Shipments of corrugated containers from plants

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Reference no: EM132102096

Paper Companies was a group of 10 manufacturing firms that accounted for 90 percent of the shipments of corrugated containers from plants in the southeastern United States. From 1965 to 1973, these firms regularly exchanged price information among themselves, but no formal written agreements to adhere to a price schedule were made. When a seller requested and received price information from a competitor, it affirmed its willingness to furnish such information in return. Frequently, after two competitors exchanged price information, they would quote the same price to a buyer. The exchange of price information had the effect of stabilizing prices within a fairly narrow range, but with supply exceeding demand in the container market, prices drifted downward over an 8-year period. Did Paper Companies violate §1 of the Sherman Act? Explain. (Hint: should the per se rule or the rule of reason apply?)

Reference no: EM132102096

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