District Court Ruling Rested on Outdated FTC Robinson-Patman Act Precedent, Agency Says
The Federal Trade Commission filed an amicus brief in the U.S. Court of Appeals for the Seventh Circuit urging the court to reverse a district court decision finding that the mere sale of large-sized packages to one merchant but not another could violate Section 2(e) of the Robinson-Patman Act. The Act is a federal antitrust statute that forbids companies from engaging in specified practices involving discriminatory pricing and product promotion in connection with products sold to merchants for resale.
In the underlying lawsuit, Woodman’s Food Market alleges that Clorox violated the Robinson-Patman Act by refusing to sell large-sized packages of various consumer products to Woodman’s while selling them to membership-based “club” retailers Sam’s Club, Costco, and BJ’s Wholesale Club. The district court’s decision relied on two FTC administrative decisions from 1940 and 1956 holding that the Act requires a seller to provide its products in packages of the same size and style to all competing buyers who demand them.
The amicus brief argues that these administrative decisions are no longer good law because they are out-of-step with more recent FTC and federal court cases that interpret the Robinson-Patman Act narrowly and consistently with other antitrust laws.
The FTC vote approving the amicus brief filing was 4-0. It was filed with the U.S. Court of Appeals for the Seventh Circuit on November 2, 2015. (FTC File No P082105; the staff contact is Bradley D. Grossman, Office of the General Counsel, 202-326-2994.)
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