordinate the interests of SMU for the benefit of any Potential Competitor or group of Potential Competitors without pre-clearing the activity with the Office of Legal Affairs. 

Potentially Sensitive Areas. Other types of conduct may have the effect of restricting competition in some respects but not always in ways that are harmful to competition.  Whether these activities violate Antitrust Laws depends on the surrounding facts and circumstances.  For this reason, the Office of Legal Affairs is here to clarify whether the proposed activity can or cannot occur.  Please contact the Office of Legal Affairs if you witness any activity that you suspect might violate the Antitrust Laws.  Likewise, if you think that a prospective meeting or gathering might touch on an Antitrust Sensitive Topic, contact the Office of Legal Affairs so that they can review it before the activities occur.  Indeed, the Office of Legal Affairs can often suggest ways to eliminate or significantly reduce the antitrust risk associated with a potential activity while still accomplishing your fundamental goals.  

We recognize that determining whether conduct may cross the line into an antitrust violation is not always easy.  And although it is not possible to describe every situation that may raise antitrust risks, we have provided the following guidelines to help:

Public vs. Confidential Information.  

SMU is committed to protecting the confidentiality and integrity of Sensitive Information.  You should neither disclose to Potential Competitors, nor accept from them, any Sensitive Information unless you know that the subject information is already public and you believe the University would have a valid reason for exchanging it. Here are a few examples to illustrate risks created by the exchange of certain information:

Prospective vs. Historical financial information.  Sharing prospective (rather than historical) Sensitive Information may create antitrust risk because it describes activity that has not yet occurred and, if done, could enable Potential Competitors to adjust their behavior in a way that could harm competition.  You should not disclose prospective financial information (for example, planned tuition increases) unless it is already publicly available (e.g., published online or in the SMU Annual Report).

Likewise, you should not share any Sensitive Information about future salary levels, financial aid, charges, rates, or research costs unless SMU has already made the information public. Once publicly available, you may share it, as appropriate, with representatives of other institutions. Until then, you must be vigilant in protecting SMU’s prospective Sensitive Information.

For similar reasons, do not ask Potential Competitors to provide similar prospective Sensitive Information and do not seek information about their plans, projections, or estimates before the relevant information has become publicly available. Do not accept any such information in any form – whether written or oral. If you find yourself holding such information, contact the Office of Legal Affairs immediately and they can guide you.

Aggregated vs. Disaggregated Information.  The exchange of aggregated information (e.g., a report describing average salaries for many employees in the school of engineering) is less likely to violate the Antitrust Laws because it doesn’t provide specific insight into SMU-related activities.  By contrast, disaggregated information (e.g., specific salaries for tenured professors in the school of engineering) is information that provides specific insights into SMU activities and operations.  If you receive a request for disaggregated information, respond by saying that you have been instructed not to provide the information without first clearing the disclosure with the Office of Legal Affairs. Please also ask the individual or entity making the request whether any reports that contain this information will mask each provider’s specific information and relay that individual’s response to the Office of Legal Affairs.    

Trade Associations, Group Meetings, and Conferences.

Conferences and meetings that include representatives of Potential Competitors are often particularly sensitive.  Beyond the direct peer-to-peer contact that these meetings generate, they also tend to involve joint activity (e.g., preparing for panel discussions, collecting information to present trends, etc.).  Before sharing any University information, make sure it does not involve Antitrust Sensitive Information. 

If an individual from a Potential Competitor asks you for Antitrust Sensitive Information (e.g., information about tuition, fees, financial aid, research costs, charges for services, rates, salaries, or similar information), do not provide it. Instead, respond that the Office of Legal Affairs has instructed you not to share that information without their approval.

If an Antitrust Sensitive Topic like this comes up at a meeting in which you and one or more Potential Competitors are present, respond politely that you have been instructed not to engage in the discussion, announce that you are leaving the room, and request that they note your departure. You should notify the Office of Legal Affairs immediately for guidance.  Do not rejoin the meeting until (1) the Office of Legal Affairs clears you to rejoin the meeting and (2) you are certain that no further discussions of Antitrust Sensitive Information will occur.

Surveys and Similar Requests to Share University Information:

Sometimes, you may receive a request for information about salaries, tuition rates, financial aid, admissions, and related Sensitive Information.  The request may come in the form of a survey or third-party effort to compare metrics of peer schools or other institutions.  But these kinds of requests can raise antitrust concerns if they require the disclosure of Antitrust Sensitive Information.

If you receive such a request, the easiest thing to do is to contact the Office of Legal Affairs before providing the requested information.  But you may provide the requested information provided the disclosure serves a legitimate purpose for SMU and you have confirmed that all four of the following criteria are met:

1. The party collecting, aggregating, and disseminating that information is an independent and reputable third-party;
2. The information will be reported in a manner that does not identify any specific provider or cannot otherwise be “reverse engineered” to determine its source;
3. The requested confidential information is at least three months old;
4. At least five providers supply similar information to what is being requested where no single provider accounts for more than 25 percent of the requested information.

Legislative and Regulatory Effects: 

In some circumstances, working with competitors to petition the government jointly—i.e., the legislature, the executive brand, regulatory agencies, or the courts—is permissible under the Antitrust Laws even if its ultimate effect may be to harm competition because regulation would conflict with one of the foundations of the Constitution: the protection of political speech.  Courts have resolved the tension between the protection of participation and the laws’ prohibition of anticompetitive cooperation by creating an immunity for this type of conduct. 

But these kinds of activities are not always permissible under the Antitrust Laws.  If the joint petition is a “sham” petition (i.e., it is being used as a cover to conduct otherwise unlawful coordination) or if the petitioning is based on fraud, then the activity may violate the Antitrust Laws.  Please contact the Office of Legal Affairs if you have questions about whether any joint activity with one or more Potential Competitors constitutes lawful petitioning before engaging in the activity. 

No One is Exempt from these Guidelines.  No employee, agent, or consultant acting on behalf of SMU is exempt from these guidelines.  If you have any doubt about whether an action may violate these guidelines, contact the Office of Legal Affairs immediately.

Take Care in What you Say and Write. Be careful about you say and write, whether by e-mail, text, letter, or by video.  Avoid ambiguous language that could be misconstrued to suggest activity that might violate the Antitrust Laws. Today, electronic communications have a particularly long lifespan and, even if deleted from a computer, mobile phone, or tablet, enterprising plaintiffs may retrieve them and try to use them as evidence of illegal conduct in an antitrust lawsuit.  Please exercise the same standard of care in these modes of communications as you would when you write formal communications (such as a memoranda or letters).  If you have questions about how to convey a potentially sensitive idea or have concerns about the contents of any document or message, contact the Office of Legal Affairs for assistance.

Reporting a Suspected Violation will not Result in Retaliation. If you discover or suspect any activity by another institution that may violate the Antitrust Laws, report the activity to the Office of Legal Affairs and your supervisor.  It is our collective responsibility to protect SMU from violations of the Antitrust Laws.  SMU does not tolerate any retaliation or threats that might inhibit reporting.  If you fear reprisal or retaliation, notify the Office of Legal Affairs for guidance. 

 

 

November 1, 2023