Brooke Group requires pricing below an appropriate measure of cost and a dangerous probability of recouping the investment through later above-competitive pricing. Both elements are required.
Claims rarely succeed.
Alternative Names:
Predatory Pricing Claim|Below-Cost Pricing
Why it Matters?
The recoupment requirement defeats nearly all these claims, since establishing that a defendant could raise prices above competitive levels long enough to recover its losses requires market conditions including high entry barriers that rarely exist. Courts recognize that low prices benefit consumers and that mistaken condemnation chills the price competition antitrust protects. Cost measure disputes are secondary to the recoupment analysis.
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Frequently asked questions
Why do these claims rarely succeed?
Why are courts cautious?
