question archive Sturdy Tires Ltd
Sturdy Tires Ltd
Subject:ManagementPrice: Bought3
Sturdy Tires Ltd. manufactures tires and sells them to wholesalers. Sturdy Tires has an agreement with all its wholesalers that they will not sell the tires for less than the list price except where they are selling to approved dealers. In that case, the wholesalers may sell at a reduced price as long as they obtain an agreement in writing from the dealers that the dealers will not sell the tires below the list price.
Sturdy Tires sells tires to Selkirk & Sons Inc., a wholesaler. Selkirk & Sons then sells the tires at a reduced price to Doucet Auto Limited, an approved dealer. Despite the agreement with Selkirk & Sons, Doucet holds a promotion and sells the tires for less than list price. Sturdy Tires then brings an action to prevent Doucet from selling its tires for less than list price.
Will Sturdy Tires be successful in its action?
Why or why not?
Are there other options for Sturdy Tires?
