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NEW YORK -- A U.S. District Court for the Eastern District of Michigan has dismissed fourth-tier cigarette maker Victory Brand LLC's 2003 lawsuit against Philip Morris USA alleging that the Wholesale Leaders Program harmed competition and violated antitrust laws.
Victory Brand's initial complaint alleged unlawful price discrimination in violation of the Robinson-Patman Act and an attempt by Philip Morris to monopolize in violation of the Sherman Antitrust Act. After Philip Morris USA brought a motion to dismiss the initial complaint, Victory Brand voluntarily dismissed its price discrimination claim. On July 29, the court dismissed Victory Brand's remaining claim, the alleged attempt to monopolize, effectively dismissing the case in its entirety.
The court ruled that Victory Brand had "alleged facts showing that PM's Program tends to increase competition" and that "Victory Brand's allegations are insufficient to show that its injuries would result from a decrease in competition rather than some other consequence of PM's Leaders program."
A separate challenge to Philip Morris USA's Wholesale Leaders Program is pending in the United States District Court for the Eastern District of Tennessee. Philip Morris USA is considering the ways the court's ruling in the Victory suit affects that case.
Philip Morris USA maintains that its Wholesale Leaders Program is legal and benefits both large and small wholesalers.