Extra Credit Brief 1

Extra Credit Brief 1 - discrepancy was that Brooke Group v....

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Michael Knutson (11040656) Lindsey 27 April 2010 Business Law 210 Section 10 Weyerhaeuser Company v. Ross-Simmons Hardwood Lumber Company, Inc. Background: The Plaintiff, Ross-Simmons Hardwood Lumber Co. is a long time sawmill firm located in Washington. Weyerhaeuser Co. started its business a little less then 20 years later. Weyerhaeuser grew in popularity and by 2001 was by far the most profitable sawmill in the northwest. As many big companies do, Weyerhaeuser was able to drive other, smaller companies out of business by offering better prices to both suppliers and consumers. Large Corporations that force other companies out of business are considered monopolies, and are illegal in America under the Sherman Act. The purpose is to maintain free enterprise, and a competitive market place; two of the most important concepts of American capitalism. Weyerhaeuser argued that un- der Brooke Group v. Williamson Tobacco Corp. as long as they were continuing to make profits, that its actions were perfectly legal, and that Ross-Simmons would have to prove otherwise. The
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Unformatted text preview: discrepancy was that Brooke Group v. Williamson Tobacco Corp. dealt strictly with predatory pricing where as Weyerhaeuser was also being accused of predatory bidding. Both the District Court and the Appellate Court dismissed Weyerhaeusers argument and granted Ross-Simmons $79 million in compensation. Weyerhaeuser appealed to the United States Supreme Court. Issue: Does the plaintiff, Ross-Simmons, have to prove that Weyerhaeuser was operating at a loss in regards to its predatory bidding Holding: Yes Reasoning: The predatory pricing of a monopoly and the predatory bidding of a monopsony are simply mirror images of one another, and because they have such similarly economic ef-fects, Brooke Group v. Williamson Tobacco Corp. was revised to include predatory bidding. Predatory pricing schemes are high risk-high reward economic plans that, for the most part, are the very essence of competition....
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