## Facts

- The United States sued E. I. du Pont de Nemours & Co. under § 2 of the Sherman Act, alleging monopolization of interstate commerce in cellophane (and related products) and seeking injunctive and structural relief.
- DuPont manufactured cellophane, including moisture-proof cellophane that benefited from patent protection and was valued for packaging uses.
- During the relevant period, DuPont sold nearly 75% of cellophane sold in the United States.
- Cellophane accounted for less than 20% of sales within a broader category of “flexible packaging materials,” which included substitutes such as waxed paper, aluminum foil, and other packaging films.
- After trial, the district court defined the relevant product market as flexible packaging materials and entered judgment for DuPont, finding no monopoly power in that market.
- On direct appeal, the Government narrowed its challenge to the single claim that DuPont had monopolized trade in cellophane; it did not pursue other theories or product findings.
- The Supreme Court reviewed whether DuPont unlawfully monopolized under § 2 given the proper definition of the relevant product market.

## Issues

1. What is the relevant product market for assessing monopolization: cellophane alone or the broader market of flexible packaging materials?
2. Whether DuPont possessed monopoly power—power to control prices or unreasonably restrict competition—within the relevant market so as to violate § 2 of the Sherman Act.

## Decision

- The Supreme Court affirmed the judgment for DuPont.
- The Court held the relevant product market was flexible packaging materials, not cellophane standing alone.
- The Court concluded that, within that market, DuPont did not have monopoly power and therefore did not unlawfully monopolize under § 2.

## Legal Principles

- The core § 2 inquiry is whether the defendant has power to control prices or unreasonably restrict competition in the relevant market.
- Relevant product markets are defined by consumer demand substitution: products “reasonably interchangeable by consumers for the same purposes” belong in the same market.
- Products need not be identical or fungible to be included in the same market; practical interchangeability and competitive constraints govern market boundaries.
- Evidence of substitution and price relationships (including cross-elasticity considerations) may show that other products constrain a firm’s pricing, defeating a claim of monopoly power based on a narrow product share.

## Conclusion

Because cellophane competed with other reasonably interchangeable flexible packaging materials that constrained its pricing, DuPont’s large share of cellophane sales did not establish monopoly power in the relevant market, and the monopolization claim under § 2 failed.


United States v. E. I. du Pont de Nemours & Co., 351 U.S. 377 (1956)