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Article: Ninth Circuit Adopts A Cost-Based Standard To Evaluate Whether A Competitor's Bundled Discounts Are Anticompetitive.
- Article from:
- Mondaq Business Briefing
- Article date:
- September 14, 2007
CopyrightCOPYRIGHT 2007 Mondaq Ltd. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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The Ninth Circuit recently issued an important antitrust decision (McKenzie-Willamette Hospital v. PeaceHealth) that establishes a cost-based standard to evaluate whether a "bundled discount" program violates U.S. antitrust law - namely, the prohibition against monopolization and attempts to monopolize in Section 2 of the Sherman Act. The Ninth Circuit's decision is notable for several reasons:
First, the standard set forth in the decision requires an antitrust plaintiff to demonstrate that the discounts resulted in prices that are below an appropriate measure of the defendant's costs.
The cost-based rule adopted by the Ninth Circuit is known as the ...