Federal Trade Commission v. Swedish Match, Inc.
United States District Court for the District of Columbia
131 F. Supp. 2d 151 (2000)
- Written by Jamie Milne, JD
Facts
Swedish Match North American, Inc. (Match) (defendant) sold loose-leaf chewing tobacco and held a 42 percent market share in the loose-leaf-tobacco market. National Tobacco Company, L.P. (National) also sold loose-leaf tobacco and held an 18 percent market share. National’s product was the most direct competitor for Match’s product, and National’s retail prices consistently constrained Match’s prices. In 2000, Match entered an agreement with National to acquire National’s loose-leaf-tobacco brands. The Federal Trade Commission (FTC) sued Match and National, seeking a preliminary injunction enjoining the acquisition pending an administrative proceeding to determine whether it would substantially lessen competition and therefore violate the Clayton Act and the FTC Act. Match and National argued that a preliminary injunction was improper because certain market realities mitigated the risk of a postacquisition price increase. Specifically, they pointed to the declining demand for loose-leaf tobacco, a corresponding increase in excess capacity, increased regulation of the industry, and the existence of other market competitors. The district court considered the parties’ arguments.
Rule of Law
Issue
Holding and Reasoning (Hogan, J.)
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