Sunday, June 1, 2014

Chicago Board of Trade v. United States case brief summary

Chicago Board of Trade v. United States case brief summary

Facts:  Three types of grain trading:
(1) spot sales: sales of grain already available for immediate delivery;
(2) Future sales: agmt for future delivery;
(3) Sales to arrive: agmt to delivery grains already in transit to Chicago. Restraint in case dealt with sales to arrive & sold at a special session called “A Call” i.e., the Call rule. It was an open bid market where the price of grain is displayed.
a.       Issue: whether the Call rule is legal.
                                                                                                         i.            The Call rule” at issue: If you were to buy grain after the market closed, if you wanted to buy grain privately, need to offer the price set at the end of the Call.
b.      Holding/rationale: Rule is allowed. Established the rule of reason analysis
                                                                                                         i.            The effects of the rule actually improved the market conditions.
a)      Created a public market for the grain.
b)      Less risk involved in the market since price is public.

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