J&J faces price fixing claims
By Zhao Wen |
February 4, 2012, Saturday
|
Print Edition
Print Edition
JOHNSON & Johnson Medical (China) Ltd and its Shanghai branch company faced accusations of price fixing in a local court yesterday after one of its distributors claimed the company had set a minimum resale price for its suturing products, which violated China's Anti-Monopoly Law.
Beijing-based distributor Rainbow Medical Equipment and Supplies Co demanded compensation of nearly 15 million yuan (US$2.37 million) from the two defendants in a Shanghai court.
Rainbow said it signed a one-year distribution contract with the two defendants on January 2, 2008, under which Rainbow was allowed to sell Johnson & Johnson's Ethicon suturing products to hospitals in certain areas of Beijing.
The contract stipulated that Rainbow could not sell the products below prices set by the defendants.
In March 2008, Johnson & Johnson's Shanghai branch found Rainbow privately selling the suturing products below minimum prices to win distribution rights in hospitals outside its jurisdiction.
The company deducted Rainbow's guarantee deposit of 20,000 yuan on July 1, 2008. It also stopped delivering its products to Rainbow from August 15, 2008.
Rainbow accused the two defendants of violating China's Anti-Monopoly Law, which took effect on August 1, 2008.
Johnson & Johnson Medical argued the contract was signed before the Law came into effect and claimed Rainbow was party to benefits during the contract period.
The court did not announce a verdict yesterday.
Beijing-based distributor Rainbow Medical Equipment and Supplies Co demanded compensation of nearly 15 million yuan (US$2.37 million) from the two defendants in a Shanghai court.
Rainbow said it signed a one-year distribution contract with the two defendants on January 2, 2008, under which Rainbow was allowed to sell Johnson & Johnson's Ethicon suturing products to hospitals in certain areas of Beijing.
The contract stipulated that Rainbow could not sell the products below prices set by the defendants.
In March 2008, Johnson & Johnson's Shanghai branch found Rainbow privately selling the suturing products below minimum prices to win distribution rights in hospitals outside its jurisdiction.
The company deducted Rainbow's guarantee deposit of 20,000 yuan on July 1, 2008. It also stopped delivering its products to Rainbow from August 15, 2008.
Rainbow accused the two defendants of violating China's Anti-Monopoly Law, which took effect on August 1, 2008.
Johnson & Johnson Medical argued the contract was signed before the Law came into effect and claimed Rainbow was party to benefits during the contract period.
The court did not announce a verdict yesterday.
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