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ACME and Summit were the two primary security system companies selling their product door-to-door in the Houston, Texas, area. They started to encounter problems with

ACME and Summit were the two primary security system companies selling their product door-to-door in the Houston, Texas, area. They started to encounter problems with their sales forces visiting the same neighborhoods during the same weeks or even on the same day and annoying customers. The regional directors for the two companies met and agreed that each company would sell in only certain areas of Houston: ACME would cover north Houston with Summit covering south Houston. This agreement between the firms is

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an illegal allocation of territories.

a legal joint venture.

an illegal vertical exclusionary agreement.

a conglomorate merger that must be considered under a rule of reason analysis.

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