The Mobil-Marathon case - Essay Example

The Directors of Marathon Oil Company filed an antitrust suit against Mobil at United States District Court in the Northern Ohio District. In the case, the director of Marathon argued that Mobil violated section seven of Clayton Act. The Act rejects the ideas of holding companies since they encourage the development of monopolies. The directors of Marathon wanted the court to restrain Mobil by preventing the company from purchasing shares of the company and permit the company to keep looking for other companies with which to form an appropriate merger.

The district court ruled in the favor of Marathon Oil Company, which then proceeded to look for other companies. The directors of Marathon settled for United States Steel Inc., which was just newly formed. Just as the two were about to form a merger, Mobil Corporation filed a suit at the District Court in Southern District of Ohio arguing that Marathon had violated the Williams Act by withholding substantial information in its communication with its shareholders about merger and while filing with the country’s Stock Exchange Commission.

Mobil Corp argued that the directors of Marathon had not disclosed adequate material facts of USS, Inc.’s tender offer. Mobil therefore requested an injunction on the merger. The district court denied the injunction. Mobil Corp appealed the ruling to the Sixth Circuit Court. The Circuit Court determined that Mobil indeed had the standing to bring a case against Marathon Oil Company since it was a tender offeror. As such, the Court began investigating the operations of Marathon as tabled by Mobil Corp.

the court found that in its defensive tactics, Marathon Oil Company had violated a number of provisions of the William’s act (Kwoka and Lawrence 21). The two interrelated cases above involved a number of legal issues in the United States key among which was the interpretation and application of both the Williams Act and the Clayton’s Antitrust Act.