Chapter 50 – The Clayton Act, the Robinson–Patman Act, and Antitrust Exemptions and Immunities
V. ANSWERS TO PROBLEM CASES:
1. Yes. The Ninth Circuit Court of Appeals noted that the standards for tying liability are
identical under the Sherman and Clayton Acts and that the same defenses to tying claims are
2. Yes, according to the Second Circuit Court of Appeals. Although a post-merger market share
of 48.8 percent was sufficient to establish prima facie illegality, the trial court should have
considered the ease with which new competitors could enter the market. This ease of entry
3. Yes. The Court concluded that the acquisition threatened competition in several ways. First,
the merger eliminated potential competition because it eliminated the moderating effect Ford
had on independents such as Champion and Autolite while Ford was “waiting in the wings”
4. The U.S. Court of Appeals for the Ninth Circuit concluded that the FTC’s argument was
correct. Given the cross-elasticity between ISOS and CAL-HYPO, the FTC reasonably
5. No. The Supreme Court held that the state action exemption did not protect the title insurers
against claims that they committed horizontal price-fixing regarding rates for title searches
and title examinations. Although the price-fixing allegedly took place through the defendants’
50-1
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 50 – The Clayton Act, the Robinson–Patman Act, and Antitrust Exemptions and Immunities
6. No. Despite recognizing that functional discounts are generally lawful, the Supreme Court
held that the price differential in this case did not constitute a legitimate functional discount.
7. No. The antitrust violation alleged was a violation of Section 2(a) of the Robinson-Patman
Act. Indian Coffee and Folger were primary line competitors. Such competitors injured by
geographic price discrimination may recover damages. A price discrimination granted to a
retailer on condition that he pass it on to a consumer so as to increase the discriminator’s
8. No. The U.S. Court of Appeals for the Fourth Circuit reversed and remanded the case for
further proceedings. The Fourth Circuit concluded that Bayer’s volume-based discount
pricing system was not entitled to the protection of the meeting competition defense because
9. No. The act of state doctrine applies only when the relief sought or the defense interposed
would have required a court in the United States to declare invalid the official act of a foreign
sovereign performed within its own territory. This case did not require such a declaration.
10. Yes. In order to show a violation of section 8, Pocahontas needed to prove, rather than
merely allege, that the defendants were in competition with each other. Furthermore, the
50-2
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
Chapter 50 – The Clayton Act, the Robinson–Patman Act, and Antitrust Exemptions and Immunities
11. No, according to the U.S. Supreme Court. The Court held that when the filing and
prosecution of a lawsuit is the activity challenged on antitrust grounds, the party who brought
the lawsuit is not deprived of Noerr-Pennington immunity on the basis of the sham exception
50-3
© 2016 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.