Opinion ID: 411696
Heading Depth: 2
Heading Rank: 1

Heading: Effect on Intrabrand Competition

Text: 15 Sylvania's location clause, to the extent that it prevented Continental from establishing a retail outlet in Sacramento, would tend to harm intrabrand competition. As a result of the location clause, and the alleged conspiracy between Sylvania and Handy Andy, 8 Handy Andy was the dominant outlet for Sylvania's goods in Sacramento. However, Sylvania could authorize another major dealer in the Sacramento area at any time. We are not confronted, therefore, with an airtight territorial restriction. 9 16 Nor are we confronted with a situation where the restraint was adopted to protect a dealer from competition from price-cutters. See Eiberger v. Sony Corp., 622 F.2d 1068 (2d Cir. 1980); Cernuto v. United Cabinet Corp., 595 F.2d 164, 168-70 (3d Cir. 1979). 10 In Eiberger, for example, there was considerable evidence that the manufacturer imposed the restraint after complaints by its retailers that unauthorized dealers were engaged in price discounting. 622 F.2d at 1073-74, 1076-77. There is no evidence in the record to suggest that Sylvania adopted its location clause policy to prevent price discounting, and, indeed, the jury found against Continental on its price-fixing claim. 17 Although Sylvania's restraint harmed intrabrand competition to some extent, the restraint was neither overly restrictive 11 nor adopted to prevent price-discounting.