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Law School Case Brief

Matsushita Elec. Indus. Co. v. Zenith Radio Corp. - 475 U.S. 574, 106 S. Ct. 1348 (1986)

Rule:

In an antitrust case, courts should not permit fact-finders to infer conspiracies when such inferences are implausible, because the effect of such practices is often to deter pro-competitive conduct.

Facts:

Respondents brought an antitrust conspiracy suit against petitioners. Respondents claimed that petitioners conspired to depress prices in the American market in order to drive out American competitors. The district court granted summary judgment for petitioners, but the appellate court reversed based on its finding of direct evidence of concert of action. Petitioners challenged the decision of the court of appeals.

Issue:

Was the grant of summary judgment in favor of the petitioners proper in the absence of any evidence of predatory pricing?

Answer:

Yes.

Conclusion:

The Supreme Court of the United States concluded that the court of appeals erred in two respects: First, the direct evidence on which the court of appeals relied had little, if any, relevance to the alleged predatory pricing conspiracy. Second, the court of appeals failed to consider the absence of a plausible motive to engage in predatory pricing. The decision reversing the summary judgment for petitioners was reversed and remanded based on the Court's holding that the court of appeals erred by relying on irrelevant evidence and failing to consider the absence of a plausible motive for petitioners to engage in predatory pricing.

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