California Civil Jury Instructions (CACI) (2017)

3335. Affirmative Defense - "Good Faith" Explained

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3335.Affirmative Defense—“Good Faith” Explained
In deciding whether [name of defendant] acted in good faith in
attempting to meet competition, you must decide whether [his/her/its]
belief was based on facts that would lead a reasonable person to believe
that the price he or she was offering would meet the legal price of his or
her competitor. You must consider all of the facts and circumstances
present, including, but not limited to:
1. The nature and source of the information on which [name of
defendant] relied;
2. [Name of defendant]’s prior experience, if any, with similar
information or with persons who provided the information;
3. [Name of defendant]’s prior pricing practices; and
4. [Name of defendant]’s general business practices.
[Name of defendant] does not have to prove that [his/her/its] price did
actually meet the legal price of its competitor; only that [he/she/it]
reasonably believed that [he/she/it] was offering a price that would meet
the competitor’s price.
New September 2003
Directions for Use
This instruction provides the jury with a general listing of circumstances against
which it might consider evidence in the record to decide whether a defendant’s
attempts to meet competition were in good faith. The final paragraph eases the
defendant’s burden of proof with respect to the “meet but don’t beat” element
because a defendant is required only to prove its reasonable belief that its prices
would meet, but not beat, a competitor’s prices.
Sources and Authority
• Good-Faith Price to Meet Competition Permitted. Business and Professions
Code section 17050(d), (e).
• “The requirement [to ascertain the ‘legal prices’ of competitors] is not absolute.
It is merely that the defendants shall have endeavored ‘in good faith’ to meet
the legal prices of a competitor.” (People v. Pay Less Drug Store (1944) 25
Cal.2d 108, 117 [153 P.2d 9].)
Secondary Sources
1 Witkin, Summary of California Law (10th ed. 2005) Contracts, §§ 609–615
3Levy et al., California Torts, Ch. 40, Fraud and Deceit and Other Business Torts,
§ 40.153 (Matthew Bender)
49 California Forms of Pleading and Practice, Ch. 565, Unfair Competition,
§ 565.53 (Matthew Bender)
1 Matthew Bender Practice Guide: California Unfair Competition and Business
Torts, Ch. 5, Antitrust, 5.46[2], 5.51, 5.100[7]
3336–3399. Reserved for Future Use