California Civil Jury Instructions (CACI)

3410. Vertical Restraints - Agreement Between Seller and Reseller's Competitor

If a reseller coerces a supplier to refuse to do business with a competing reseller, and the supplier does so, this conduct is an agreement to restrain competition.

Refusing to do business with a reseller after receiving complaints by a competing reseller is not, by itself, an agreement to restrain competition. However, if a supplier receives such complaints and then agrees with the complaining reseller to act on them, that becomes an agreement to restrain competition.

Directions for Use

If the complaining competitor is also a named defendant, this instruction must be rewritten to reflect that circumstance.

Sources and Authority

In Bert G. Gianelli Distributing Co. v. Beck & Co. (1985) 172 Cal.App.3d 1020, 1043-1044 [219 Cal.Rptr. 203], the Court of Appeal held that proof that the reseller competing against the plaintiff complained to the seller about plaintiff's pricing and that the seller then took action against the plaintiff reseller in response to the complaint was sufficient to support a finding of a combination.

"[T]he plaintiff must present evidence that tends to exclude, although it need not actually exclude, the possibility that the alleged conspirators acted independently rather than collusively. Insufficient is a mere assertion that a reasonable trier of fact might disbelieve any denial by the defendants of an unlawful conspiracy." (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 852 [107 Cal.Rptr.2d 841, 24 P.3d 493].)

Secondary Sources

1 Witkin, Summary of California Law (9th ed. 1987) Contracts, §§ 575- 590

2 Antitrust and Trade Regulation Law Section, State Bar of California, California Antitrust Law (2d ed. 2001), § 10.04C

6 Antitrust Laws & Trade Regulation, Ch. 105, California, § 105.02 (Matthew Bender)

3 Levy et al., California Torts, Ch. 40, Fraud and Deceit and Other Business Torts, § 40.168 (Matthew Bender)

49 California Forms of Pleading and Practice, Ch. 565, Unfair Competition (Matthew Bender)

(New September 2003)