Opinion ID: 796577
Heading Depth: 3
Heading Rank: 1

Heading: The Warranty Allegation

Text: 22 HDC alleges that Minntech's warranty policy was implemented to hamper competition. In 1998, Minntech announced that it would not honor a one-year warranty on its reprocessing machines if any product other than Renalin was used in the machine. Minntech justified its warranty policy based upon its inability to predict how its machines would react to another manufacturer's reprocessing solution. In light of such uncertainty, Minntech believed that it could not feasibly warrant the performance of the product. Further, the record indicates that Minntech was willing to test the effect a competitor's product had on its machines; however, the competitor would have to pay the cost associated with such tests. The district court determined that this explanation was a legitimate business justification. We agree. 23 We decided a very similar issue in Marts v. Xerox, Inc., 77 F.3d 1109 (8th Cir.1996). In that case, Xerox announced that it would void the warranty of its photocopying machine if a consumer used a replacement ink cartridge made by a different manufacturer. Although Marts was a tying case, we held that this arrangement did not violate the Sherman Act because [a]n owner of a new Xerox copier could forego the benefits of the warranty, buy service from Xerox or an independent provider, and purchase cartridges from the vendor of its choice. The end result is the same: customers receive both service and cartridges for their copiers. Id. at 1112. We believe the same logic applies here. 24 Anticompetitive conduct is conduct without legitimate business purpose that makes sense only because it eliminates competition. Morgan v. Ponder, 892 F.2d 1355, 1358 (8th Cir.1989). When a valid business reason exists for the conduct alleged to be predatory or anti-competitive, that conduct cannot support the inference of a [Sherman Act] violation. Midwest Radio Co., Inc. v. Forum Pub. Co., 942 F.2d 1294, 1297-1298 (8th Cir.1991); Paschall v. Kan. City Star Co., 727 F.2d 692 (8th Cir.1984). Summary judgment is appropriate when a defendant's business justification goes unchallenged. Stearns Airport Equip. Co., Inc. v. FMC Corp., 170 F.3d 518, 522 (5th Cir.1999). 25 HDC offers no evidence to refute Minntech's legitimate business justification. Accordingly, we hold that the district court did not err by dismissing this allegation of anticompetitive conduct.