5-9 Jennings text, p. p. 535, Consider

The Federal Trade Commission is conducting an investigation into the informal agreements reached between Toys "R" Us and toy manufacturers. Toys "R" Us holds a 19.4 percent share of the U.S. toy market and has informal agreements with Mattel and Hasbro with respect to the sale of their toys to discount warehouse clubs such as Costco and Sam's Club. The clubs are sold toys only in more expensive packaging arrangements. For example, Hollywood Hair Barbie can be purchased at Toys "R" Us for $10.95 but at warehouse clubs can be purchased only in a package with a dress for $15.95. Some of the most popular toy items are never sold to the warehouse clubs. For example, Hasbro has not sold its Hall of Fame GI Joe action figures to warehouse clubs, and Mattel will not sell its Fisher Price pool table to the clubs. The FTC commissioners voted 5 to 3 to begin the investigation because toy manufacturers are put into a situation of choosing between selling to Toys "R" Us and other retailers. Toys "R" Us maintains that the warehouse clubs do not have the overhead of advertising the toys and simply choose those items that sell the best at very low margins. The low margins can be maintained because, for example, Costco took in more in membership fees over the last 10 years than its total net profit. Apply the Leegin rule of reason standard. Have the antitrust laws been violated?