Is predatory pricing a per se violation


Problem:

William Inglis & Sons is a family-owned whole-sale bakery with production facilities in Stockton, California, that manufactured and distributed bread and rolls in northern California. ITT Continental is one of the nation's largest wholesale bakeries and was a competitor of Inglis in the northern California market. Both Inglis and Continental sold their bread under a private label and an advertised label. Continental's advertised bread was Wonder bread, whereas Inlis's advertised bread was Sunbeam. The private label is sold at a lower price than the advertised brand, but the principal difference between the two is the profit. Inglis filed a complaint stating that Continental was selling its private label bread at below-cost prices in a predatory price scheme designed to drive Inglis out of the market. Inglis also says the lower price on private bread earned Continental more grocery-shelf space for its Wonder bread. Is such conduct illegal under the Sherman Act? Is predatory pricing a per se violation?

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Business Law and Ethics: Is predatory pricing a per se violation
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