United States v. Grinnell Corp.

Summary

The Supreme Court considered whether Grinnell Corporation and affiliated alarm-service companies violated § 2 of the Sherman Act by monopolizing the accredited central station protective-services market. The Court held that the defendants possessed monopoly power and had willfully acquired and maintained it through exclusionary practices, including restrictive agreements, acquisitions, and pricing conduct. It affirmed the finding of liability but remanded for modification of the relief, including divestiture and additional competitive safeguards.

Holdings

1. A § 2 monopolization offense has two elements: possession of monopoly power in the relevant market and willful acquisition or maintenance of that power, as distinguished from growth or development resulting from a superior product, business acumen, or historic accident.
2. The relevant product market may consist of a cluster of different services when combining them reflects commercial realities and the services share a basic use, are supplied from a common facility, and are commonly utilized in combination.
3. The relevant geographic market for the accredited central-station protective-service business was national rather than limited to the local areas served by individual stations.
4. A predominant market share may support an inference of monopoly power, and the defendants' collective 87% share of the relevant market established monopoly power on this record.
5. Relief in a monopolization case must terminate the unlawful combination, deprive defendants of the benefits of their unlawful conduct, and break up or render impotent the monopoly power created in violation of the Act.
6. Disqualifying bias or prejudice must stem from an extrajudicial source and result in an opinion on the merits based on something other than the judge's participation in the case; the defendants failed to establish such bias.

Questions Presented

1. Whether the defendants possessed monopoly power in a properly defined relevant market under § 2 of the Sherman Act.
2. Whether the defendants willfully acquired or maintained monopoly power through exclusionary conduct rather than through superior product, business acumen, or historic accident.
3. Whether the District Court properly treated accredited central-station protective services as a relevant national market.
4. Whether the District Court's decree provided adequate relief to terminate the combination and eliminate the benefits and effects of the unlawful monopoly.
5. Whether the trial judge was disqualified because of personal bias or prejudice and whether defendants were denied a fair trial.

Disposition

remanded