Ojay Corp. sells knives online and Kato Co. sells knives at its retail stores. A

Question

Ojay Corp. sells knives online and Kato Co. sells knives at its retail stores. A year ago, the two firms agreed to share pricing information with each other on a periodic basis. As a result of this agreed sharing of information, the two companies entered into an agreement that restricted the minimum price that Kato Co. and Ojay could resell their knives for. A proper plaintiff brings a lawsuit against Ojay and Kato and asserts that the foregoing facts constituted price fixing in violation of Section 1 of the Sherman Act. Which of the following is an accurate analysis under current antitrust law?

A.  The defendants were involved only in conscious parallelism concerning pricing policies, and as such they will not be held liable under Section 1.

Explanation / Answer

B. If the court believes that the evidence demonstrates an agreement to fix prices, it will hold the defendants liable under Section 1 without giving them the opportunity to make arguments concerning any allegedly sound business justification for their agreement

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