Document: 546 U.S. 164 (2006) VOLVO TRUCKS NORTH AMERICA, INC. v. REEDERSIMCO GMC, No. 04-905. Supreme Court of United States. Argued October 31, 2005. Decided January 10, 2006. *168 Roy T. Englert, Jr., argued the cause for petitioner. With him on briefs were Donald J. Russell, Max Huffman, and David L. Williams. Deputy Solicitor General Hungar States as amicus curiae urging reversal. brief Clement, Assistant Attorney Pate, Delrahim, Jonathan Marcus, Catherine G. O'Sullivan, Seidman. Carter Phillips respondent. Richard D. Bernstein, Stephen B. Kinnaird, Joe Byars, Jr.[*] *169 JUSTICE GINSBURG delivered opinion Court. This case concerns specially ordered productsheavy-duty trucks supplied by Volvo Trucks North America, Inc. (Volvo), sold franchised dealers through a competitive bidding process. In this process, retail customer states its specifications invites bids, generally from different manufacturers. Only when dealer's bid proves successful does dealer arrange to purchase trucks, which then builds meet customer's specifications. Reeder-Simco (Reeder), located in Fort Smith, Arkansas, commenced suit against alleging that Reeder's sales profits declined because offered other more favorable price concessions than those Reeder. Reeder sought redress alleged losses under § 2 Clayton Act, 38 Stat. 730, amended Robinson-Patman Price Discrimination 49 1526, 15 U.S.C. 13 (Robinson-Patman Act or Act), Arkansas Franchise Practices Ark. Code Ann. 4-72-201 et seq. (2001). prevailed at trial appeal both claims. We granted review federal claim resolve question whether manufacturer offering wholesale prices may be held liable discrimination proscribed Robinson-Patman, absent showing discriminated between contemporaneously competing resell same customer. While state law designed protect franchisees provide, has provided, remedy exposed conduct kind alleged, we hold, not reach presents. The centrally addresses cases involving competition purchasers *170 resale purchased product. Competition character ordinarily is involved product subject special order customer-specific I manufactures heavy-duty trucks. sells new used including 374 F.3d 701, 704 (CA8 2004). became an authorized 1995, pursuant five-year franchise agreement provided automatic one-year extensions if met objectives set Volvo. Ibid. Volvo's describes specific requirements bids several it selects. "decision request particular allow controlled such factors existing relationship, geography, reputation, cold calling marketing strategies initiated individual dealers." Id., 719 (Hansen, J., concurring part dissenting part). Once receives specifications, turns requests discount "concession" off (set 80% published price). 704. It common practice industry manufacturers offer discounts their dealers. Ibid.; App. 334, 337. decides case-by-case basis and, so, what rate will be, taking account industry-wide demand has, historically, brand 348-349, 333-334.[1] uses preparing *171 bid; purchases only accepts bid. was one many dealers, each assigned geographic territory. territory encompassed ten counties two Oklahoma. F.3d, 709. Although nothing prohibits outside territory, ibid., rarely another dealer, see id., 705; 5 02-2462 (CA8), pp. 1621-1622 (hereinafter C. A. App.). atypical event solicited stated policy provide concession head sale. 4 1161-1162; 1619, 1621. 1997, announced program called "Volvo Vision," company addressed problems faced market heavy among them, company's assessment had too projected enlarging size dealers' markets reducing number 146 75. 705. Coincidentally, learned given greater typically received, "Reeder came suspect eliminate." filed February 2000, attributable violation Act. At trial, vice-president, William E. Heck, acknowledged equal contract, but he contended "was executed." 1162. presented evidence concerning instances over course dealership 705, 708-709. One sale *172 Tommy Davidson Trucking. 1267-1268. initially 17%, Volvo, unprompted, increased 18.1% then, week later, 18.9%, match 1268-1272. Neither won 1272. instance Hiland Dairy, Southwest Missouri Truck Center. 1626-1627. Per written policy, concession, selected Missouri, previously After selecting insisted prior general increase prices; obliged increasing discount. 1627. See also 1483-1488; 720 dominantly relied comparisons non-Volvo with accorded similarly sales. compared received four occasions successfully (and thus trucks), connection processes did participate. 705-706. unsuccessfully therefore who gained contracts 706-707. testified look larger although "quite possible" occurred. 1462. Nor endeavor determine any statistical *173 analysis disfavored average 1462-1464. jury found there reasonable possibility discriminatory pricing have harmed truck injured 480-486. further damages exceeded $1.3 million. 486.[2] District summarily denied motion judgment matter alternative remittitur, awarded treble claim, entered judgment. A divided Appeals Eighth Circuit affirmed. appeals court noted that, "as threshold matter[,] show [that] `purchaser' within meaning [Act]," 708, i. e., "there actual prices[,] . [Reeder] dealer," 707-708. Rejecting contention situations do give rise claims 708-709, observed "more unsuccessful bidder," "actually following contracts," concluded, sufficed render purchaser next determined could reasonably decide "in competition" favored "[A]s time differential imposed," reasoned, "the *174 competed functional level market." (quoting Best Brands Beverage, Falstaff Brewing Corp., 842 F.2d 578, 585 (CA2 1987)). properly find proved injury discrimination. Specifically, pointed (1) intended reduce dealers; (2) lost Dairy dealer; (3) would earned profits, received; (4) period time. 711-712. affirmed award 712-714. Judge Hansen dissented claim. "Traditional [Robinson-Patman Act] cases," observed, "involve sellers carry inventory deal fungible goods." 718. majority, commented, "attempt[ed] fit square peg into round hole," extended Act's marketplace where "special-order products are individual, pre-identified customers after bidding," ibid. There opportunity potential sales, noted, "[o]nce begins, relevant becomes limited needs demands end user, handful ultimate sale." 719. Violation Hansen's view, predicated identified purchaser, no between" purchases. "Without proof requisite made, cannot *175 demonstrate injury." certiorari, 544 903 (2005), question: May secondary-line absence customer? Satisfied erred answering affirmative, reverse Circuit's II Section 2, "when originally enacted 1914, born desire Congress curb use financially powerful corporations localized price-cutting tactics gravely impaired position sellers." FTC Anheuser-Busch, Inc., 363 536, 543, n. 6 (1960) (citing H. R. Rep. 627, 63d Cong., 2d Sess., 8 (1914); S. 698, 2-4 (1914)). Augmenting provision 1936 target perceived harm occasioned buyers, rather sellers; specifically, responded advent large chainstores, enterprises clout obtain lower goods smaller buyers demand. 14 Hovenkamp, Antitrust Law ¶ 2302, p. 11 (2d ed. 2006) Hovenkamp); P. Areeda & Kaplow, Analysis 602, 908-909 (5th 1997) Areeda). provides, part: "It shall unlawful person engaged commerce. discriminate commodities like grade quality, effect substantially lessen tend create monopoly line commerce, injure, destroy, prevent either grants knowingly *176 benefit discrimination, them...." 13(a). Pursuant private plaintiff recover threefold sustained result 15(a); Truett Payne Co. Chrysler Motors 451 557, 562 (1981). Mindful purposes antitrust laws generally, explained "ban all differences charged quality," Brooke Group Ltd. Brown Williamson Tobacco 509 209, 220 (1993) (internal quotation marks omitted); rather, proscribes "price extent threatens injure competition," Our decisions describe three categories claim: primary line, secondary tertiary line. Primary-line entail conductmost conspicuously, predatory pricingthat injures discriminating seller direct competitors. See, e. g., 220-222; Hovenkamp 2301a, 4-6. Secondary-line cases, one, involve seller's (here, dealerships); category refer "favored" "disfavored" purchasers. ibid.; Texaco Hasbrouck, 496 558, (1990). Tertiary-line purchaser's customers. 601e, 907. To establish complains, made interstate commerce; "like quality"; "discriminate[d] trucks; advantage *177 "receive[d] discrimination." undisputed satisfied first second requirements. States, curiae, maintain satisfy third fourth requirements, differentially priced transaction "purchaser" hallmark injury, our indicate, diversion purchaser. Sun Oil Co., 371 505, 518-519 (1963) (evidence showed patronage shifted dealers); Falls City Industries, Vanco 460 428, 437-438, (1983) (complaint "supported diverted sales"). recognized permissible inference arise competitor significant reduction substantial Morton Salt 334 37, 49-51 (1948); U.S., 435. Absent however, required III falls categories: (purchase-to-purchase comparisons); (offer-to-purchase *178 (head-to-head comparisons). concluded demonstrated "at 709 Brands, F. 2d, 585). As it, selective targeted Both purchase-to-purchase offer-to-purchase fall short, none discrete compete beneficiaries even attempt consistently vis-à-vis simply paired Customer incidents tied systematic study separated seven months. 706, 710. decline permit mix-and-match, manipulable quality. Tr. Oral Arg. 34-35, 55. No similar risk manipulation occurs kin chainstore paradigm. Here, comparable independent department storeat least, insufficient support For know, Reeder, occasion, might gotten better comparisons. supra, 172. broad area. initial stage, *179 affected pricing; process here issue approaches been submit bid, earlier based variety factors, existence vel non relationship bidder customer, reputation. 170.[3] reiterate regard observation Hansen, holding: chosen solicit That area import they fact customer-tailored sum, fail "competitors," hence injury. 435 (inference arises "proof time" (emphasis added)). B dealer. 171-172. When multiple business win thereafter supplier's fulfill *180 contractual commitment. Because "prohibits `between purchasers,'" Brief Petitioner 26 13(a); emphasis added), argue, characterized special-order opposed inventory. 27; Amicus Curiae 9, 17-20. need today. Assuming applies head-to-head transactions, rare salelet alone substantial. 1 ABA Law, Developments 478-479 2002) ("No permitted substantial." (collecting cases)). loss 12 generated $30,000 gross concession. ultimately identified, 17% neither existed all, magnitude affect IV Interbrand competition, opinions affirm, "primary concern law." Continental V., GTE Sylvania 433 36, 51-52, 19 (1977). signals departure *181 main concern. Even text construed manner urged embraced Appeals, resist interpretation geared protection competitors stimulation competition.[4] before us, possesses power, allegedly little resemblance stores chain operations, discounting fosters suppliers brands. 51-52 (observing impact vertical practice, change distribution system, "simultaneous intrabrand interbrand competition"). By declining extend Robinson-Patman's governance continue construe "consistently broader policies laws." Group, Great Atlantic Pacific Tea FTC, 440 69, 80, (1979)); Automatic Canteen America 346 61, 63 (1953) (cautioning constructions "extend beyond prohibitions doing help uniformity rigidity open conflict legislation").[5] *182 * reasons stated, reversed, remanded proceedings consistent opinion. so ordered. STEVENS, whom THOMAS joins, dissenting. Franchised sell automobiles, farm equipment, washing machines, expensive items, routinely engage negotiations prospective Sometimes prospect simultaneously negotiating sometimes representing manufacturer, still times familiar options available negotiate Until today, prohibition discrimination[1] protected ability situations. Today, adopting novel, transaction-specific concept eliminates statutory thoserare Setting aside moment involves *183 stocked inventory, ordinary suit. Respondent Act; parties submitted good conflicting jury; judge instructed jurors elements damages; returned verdict resolving issues favor. error instructions sufficiency evidence. 701 Two bear mention. First, challenge jury's finding theory cut back deemed expendable. avoid possible violations agreements laws, chose accomplish goal worse regional introduced theory. explicit strategy, known "fewer markets." 34. afford lose squeezed out, since boom years late 1990's left about orders fill. 256-257. And frequently gave On least occasions, significantly higher buying around time.[2] example, spring 1998 20 9% Texas 12.3% 132-134. paying $2,606 per truck. 134. chides *184 failing perform analyses, ante, 172-173, 178, clearly sufficient infer secret catalog listing low "A" "B" exception providing Second, these players conclusion implicit instruction element prove "a difference defendant requires dealer(s) draw away plaintiff." 480, Instruction 18. dispute operated market.[3] restraint wise, unsurprisingly mobile, throughout region, *185 decades, juries inferred retailer rule dates discussion Justice Black's 37 (1948): findings respondent's caused competition. injuries resulted discounts, statute require Commission actually resulted. prohibited discriminations `may competition.' careful consideration said `the must "may" effect.' Corn Products Federal Trade Comm'n, 324 726, 742. Here appear obvious, opportunities certain merchants pay respondent pay. adequate." 45-47 (footnote omitted). treated single, 436 (1983); cf. Tampa Elec. Nashville Coal 365 320, 327 (1961). Under approachuncontroversial until todayReeder *186 readily prevail. ample just obvious described Salt. nonetheless argues occurred never seeking separate market, defined asked bids. "competitors" making Accordingly, suffered (relative dealers) discriminatorily high price. Unlike Court, accept vision. Nothing precedent suggests "competition" evaluated inquiry, approach makes sense. us ignore continuing war waged series wholly events. Each managed prices, forced profit margins pass costs (who well go time). long indicated relative proper permitting inference. (noting overcome inference, "evidence breaking causal profits" ignoring commonsense points, *187 gives short shrift prophylactic intent. 13(a) (barring added)); also, Salt, 46. appears hold can suffer injury.[4] unclear holding inventories, excludes virtually effective event, faithful text. recognizes, primarily small retailers vigorous afforded chainstores volume Whether mission represented sound economic merely serious debate, merit Bork's characterization "wholly mistaken theory."[5] suggest disagreement played conscious role my colleagues' unprecedented decision avoid, identifying irony refusing adhere credited *188 employed means escaping commitments eliminating specifically firms market. exceptional quality provides strong reason enforce evaluation (with happen agree) completely accurate. respectfully dissent. NOTES [*] Briefs amici reversal American Petroleum Institute Carolyn Corwin, Harry M. Ng, Douglas W. Morris; National Electrical Manufacturers Association Clark Silcox; al. Michael Halfenger; Washington Legal Foundation Daniel Popeo Price. affirmance Automobile Dealers Paul Norman Cetrangolo; Equipment Wayne Mack. [1] shield manufacturers, keeps confidential precise method calculating 704-705 2004); 337-338. [2] $513,750 state-law respecting trained design eliminate 171. [3] reputation securing concessions, recognize, influence invitations. Cf. post, 183, 2. pursue point here, presentor forevidence while 172-173. [4] dissent assails Post, 183. But bar restructuring networks improve efficiency operations. If honor obligations franchisee, "[a]ny lies addressing unfair rights franchisees, Act." 28. [5] 2333c, 109 (commenting expansive "views guarantee made," thereby exposes unless "charge uniform dealers"). them." amended, Additionally, deals Arguably due stingy failed close ended up Similarly, despite extensive evidentiary record, 170-173, supporting Indeed, argument "purchaser," 179-180, meets Court's approval, apply context. Any fails complete drives requirement, completes price, (as majority sees it) purchase. Bork, Paradox 382 (1978).

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