ALITO, J., dissenting

reflected in the jury verdict or admitted by the defendant." Blakely, supra, at 303 (emphasis deleted).

Booker's reasonableness review necessarily anticipates that the imposition of sentences above this level may be conditioned upon findings of fact made by a judge and not by the jury. Booker held that a system of "advisory Guidelines" with reasonableness review is consistent with the Sixth Amendment, and the same analysis should govern California's "requirement that the decision to impose the upper term be reasonable." Black, 35 Cal. 4th, at 1255, 113 P. 3d, at 544 (emphasis in original). That the California requirement is explicit, while the federal aggravating factor requirement is (at least for now) implicit, should not be constitutionally dispositive.

Unless the Court is prepared to overrule the remedial decision in Booker, the California sentencing scheme at issue in this case should be held to be consistent with the Sixth Amendment. I would therefore affirm the decision of the California Court of Appeal.

Syllabus

WEYERHAEUSER CO. v. ROSS-SIMMONS HARDWOOD LUMBER CO., INC.

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

No. 05-381. Argued November 28, 2006-Decided February 20, 2007 Respondent Ross-Simmons, a sawmill, filed suit under § 2 of the Sherman Act, alleging that petitioner Weyerhaeuser drove it out of business by bidding up the price of sawlogs to a level that prevented Ross-Simmons from being profitable. The District Court, inter alia, rejected Weyerhaeuser's proposed predatory-bidding jury instructions that incorporated elements of the test applied to predatory-pricing claims in Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U. S. 209. The jury returned a verdict against Weyerhaeuser. The Ninth Circuit affirmed, rejecting Weyerhaeuser's argument that Brooke Group's standard should apply to predatory-bidding claims.

Held: The test this Court applied to predatory-pricing claims in Brooke Group also applies to predatory-bidding claims. Pp. 318-326.

(a) Predatory pricing is a scheme in which the predator reduces the sale price of its product hoping to drive competitors out of business and, once competition has been vanquished, raises prices to a supracompetitive level. Brooke Group established two prerequisites to recovery on a predatory-pricing claim: First, a plaintiff must show that the prices complained of are below cost, 509 U. S., at 222, because allowing recovery for above-cost price cutting could chill conduct-price cutting-that directly benefits consumers. Second, a plaintiff must show that the alleged predator had "a dangerous probabilit[y] of recouping its investment in below-cost pric[ing]," id., at 224, because without such a probability, it is highly unlikely that a firm would engage in predatory pricing. The costs of erroneous findings of predatory-pricing liability are quite high because "[t]he mechanism by which a firm engages in predatory pricing-lowering prices-is the same mechanism by which a firm stimulates competition,'" and, therefore, mistaken liability findings would """chill the very conduct the antitrust laws are designed to protect. Id., at 226. Pp. 318-320.

(b) Predatory bidding involves the exercise of market power on the market's buy, or input, side. To engage in predatory bidding, a purchaser bids up the market price of an input so high that rival buyers cannot survive, thus acquiring monopsony power, which is market power on the buy side of the market. Once a predatory bidder causes

Syllabus

competing buyers to exit the market, it will attempt to drive down input prices to reap supracompetitive profits that will at least offset the losses it suffered in bidding up input prices. Pp. 320–321.

(c) Predatory-pricing and predatory-bidding claims are analytically similar. And the close theoretical connection between monopoly and monopsony suggests that similar legal standards should apply to both sorts of claims. Both involve the deliberate use of unilateral pricing measures for anticompetitive purposes and both require firms to incur certain short-term losses on the chance that they might later make supracompetitive profits. More importantly, predatory bidding mirrors predatory pricing in respects deemed significant in Brooke Group. Because rational businesses will rarely suffer short-term losses in hopes of reaping supracompetitive profits, Brooke Group's conclusion that "predatory pricing schemes are rarely tried, and even more rarely successful,'" 509 U. S., at 226, applies with equal force to predatory-bidding schemes. And like the predatory conduct in Brooke Group, actions taken in a predatory-bidding scheme are often """the very essence of competition,""" ibid., because a failed predatory-bidding scheme can be a "boon to consumers," see id., at 224. Predatory bidding also presents less of a direct threat of consumer harm than predatory pricing, which achieves ultimate success by charging higher prices to consumers, because a predatory bidder does not necessarily rely on raising prices in the output market to recoup its losses. Pp. 321-325.

(d) Given these similarities, Brooke Group's two-pronged test should apply to predatory-bidding claims. A predatory-bidding plaintiff must prove that the predator's bidding on the buy side caused the cost of the relevant output to rise above the revenues generated in the sale of those outputs. Because the risk of chilling procompetitive behavior with too lax a liability standard is as serious here as it was in Brooke Group, only higher bidding that leads to below-cost pricing in the relevant output market will suffice as a basis for predatory-bidding liability. A predatory-bidding plaintiff also must prove that the defendant has a dangerous probability of recouping the losses incurred in bidding up input prices through the exercise of monopsony power. Making such a showing will require "a close analysis of both the scheme alleged by the plaintiff and the [relevant market's] structure and conditions," 509 U. S., at 226. Pp. 325-326.

(e) Because Ross-Simmons has conceded that it has not satisfied the Brooke Group standard, its predatory-bidding theory of liability cannot support the jury's verdict. P. 326.

411 F.3d 1030, vacated and remanded.

THOMAS, J., delivered the opinion for a unanimous Court.

LUMBER CO.

Opinion of the Court

Andrew J. Pincus argued the cause for petitioner. With him on the briefs were Charles A. Rothfeld, Guy C. Stephenson, Stephen V. Bomse, M. Laurence Popofsky, Kevin J. Arquit, and Joseph F. Tringali.

Kannon K. Shanmugam argued the cause for the United States as amicus curiae urging reversal. With him on the brief were Solicitor General Clement, Assistant Attorney General Barnett, Deputy Solicitor General Hungar, Deputy Assistant Attorney General Masoudi, Catherine G. O'Sullivan, and Adam D. Hirsh.

Michael E. Haglund argued the cause for respondent. With him on the brief were Michael K. Kelley and Roy Pulvers.*

JUSTICE THOMAS delivered the opinion of the Court.

Respondent Ross-Simmons, a sawmill, sued petitioner Weyerhaeuser, alleging that Weyerhaeuser drove it out of

*Briefs of amici curiae urging reversal were filed for AT&T Inc. et al. by A. Douglas Melamed, Jonathan Nuechterlein, William M. Schur, Ronald A. Stern, John Thorne, and Paul J. Larkin, Jr.; for the Business Roundtable et al. by Janet L. McDavid, Catherine E. Stetson, Jessica L. Ellsworth, Jan S. Amundson, and Quentin Riegel; for the Chamber of Commerce of the United States of America et al. by Roy T. Englert, Jr., Donald J. Russell, Mark T. Stancil, Stephen A. Bokat, Robin S. Conrad, Amar D. Sarwal, and Richard S. Wasserstrom; for Economists by Joe Sims and Beth Heifetz; for Law Professors by Joseph J. Simons and Moses Silverman; and for Timberland Owners and Managers by Jeffrey A. Lamken and Barnes H. Ellis.

Briefs of amici curiae urging affirmance were filed for the State of California et al. by Hardy Myers, Attorney General of Oregon, and Tim D. Nord, Senior Assistant Attorney General, by Bill Lockyer, Attorney General of California, Thomas Greene, Chief Assistant Attorney General, Kathleen E. Foote, Senior Assistant Attorney General, and Emilio E. Varanini IV, Deputy Attorney General, and by the Attorneys General for their respective States as follows: Terry Goddard of Arizona, Thomas J. Miller of Iowa, Charles C. Foti, Jr., of Louisiana, Mike McGrath of Montana, Darrell V. McGraw, Jr., of West Virginia, and Peggy A. Lautenschlager of Wisconsin; for the American Antitrust Institute by Jonathan L. Rubin, Jonathan W. Cuneo, and Robert H. Lande; and for Forest Industry Participants by R. Daniel Lindahl.

Opinion of the Court

business by bidding up the price of sawlogs to a level that prevented Ross-Simmons from being profitable. A jury returned a verdict in favor of Ross-Simmons on its monopolization claim, and the Ninth Circuit affirmed. We granted certiorari to decide whether the test we applied to claims of predatory pricing in Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U. S. 209 (1993), also applies to claims of predatory bidding. We hold that it does. Accordingly, we vacate the judgment of the Court of Appeals.

I

This antitrust case concerns the acquisition of red alder sawlogs by the mills that process those logs in the Pacific Northwest. These hardwood-lumber mills usually acquire logs in one of three ways. Some logs are purchased on the open bidding market. Some come to the mill through standing short- and long-term agreements with timberland owners. And others are harvested from timberland owned by the sawmills themselves. The allegations relevant to our decision in this case relate to the bidding market.

Ross-Simmons began operating a hardwood-lumber sawmill in Longview, Washington, in 1962. Weyerhaeuser entered the Northwestern hardwood-lumber market in 1980 by acquiring an existing lumber company. Weyerhaeuser gradually increased the scope of its hardwood-lumber operation, and it now owns six hardwood sawmills in the region. By 2001, Weyerhaeuser's mills were acquiring approximately 65 percent of the alder logs available for sale in the region. App. 754a, 341a.

From 1990 to 2000, Weyerhaeuser made more than $75 million in capital investments in its hardwood mills in the Pacific Northwest. Id., at 159a. During this period, production increased at every Northwestern hardwood mill that Weyerhaeuser owned. Id., at 160a. In addition to increasing production, Weyerhaeuser used "state-of-the-art technology," id., at 500a, including sawing equipment, to increase the amount of lumber recovered from every log, id., at 500a,