Document: 334 U.S. 37 68 S.Ct. 822 92 L.Ed. 1196 FEDERAL TRADE COMMISSIONv.MORTON SALT CO. No. 464. Argued March 10, 1948. Decided May 3, [Syllabus from pages 37-39 intentionally omitted] Mr. Robert L. Stern, of Washington, D.C., for petitioner. Lloyd M. McBride, Chicago, Ill., respondent. Justice BLACK delivered the opinion Court. 1 The Federal Trade Commission, after a hearing, found that respondent, which manufacturers and sells table salt in interstate commerce, had discriminated price between different purchasers like grades qualities, concluded such discriminations were violation § 2 Clayton Act, 38 Stat. 730, as amended by Robinson-Patman 49 1526, 15 U.S.C. 13, U.S.C.A. 13.1 It accordingly issued cease desist order. 39 F.T.C. 35.2 Upon petition respondent Circuit Court Appeals, with one judge dissenting, set aside Commission's findings order, directed Commission to dismiss its complaint against denied cross enforcement 7 Cir., 162 F.2d 949. Court's judgment rested on construction holding crucial either not supported evidence or contrary evidence, conclusion order was too broad. Since questions importance administration Act presented, we granted certiorari. 332 850, 355. Disposition these requires only brief narration facts. Respondent several brands salt3 them directly (1) wholesalers jobbers, who turn resell retail trade, (2) large retailers, including chain store retailers. finest brand salt, known Blue Label, what it terms standard quantity discount system available all customers. Under this pay cost both wholesale differs according quantities bought. These prices are follows, making allowance rebates discounts: 3 Only five coma nies have ever bought sufficient respondent's obtain $1.35 per case price. companies could buy because they operate chains stores various parts country.4 As result low been able sell Label at cheaper than reasonably same independently operated stores, many whom competed local outlets stores. 4 Respondent's salts, other also sold under differing slightly used selling Label. Sales less-than-carload lots made list plus freight plant destination. Carload approximately 5 cent discount; 10 is much $50,000 worth any consecutive twelve-month period. discounts salts enjoyed certain retailers refused. In addition discounts, special allowances favored customers denied.5 6 First. basic contention, argues hinges upon, 'standard equal terms, contrasted example, hidden rebates, allowances, discriminatory, within meaning Act.' Theoretically, equally all, but functionally not. For record indicates (if reference point necessary) no single independent grocery store, probably wholesaler, 50,000 cases year. Furthermore, shows that, while enjoying more some their competitors purchases small qualify even those based carload shipments. legislative history makes abundantly clear Congress considered be an evil buyer secure competitive advantage over solely buyer's purchasing ability. passed deprive advantages except extent lower justified reason seller's diminished costs due manufacture, delivery sale, h e good faith effort meet competitor's Section original included proviso nothing contained should prevent 'discrimination * account differences grade, quality, commodity sold, difference transportation *.' That section has construed permitting here, without regard amount actual savings attributable sales deliveries. Goodyear Tire & Rubber Co. v. Comm., 101 620. House Committee Report Act's allowing so weakened 'as render inadequate, if almost nullity.'6 present amendment 'of great importance.' Its purpose limit 'the use differentials sphere differences. Otherwise,' report continued, 'such would become instruments favor privilege weapons oppression.'7 Senate reporting bill emphasized purpose,8 did Congressman charge Conference when explaining just before final passage.9 And furtherance avowed purpose-to protect competition full savings-that 2(a) provided 'That herein shall make resulting methods commodities delivered.' 8 foregoing references, others mentioned, establish discriminatory prohibited whenever defined effect competition. See Comm. Staley Co., 324 746, 751, 65 971, 973, 89 1338. 9 Second. Government interprets Appeals having held price' burden prove savings.10 does understand decision, furthermore admits rests Commission. We agree First, general rule statutory proving justification exemption exception prohibitions statute generally claims benefits,11 undertake proof 2(a). Secondly, 2(b) specifically imposes showing upon shown prices. committee explained provisos throw 'upon benefit exceptions falls them.'12 think language cited, show meant using words involving injury need seller charged purchaser higher goods he purchaser's competitors.13 This consistent first sentence unlawful 'to discriminate commodt ies grade where involved discrimination commerce may injure, destroy, person grants knowingly receives discrimination, Third. argued fail fact caused There specific injuries resulted although require find actually resulted. 'may substantially lessen competition.' After careful consideration provision said must harmed competition, there reasonable possibility 'may' effect.' Corn Products 726, 742, 961, 969, 1320.14 Here appear obvious, opportunities merchants injured pay. adequate. 11 Fourth. urged inadequate support competition.15 pointed out, however, authorized bar 'reasonable possibility' competing competition.16 u rchasers influence resale evidence. itself adequate appropriate destroy 12 adequacy possible singled out attacks here. suggested considering treated alike. argument obvious saving delivers lots. Assuming true, tend disprove merchant compelled ten-cent differential injure him competitively name. However relevant separate might question justifying savings, relevancy determining whether works competitor. seen fit give classification cannot do so. Such others, can proves his cost. trouble phase thus far failed proof. 13 very comparison total volume business17 reject finding discount. To argument, item most businesses consumers' budgets. reasons accept contention. 14 articles separately, comparatively merchant's stock. intended discrimn atory particular constituted major minor portion consists articles, way effectively grocer applying each individual article store. enacting especially concerned protecting unable quantities, here purchased end undertook strengthen old Act. reports belief 'been restrictive requiring conditions new provision, controlling, justify 'injury competitor victimized discrimination.'18 handicapped established thereby lessened 16 Apprehension expressed continued violations lead raise purchasers. conceivable, though, think, highly improbable contingency, afford us upsetting declining direct compliance Congress. 17 went further receiving requires. heard testimony witnesses country suffered financial losses Experts offered tendency covers about two thousand pages, largely devoted issue-injury greatly handicap effective believe self-evident, namely, adversely affected practice producers our adequately 18 Fifth. held, contends, sweeping, required 'conduct business peril,' exceeded jurisdc tion entering order.19 Reliance contention chiefly National Labor Relations Board Express Publishing 312 426, 61 693, 85 930. broadly enjoin provisions merely found. Id., 435, 436 U.S., 699, 700 But Board, 'Having acts constitute unfair labor free restrain related acts.' applied similar Beech Nut 257 441, 455, 42 150, 155, 66 307, 19 A.L.R. 882. latter approved restraint price-fixing practices found, 'any equivalent co-operative means accomplishing maintenance fixed company.' Dep't. Stores 326 376, 392, 393, 203, 213, 90 145. save (a) (b) later considered, aimed pricing unlawful, therefore run counter case. Certainly relation circumstances designed violations, threat future indicated similarity (Commission) committed (respondent) past.' supra, 436, 437, page 700. restraints paragraphs identical, applies charges part paragraphs, preceding provisos, absolutely regardless salt. respondents continuously engaged through allowances. corresponding costs. Thus imposed precise number years. True, prohibit exact mathematical percentages previously utilz ed Had done despite simply altering applied. Paragraphs up approved. 20 difficult problem. They read: 'Provided, less cents lessen, among (retailers).' clause second qualifying clause, unequivocally permit maintain retailers.20 challenge it, standing alone, raised. seriously objects qualifies permissive less-than-five-cent clause. qualification permits 'not points tends it. 'The Commission,' urges, 'must given injures then leave entirely alone.' Whether, circumstances, any, themselves decide, taken action forbids noninjurious differentials. objections raised clauses consideration. 21 One entrusting primarily body experts, authorize hear concerning basis orders definitely restraining justification. insofar entrusts impaired, if, compelling present, shift courts subsequent contempt proceedings etc., determine responsibility courts, once lapse time court approval, §§ 21, 45, adjudicate order's violation, valid 22 Whether exempt decide. exempted constrained hold differentials, trying issues competitio, entrusted 23 leaves objection paragraph (c) reads: 'By products retailer whose compete retailer.' criticism bars wholesaler retailer. authorizes them.' plainly supports 24 sustain out. important limitation opportunity reconsider entire light rejection clauses, refashion deemed necessary. case, conclude Royal Milling et al., 288 212, 218, 53 335, 337, 77 706. 25 reversed remanded disposed conformity opinion. 26 Reversed. 27 JACKSON, FRANKFURTER joins, dissenting part. 28 While I opinion, significant feature, interpretation will sanction prohibition 'if effect' wit: (Emphasis supplied.) law written always interpreted probability effect. difference, every lawyer knows, unimportant decisive. 29 rarely judgments mere possibilities. has, least three times late 1945, refused interpret laws doing 1922, Standard Fashion Magrane-Houston 258 346, 356, 360, 362, 653, unanimous Court, construing said: 'But word consequences described. agreements disclosed create monopoly.' 30 1930, International Shoe Company 280 291, 298, 50 89, 91, 74 431, respect identical 18: '* act deals acquisitions lessening substantial degree, 357, (362,) 653 Stone wrote justices (280 306, 94): 'Nor am say McElwain straits preclude inference continue 653.' 31 With interpretations books passed. 32 When came carefully Chief Stone, concurrence members disagreement noted point, wrote: 'It observed adverse reach 'in incipiency,' harm effected. enough prescribed Cf. 356-357, 653. prohibiting tying agreements, competition,' consequences, Refining 738, 967, 1320. 33 true (324 969) uses now quoted part1 phrase appears form context irreconcilable earlier complete statement, above, inconsistency fair reader inadvertencies into judges sometimes fall. authority thrice-rejected prevailing one. know instance administrative drastic regulation hand slender thread inference. 34 overtones hostility translated fatal sees attack. strike down coupled absolute subservience judicial experience, cf. Securities Exchange Chenery Corp., 194, 67 1575, review promise ear broken hope. nutshell, chooses enacted uniformly stated until today. 35 itself, relates seems me, face history, strive results, kept mind interpreting 36 On hand, recognizes utilized arbitrarily effected sales, buyers ones. prohibit. reason, call living wide availability low-priced mass production distribution, hence whatever economies transactions may, indeed should, line consumer. disposition pretty sanctions obliteration foster condemn. illustrate my discuss involved-two lump together treat exactly alike, me facts quite inferences lot discount, quota purchase 5,000 period get rebate periods additional application schedule distribution illustrated Company's exhibits, find: 4,000 54 receive practice, larger four organizations. allowed customer apparent handling purchases, depends surely influenced lowered reflect 40 warrant prima facie unless Company, best knows why how arrived possesses data costs, comes forward agree, too, results effects 41 Even stricter test probability, warranted discounts. probable inevitable fifteen-cent net merchants, accelerates trend former towards extinction monopoly. However, problem presented pool shipment pick orders, matter small, company warehouses maintained ten cities. 1/10 1% carload-lot 43 seem fairly draw Indeed, proportion price, consumer's budget farfetched affected. Hence, handling, fall condemnation statute. incidence determined 44 forbidden differential. power prescribe prices, eliminated. Unless impossible, self-interest dictate abolish base rather universally applicable. 99.9% position elimination 45 gives withheld obviously impose greater reduce few ultimately size. 46 types purposes conclusions Accordingly, below sets provides course indirectly, use, consumption, United States Territory thereof District Columbia insular possession place jurisdiction States, monopoly modified own motion. controversy modified. produces kinds trade relate American Tea Kroger Grocery Safeway Stores, Inc., Great Atlantic Pacific Company. customer, received 1/2 Salt. $1.42 $1.50 competitors, discriminatory. nevertheless ground little supporting separately treated. H.Rep.No.2287, 74th Cong., 2d Sess. 7. Id. 9. Sen.Rep.No.1502, 4-6. 80 Cong.Rec. 9417. Ill.L.Rev. 556-561; U. Chi.L.Rev. 384-391; 60 Harv.L.Rev. 1167-1169. Javierre Central Altagracia, 217 502, 507, 508, 598, 599, 859 cited. 3. 3599, 8241, 9418. Moss 148 378, 379, price,' sellers. Cement Institute 333 683, 793. read following statement discussing 2(a), 14: 967; see Lexington Mill 232 399, 411, 340, 58 658, L.R.A.1915B, 774. Reports Congressional debate indicate broader scope note infra. discriminations, stated: finds described denied.' outlaws them: introduced exhibits one-tenth figure one-year obtained lumping statistics along products, tablets, coarse rock soda. proceeding figures dubious value. limited Chicago area, whereas carried nation-wide business. proposed Judiciary 'This represents recommended referred your committee. exclude otherwise harmless letter, accomplishes broadening restrictive, concerned; immediately concern discrimination. injuries, fact, result, catch weed seed keep coming flower.' S.Rep. No.1502, 4. 8; were: '(a) By sale products; provided, wholesalers. '(b) '(c) 'For comparison, term 'price' takes sale.' relating five-cent was: 'Salt staple medium turnover margin profit commodities. Consequently, offers usually loss well, placed purchase.' text reference, is: 'As said, permissible infer said,' refers 'probability' particularly absence citation reference.

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