0538452803_269418 - Sample Answer Yes The major antitrust...

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BLTC-9e Sample Answer for End-of-Chapter Hypothetical Question with Sample Answer Chapter 39: Promoting Competition 39–2 Hypothetical Question with Sample Answer Allitron, Inc., and Donovan, Ltd., are interstate competitors selling similar appliances, principally in the states of Illinois, Indiana, Kentucky, and Ohio. Allitron and Donovan agree that Allitron will no longer sell in Indiana and Ohio and that Donovan will no longer sell in Illinois and Kentucky. Have Allitron and Donovan violated any antitrust laws? If so, which law? Explain.
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Unformatted text preview: Sample Answer: Yes. The major antitrust law being violated is the Sherman Act, Section 1. Allitron and Donovan are engaged in interstate commerce, and the agreement to divide marketing territories between them is a contract in restraint of trade. The U.S. Department of Justice could seek fines for up to $1 million for each corpora-tion, and the officers or directors responsible could be imprisoned for up to three years. In addition, the Department of Justice could institute civil proceedings to restrain this conduct....
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