But the technicalities of the robinsonpatman act are not. Robinsonpatman actthe robinsonpatman act is a 1936 statute 15 u. The robinson patman act is an amendment to the 1914 clayton antitrust act and is supposed to prevent unfair. That the bar has long needed a work of the instant sort requires no extended demonstration in view of the fact that it is the only treatment of the robinson patman act, of comparable scope and depth, which has. So maybe the robinsonpatman act isnt dead after all. Apr 01, 2015 supply chain costs and the robinson patman act. History books, newspapers, and other sources use the popular name to refer to these laws. Robinsonpatman act legal definition of robinsonpatman act. In fact, the robinson patman act is historically referred to as the antichainstore act. The robinson patman act of 1936, also called the antiprice discrimination act, made it illegal for companies to engage in price discrimination. The rationale for this act and the enforcement of the.
Another provision of the clayton act prohibits price discrimination by a seller where the effect is to injure the competition. The avenue to discounts for nonprofit hospital pharmacies. The robinson patman act of 1936 was a result of this public outcry against the chain store. The act prohibits sellers from charging different prices to different buyers for identical products when the effect might be injurious to competition. Memorandum issues adopted by the commission for study. It was designed to protect small retail shops against competition from chain stores by fixing a minimum price for retail products. Business decision under robinson patman act university of the people bus 5110.
It is too soon to say who will win this case, but at the minimum both sides are going to have significant legal fees. Goudy invited me to speak to you, he requested that i make some remarks regarding frdr trade laws. Theres more to life than just work let the aba help balance your personal life with tips on wellness, relationships, worklife balance, and. My answer is, as currently enforced, the robinson patman act is a socially costly statute that.
Rather, a price discrimination within the meaning of that provision is merely a. And sometimes they are meant to garner political support for a law by giving it a catchy name as with the usa patriot act or the take pride in america act or by invoking public outrage or sympathy as with any number of laws named for victims of crimes. The robinsonpatman act of 1936, also referred to as the antiprice discrimination act, is a part of united states federal law that prohibits producers of products from participating in anticompetitive practices. Posted on september 16, 20 by laxman rajagopalan robinsonpatman act is not a very commonly used phrase in the marketers arsenal. The robinsonpatman act of 1936 made it illegal for companies to engage in certain behavior. Even the supreme court has acknowledged that the law by no means represents an exemplar of legislative clarity. Require price difference be justified by different operation costs and prohibited price discrimination robinson patman act was an amendment to clayton antitrust act which doesnt allow price discrimination. Robinson patman act passed in 1936, it aims to prevent businesses from selling the same product to different people at different prices price discrimination. Robinsonpatman act definition, price discrimination. Patman and his allies of twentyfive years ago and the federal trade commission. Ethics is the study of moral choice and values, and. The supreme court has ruled that price discrimination claims under the robinson patman act should be evaluated consistent with broader antitrust policies.
The robinsonpatman act of 1936, also called the antiprice discrimination act, made it illegal for companies to engage in price discrimination. The case does, however, provide some helpful reminders. Therobinsonpatmanact wasdesigned asa weapon to beusedbythesocalledregular or orthodoxchannels of distribution in theirbattle xjith the. View essay unit 5 group activity robinson patman act. Bargaining between consumerproduct manufacturers and their retail customers is at least nominally constrained by the prohibitions on price discrimination of the robinsonpatman act rpa of 1936. The robinsonpatman act and vertical relationships request pdf. The bottomline message is that the robinsonpatman act is a fact of life that companies must be mindful of in making pricing decisions. Robinson patman act study plan issues adopted by the commission for study a. Act june 19, 1936, which amended this section and added sections a, b, and 21a of this title, is popularly known as the robinson patman act, as the robinson patman antidiscrimination act, and also as the robinson patman price discrimination act. The law grew out of practices in which chain stores were allowed to purchase goods at lower prices than other retailers. Congress as an amendment to clarify and supplement the sherman antitrust act of 1890. The robinson patman act of 1936 is antitrust legislation that amends section 2 of the clayton act of 1914, which was designed to prevent monopolies by catching earlystage practices leading to corporate mergers. Robinson patman act is against price discrimination on customers.
Rpamall summary of robinsonpatman act rpa decisions. Defendant faldutis antitrust counterclaims under the sherman act and the robinson patman act were dismissed by grant of summary judgment meaning, without any trial, because the complaining purchaser bought from an intermediate distributor and not directly from the manufacturer, unlike the superstore retailers who bought their pet food. But the technicalities of the robinson patman act are not. Walmart and price discrimination by dukes, anthony j.
As a manager of a business, this means that it is required to sell products or services at the same price to all customers. Congress in 1936 to supplement the clayton antitrust act clayton antitrust act, 1914, passed by the u. In 1936, section 2 of the clayton act was amended by the robinson patman act, and it became a far more complex statute. Robinsonpatman act and its implications for marketers. While assuming potentially different wholesale prices is against the robinson patman act of 1936 in the usa known as the antiprice discrimination act, this and similar acts in other countries. The robinson patman act of 1936 is a united states federal law that prohibits anticompetitive practices by producers, specifically price discrimination. David schiering the author, who has participated in the defense of actions involving section 2c of the robinson patman act, traces the history of litigation brought under this controversial statute and then examines the attempts by eliminated middlemen to revive section 2c. The act applies to commodities, but not to services, and to purchases, but not to leases. Should the robinson patman act be repealed in whole or in part, or otherwise be modified. The history of the robinson patman act actually begins in 1914, when section 2 of the clayton act became the first federal statute that expressly prohibited certain forms of price discrimination.
It is also know as the antiprice discrimination act. A federal law passed in 1936 to outlaw price discrimination. There is a rarely litigated but often irritating antitrust and distribution law known as the robinson patman act. Competitive injury and damages under the robinsonpatman act. The robinsonpatman act of 1936 or antiprice discrimination act, pub. Should section 3 of the robinson patman act providing for criminal penalties be repealed. The robinsonpatman actalso called the antiprice discrimination actwas passed in 1936 to respond to the perceived unfairness of manufacturers that sold products at cheaper prices to chain stores, thereby creating a disadvantage to the chains singlestore competitors in a given town. We discuss the computational challenges and our solutions to them.
The robinson patman act the act or law, the antitrust law prohibiting price discrimination, has long been a source of confusion and a target of criticism by courts, commentators, and practitioners. What are the benefits and costs of the robinson patman act as currently enforced. Sep 16, 20 robinsonpatman act and its implications for marketers. The robinson patman act is a complex statute which can have important ramifications to decisions about price. The act specifically limits price discrimination and it is an amendment to the clayton antitrust act, which was the first law of its kinds to prevent unfair price discrimination. Does the act promote or reduce competition and consumer welfare. Exploring the robinsonpatman act and its ethical implications. Robinsonpatman act article about robinsonpatman act by. The supreme court has ruled that price discrimination claims under the robinsonpatman act should be evaluated consistent with broader antitrust policies. An essential element of a robinson patman act secondaryline violation is proof that the discriminatory price was granted to a purchaser who competes with the disfavored purchaser for resale to the same customer. Recent changes to the ftcs robinsonpatman act guidance. The robinson patman act of 1936 made it illegal for companies to engage in certain behavior. Our identity as lawyers is something very precious to us, yet it is no substitute for our identity as a human being in social connection to others. The supreme court instructed in volvo trucks north america, inc.
We present a case study in the gasoline fuel market, where competitors engage in a high degree of pricematching and intense competition. It stated that differences in price need to be justified, i. Robinson patman act article about robinson patman act by. Price discrimination is a practice where a company will charge two different customers different prices for the same good. As you counsel your clients regarding the robinsonpatman act dont be too disdainful, regardless of your opinion of the economic policy behind it. In addition, we discuss the implications of this case study for future robinson patman cases. The amendment to the clayton antitrust act prevented unfair price discrimination for the.
What are the benefits and costs of the robinson patman act. The robinsonpatman act is an amendment to the 1914 clayton antitrust act. The robinsonpatman act is part of the antitrust legislation of the clayton act of 1914. In practice, robinsonpatman claims must meet several specific legal tests.
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