Abstract

The indirect purchaser rule, established three decades ago in Illinois Brick v. Illinois, has generated sufficiently steady and widespread criticism that Congress's Antitrust Modernization Commission is now considering possible reforms. The debate over reforms, however, has been constrained by an undue emphasis on legal formalism and has failed to generate innovative alternatives. We review the development of the doctrine, identify its significant shortcomings, and articulate the functional objectives that antitrust rules of standing should pursue. Building off these objectives, which constitute the foundations of antitrust law, and incorporating some lessons from securities law, we propose a mechanism that opens antitrust suits to indirect purchasers, consolidates the multiple claims, and designates a presumptive lead plaintiff.