Hi all - thanks for bringing this to our attention! Due to your concerns over where to draw the line, I asked our General Counsel to review this thread and provide some feedback:
Any sharing of specific fee amounts is likely to be problematic for purposes of federal antitrust law. In addition, discussions concerning fees – even without stating specific dollar amounts – can cause problems. The General Counsel has been monitoring this discussion to help ensure that it remains within the boundaries fixed by applicable law.
If you have questions regarding whether or not something is appropriate to post, you can always run content past us at knowledgecommunities@aia.org, and we'll help you verify.
Happy Friday!
Edit to add more info:@Robert T. Braddock AIA - Given a little more time, our General Counsel has been able to pull together a bit more information, including the guidelines you requested. I hope this helps!
The Sherman Antitrust Act, dating back to 1890, prohibits "every contract, combination, or conspiracy in restraint of trade," subject to a variety of interpretations by the courts over the past 129 years. Some actions are viewed as so inherently harmful to competition that they automatically violate the Sherman Act. They are known as per se violations, and they include price-fixing. An individual convicted of price-fixing (or otherwise found to have violated the Sherman Act) is subject to a fine of up to $1 million and imprisonment for up to 10 years.
The U.S. Department of Justice and the Federal Trade Commission (FTC) are specifically charged with enforcement of federal antitrust laws. The FTC has noted that antitrust scrutiny may occur when competitors discuss the following topics (among others):
- Present or future prices
- Pricing policies
- Promotions
- Bids
- Costs
- Capacity
- Terms or conditions of sale, including credit terms
- Discounts
- Identity of customers
- Allocation of customers or sales areas
- Production quotas
- R&D plans
You will note that discussing any of these subjects in a manner that might be viewed as anticompetitive by antitrust enforcers could be interpreted as part of a “combination” or “conspiracy in restraint of trade.” The line between what can and can’t be discussed is often hard to define, and often counterintuitive to those who don’t practice antitrust law. It is for that reason that we monitor discussions about price carefully, and guide the conversation away from dangerous territory.
I will add that the AIA’s concerns about antitrust subjects are founded in large measure on past experience. The AIA was a named defendant in a private antitrust lawsuit in the 1970s (and did not prevail), and was the subject of Justice Department antitrust investigations in the 1970s and 1980s. Long-time members will recall that, after the second investigation, the AIA was under court-ordered supervision on antitrust matters from 1990 to 2000.
For more information on the AIA’s antitrust compliance policy and guidelines on some of the things that might raise antitrust issues, please see the attached materials. If anyone would like to discuss this subject further, please contact me at jstephens@aia.org or at (202)626-7379.
Thank you.
The attached materials from Jay Stephens are uploaded
in our library here - the Guidelines provides a quicker overview, while the Statement provides a more comprehensive understanding.
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Emma Tucker
Manager, Knowledge Communities
The American Institute of Architects
Washington DC
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Original Message:
Sent: 04-11-2019 11:00
From: John Dugger
Subject: Fee structure for house plans that will be used for a 300 home development.
Group: Has anyone heard from our General Council? Last time I posted just a little note about Business 101 I got a rebuke from the council.
Is anyone else old enough to recall the "consent decree?"
We had to sign it back in the 1980s.
John Dugger, AIA, MBA
J S Dugger, AIA & Associates
Phone: 978-618-3391
Member American Institute of Architects
jsdaia.com
Original Message------
We have began prototyping some plans for specific developer/builder clients, and the structure we are using is a $/SF for the prototype, and a reduced $/SF, about a third, for the reuse fee per dwelling. Our designs are not 300 units, much smaller infill scale.
Our AHJ has a prototyping program which we are learning to take advantage of. The prototypes are good for the 3 year building code cycle, and there are site plan requirements for the individual building permits associated with each build.
Changes to update the prototype after it has been issued are handled hourly, CA hourly, plus any engineering, printing, or other reimbursable expenses.
Felix Ziga, AIA
Sent from my iPhone