Robinson-Patman Act

AuthorRonan P. Harty
A. Introduction
Section 2 of the Clayton Act, as originally enacted in 1914, was the first federal
law specifically directed at price discrimination. That section was expressly limited to
geographic pricing practices and focused primarily on practices that were harmful to
rivals rather than customers or suppliers. The perceived inadequacies of Section 2 led
to its amendment in 1936 by the Robinson-Patman Act,1 now the principal federal
statute directed at price discrimination.2 With the Robinson-Patman Act, “Congress
sought to target the perceived harm to competition occasioned by powerful buyers,
rather than sellers; specifically, Congress responded to the advent of large chainstores,
enterprises with the clout to obtain lower prices for goods than smaller buyers could
demand.”3 The act often has been criticized by the courts for imprecision in the
statutory language, which has resulted in a large body of case law interpreting its
ambiguities and nuances.4
The Robinson-Patman Act5 contains six basic provisions: Sections 2(a) through (f).
Section 2(a) prohibits a seller from discriminating in price between different buyers if
the discrimination adversely affects competition. Two provisos address affirmative
defenses: cost justification and changing conditions. Section 2(b) establishes an
affirmative defense if the discrimination arises from meeting competition. Section 2(c)
prohibits a party to a sales transaction from granting to or receiving from the other
party certain commissions or brokerage fees, except for services rendered. Sections
2(d) and 2(e) prohibit a seller from providing or paying for promotion or advertising
in connection with a product’s resale unless equivalent benefits are offered to all
1. Act of June 19, 1936, 15 U.S.C. §§ 13-13b, 21a.
2. The other federal statutes that have been applied to price discrimination and predatory pricing§ 5
of the Federal Trade Commission Act (FTC Act), 15 U.S.C. § 45, and § 2 of the Sherman Act, 15
U.S.C. § 2are discussed in Chapters 8 and 2, respectively.
3. Volvo Trucks N. Am., Inc. v. Reeder-Simco GMC, Inc., 546 U.S. 164, 175 (2006); see also FTC v.
Morton Salt Co., 334 U.S. 37, 43 (1948) (Congress sought to prevent large buyers from “secur[ing]
a competitive advantage over a small buyer solely because of the large buyer’s quantity purchasing
4. See Boise Cascade Corp. v. FTC, 837 F.2d 1127, 1138-39 (D.C. Cir. 1988) (“The imprecision
infecting the statutory language has frequently led courts construing the measure to repair to the
backdrop against which the Robinson-Patman amendments were crafted in 1937.”); see also Cash
& Henderson Drugs Inc. v. Johnson & Johnson, 799 F.3d 202, 209 (2d Cir. 2015); Smith Wholesale
Co. v. R.J. Reynolds Tobacco Co., 477 F. 3d 854, 865-66 (6th Cir. 2007). For a detailed discussion
of the original purpose of the Act, see WRIGHT PATMAN, COMPLETE GUIDE TO THE ROBINSON-
PATMAN ACT (1963).
5. Section 1 of the Robinson-Patman Act is codified as § 2 of the Clayton Act, 15 U.S.C. § 13.
competing buyers. Section 2(f) makes it unlawful for a buyer “knowingly to induce or
receive” a discriminatory price prohibited by the act. Section 36 establishes criminal
sanctions for unreasonably low pricing, although that provision has not been enforced
since the early 1960s.
While the Federal Trade Commission (FTC) and the Department of Justice (DOJ)
both have jurisdiction to enforce the act, in practice the FTC is the only agency that
has exercised it. The FTC has brought only a few cases since the 1980s and has not
brought a Robinson-Patman Act case since 2000.7 In 2017, the FTC issued an advisory
opinion setting forth a broad interpretation of the Nonprofit Institutions Act exemption
to the Robinson-Patman Act.8 The general trend in recent case law, including at the
Supreme Court, has been to narrow the Robinson-Patman Act’s scope and expand
defenses such as functional availability and meeting competition.9
B. The Commerce Requirement
The Robinson-Patman Act applies only to persons “engaged in commerce” and
acting “in the course of such commerce.”10 Section 2(a) also requires that “either or
any of the purchases involved in such di scrimination” be “in commerce.”11 As a
practical matter, proof of the additional “in commerce” requirement of Section 2(a) for
any of the involved purchases will necessarily satisfy the other commerce requirements
of the act.12
In Gulf Oil Corp. v. Copp Paving Co.,13 the U.S. Supreme Court explained that “the
distinct ‘in commerce’ language of the . . . Robinson-Patman Act . . . appears to denote
only persons or activities within the flow of interstate commercethe practical,
economic continuity in the generation of goods and services for interstate markets and
their transport and distribution to the consumer.”14 Thus, “[s]ales that merely ‘affect’
interstate commerce do not meet the Robinson-Patman Act ‘in commerce’ standard.”15
6. 15 U.S.C. § 13a.
7. McCormick & Co., FTC Dkt. C-3939, available at
8. Letter from Markus H. Meier, Assistant Dir., Bureau of Competition, Fed. Trade Comm’n, to
Jennifer R. Bolster, Esq., Hancock Estabrook, LLP, Crouse Health Hospital Advisory Opinion 5
(Oct. 20, 2017), availa ble at
9. See Feesers, Inc. v. Michael Foods, 591 F.3d 191, 198 (3d Cir. 2010) (discussing Supreme Court
10. “Although § 2(e) does not explicitly state similar requirements, the jurisdictional bases of § 2(a) have
been incorporated into § 2(e).” L&L Oil Co. v. Murphy Oil Corp., 674 F.2d1113, 1116 (5th Cir.
11. See part B.3 of this chapter for a discussion of export sales under § 2(a).
12. See, e.g., Precision Printing Co. v. Unisource Worldwide, Inc., 993 F. Supp. 338, 346 (W.D. Penn.
1998); Ashkanazy v. I. Rokeach & Sons, 757 F. Supp. 1527, 1546 (N.D. Ill. 1991); Liquilux Gas
Servs. v. Tropical Gas, 303 F. Supp. 414, 416 n.2 (D.P.R. 1969); Int’l Tel. & Tel. Corp., 104 F.T.C.
280, 419 (1984).
13. 419 U.S. 186 (1974).
14. Id. at 195 (emphasis added); see also Able Sales Co., Inc. v. Compania de Azucar de P.R., 406 F.3d
56, 61 (1st Cir. 2005); Rotec Indus., Inc. v. Mitsubishi Corp., 348 F.3d 1116, 1120 (9th Cir. 2003);
L&L Oil, 674 F.2d at 1116.
15. Chawla v. Shell Oil Co., 75 F. Supp. 2d 626, 646 (S.D. Tex. 1999) (citing Gulf Oil, 419 U.S. at 195).
Biocad JSC v. F. Hoffmann-La Roche, Ltd., 2017 U.S. Dist. LEXIS 162398, at *17-18 (S.D.N.Y.
2017) (quoting Zenith Radio Corp. v. Matsushita Elec. Indus., 402 F. Supp. 244, 248 (E.D. Pa. 1975)
(“[N]o cause of action arises under the [Robinson-Patman] Act unless both commodities involved
The jurisdictional scope of the Robinson-Patman Act is therefore narrower than that
of the Sherman Act.16
1. Interstate and Intrastate Sales
The in commerce language of Section 2(a) establishes a threshold jurisdictional
requirement that at least one of the discriminatory sales at issue must have crossed a
state line.17 The sales used to establish the in commerce requirement must be the same
sales challenged as discriminatory.18 As this is a jurisdictional requirement, “the
burden to prove the interstate character of the sales is on the party asserting subject
matter jurisdiction.”19
An interstate sale in either the victim’s market or in the market where the defendant
allegedly provided more favorable pricing will satisfy the requirement.20 “It is
immaterial which one crossed a state line. As long as one or both did so, the
jurisdictional requirement is satisfied.”21 This jurisdictional requirement may be
in the alleged price discrimination are sold for use, consumption or resale within the United
16. See, e.g., Gulf Oil, 419 U.S. at 194-95; McCallum v. City of Athens, Ga., 976 F.2d 649, 657-58 (11th
Cir. 1992); William Inglis & Sons Baking Co. v. ITT Cont’l Baking Co., 668 F.2d 1014, 1043 (9th
Cir. 1981); Littlejohn v. Shell Oil Co., 483 F.2d 1140, 1144 (5th Cir. 1973) (en banc) (“The language
of the actrequiring discriminatory sales be ‘in commerce’—is far narrower in scope than the
‘effect on commerce’ test applicable under the Sherman Antitrust Act.”); Boyd v. AWB Ltd., 544 F.
Supp. 2d 236, 239 (S.D.N.Y. 2008) (“In contrast to § 1 of the Sherman Act, the ‘in commerce’
language of the Robinson-Patman Act extends only to persons or activities ‘within the flow’ of
commerce among the states or with foreign nations.”).
17. Gulf Oil, 419 U.S. at 195; Able Sales, 406 F.3d at 61; Bailey v. Allgas, Inc., 284 F.3d 1237, 1244
n.13 (11th Cir. 2002).
18. See, e.g., Mayer Paving & Asphalt v. General Dynamics Corp., 486 F.2d 763, 769 (7th Cir. 1973)
(secondary line claim dismissed because the statute “requires that only the purchases by Mayer
Paving competitors and by Mayer Paving itself be considered in determining whether ‘either or any’
discriminatory sale is ‘in commerce’”); Cliff Food Stores, Inc. v. Kroger, Inc., 417 F.2d 203, 208
(5th Cir. 1969) (“at least one of the sales alleged to be discriminatory must actually be in interstate
commerce”); Chawla, 75 F. Supp. 2d at 647 (rejecting plaintiffs’ jurisdictional argument based on
their own interstate retail sales because the transactions challenged as discriminatory were wholesale
sales to retailers).
19. Able Sales, 406 F.3d at 61.
20. See, e.g., Coastal Fuels of P.R. v. Caribbean Petrol. Corp., 79 F.3d 182, 189 (1st Cir. 1996) (“For a
transaction to qualify, the product at issue must physically cross a state boundary in either the sale
to the favored buyer or the sale to the buyer allegedly discriminated against.”); Ashkanazy v.
I. Rokeach & Sons, 757 F. Supp. 1527, 1546-47 (N.D. Ill. 1991) (§ 2(a) “applies only if at least one
of the two transactions which, when compared, generate a discrimination crosses a state line”)
(internal quotation marks omitted). To establish jurisdiction, it may not be necessary to prove that
the favored and disfavored purchasers compete with each other, although such proof is a required
part of the plaintiff’s prima facie case. In Godfrey v. Pulitzer Publ’g, 161 F.3d 1137 (8th Cir. 1998),
the Eighth Circuit rejected the argument that proof of competition with the alleged favored purchaser
is a jurisdictional requirement. Relying upon the plain language of § 2(a), the court rejected the
“somewhat seductive” logic of an earlier Seventh Circuit decision that held only purchases that might
injure competition are in commerce. See id. at 1142 (discussing Mayer Paving & Asphalt Co. v.
General Dynamics Corp., 486 F.2d 763 (7th Cir. 1973)).
21. William Inglis & Sons Baking Co., 668 F.2d at 1043-44 (citing Moore v. Mead’s Fine Bread Co.,
348 U.S. 115, 120 (1954)).

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