Weinberger Law litigates cases and counsels individuals, small business and large firms challenging unfair and anti-competitive business practices, including the use of patents and other intellectual property for the purpose of creating or maintaining unlawful monopolies. Our attorneys have successfully engaged with economists, high technology companies and nationally known defense contractors on a variety of competition issues. Our counseling practice focuses on resale price maintenance, distribution agreements and interlocking directorate issues.
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We counsel clients in Scottsdale and throughout Arizona. Call (480) 900-5192 to schedule an appointment.
Antitrust law is designed to protect and maintain competition for a product or service. When there is competition for business, companies must update and innovate new products on an ongoing basis to attract customers. They cannot charge exorbitant prices, because if they do, the customers will simply go to one of their competitors to buy the product or service for less money. Business practices that reduce competition illegally, therefore, throw the system out of whack. Consumers no longer get the best product or service for the best price. This is what the antitrust laws are designed to protect against.
Unfair competition is defined broadly as business conduct that is “contrary to honest practice in industrial or commercial matters.” The types of conduct that fall within this definition are things such as trademark infringement, false advertising, misappropriation and what is referred to as “palming off.” A company is guilty of “palming off” when it makes representations or designs or packages its product in such a way as to confuse buyers as to which company’s product they are purchasing. The buyer purchases the product thinking it is one thing, only to find out later that they were deceived into purchasing counterfeit.
A practice is anti-competitive or illegal if a company uses its market power to reduce or eliminate competition in the market, or to reduce or eliminate competition in a secondary market in which it does not have such power. A good example is computers and printers. Today you can purchase a computer from one company and a printer from another. Say that I make such great computers that 80 percent of buyers buy my computer, but my printers are not terribly good and do not fare well when in competition with other manufacturers’ printers. If I use my market power in the market for computers to force customers to buy my printer too, when they would normally purchase the printer elsewhere if given the choice, that is an example of an anti-competitive practice.
Certain practices, such as price fixing, are so clearly harmful to competition that little more is needed than proof of the agreement to fix prices itself. If all of the competitors in a market agree to charge the same price, then there can never be any price competition. Most practices, however, require a more detailed analysis that always involves two questions: (1) What is the relevant market? and (2) Does the defendant have “market power” in that market. The bigger and more powerful the company, the more likely its conduct can affect competition in the market. The more narrowly the market is defined, the more likely that company’s business practice will be found to harm competition. A rock dropped into a glass of water, in other words, is going to have a much greater impact on the water in that glass than if I were to drop the same rock into the Pacific Ocean.
Contact an Arizona business lawyer from Weinberger Law to represent you in your antitrust and unfair competition claim, call our Scottsdale office at (480) 900-5192.