baye kodak case 6e
Kodak Appeals to Court to Terminate 1921 and
1954 Decrees that Restrict Pricing Policies
Michael Baye and Patrick Scholten prepared this case to serve as the basis for classroom discussion rather than to represent economic or legal fact. The case is a condensed and slightly modified version of the public copy of the DOJ's Brief filed in Appeal to the District Court's decision in
November 24, 1994 to terminate prior antitrust decrees which restricted Kodak's pricing policies. No.
94-6190.
KODAK
Kodak’s History
George Eastman and his Eastman Kodak Co. pioneered amateur photography. In a
1921 consent decree1, the government concluded that Eastman Kodak monopolized the amateur photography market in violation of the Section 2 of the Sherman Act by buying competitors and imposing various forms of exclusive dealing contracts on retailers. The 1921 decree barred Kodak from "preventing dealers ... from freely selling goods produced by competitors," from hindering dealers in freely selling Kodak products, and from selling "socalled fighting brands" or any product without the Kodak name on it.2
Kodak began to market a color slide film called Kodachrome in the late 1930s, and a color print film, Kodacolor, by 1954. At that time, it had over 90% of the color film market.
Since Kodak sold its color film only as a package deal with processing included in the price, it also had over 90% of the color photofinishing market. The tying arrangement resulted in a government antitrust suit and a consent decree in 1954. The 1954 decree permanently enjoined Kodak from "[t]ying or otherwise connecting in any manner the sale of its color film to the processing thereof, or the processing of its color film to the sale thereof".3
1
The district court's opinion finding that Kodak had violated Section 2 of the Sherman Act is reported as United States v. Eastman Kodak Co., 226 Fed. 62 (W.D.N.Y. 1915). The court entered a decree the following year. United States v. Eastman Kodak Co., 230 Fed.
1954 Decrees that Restrict Pricing Policies
Michael Baye and Patrick Scholten prepared this case to serve as the basis for classroom discussion rather than to represent economic or legal fact. The case is a condensed and slightly modified version of the public copy of the DOJ's Brief filed in Appeal to the District Court's decision in
November 24, 1994 to terminate prior antitrust decrees which restricted Kodak's pricing policies. No.
94-6190.
KODAK
Kodak’s History
George Eastman and his Eastman Kodak Co. pioneered amateur photography. In a
1921 consent decree1, the government concluded that Eastman Kodak monopolized the amateur photography market in violation of the Section 2 of the Sherman Act by buying competitors and imposing various forms of exclusive dealing contracts on retailers. The 1921 decree barred Kodak from "preventing dealers ... from freely selling goods produced by competitors," from hindering dealers in freely selling Kodak products, and from selling "socalled fighting brands" or any product without the Kodak name on it.2
Kodak began to market a color slide film called Kodachrome in the late 1930s, and a color print film, Kodacolor, by 1954. At that time, it had over 90% of the color film market.
Since Kodak sold its color film only as a package deal with processing included in the price, it also had over 90% of the color photofinishing market. The tying arrangement resulted in a government antitrust suit and a consent decree in 1954. The 1954 decree permanently enjoined Kodak from "[t]ying or otherwise connecting in any manner the sale of its color film to the processing thereof, or the processing of its color film to the sale thereof".3
1
The district court's opinion finding that Kodak had violated Section 2 of the Sherman Act is reported as United States v. Eastman Kodak Co., 226 Fed. 62 (W.D.N.Y. 1915). The court entered a decree the following year. United States v. Eastman Kodak Co., 230 Fed.