Sunday, November 24, 2013

Matsushita Electric Industrial Co. v. Zenith Radio Corp. case brief

Matsushita Electric Industrial Co. v. Zenith Radio Corp. case brief summary
475 U.S. 574 (1986)

Petitioners challenged a decision from the United States Court of Appeals for the Third Circuit that reversed a summary judgment decision in favor of petitioners, who were defendants in an antitrust conspiracy case.

Respondents, domestic electronics companies, brought an antitrust conspiracy suit against petitioners, Japanese electronics companies. Respondents claimed that petitioners conspired to depress prices in the American market in order to drive out American competitors. The district court granted summary judgment for petitioners, but the appellate court reversed based on its finding of direct evidence of concert of action.

  • The Court granted certiorari to determine whether the court of appeals applied the proper standard in evaluating the summary judgment decision. 
  • The Court concluded that the court of appeals erred in two respects: First, the direct evidence on which the court of appeals relied had little, if any, relevance to the alleged predatory pricing conspiracy. 
  • Second, the court of appeals failed to consider the absence of a plausible motive to engage in predatory pricing. 
  • The decision was reversed and remanded for the court of appeals to consider any evidence that petitioners conspired to price predatorily despite the lack of any apparent motive to do so. 
  • In the absence of such evidence, the Court instructed that petitioners were entitled to have summary judgment reinstated.

The decision reversing the summary judgment for petitioners was reversed and remanded based on the Court's holding that the court of appeals erred by relying on irrelevant evidence and failing to consider the absence of a plausible motive for petitioners to engage in predatory pricing.

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