Document: 386 U.S. 685 87 S.Ct. 1326 18 L.Ed.2d 406 UTAH PIE COMPANY, Petitioner,v.CONTINENTAL BAKING CO. et al. No. 18. Argued Jan. 17, 1967. Decided April 24, Rehearing Denied June 5, See 387 949, 2071. Joseph L. Alioto, San Francisco, Cal., for petitioner. John H. Schafer, Washington, D.C., Peter W. Billings, Salt Lake City, Utah, and George P. Lamb, respondents. Mr. Justice WHITE delivered the opinion of Court. 1 This suit treble damages injunction under §§ 4 16 Clayton Act, 38 Stat. 731, 737, 15 U.S.C. 261 was brought by petitioner, Utah Pie Company, against respondents, Continental Baking Carnation Company Pet Milk Company. The complaint charged a conspiracy 2 Sherman 26 209, as amended, 2, violations each respondent § 2(a) Act amended Robinson-Patman 49 1526, 13(a).2 jury found respondents on charge petitioner price discrimination charge.3 Judgment entered attorneys' fees appealed several grounds. Court Appeals reversed, addressing itself to single issue whether evidence sufficient support finding probable injury competition within meaning holding that it not. 349 F.2d 122. We granted certiorari. 382 914, 86 288, 230.4 reverse. product involved is frozen dessert pies—apple, cherry, boysenberry, peach, pumpkin, mince. period covered comprised years 1958, 1959, 1960 first eight months 1961. Petitioner corporation which 30 had been baking pies in its plant City selling them surrounding States. It pie business late 1957. immediately successful with new line built 1958. market rapidly expanding one: 57,060 dozen were sold 111,729 184,569 1960, 266,908 Pie's share this those 66.5% 34.3% 45.5%, 45.3% respectively, sales volume steadily increasing over four years. Its financial position also improved. not, however, large company. At time trial, operated only employees, nine whom members Rigby family, controlled business. net worth increased from $31,651.98 October 31, 1957, $68,802.13 Total $238,000 year ended $353,000 $430,000 $504,000 $589,000 income or loss these same $6,461 remaining $7,090, $11,897, $7,636, $9,216. 3 Each company major factor one more regions country. before began freezing pies. None Utah. By end plants Michigan, Pennsylvania, California; Virginia, Iowa, California. supplied chiefly their California operations. They primarily basis. 'Utah' label petitioner's proprietary brand. Beginning like grade quality 'Frost 'N' Flame' Associated Grocers 1961 American Food Stores 'Mayfresh' label.5 also, seasonal basis, pumpkin mince Safeway Safeway's own 'Bel-air' label. 5 competitive weapon price. location gave natural advantages marketing area at below then going prices respondents' comparable For most here lowest market. was, challenged another varying periods. There ample show contributed what proved be deteriorating structure suit, course ongoing lower than other markets considerably closer plants. Pie, $4.15 per beginning relevant period, $2.75 when instant filed some 44 later.6 Pet, offering $4.92 February 'Pet-Ritz' $3.56 $3.46 respectively March Carnation's early 1958 $4.82 but conclusion meanwhile having down low $3.30 dozen. range experienced during ran high $5 $2.85 dozen.7 I. 6 deal case 1955, acquired Pennsylvania undertook advertising campaign brand Pet's initial emphasis quality, face regional local companies an where crucial factor, forced take steps reduce ultimate consumer. These developments consequences are substance Pet. 7 First, successfully concluded arrangement Safeway, three largest customers markt, whereby would sell latter's significantly elsewhere.8 slightly Utah's time, near higher amounted 22.8%, 12.3%, 6.3% entire 1961, 64%, 44%, 22% 8 Second, introduced 20-ounce economy 'Swiss Miss' August ranging $3.25 remainder period. times markets. 9 Third, became respect Pet-Ritz $4 lower, $3.70 six months. According Appeals, seven true although 30- 35-cent freight cost. 10 differential must put aside considering because view completely cost justified not any event have able enjoy custom. discriminations insufficient predicate could reasonably possible either force generally. 11 disagree respects. there considered Appeals. In addition markets, additional discriminatory compared western Likewise, pies, record five 13 prior filing 12 business, burden proving justification Pet9 and, our view, reasonable men priced, entirety. data indicating saving greater advantage extended customer. statistics particularized market, assuming they adequate justify sales, relatd 24% concerning 76% best incomplete inferential. defense jury, incidence unjustified allowed Appeals' evidence.10 With enjoyed absent contract seems clear whatever fact regard, determinative impact competitors seeking including Carnation, whose may excluded shelves Safeway.11 What more, unwillingness install control equipment prevented enjoying private question. contrary. compelled find gained 14 almost entirely ignored provides material jury's behavior satisfied statutory test regarding injury. bore predatory intent injure Pie.12 As matter, pricing aimed Pie; management, identified 'unfavorable factor,' 'd(u)g holes operation' posed constant 'check' performance Moreover, candidly admitted establishing relationship sent into industrial spy seek information use vincing worthy denied ever used learned competing parties, judges credibiility. But even giving incident measure weight does mean foreclosed underlying mode competition. Finally, deny showed suffered substantial losses part ws sustained incurred elsewhere. irrational step if between losses. us heard engaged tactics waging warfare Coupled attributable whole established, rather negated, possibility produced lessening proscribed Act. II. Petitioner's complicated. 22-ounce 'Morton' brand, 1.3% 2.9% 1.8% 1960. problems thatof turn price, controlling worked out co-packing fruit processed directly trees finished without intermediate packing, storing, shipping expenses. Having improved position, attempted increase utilizing broker short-term concessions amounts. efforts spectacularly successful. Then took heart it. Effective last two weeks offered apple substantially less direct plus allocation overhead. 24-ounce $3.10 dozen, $3.40 prices, Pocatello, Idaho, Ogden, buyers purchased 6,250 requirements about weeks. Another purchaser ordered 1,000 response immediate. reduced all refused request match renewed offer effective July 31 two-week September 8, Continental's total 3,350 18,800 8.3% conduct minimal effect, injured weakened competitor, lessened no do so future. 17 again differ damaged apparently rested continued climb court's factual deprived otherwise might had. retrospective assessment fails note below-cost caused $2.75. entitled consider potential reduction responsive cut Pie. Price buying reacted five-week supply Continental, thereby temporarily foreclosing brands firms rationally lowered repeated once, it, buy buyers, well small, followed suit. competitor who his all-time declining will feel pinch force. Even negligible, remain others compete both labels. sellers did account 91.8% 23,473 12.7% In19 61 before—18,565 8.2% total—although expanded 226,908 think violation Continental. III. 19 1955 through acquisition 'Mrs. Lee's Pies' manufacturing elsewhere 'Simple Simon' quickly extremely sensitive decided, enter primary method meeting variety discounts reductions, technique unsuccessful. example, 10.3% next year, percentage slipped 8.6%. However, turnaround market; doubled preceding 12.1% And while deteriorated remained important. 20 need dwell long upon respects similar nearly resembles After temporary setback 1959 instituted policy regain slash 60¢ level admittedly costs, prevailing move felt immediately, prices. banner trend preceded case. 20¢ 50¢ distant Francisco. held That holding, simply overlooks throughout maintained pricing, important effect cannot say precluded IV. 21 Section forbid probably lessen eliminating competitors, discouraging entry enhancing shares dominant sellers. Congress has established ground rules game. Sellers goods different purchasers result sellers' buyers' unless such permitted concerns context, placed heavy constantly make profit. we apparent particular least n continue operate Nor comes play regulate discriminators consistently undercut competitors. many cases reached courts blatant employed hope immediate destruction competitor. On question present difficulty, clearly proscription Courts commentators alike noted existence bear likelihood competition.13 respondents.14 requisite highly competitive. leader moving general down, responsibility downward pressure structure. believe reaches erodes much intended destructive impact. case, shows drastically attribute sporadic discrimination. conclude 'the discrimination,' 'may * injure, destroy, prevent person grants knowingly receives benefit *.' necessarily looks forward basis proven past. Proper application standard requires reversal judgment Appeals.15 22 ..................................Since failed prima facie expressly declined pass grounds presented 122, 126. Without intimating views reverse remand court further proceedings. 23 ordered. 24 Reversed remanded. 25 Chief decision STEWART, HARLAN joins, dissenting. 27 I affirm judgment, agreeing reasoning expressed thorough conscientious Judge Phillips. 28 posture: Whether 'where tend create monopoly commerce, *.'1 Phrased simply, actions anticompetitive required statute element cause action? 29 Court's description answer no.2 quasi-monopolistic 1961—after alleged predations respondents—Utah still commanding 45.3%, 29.4%, divided equally other, small bakers. Unless disregard lessons laboriously scores cases, situation Thus, assume competition, beneficient. fallen error reading protecting instead can seen unsuccessful attempt distinguish relied respondents.3 Those said inapposite 'no decline structure,' 'lasting prices.' hallmark intensified squarely fallacy today embraces: 32 '* contention hold extraordinary 66.5, attained falls dead weight. To approve maintain approached, amount monopoly, exist proper healthy competition.' 155. 33 monopolistic protected federal antitrust laws effetive therefore respectfully dissent. that: 'Any shall property reason anything forbidden sue therefor district United States defendant resides agent, controversy, recover threefold him sustained, attorney's fee.' injunctive relief parties laws. portion provides: 'That unlawful indirectly, discriminate commodities purchases commerce discrimination, Respondent counterclaim certain sales. directed verdict submission trial judge motion notwithstanding verdict. reversed counterclaim, remanded trial. No order allowing certiorari requested counsel brief discuss oral argument, questions petition, following questions: '1. Whether, affirms directing District Rule 50(c)(2) Federal Rules Civil Procedure days respondents? '2. him, compatible 50(b) interpreted Cone v. West Virginia Pulp & Paper Co., 330 212 (67 752, 91 L.Ed. 849); Globe Liquor Co. Roman, 332 571 (68 246, 92 177); Weade Dichmann, Wright Pugh, 337 801 (69 1326, 93 1704)? '3. 50(d) authority respondents?' light disposition reach questions. Spokane, buyer 'Sonny Boy' discussed herein refer flavor objection adhere practice here. volumes follows: Carnation......................... 20,067 8.8 Continental....................... 18,799.5 8.3 Pie..........................102,690 45.3 Pet............................... 66,786 29.4 Others............................ 18,565.5 8.2 Total............................ 100.0 Pet-Safeway contract, January 1, obligated organization purchase minimum 1,000,000 (six case) year. orally thereafter production formal contract. All way 2(b) assigns burden. 'Upon proof being made, hearing section, services facilities furnished, rebutting prima-facie thus made showing section 13(b). F.T.C. Morton 334 37, 44—45, 68 822, 827, 1196; Borden 370 460, 467, 82 1309, 1313, 627. cited requiring illegally discriminatory. incorporated unprepared contractual obligation differentials legally dispositive justified. cost-justification figures drawn past performance, crediting accompanying differences, bring umbrella least, free inadequately accounted 12.3% context particularly since influenced depressing overall 'there likely among area.' R., 1355. (Emphasis supplied.) dangers recognized Moore Mead's Fine Bread 348 115, 75 148, 99 145, violative 2(a). Subsequently, decisions primary-line-competition emphasize unreasonably defendants.' Anheuser-Busch, Inc., 363 536, 548, 80 1267, 1274, 1385. Balian Ice Cream Arden Farms Cir., 231 356, 369; Maryland F.T.C., 243 716; Atlas Building Prod. Diamond Block Gravel 269 950; Inc. 289 835. latter went far suggest 'If projection (to ascertain future discrimination) based predatoriness buccaneering, forecast adverse occur. event, incipiency prescribed establish If engages type activity, probability inferred willful misconduct lessen, destroy F.2d, 843. Hughes related 'knowledge actual aid interpretation facts prediction consequences.' Appalachian Coals, States, 288 344, 372, 53 471, 478, 77 825, unreasonable follow lead. Although regard obvious, seller's economic circumstances, include persistent unprofitable drastic cuts themselves Rowe, Discrimination Under 141—150 (1962), commenting statement supra, 'a tends (predatory) intent.' U.S., 552, S.Ct., 1276. Ben Hur Coal Wells, 242 481, 486, 368, inferential value intent. n. 12, supra. argued displayed fierce instincts. Actual fall category, neither, viewed radical fair game cutting proscriptions. 'The nullified merely existing involved.' 52 1679, 1689, aff'd, 716. competitor's 91.3%, yet Trade Commission impressed argument terminate argues Commission, found, compels affirmance holding. rely readily distinguishable. 835, 839, defendant's discriminations, nor lethal victim purpose.' Id., 842. 339 953, Commission's want interstate connection, lasting single, isolated incidet proved. Absence due International Milling CCH Reg.Rep.Transfer Binder, 1963—1965, 16,494, 16,648. Uarco, 16,807, long-term decline. Similar failure absence costs evident Quaker Oats 17,134. Dean Reg.Rep. 17,357, generally 13(a). ante, p. 691, 7. 703, 15.

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