Ninth Circuit Articulates New Standard For Bundling

On September 4, 2007, the Ninth Circuit vacated a $16.2 million antitrust judgment, holding that the lower court erred in instructing the jury that it could impose liability for bundled discounts even without finding that the defendant priced the bundled services below cost. Cascade Health Solutions v. PeaceHealth, --- F.3d ----, Case Nos. 05-35627, 05-35640, 05-36202, 2007 WL 2473229 (9th Cir. Sept. 4, 2007). This decision re -affirms the trend in the Courts to find that bundling products can in fact constitute exclusionary conduct under Section 2 of the Sherman Act. However, it adds to the confusion concerning the appropriate standard for anticompetitive bundling, as the decision adopts a standard that differs from those previously articulated by other courts and even that most recently suggested by the Antitrust Modernization Commission.