Container Corporation of America et al. (1969)
Abstract
This case involved a civil antitrust action charging a price-fixing agreement in violation of Sherman antitrust act, in which the district court dismissed the complaint. This was generally a case between the United States and Sugar institute.
Sherman antitrust act was a federal statute on United States competition law after its passing by congress in 1890. The act was against business activities that regulations within the government deemed anticompetitive. Additionally, the federal government was tasked to carry out investigations and pursuits on trusts, and other forms of organizations that were alleged or suspected of the violation.
Remarkably, this was the first statute that imposed limitations on cartels and monopolies. Currently, the Sherman act forms the basis for most antitrust litigation by the federal government of the United States. Politicians were slow to enforce this law until the reign of Theodore Roosevelt probably due to the implications that were involved in the entire process.
The basis of the ruling was to enhance balance between legal and business operations. The statutes cripple some sources of income but this was intended to yield considerably high returns in the long run.
The conduct in the case regarded a situation where different players operate within the market. Each aims at gaining the best share of the market. Initially, the seller truncates on their prices in order to attract the most clients. However, every player in the market tends to pursue the most attractive prices. These prices later stabilize at a competitive level. Competitiveness essentially determines the level of quality, in which the clientele stands to benefit. The federal government is responsible for stabilizing the market through customer protection such that uncompetitive markets were technically disallowed.
Defendants were accountable for almost 90% of the shipments that we made from corrugated containers that emanated from the southeastern United States. Variations occurred in terms of weight, color, and related attributes that facilitated the enhancement of effective trading. Different producers came up with similar products such that the only differentiating attributes were the prices. This created fairness in the market, but technically, differences were also dependent on the level of marketing in the entire ordeal. Besides, the client had a fair chance of benefiting because there was sufficient varieties for the clients and more so, the employees, who were significantly required to influence the market just by their choices.
Initial legal action taken in favor of the defendant were a relative allowance and permission to change their prices as well as their level of marketing. Clearly, some of the basic considerations that would affect the defendants were extensive pursuit by the federal government. defendants were granted sufficient freedom to run their affairs and more so, to determine the differentiation methods that would see them win the hearts of their customers. Some of the contentious issues in the case were the fact that different aspects determined the manner in which differences within the entire market unveiled following the fact that there was need to come up with a plan to eradicate the issues that could compromise the market dynamics.
Subsequent legal actions in the case ascertained that legal aspects were very crucial in the determination of a viable process that could develop the entire process and still give room to fairness within the organization. certainly, some of the major aspects in the development of a friendly market were well defined roles and constraints that were key in the enhancement of a critical process.
Structure conduct performance applied in the case. Basically, the plaintiff and the defendants were streamlined by the case in the sense that caution and boundary levels within the organization were enhanced. The government has a role to protect business from unfriendly competition, a factor that implies that business are operational on legal basis and more so, their role is determined by the need to addresses problems within the market. Businesses are therefore government agents that address social and economic issues, thus restoring balance within the market. Operations of these businesses were therefore dictated by the need to address to solve the prevailing problems. Their entity was very crucial in the sense that the judiciary had a mandate to protect them from the law that was set arbitrary to regulate business operations in the vast market of the United States.
These statutes were very controversial and hence needed judicial intervention especially considering that politicians had initially stepped aloof considering their enforcement until the reign of Theodore Roosevelt. This form of legal intervention in business operations was important considering the fact that business are dynamic and need to be restricted within certain legal constraints so as to give the federal government a chance to play part in ensuring that business especially monopolies and cartels disburse some of their strengths upon the people.
References
Cseres, Katalin Judit (2005). Competition law and consumer protection. Kluwer Law International. pp. 291–293.
William L. Letwin, Congress and the Sherman Antitrust Law: 1887-1890, 23 U.Chi.L.Rev 221 (1956)
"Mr. Sherman's Hopes and Fears" (PDF). New York Times. 1890-10-01. Retrieved 2008-04-21.
