On August 14, 1963, defendant's officials determined that they would advertise and sell fryer chickens at twenty-nine cents per pound during the upcoming Labor Day weekend. Defendant's invoice cost was thirty and one half cents per pound. Competing stores had sold at twenty-nine cents on July 24, August 14 and August 16. Before it established the Labor Day weekend selling price, defendant made no investigation to determine the legality of its competitors' prices, but assumed their twenty-nine cent prices were legal because no action had been brought to enjoin or prosecute competitors. The state brought action to enjoin defendant's sales of fryer chickens below cost under the Unfair Practices Act. The trial court found that defendant had not violated the act, because the sales below cost were made in good faith to meet competitors' prices. On appeal, the Washington Supreme Court affirmed with a 5-4 decision. Held: The good faith defense provided in Washington's Unfair Practices Act may be invoked when below cost selling prices have been established in advance of selling date without specific knowledge of competitors' future prices, and without investigation to determine whether competitors' prices are legal. State ex. rel. O'Connell v. Albertson's, Inc., 68 Wash. Dec. 2d 254, 412 P.2d 755 (1966).
Meeting Competition Exception to Sales Below Cost Prohibition,
42 Wash. L. Rev.
Available at: https://digitalcommons.law.uw.edu/wlr/vol42/iss3/12