CACI 3335 Affirmative Defense—Good Faith Explained

California Civil Jury Instructions CACI

3335 Affirmative Defense—“Good Faith” Explained

In deciding whether [name of defendant] acted in good faith in attempting to meet competition, you must decide whether [his/her/nonbinary pronoun/its] belief was based on facts that would lead a reasonable person to believe that the price [name of defendant] was offering would meet the legal price of [name of defendant]’s competitor. You must consider all of the facts and circumstances present, including, but not limited to:

1.The nature and source of the information on which [name of defendant] relied;

2.[Name of defendant]’s prior experience, if any, with similar information or with persons who provided the information;

3.[Name of defendant]’s prior pricing practices; and

4.[Name of defendant]’s general business practices.

[Name of defendant] does not have to prove that [his/her/nonbinary pronoun/its] price did actually meet the legal price of its competitor; only that [he/she/nonbinary pronoun/it] reasonably believed that [he/she/nonbinary pronoun/it] was offering a price that would meet the competitor’s price.

Directions for Use

This instruction provides the jury with a general listing of circumstances against which it might consider evidence in the record to decide whether a defendant’s attempts to meet competition were in good faith. The final paragraph eases the defendant’s burden of proof with respect to the “meet but don’t beat” element because a defendant is required only to prove its reasonable belief that its prices would meet, but not beat, a competitor’s prices.

Sources and Authority

Good-Faith Price to Meet Competition Permitted. Business and Professions Code section 17050(d), (e).

“The requirement [to ascertain the ‘legal prices’ of competitors] is not absolute. It is merely that the defendants shall have endeavored ‘in good faith’ to meet the legal prices of a competitor.” (People v. Pay Less Drug Store (1944) 25 Cal.2d 108, 117 [153 P.2d 9].)

Secondary Sources

1 Witkin, Summary of California Law (11th ed. 2017) Contracts, §§ 623–629
3 Levy et al., California Torts, Ch. 40, Fraud and Deceit and Other Business Torts, § 40.153 (Matthew Bender)
49 California Forms of Pleading and Practice, Ch. 565, Unfair Competition, § 565.53 (Matthew Bender)
1 Matthew Bender Practice Guide: California Unfair Competition and Business Torts, Ch. 5, Antitrust, 5.46[2], 5.51, 5.100[7]