Opinion ID: 747558
Heading Depth: 3
Heading Rank: 1

Heading: First Two Tampa Factors: Defining the Line of Commerce

Text: 131 and Area of Competition 132 In this case, the first two Tampa factors-the line of commerce and area of competition-consist of the sale of retail gasoline dispensers in the United States to small independent buyers who purchase retail petroleum dispensers from distributors. The majority incorrectly defines the line of commerce and area of competition as the sale of all retail petroleum dispensers from manufacturers. To understand why the relevant market does not include all sales of retail petroleum dispensers, it is important to understand the retail petroleum dispenser market. 133 The sale of retail petroleum dispensers to end-users occurs in two ways: (1) direct sales from manufacturers of petroleum dispensers to major oil companies and large convenience store chains; and (2) sales from distributors of petroleum dispensers to independent gasoline station owners, regional petroleum marketers, and small oil companies (small independent buyers). 134 Major oil companies purchase retail petroleum dispensers from more than one manufacturer. 7 The major oil companies want to have more than one supplier to ensure an alternate source of petroleum dispensing products. Gilbarco gives some major oil companies discounts on retail petroleum dispensers. 135 Small independent buyers, in contrast, purchase retail petroleum dispensers from a single distributor and develop long-term relationships with that distributor. The key reason for the small independent buyers to stay with a particular distributor is that they want a single reliable source of service and products. One former distributor of Gilbarco retail petroleum dispensers explained: 136 Well, major oil companies have engineers and consultants and experts that go out and inspect the stuff and lay it all out for them. These [buyers from distributors] were small business [people] who depended on me and my company to spec them the correct equipment that could be serviced and taken care of and not have to be worried about. 137 As a result of the small independent buyers' reliance on particular distributors, small independent buyers normally do not change distributors. For example, the customer base of one Gilbarco distributor has not changed significantly in the last forty years. 138 This evidence shows that the sale of retail petroleum dispensers to small independent buyers is an entirely different market from the sale of retail petroleum dispensers to major oil companies. Unlike major oil companies, small independent buyers have strong reasons to buy from a single distributor. Nor is there any evidence in the record to suggest that small independent buyers have the option of purchasing retail petroleum dispensers directly from manufacturers such as Gilbarco. Gilbarco's own reluctance to allow discounts and dissemination of price information to small independent buyers-though discounts and price dissemination were common for major oil companies-shows that Gilbarco itself sought to maintain two distinct markets. By failing to recognize the substantial evidence in the record showing this bifurcation in the retail petroleum dispenser market, the majority incorrectly defines the line of commerce and area of competition. 139