Document: 547 U.S. 1 (2006) TEXACO INC. v. DAGHER et al. No. 04-805. Supreme Court of United States. Argued January 10, 2006. Decided February 28, 2006.[*] *2 Glen D. Nager argued the cause for petitioners in both cases. With him on briefs petitioner 04-805 were Craig E. Stewart, Joe Sims, and Louis K. Fisher. On 04-814 Ronald L. Olson, Bradley S. Phillips, Stuart N. Senator, Paul J. Watford. Jeffrey P. Minear States as amicus curiae urging reversal brief Solicitor General Clement, Acting Assistant Attorney Barnett, Deputy Hungar, Catherine G. O'Sullivan, Adam Hirsh. *3 Joseph M. Alioto respondents Daniel R. Shulman Gregory Merz.[] JUSTICE THOMAS delivered opinion Court. From 1998 until 2002, Texaco Inc. Shell Oil Co. collaborated a joint venture, Equilon Enterprises, to refine sell gasoline western under original brand names. Respondents, class service station owners, allege that engaged unlawful price fixing when set single gasoline. We granted certiorari determine whether it is per se illegal § Sherman Act, 15 C. 1, lawful, economically integrated venture prices at which sells its products. conclude not, accordingly we reverse contrary judgment Appeals. I Historically, have competed with one another national international oil *4 markets. Their business activities include refining crude into gasoline, well marketing downstream purchasers, such stations represented respondents' action. In 1998, formed Equilon, consolidate their operations States, thereby ending competition between two companies domestic Under agreement, agreed pool resources share risks profits from Equilon's activities. board directors would comprise representatives Oil, be sold purchasers The formation was approved by consent decree, subject certain divestments other modifications, Federal Trade Commission, see re Co., 125 F. T. 769 (1998), state attorneys general California, Hawaii, Oregon, Washington. Notably, decrees imposed no restrictions pricing After began operate, brought suit District Court, alleging that, unifying brands, had violated rule against this has long recognized ch. 647, 26 Stat. 209, amended, 1. See, e. g., Catalano, Target Sales, Inc., 446 643, 647 (1980) (per curiam). awarded summary Oil. It determined reason, rather than or quick look doctrine, governs claim, eschewing reason analysis, failed raise triable issue fact. Ninth Circuit reversed, characterizing petitioners' position request an "exception prohibition price-fixing," rejecting request. Dagher *5 Saudi Refining, 369 F.3d 1108, 1116 (2004). consolidated Texaco's Oil's separate petitions extent applies important increasingly popular form organization, venture. 545 1138 (2005). II Section Act prohibits "[e]very contract, combination trust otherwise, conspiracy, restraint trade commerce among several States." This not taken literal approach language, however. State Khan, 522 3, 10 (1997) ("[T]his Congress intended outlaw only unreasonable restraints" (emphasis added)). Instead, presumptively antitrust plaintiffs must demonstrate particular contract fact anticompetitive before will found unlawful. id., 10-19. Per liability reserved those agreements are "so plainly anti-competitive elaborate study industry needed establish illegality." National Soc. Professional Engineers 435 679, 692 (1978). Accordingly, "we expressed reluctance adopt rules ... `where economic impact practices immediately obvious.'" supra, (quoting FTC Indiana Federation Dentists, 476 447, 458-459 (1986)). Price-fixing more competitors, otherwise known horizontal price-fixing agreements, fall category arrangements 647. These cases do present however, because did compete relevant marketnamely, sale Statesbut instead participated *6 market jointly through investments Equilon.[1] words, policy challenged here amounts little setting entityalbeit within context ventureand agreement competing entities respect Throughout existence, shared role investors, competitors. When "persons who competitors capital loss opportunities profit ventures [are] regarded firm sellers market." Arizona Maricopa County Medical Soc., 457 332, 356 (1982). As such, though may sense, sense. See Broadcast Music, Columbia Broadcasting System, 441 9 (1979) ("When partners goods services they literally `price fixing,' but violation Act"). conclusion confirmed apparent concession there simply chosen brand. Tr. Oral Arg. 34. treat differently just chose distinct *7 brands price. entity, like any firm, discretion products sells, including product different single, unified If unification anticompetitive, then should pursuant reason.[2] But inconsistent Court's precedents condemn internal decisions legitimate unlawful.[3] court below reached opposite invoking ancillary restraints doctrine. F.3d, 1118-1124. That doctrine validity collaboration, association nonventure Collegiate Athletic Assn. Board Regents Univ. Okla., 468 85, 113-115 (1984); Citizen Publishing 394 131, 135-136 (1969). courts restriction naked trade, thus invalid, competitive purposes association, valid. agree application here, where practice being involves core activity itselfnamely, very *8 produced Equilon. And even if invoke these cases, clearly own Judge Fernandez, dissenting ruling below, put well: "In case, nothing radical afoot now owns all production, transportation, research, storage, sales distribution facilities engaging business, also decided them same, entity could. What could integral running services?" 1127. 23 ("Joint cooperative usually unlawful, least schemes, necessary all"). * Because narrow anti-trust claim cannot prevail. Appeals reversed. so ordered. ALITO took part consideration decision NOTES [*] Together 04-814, al., same court. [] Briefs amici filed American Bankers Association W. Stephen Smith Beth Brinkmann; Petroleum Institute Robert A. Long, Jr., Harry Ng, Douglas Morris; Chamber Commerce America Raymond Jacobsen, Bokat, Robin Conrad, Amar Sarwal; Verizon Communications Roy Englert, Donald Russell, John Thorne, Larkin, Jr.; Visa U. Laurence Popofsky V. Bomse. Ross Antitrust affirmance Northwest Ohio Physician Specialists Cooperative, LLC, Charles Weller Frederick Byers; Retail Industry Leaders Lloyd Constantine Michelle Peters. Steve Vaughn Parker Hannifin Corp. [1] presume lawful Its been federal regulators, contention sham. noted: "There voluminous record documenting justifications creating ventures. [T]he defendants concluded numerous synergies cost efficiencies result" parallel Motiva eastern "that nationwide up $800 million savings annually." 1111 (CA9 2004). Had itself, required show creation reason. Copperweld Independence Tube Corp., 467 752, 768 (1984). [2] Respondents forth claim. 1113. need address alternative argument inapplicable [3] alternatively contend held liable To sure, applied undertake cursory examination imposing liability. California Dental FTC, 526 756, 770 (1999). reasons unwarranted

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