In the Matter of Kellogg Co.
Federal Trade Commission
99 F.T.C. 8 (1982)
- Written by Heather Whittemore, JD
Facts
The ready-to-eat cereal market was highly concentrated, with the three largest companies—Kellogg Co.; General Mills, Inc.; and General Foods Corp. (defendants)—controlling over 80 percent of the market. Because of the low competition, high profits, and extreme barriers to entry created by the major cereal companies, the Federal Trade Commission (FTC) (plaintiff) alleged that the actions of the companies had created a highly concentrated market reminiscent of a monopoly, referred to as an oligopoly or shared monopoly, in violation of § 5 of the Federal Trade Commission Act (FTC Act). The FTC sought to break up the cereal industry and require each company to separate into smaller cereal companies. Determining that the FTC lacked proof to support its claims, an administrative-law judge ruled in favor of the cereal companies. The FTC was set to appeal until President Reagan appointed a new FTC head. The appeal was withdrawn and the FTC reviewed the record to decide whether the case should go on.
Rule of Law
Issue
Holding and Reasoning (Clanton, C.)
Concurrence (Bailey, C.)
Dissent (Pertschuk, C.)
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