Why the Minnesota Supreme Court Should Overturn a Lower Court Decision on Price-Setting

In an amicus curiae brief filed on behalf of the Joint Center, AEI Resident Scholar Robert Bork and Center co-director Robert Litan argue that the Minnesota Supreme Court should reverse a lower court opinion against the BASF Corporation which permits a jury to decide that a price disparity between two herbicides sold by the company constitutes an ‘unconscionably large profit.’

Bork and Litan contend that the lower court’s decision is both bad economics and bad law, is inconsistent with federal antitrust laws, and inappropriately punishes a company for discounting prices. If upheld, the lower court decision also would legitimize jury determinations of what constitutes reasonable price setting, a job that, in the absence of any evidence of unlawful collusion, should be left to markets.