The NY Times yesterday posted a tidbit about a little-talked about facet of antitrust law: the Clayton Antitrust Act does not permit a person to sit on the board of two rival companies when the result is a reduction in competition between them. Why is this interesting? Because it involves the FTC opening an investigation on two of the giants in tech, Apple and Google. The section is rarely enforced, but it could lead to Eric Schmidt leaving Apple’s board if push comes to shove.
The law only kicks in in the case of “interlocking directorates” when revenue from competing products is more than 2 percent of either company’s sales. Either way this inquiry comes out, it is not likely to make a huge difference in the reach of the two companies, but it could result in a shakeup in the board if the FTC makes an adverse finding.