Court Opinion

ID: 9705545
Source: CourtListenerOpinion
Date Created: 2023-08-26 01:11:10.00822+00
Date Added: 2024-06-11T15:24:34.237896
License: Public Domain

STEPHEN N. LIMBAUGH, JR., Judge,
dissenting.
I respectfully dissent.
Section 416.615.2 states that it is illegal to sell motor fuel below cost if “... 2) the intent or effect of the sale or offer is to induce the purchase of other merchandise, to unfairly divert trade from a competitor, or otherwise to injure a competitor.” Although the General Assembly did not define the phrase “or otherwise to injure a competitor,” it is clearly a catchall provision. Thus, any sale of motor fuel below costs that injures a competitor in any way other than by “inducting] the purchase of other merchandise” or by “unfairly diverting] trade from a competitor” is also unlawful under the act.
What, then, is an injury to a competitor? This is the focus of the majority opinion, which correctly begins its analysis by noting that a competitor of QuikTrip has two choices when QuikTrip posts lower fuel *41prices: 1) to resist lowering its prices; or 2) to lower its prices. In my view, both choices injure the competitor. If a competitor resists lowering its prices, it will be injured by losing business to QuikTrip, which is a claim that falls under the clause “to unfairly divert trade.” On the other hand, if a competitor lowers its prices in response to QuikTrip, the competitor will lose profits and in that way is otherwise injured. In this case, it is undisputed that QuikTrip’s competitors have routinely and immediately reduced their own fuel prices to correspond to QuikTrip’s below cost pricing, and I would hold that each corresponding reduction is sufficient proof of injury.
As I understand the majority opinion, the clause “or otherwise injure a competitor” can only be invoked where a competitor is forced to lower its fuel price below its own costs so that “the competitor is in effect forced to operate its over-all business at a loss.” This interpretation is based not on the plain meaning of the word “injure,” but the majority’s own policy determination that if “injure” were broadly interpreted, the statute could “greatly diminish or eliminate the competition in the sale of motor fuel and, thus, create a state-enforced cartel of motor fuel sellers.” If we are to consider policy, however, the real policy behind the Act, as this Court noted in Ports Petroleum Co. of Ohio v. Nixon, 37 S.W.3d 237, 241 (Mo. banc 2001), is to prevent predatory pricing, which otherwise would drive competitors from the market and allow the formation of monopolies, which results in higher prices in the long run. Conversely, the majority policy analysis would encourage price wars among competitors, which only result in lower prices in the short run.
In any event, I would base the opinion on the fact that the clause “or otherwise injure a competitor” is all-inclusive and necessarily addresses all injuries suffered, to whatever extent. As such, the clause covers not only those instances where a competitor is forced to lower its fuel prices below its own costs, but also those instances where a competitor is forced to lower its fuel prices to any degree. Even where a competitor lowers its prices to a level that does not fall below its own costs, there still is an injury due to a reduction in profits.
That said, I agree that not every below cost sale violates the Act. For example, if, as the majority asserts, prices were publicly posted only to the nearest one-tenth of a cent per gallon, then price reductions below one-tenth of a cent per gallon do not injure a competitor because there is no need for the competitor to make a corresponding reduction in price. In this case, however, the record does not clearly indicate which of the 23 below cost prices in question were posted to one-tenth of a cent per gallon or more. For that reason, I, too, would reverse the judgment, but only to remand for further fact-findings.