United States v. Marine Bancorporation, Inc.

PETITIONER: United States
RESPONDENT: Marine Bancorporation, Inc.
LOCATION: The White House

DOCKET NO.: 73-38
DECIDED BY: Burger Court (1972-1975)
LOWER COURT:

CITATION: 418 US 602 (1974)
ARGUED: Apr 23, 1974
DECIDED: Jun 26, 1974

ADVOCATES:
Daniel M. Friedman - for appellant
Lee Loevinger - for appellee Comptroller of the Currency
R. A. Moen -

Facts of the case

Question

Media for United States v. Marine Bancorporation, Inc.

Audio Transcription for Oral Argument - April 23, 1974 in United States v. Marine Bancorporation, Inc.

Audio Transcription for Opinion Announcement - June 26, 1974 in United States v. Marine Bancorporation, Inc.

Warren E. Burger:

The disposition of number 73-38 United States against Marine Bancorporation and 73-767, United States against Connecticut National Bank will be announced by Mr. Justice Powell.

Lewis F. Powell, Jr.:

This is a civil antitrust action under the Section 7 of the Clayton Act brought here on appeal from the District Court for the Western District of Washington.

The issue is the validity of a proposed merger between the second largest banking organization in a State based in Seattle and the eighth largest bank located in Spokane.

As there is no significant direct competition, the Government relies exclusively on the potential-competition doctrine.

It argues best that the acquiring bank would probably enter Spokane de novo or by acquisition of a smaller bank and, thus, would have assists in the deconcentration of the Spokane market.

And second that the merger would eliminate the acquiring bank as a potential entrant, which presently is alleged to have a pro-competitive affect on that market.

The District Court found no violation of Section 7 and we agree.

The potential-competition doctrine, though applicable to banks, must take into account the extensive federal and state regulation, and particularly the regulatory restraints on entry into a new market.

The barriers to entry in Washington are severe.

De novo branching is forbidden, as is branching from a branch office.

Not all multi bank holding companies allowed.

The Government nevertheless contended that entry was feasible, either by acquisition of a small state bank or by achieving an informal de novo entry though establishing a sponsored bank and later acquiring it.

We have carefully examined the record in this case and conclude in accordance with the findings of the District Court that the Government has failed to establish that either of these proposed methods of entry is feasible or that either offers a substantial likelihood of producing pro-competitive effects.

Accordingly, we affirm the judgment of the District Court.

Mr. Justice White filed a dissenting opinion in which Mr. Justices Brennan and Marshall joined; Mr. Justice Douglas took no part in that decision.