February 27, 2003

Moo  

Another local story: the anti-trust lawsuit against Dominick's and Jewel has been thrown out. We talked about this case some in my econ class and saw how this pricing behavior can be the result of normal competition in an oligopoly, although it's not clear whether that was the case here.

Four weeks of trial came to a quick end with Circuit Judge John Morrissey's six-page opinion that said lawyers who brought the class action suit failed to show clear and convincing evidence that the state's antitrust laws were violated.

Morrissey wrote that if consumers felt Jewel and Dominick's overcharged for milk, they could shop elsewhere, or even boycott the stores.

"I do not mean to oversimplify, but in our aforementioned free market and society, the defendants have competed, not conspired," Morrissey wrote. "If their milk prices are out of line, the remedy is a seasoned campaign of consumers doing the things this court has said, and not an action at law."

The strange thing about the decision is that the Morrissey's secondary argument - that consumers could simply shop somewhere else - isn't part of anti-trust law at all. It will be interesting to see whether this forms the basis for an appeal.

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