Solved: 1 a Explain why the court concluded that

destination skiers

1. a. Explain why the court concluded that “destination skiers at Deer Valley” or at “Deer
Valley’s mid-mountain village” constitute a market separate from ski rental outlets in nearby
Park City.

b. How did the Court define the “true product” market?

2. a. The plaintiff failed to establish the two core elements of its proof as required by the court.
Explain those elements and describe why the court ruled against the plaintiff.

b. How will consumers be protected from monopoly behavior by the defendant Deer Valley?

3. Why should Deer Valley be allowed to restrict output and raise prices by denying the plaintiff
the continuing opportunity to rent skis at Deer Valley?

4. The U.S. government sued DuPont, claiming monopolization of the cellophane market.
DuPont produced almost 75 percent of the cellophane sold in the United States. Cellophane
constituted less than 20 percent of the “flexible packaging materials” market. The lower court
found “great sensitivity of customers in the flexible packaging markets to price or quality
changes.”

a. What is the relevant product market?

b. Who wins the case? Explain.

We agree with the defendant that the creator of a resort has no obligation under the antitrust
laws to allow competitive suppliers of ancillary services on its property. A theme park, for
example, does not have to permit third parties to open restaurants, hotels, gift shops, or other
facilities within the park; it can reserve to itself the right to conduct such businesses and receive
revenues from them. Accordingly, if it sells land within the resort to third parties, the antitrust
laws do not bar the re-sort owner from imposing a covenant against use of the property for
competitive businesses. This is so even if food, rooms, gifts, or other ancillary goods and
services would be cheaper and more plentiful if the resort owner allowed competition in these
businesses.

ANSWER
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