Conclusion in Plain English

The Dagher opinion should serve as a sigh of relief for competing companies that want to join temporarily to reduce competition and enhance efficiency.  It provides a systematic guide to price-fixing while avoiding anti-trust violations.

Step 1.

Form a joint venture with a company that is not directly competing in your market.  This “market” can be a small sliver of your company’s overall market.  Be sure you combine assets and operations, while retaining your proportionate right to control the entity and participate in both profits and loss.  Memorialize the joint venture with a written agreement.  The agreement may require the venture’s termination after any amount of time.  The venture need not create a new marketing brand. 

Step 2.

Seek prior regulatory approval from the Federal Trade Commission and your state’s attorney general.  If either requests adjustments to your collaborative arrangement, comply with those requests and amend your agreement accordingly.   
Step 3.

Set a pricing policy that regulates only the products or services that the joint venture controls.  The venture is free to continue to trade under the companies’ original, separate brand names; the venture is also free to regulate the prices of those products being marketing under separate brands.  Resist the temptation to price-fix across all competing products.     

Step 4.

When interested parties sue the venture for anti-trust violations, be sure to require your attorneys argue all colorable defenses.  The gas stations owners failed to challenge an argument that Equilon raised in which the Court later based its ruling.  The Court inferred concession from the gas stations’ silence.  Do not make the same mistake.