Document: 387 U.S. 244 87 S.Ct. 1622 18 L.Ed.2d 749 FEDERAL TRADE COMMISSION, Petitioner,v.UNIVERSAL-RUNDLE CORPORATION. No. 101. Argued March 13, 1967. Decided May 29, Robert S. Rifkind, New York City, for petitioner. Frank C. McAleer, Chicago, Ill., respondent. Mr. Chief Justice WARREN delivered the opinion of Court. 1 The question presented by this case is whether Court Appeals exceeded its authority as a reviewing court postponing operation Federal Trade Commission cease-and-desist order against respondent until an investigation should be made alleged industry-wide violations price discrimination provisions Clayton Act, § 2, 38 Stat. 730, amended Robinson-Patman 49 1526, 15 U.S.C. 13. 2 Respondent Universal-Rundle produces full line china and cast-iron plumbing fixtures which it sells to customers located throughout United States. In 1960, issued complaint charging that more than three years Universal-Rundle's sales some these had been 'at substantially higher prices at such products like grade quality other purchasers, whom are engaged in competition with less favored purchasers resale products.' effect discriminations, alleged, 'may lessen competition' violation 2(a) amended. answer, denied essential allegations complaint, and, addition, asserted affirmative defenses differentials may have existed were cost justified or 'in good faith meet competition.' 3 After evidentiary hearings, no effort sustain defenses, found during 1957 offered 'truckload discounts' averaging approximately 10% all customers. Because could not afford purchase truckload quantities, thus unable avail themselves discounts, held offering discounts constituted within meaning Since who able quantities take advantage concluded anticompetitive proscribed 2(a).1 Accordingly, ordered refrain from: 4 'Discriminating selling 'Universal-Rundle' brand manufactured * any purchaser those granted purchaser, where competes fact unfavored distribution 5 At time four was pending did offer information competitors' princing practices suggest proceedings might appropriate. But one month after issuance order, petitioned stay sufficient 'to investigate institute whatever deemed appropriate correct practice fixture manufacturers granting inpr ices on shipments.' support petition, submitted affidavits documents tending show: (1) principal competitors 18%; (2) share Plumbing market, exclusive Sears, Roebuck Co., 5.75% whereas five leading manufacturing concerns enjoyed market shares 6 3i%;2 (3) each reported profits preceding two sustained substantial losses years. affidavit marketing vice president declared belief quantities.' further averred: 'That based upon his knowledge competitive conditions industry, if permitted sell differential respondent's under 'U/R' will decreased lost competitors, continue shipments. And he (that) Company suffer financial must sole manufacturer cease desist.' unanimous decision denying petition stay, general allegation basis instituting withholding enforcement order. Noting appeared premised contention per se illegal, wrote, 'There nothing our contention, nor does desist entered absolutely prohibit from discounts.' While result discriminations having effects, 'the necessarily illegal indicated petition.' case, determined: 7 'Whether discount creates difference, recipient competing same functional level customer paying price, buying itself discount, shown exist requisite effects.'3 8 'Moreover,' incurred prior cause hardship.'4 9 Following denial instituted review Seventh Circuit. Without reaching merits set aside below Commission's rma nded instructions conduct industry investigation. 352 F.2d 831 (1965). conceded Moog Industries v. Commission, 355 411, 78 377, 370 (1958), discretionary determination refuse 'should overturned absence patent abuse discretion.' U.S., 414, 380. considered demonstrate refusal grant requested discretion. premises conclusion briefly restated: '(i)t apparent,' wrote reference offering, 'that has directed attack prevalent industry'; would lead 'sacrifice' 'smallest participants' industry; consequently, approval sanctions contrary purposes Act since giants field real benefactors—not public.' 10 supra, we forth principles govern action taken below: postpone 'depends variety factors peculiarly expert understanding Commission.' 413, 379. Thus, 'although allegedly appear operative appearances reflect fact' call(s) administrative agency.' Ibid. determinations require specialized experienced judgment they cannot courts Consequently, court's inquiry evidence adduced tends establish certain facts, practices; rather, limited determining evaluation merit patently arbitrary capricious. 11 Viewed light principles, reversed. so inconclusive said evidence, consequent Indeed, even improper de novo findings formed Appeals' decision. only because corporation sold group while simultaneously another nonfavored group. tend show effect, there industry. Similarly, unsupported speculation pecuniary provide finding 'sacrificed' injury. It follows failed Act. 12 We note petitoner succeeded demonstrating price-discrimination identical own, injury, obliged withhold As stated Industries, 379: 13 'It clearly special competence appraise adverse particular prohibiting continued law. Furthermore, alone empowered develop policy best calculated achieve ends contemplated Congress allocate available funds personnel way execute efficiently economically.' 14 On hand, also indicates, unbridled power arbitrarily destroy many law violators This case. reasonable stay; scope overthrow determination. reverse below, remand consistent opinion.5 ordered. Judgment reversed, aside, remanded. Reg. Rep., 1963—1965 Transfer Binder, 16,948. According were: Percent American Radiator & Standard Sanitary Corp.. 32 Kohler Co...................... Eljer Division Murray Corp. America Crane Co........................ Briggs Manufacturing Co......... Rheem Co.......... noted 'even prima facie Section established, seller interpose statutory justify discrimination.' 16,998, 22,070. informed parties staff relevant effects competitors. Apparently relying ruled own pendency Department antitrust relieve responsibility. post-proceeding properly before record here, do reach, reached, questions necessitated additional unnecessary

Category: 8