The appellants, operators of sugar refineries in eastern Canada, were charged with conspiracy to enhance the price of sugar unreasonably and to lessen competition unduly under the Combines Investigation Act.
The trial judge acquitted them, finding that while there was a tacit agreement to maintain traditional market shares, it was not intended to lessen competition unduly but rather to avoid a price war.
The Court of Appeal reversed the acquittal on the second count.
The Supreme Court of Canada allowed the appeal and restored the acquittals, holding that the trial judge did not err in law in concluding that the Crown failed to prove an agreement to lessen competition unduly.
The Court affirmed that conscious parallelism or a tacit agreement to maintain market shares does not necessarily amount to an undue lessening of competition.
