|
Court hears antitrust case
|
 |
October 7, 1997: 8:24 p.m. ET
Oil companies claim price fixing does 'more protective harm than good'
From Correspondent Charles Bierbauer
|
WASHINGTON (CNNfn) - Oil companies, along with an assistant U.S. attorney general, asked the Supreme Court Tuesday to loosen long-standing antitrust legislation that makes price fixing illegal.
The ban "should be overruled because it is likely to do considerably more protective harm than good," argued Assistant Attorney General Joel Klein.
While it still would be illegal for oil companies to get together and fix prices, past Court decisions indicate justices may be willing to allow producer-retailer price setting.
"I hope… the Court has come to the determination that you really are paying more for gasoline than you would pay if the rule were not in effect," said State Oil Co.'s attorney, John Baumgartner.
Tuesday's case originated when an Illinois dealer complained that an oil company contract limiting him to 3.25 cents profit per gallon put him out of business. Lower courts called it price fixing.
"This was a squeeze that came from both ends and ultimately led to his [the dealer's] failure," said another attorney, Anthony DiVencenzo.
But Justice Antonin Scalia swept the dealer's plight aside. "Antitrust law is not there to protect the merchant, but to protect the consumer," he said.
Service station dealers contend competition will also guarantee consumers a fair price. No one, the Court was assured, is seeking to set minimum prices.
The justices voiced concerns that maximum prices could, in effect, become the minimum price, thus raising cost to consumers.
If the Court decides some price fixing is acceptable, that decision will reach well beyond the gas pump. Auto dealers, newspapers, beer distributors and fast food chains seem keen to make similar price setting contracts with their retailers.
|
|
|
|
|
 |
|
