Christopher Herlihy 9/25/2012 Business Law Professor Orlando

5. In the case, Hines Cosmetic Company is being accused of unlawful price discrimination because certain shops were given a demonstrator and free advertising material and other shops werent. Hines claimed it wasnt unlawful price discrimination because every shop had been charged the same amount. However, if ever shop was charged the same amount, then why did some shops receive free advertising material and others didnt? Hines most likely offered the free advertising material and demonstrator at first as incentive to increase sales and profits. Consequently, Hines decided not to give some shops free advertising material because maybe they thought they were being too generous or this could have been the original plan. Hines is committing unlawful price discrimination according to the Robinson-Patman Act. Offering one buyer free advertising while not offering it to another as an incentive to buy would be a violation of the Robinson-Patman Act. The Clayton Act also prohibits price discrimination.

6. Moore ran a wholly intrastate bakery in Santa Rosa, New Mexico and Meads Fine Bread, his competitor, engaged in an interstate commerce, increasing competition between the two companies. Consequently, Meads lowered the price of bread in half in Santa Rose, but didnt lower his price in any other location. It seems that Meads deliberately lowered the price of their bread in Santa Rosa to decrease Moores profit margin. If there wasnt a difference between the qualities of products of both companies, then Meads had no reason to lower the price of their bread. Meads tried to monopolize their product by putting the competition out of business. Meads actions are a direct violation of the Clayton Act and the Robinson-Patman Act.