12/31/2023 0 Comments Predatory pricing![]() ![]() ![]() ![]() First, it noted that “there is a consensus among commentators that predatory pricing schemes are rarely tried, and even more rarely successful”.² Second, it can be difficult to distinguish pro-competitive low prices from predatorily low ones after all, “cutting prices in order to increase business often is the very essence of competition”.³īecause of that skepticism, the Court has established a test that is difficult for plaintiffs to meet. Supreme Court as “pricing below an appropriate measure of cost for the purpose of eliminating competitors in the short run and reducing competition in the long run”.¹ The Court expressed skepticism toward such claims several times for two reasons. Predatory pricing has been defined by the U.S. There is no general test to judge a monopolist’s actions instead, courts have developed different tests for different actions, including predatory pricing. But even a monopolist is only liable for “ monopolization,” actions that help it acquire or maintain that monopoly. Finding “monopoly power” is a difficult question this blog covered here. Such claims can only be lodged against a “monopolist,” a competitor with monopoly power. Monopolization is illegal under Sherman Act Section 2 of the antitrust laws. Can such “predatory pricing” ever violate the antitrust laws? It is a very difficult monopolization case to make but, as Uber recently discovered, not all such claims are quickly dismissed. Your much larger competitor sells the same products as you do but at a much lower price, so low you think that it must be losing money on each sale. ![]()
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