page_title: Standard Oil Co. v. United States (Standard Stations)
section_title: Jackson dissent
hierarchical_section_title: Standard Oil Co. v. United States (Standard Stations) / Ruling of Supreme Court / Jackson dissent
caption_attribution_description: Robert H. Jackson
context_page_description: Standard Oil Co. v. United States, 337 U.S. 293, more commonly referred to as the Standard Stations case, is a 1947 decision of the United States Supreme Court in which requirements contracts for gasoline stations (Standard Stations) were held to violate section 3 of the Clayton Act. That statute prohibits selling goods on the condition that the customer must not deal in the goods of a competitor of the seller, such as in a requirements contract, if the effect is to "substantially lessen competition" or "tend to create a monopoly." The doctrine of this case has been referred to as "quantitative substantiality," and its exact contours were unsettled and controversial for many years until the Supreme Court authoritatively explained it in United States v. Philadelphia National Bank.
  The importance of the decision and its place in antitrust jurisprudence have been characterized in these terms:
  Standard Stations is the richest and the most difficult of all the vertical integration cases. Each of the tensions that has been mentioned within the structure of antitrust is revealed in the Standard Stations decision.
context_section_description: Justice Jackson challenged the majority's inference that competition may be substantially lessened merely because a large majority of the market is foreclosed by requirements contracts, including those of Standard. Thus while the majority said it was not farfetched to move from foreclosure to a likelihood of lessening of competition, Jackson insisted that it was farfetched to do so: "But proof of their quantity does not prove that they had this forbidden quality; and the assumption that they did, without proof, seems to me unwarranted."
  Jackson saw the market as an already imperfect one in oligopolists battle it out with one another for market share, using the dealers as pawns, "the instrumentalities through which competition . . . is waged." He explained:
  [T]he retailer in this industry is only a conduit from the oil fields to the driver's tank, a means by which the oil companies compete to get the business of the ultimate consumer—the man in whose automobile the gas is used. It means to me, if I must decide without evidence, that these contracts are an almost necessary means to maintain this all-important competition for consumer business, in which it is admitted competition is keen. The retail stations, whether independent or company-owned, are the instrumentalities through which competition for this ultimate market is waged.
  Jackson considered that exclusive dealing is an offsetting market imperfection that increases competition. He therefore dissented from holding Standard's contracts unlawful. He said, "If the courts are to apply the lash of the antitrust laws to the backs of businessmen to make them compete, we cannot in fairness also apply the lash whenever they hit upon a successful method of competing."
caption: Justice Robert H. Jackson
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