## Facts

- Weyerhaeuser Company operated sawmills in the Pacific Northwest and purchased alder sawlogs as an input for producing lumber.
- Ross-Simmons Hardwood Lumber Co., Inc., a smaller sawmill, also purchased alder sawlogs and sold finished lumber.
- Ross-Simmons alleged Weyerhaeuser engaged in “predatory bidding” for alder sawlogs by bidding up input prices and buying more logs than necessary to deprive rivals of supply and force them from the market.
- Ross-Simmons claimed Weyerhaeuser planned to recoup losses after rivals exited by exercising monopsony power and paying suppliers less for sawlogs.
- In the district court, Weyerhaeuser sought jury instructions requiring the predatory-pricing framework from Brooke Group, including a below-cost condition and a dangerous probability of recoupment.
- The district court rejected those instructions and instead permitted liability if Weyerhaeuser paid more than necessary or bought more than needed to prevent competitors from obtaining logs at a fair price.
- The jury found for Ross-Simmons and awarded damages that were trebled under federal antitrust law.
- The Ninth Circuit affirmed, declining to apply Brooke Group to predatory bidding claims under Sherman Act § 2.

## Issues

1. Whether the Brooke Group predatory-pricing standard applies to predatory bidding (predatory buying) claims under § 2 of the Sherman Act.
2. Whether liability may be based on proof that a defendant bought more inputs than needed or paid more than necessary to disadvantage rivals, without proof of below-cost output pricing and a dangerous probability of recoupment.

## Decision

- The Supreme Court unanimously reversed the Ninth Circuit and vacated the judgment based on the challenged jury instructions.
- The Court held that the Brooke Group framework applies to predatory bidding claims under Sherman Act § 2.
- The Court ruled that the “more than needed”/“more than necessary” standard was legally erroneous because it did not require proof of below-cost output and recoupment.
- The case was remanded for further proceedings consistent with the proper legal standard.

## Legal Principles

- Predatory bidding under Sherman Act § 2 is assessed under the same core limits as predatory pricing because both can resemble aggressive, lawful competition and false liability risks deterring competitive conduct.
- To prove predatory bidding, a plaintiff must show:
  - The defendant’s bidding caused the cost of the relevant output to exceed the revenues generated by that output (a below-cost output condition), and
  - A dangerous probability that the defendant would recoup the losses from the bidding phase by later exercising monopsony power in the input market.
- Evidence that a buyer purchased more inputs than needed or paid higher prices than necessary, without the above-cost and recoupment showings, is insufficient for § 2 liability.

## Conclusion

The Court required predatory-bidding plaintiffs to satisfy Brooke Group’s two-part test—below-cost output and a dangerous probability of recoupment—rejecting broader standards that could condemn ordinary, competitive input purchasing.


Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber Co., 549 U.S. 312 (2007)