Corporate Practice Series Portfolio No. 76-1st, Living with the Robinson-Patman Act, discusses the antitrust analysis applied to price discrimination, brokerage payments, and discriminatory promotional payments and services, involving both sellers and buyers, under the Robinson-Patman Act, the principal federal antitrust statute governing such practices. Since the Robinson-Patman Act is the most generally applicable statute addressing discriminatory practices in the distribution of commodities, and decisions under that federal statute usually are used for guidance in interpreting other federal and state laws dealing with that subject matter, this portfolio deals almost entirely with Federal Trade Commission and judicial interpretations of the Robinson-Patman Act, and includes counseling guidelines based upon those interpretations.
Portfolio 76-1st: Living with the Robinson-Patman Act
I. Introduction and Overview A. Subjects and Scope of the Portfolio B. Statutory Overview II. Legislative History of the Robinson-Patman Act A. Introduction B. Chain Store Revolution C. The Robinson-Patman Act: Toward Passage D. The Robinson-Patman Act’s Complicated Legislative Legacy III. The Charitable Institutions and Government Exemptions . Introductory Material A. The Charitable Institutions Exemption B. The Government Exemption IV. Price Discrimination—Section 2(a) A. Applicable Statutory Language B. Jurisdictional Elements of the Statute 1. Interstate commerce 2. Discrimination in price a. Definitions of price and discrimination b. Indirect price discrimination (1). Freight and delivery preferences (2). Preferential credit (3). Other forms of indirect discrimination c. Availability 3. Different purchasers from the same seller a. Sales transactions b. Two independent buyers (1). Refusals to deal (2). Competitive bidding (3). Transactions through agents (4). Sales to subsidiaries or affiliates c. Contemporaneous purchases d. Same seller (1). Direct purchaser requirement (2). Sales by affiliated suppliers 4. Sale of commodities 5. Like grade and quality C. Injury to Competition 1. Primary-line injury a. Brooke Group b. Predatory pricing law after Brooke Group c. Possible use of state sales ‘below-cost' statutes 2. Secondary-line competition a. The competing customer requirement b. The Morton Salt inference c. Discrimination involving unbranded products d. Functional discounts e. Indirect purchaser doctrine f. Third-line injury and beyond 3. Private enforcement—treble damages requirement of antitrust injury V. Statutory Defenses to Claims Under Section 2(a) . Introductory Material A. Cost Justification Defense 1. Evidentiary standards 2. Types of savings permitted under defense a. Reductions in manufacturing costs b. Reductions in selling costs c. Reductions in delivery costs B. Changing Conditions Defense C. Meeting Competition Defense 1. Individual competitive situations vs. area-wide competition 2. Lawful-unlawful dichotomy 3. Meet-but-not-beat rule 4. Defensive vs. aggressive action 5. Verifying the competitive offer 6. Assisting a buyer to meet its competition VI. Section 2(c)—Illegal Brokerage . Introductory Material A. Scope of Section 2(c) B. Resurgence of the ‘For Services Rendered' Defense C. Application to Commercial Bribery VII. Advertising and Promotional Assistance A. Statutory Language and Distinctions of Sections 2(d) and 2(e) B. Allowances, Services, and Facilities Covered C. The Competing Customer Requirement D. Availability of Payments or Services 1. Notice 2. Functional availability (suitability) E. The Proportional Equality Requirement VIII. Buyer Liability for Price and Promotional Discriminations . Introductory Material A. Buyer Liability Under Section 2(f) 1. The requirement of a seller’s violation 2. The knowledge requirement B. Buyer Liability for Inducing or Receiving Discriminatory Promotional Payments or Services IX. Criminal Prohibitions
Wks. 1 Robinson-Patman Act, 15 U.S.C. §§13(a)–(f), 13a, 13b, and 13c Wks. 2 Sherman Act, 15 U.S.C. §§1–2 Wks. 3 Clayton Act, 15 U.S.C. §§12, 14, 15(a), 15b, 25, and 26 Wks. 4 Federal Trade Commission Act, 15 U.S.C. §§45, 53, 57a, and 57b Wks. 5 U.S. Department of Justice, Report on the Robinson-Patman Act (1977) Wks. 6 Federal Trade Commission, Guides for Advertising Allowances and Other Merchandising Payments and Services (“Fred Meyer Guides”) 55 Fed. Reg. 33,651, 16 C.F.R. Part 240 (comments on guides) 16 C.F.R. §§240.1–240.15 (guides) Wks. 7 Sample Meeting Competition Form #1 Wks. 8 Sample Meeting Competition Form #2 Wks. 9 Sample Initial Letter to Meet Competition Wks. 10 Sample Meeting Competition Reconfirmation Letter