Between 1972 and 1981, Texaco sold gasoline to independent Texaco retailers at “retail tank wagon prices” but granted substantial discounts to distributors Gull and Dompier. Gull resold the gas under its own name. Dompier resold the gas under the Texaco brand name to retail stations and entered the retail market directly. Since neither Gull nor Dompier had significant storage facilities, both distributors picked up gas directly from the Texaco plant and delivered it to their retail outlets. As a result, the sales volume increased substantially at the retail stations purchasing gas from these distributors, while independent Texaco retailers suffered a corresponding sales decline. In 1976, independent Texaco retailers filed suit against Texaco. In 1990, the Supreme Court of the United States found that Texaco had indeed violated antitrust law. Which law do you think Texaco was found guilty of violating?

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter12: Price And Output Determination: Oligopoly
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Between 1972 and 1981, Texaco sold gasoline to independent Texaco retailers at “retail tank wagon prices” but granted substantial discounts to distributors Gull and Dompier. Gull resold the gas under its own name. Dompier resold the gas under the Texaco brand name to retail stations and entered the retail market directly. Since neither Gull nor Dompier had significant storage facilities, both distributors picked up gas directly from the Texaco plant and delivered it to their retail outlets. As a result, the sales volume increased substantially at the retail stations purchasing gas from these distributors, while independent Texaco retailers suffered a corresponding sales decline. In 1976, independent Texaco retailers filed suit against Texaco. In 1990, the Supreme Court of the United States found that Texaco had indeed violated antitrust law. Which law do you think Texaco was found guilty of violating?

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