Fact Pattern 16-1 Patty Owns and Operates a Gym. Her Main Competitor Is

question 31

Multiple Choice

Fact Pattern 16-1
Patty owns and operates a gym. Her main competitor is Jason who runs another gym three streets from her. They cater to the same clientele. Patty and Jason keep trying to undercut each other in order to attract customers. One evening Patty sees Jason in the local coffee shop and sits down to talk with him. They discuss how difficult it is to do upgrades and make money with the prices they are charging. Patty winked at Jason and said "You know, charging $80 per month would enable a good profit margin." The next day Patty started charging $80 per month as did Jason. Customers started complaining particularly after another coffee drinker and gym customer at a table sitting at a table near Patty and Jason made it known that they had seemed very cozy. Patty and Jason deny any agreement to set the same price for gym membership. They avow that the decision was made by each of them independently.
-Refer to fact pattern 16-1. Is the fact that no express words passed between Patty and Jason a defense to charges of antitrust violation?

• A) Yes, because direct evidence is required in order to establish an illegal agreement to fix prices.
• B) Yes, both because direct evidence is required in order to establish an illegal agreement to fix prices and because the courts require evidence of an explicit agreement in such cases.
• C) It is a defense to charges of criminal antitrust violations, but not to civil antitrust violations.
• D) No, because a knowing wink can mean more than words.

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Definitions:

Environmental Performance Measures

Indicators used to assess the impact of an organization's activities on the environment, including emissions, resource use, and waste management.

Relationship and Image

Aspects related to how an entity or individual is perceived in the market or by the public, and how they interact or relate with customers, partners, or other relevant entities.

Environmental Costs

Expenses associated with the impact of a company's activities on the environment.

Environmental External Failure Costs

Expenses associated with environmental damage caused by a company's products or processes, paid outside the company, such as fines or cleanup costs.