The Philadelphia National Bank (PNB) (defendant) and Girard Trust Corn Exchange Bank (Girard) were the second-largest and third-largest commercial banks in the Philadelphia metropolitan area. PNB and Girard planned to merge their operations, which would establish the post-merger PNB-Girard bank as the largest commercial bank in the area, with a market share of over 30 percent. The United States (plaintiff) brought a complaint against PNB and Girard, alleging that the prospective merger violated § 7 of the Clayton Act, because the merger would tend to substantially reduce competition. The government supported its claim with evidence that commercial banking in the Philadelphia area had been increasing in concentration for years and that the PNB-Girard merger would further that concentration by more than 33 percent, thus significantly reducing competition. PNB argued that the pro-competitive benefits justified the merger and that the proper geographic market should be expanded to include large New York banks. The district court held in favor of PNB, and the government appealed the decision.