Justice Department efforts to expand competitive bidding in numerous professions and occupations face a Supreme Court challenge in a case involving the Texas State Board of Public Accountancy.
At issue is an appeals tribunal's decision that the Sherman Antitrust Act was violated by a board rule preventing accountants from quoting or estimating fees for consumers to compare prices.
The state agency imposed the ban under a 1945 law permitting it to adopt "rules of professional conduct appropriate to establish and maintain a high standard of integrity in the profession of public accountancy."
As of September 1976, according to a Justice Department survey, 15 states barred competitive bidding by accountants. Maryland and Virginia were not among them.
The Texas rule, adopted by the nine practicing accountants who composed the board, and ratified by a majority vote of members of the proffession in the state, was challenged by the department in a civil suit filed in 1976.
While the suit was pending in U.S. District Court in Austin, the Supreme Court ruled for the government in a case involving a total ban by the National Sociey of Professional Engineers on competitive bidding. The ban, justified on grounds of professional ethics. took the form of an agrement among competitors to refuse to discuss prices with potential customers until after the initial selection of an engineer.
Ten days after the engineers decisions, Judge Jack Roberts in Austin termed the Texas accountants' rule "at least as restrictive" and held that it was an anticompetitive conspiracy under the Sherman act.
Last April, the 5th U.S. Circuit Court of Appeals affirmed Roberts by a 2-to-1 vote. The decision invalidated not only the Texas rule, but bans on competitive bidding by accountants elsewhere in the 5th Circuit, directly affecting Georgia and Mississippi.
Actually, the Texas rule was eftectively nullified by the legislature in its 1979 law directing the board not to restrict normal competitive bidding.
Despiet that, the board is asking the Supreme Court to review the 5th Circuit decision on the grounds that the board rule was "state action" exempt from the Sherman act.