Evening star., 1936-03-25
CHAIN STORE BILL
HIT At HEARING
Counsel for Manufacturers
Declares Measure Is
Unconstitutional.
BY the Associated Press.

BY the Associated Press.
Charles Wesley Dunn of New York,
general counsel of the Associated
Grocery Manufacturers of America,
Inc, told Senate Judiciary Subcom-
mittee today that the Borah anti
price discrimination bill was uncon-
stitutional.
His view was challenger promptly
by Senator Borah, Republican, Of
Idaho, who said it was wholly con-
stitutional and designed 'in the
public interest" to prevent price dis
ordinations aimed at eliminating
competition.
Dunn contended the Borah bill was
unconstitutional on two grounds.
1T prohibits price discrimination
regardless of the presence or absence
of a wrongful competitive purpose"
was one reason advanced.
Fails to Consider Cost.
As a second. Dunn said:
THE bill requires a manufacturer
to make a discount. or advertising
allowance, to all competing dealers
If he makes 1t to one. It fails to
recognize that the seller varies the
price for difference in the cost Of do
ing business, the difference in cost of
selling to different customers and
other reasons.
This bill allows the manufacturer
to make only a quantity distinction,
whereas there are an infinite variety
of causes for price variation"
This bill requires" Borah replied.
"that where a concession is made to
one purchaser, 1t must be made to an
other. The courts have never touched
on that point"
Favors Copeland Bill.
Dunn spoke in favor of the Copeland
bill as a substitute for the half dozen
similar price discrimination measures
now pending before House and Senate.
The Copeland measure, he said,
prohibited discriminatory price, or
service, rebates unless the seller is able
to show he made them in good faith
and not with the intent of offending
against q fair competitive purpose.
Borah protested that such a provi-
sion would have no effect, since 1t
would impose on the isolated inde-
pendent merchant the task of show
ing before the Federal Trade Commits
sion that the firm with which he dealt
did not act in good faith" in granting
special benefits to a competitor.
House Approves Bill.
Yesterday the House Judiciary Com
mittee approved a different chain
store measure. the revised Patman
bill, designed to prevent price discrimi-
nation in chain store and other guam
tity buying.
The bill would seek to prohibit false
brokerage allowances, advertising al
lowances that are not bona fide and
similar practices. 1t would endeavor
to prevent manufacturer from charg-
ing the same for quantity of goods
| at the point Of sale as he charges
miles away; proponents said this would
prevent losses on distant sales from
being made up at the expense of
nearby buyers.
Bcrah and Harvard professor diff
fered at the subcommittee hearing
yesterday over whether chain stores
threatened to bring about monopoly.
THE object Of this bill is to pro-
tect the independent merchant" Borah
said, 80 he may have the same re-
bate granted the larger purchaser y
DR.. Malcolm McNair, teacher in
the Harvard Business School, said he
agreed with the aim of the BILL but
saw no danger of the chain stores
obtaining a monopoly by crowding out
the independent merchant.