Town of Concord v. Boston Edison Co.

Boston Edison Co. (Edison) (defendant) was a fully integrated electric company. As a fully integrated company, Edison produced electricity, transmitted the electricity to distributors, and distributed electricity to towns in eastern Massachusetts. Edison’s wholesale prices, the prices it charged firms and municipalities that purchased the energy it produced, were regulated by the Federal Energy Regulatory Commission (the commission). Edison’s retail prices, the prices it charged consumers to whom it distributed electricity, were regulated by the Massachusetts Department of Public Utilities (the department). The towns of Concord and Wellesley (collectively, the towns) (plaintiffs) operated their own distribution systems, purchasing electricity directly from Edison. Edison filed a wholesale-price increase with the commission, which the towns opposed. When the price increase was implemented, the towns filed a lawsuit in federal district court against Edison for unlawful monopolization in violation of § 2 of the Sherman Act. The towns argued that because Edison increased its wholesale prices but did not increase its retail prices, Edison put the towns into a price squeeze. The towns would need to increase their retail prices to consumers to reflect Edison’s wholesale-price increase, making the towns uncompetitive with Edison and potentially driving the towns’ customers to Edison. A jury found Edison guilty of monopolization. The district court refused to set aside the jury’s verdict, and Edison appealed.