Theres more to life than just work let the aba help balance your personal life with tips on wellness, relationships, worklife balance, and. To avoid costly penalties under rp, managers take a variety. The robinsonpatman act prohibits a seller of commodities from selling comparable goods to different buyers at different prices, except in certain. Like much other new deal legislation, the principal purpose of the robinsonpatman act the act was protectionist.
It was designed to protect small retail shops against competition from chain stores by. The bottomline message is that the robinson patman act is a fact of life that companies must be mindful of in making pricing decisions. The sixth and seventh circuits provide practical robinson. The robinson patman act protects inefficient competitors rather than consumers. Congress in 1936 to supplement the clayton antitrust act. The robinsonpatman act was passed in 1936 to close what was perceived as a major loophole in the original clayton acts prohibition on price discrimination. Predatory pricing the danger of penalizing competitive conduct cutting prices in order to increase business often is the very essence of competition. The possibility of a suit brought under robinsonpatman increases the costs of efficient competitors. This article examines a number of these courts interpretations of the in commerce subelement, along with influential scholarship. This standard document should be used by a sales person who has been. The robinson patman act the act or law, the antitrust law prohibiting price discrimination, has long been a source of confusion and a target of criticism by courts, commentators, and practitioners. The robinson patman act of 1936, also called the antiprice discrimination act, made it illegal for companies to engage in price discrimination.
The robinsonpatman act was not the first or the last act to try to eliminate price discrimination. The robinsonpatman act is an amendment to the 1914 clayton antitrust act and is. The avenue to discounts for nonprofit hospital pharmacies. The robinson patman act of 1936 or antiprice discrimination act, pub. The robinsonpatman act of 1936 made it illegal for companies to engage in certain behavior. The price discrimination provisions of the robinsonpatman act. The vote was taken during the amcs most recent session, held last week. Fully the robinsonpatman price discrimination act, an american federal statute which attempts to restrict ways in which price discounting can be used to stifle competition details. The supreme court has ruled that price discrimination claims under the robinsonpatman act should be evaluated consistent with broader antitrust policies. Via express mail and email university of north texas. But the technicalities of the robinsonpatman act are not. Robinsonpatman act legal definition of robinsonpatman act. The robinsonpatman actalso called the antiprice discrimination actwas passed in 1936 to respond to the perceived unfairness of manufacturers that sold products at cheaper prices to chain stores, thereby creating a disadvantage to the chains singlestore competitors in a given town. Comments regarding the robinson patman act ladies and gentlemen.
Robinson patman act passed in 1936, it aims to prevent businesses from selling the same product to different people at different prices price discrimination. The act specifically limits price discrimination and it is an amendment to the clayton antitrust act, which was the first law. Congress passed both of these acts in an effort to follow up on the sherman antitrust act. Robinsonpatman act rpa case and added to the longstanding history of judicial criticism of the rpa. Over a period of years the plaintiff had purchased many auto. National test date at an act test site within the united states, us territories, or puerto rico. The act, advanced by congressman wright patman, prohibited any person or firm engaged in interstate commerce to discriminate in price to different purchasers of the same commodity when the effect would be to lessen competition or to create a monopoly.
Robinson patman act also known as the robinson patman antidiscrimination act and as the robinson patman price discrimination act june 19, 1936, ch. The robinsonpatman act is an amendment to the clayton act, which outlaws price discrimination that might substantially lessen competition or tends to create a monopoly. The robinsonpatman act is part of the antitrust legislation of the clayton act of 1914. However, because the rpa is generally regarded as being inconsistent with the anti. The decision refers to the robinson patman act but was decided under the federal trade commission act and the clayton act. See saferstein, an overview and update of the federal and state law of price discrimination, 2012 pli antitrust. The robinson patman act is an amendment to the 1914 clayton antitrust act and is supposed to prevent unfair. The act prohibits sellers from charging different prices to different buyers for identical products when the. The possibility of a suit brought under robinson patman increases the costs of efficient competitors.
Section 2a says that it is unlawful to discriminate in price where the effect is to injure, destroy, or prevent competition with any person who. The robinsonpatman act the act or law, the antitrust law prohibiting price discrimination, has long been a source of confusion and a target of criticism by courts, commentators, and practitioners. Pdf the robinsonpatman act rp, an antitrust statute aimed at protecting small businesses, limits price. Out of these and other bills developed the present law known as the robinsonpatman antidiscrimination act, which was approved june 19, 1936, section 2 of the clayton antitrust act as amended by the robinsonpatman antidiscrimination act of 1936, when analyzed in the light of tho. The act prohibits sellers from charging different prices to different buyers for identical products when the effect might be injurious to competition.
The sherman act, clayton act, and robinsonpatman act were created to promote. The robinsonpatman act and vertical relationships yonezawa. Rpamall summary of robinsonpatman act rpa decisions. The usual clayton act standard for measuring injury applies to robinsonpatman violationsthat is, a violation occurs when the effect may be substantially to lessen competition or tend to create a monopoly in any line of commerce. Short title act june 19, 1936, which amended this section and added sections a, b, and 21a of this title, is popularly known as the robinsonpatman act, as the robinsonpatman antidiscrimination act, and also as the robinsonpatman price discrimination act. Comments regarding the robinsonpatman act ladies and gentlemen. Our identity as lawyers is something very precious to us, yet it is no substitute for our identity as a human being in social connection to others. Discriminatory pricing and the robinsonpatman act every crs. The robinsonpatman act of 1936, also called the antiprice discrimination act, made it illegal for companies to engage in price discrimination. Out of these and other bills developed the present law known as the robinson patman antidiscrimination act, which was approved june 19, 1936, section 2 of the clayton antitrust act as amended by the robinson patman antidiscrimination act of 1936, when analyzed in the light of tho.
The decision refers to the robinsonpatman act but was decided under the federal trade commission act and the clayton act. In practice, robinsonpatman claims must meet several specific legal tests. On behalf of the section of antitrust law of the american bar association, i am pleased to submit the enclosed comments to the antitrust modernization commission in response its request for public comments regarding the robinson patman act. Chapter 7 practice test multiple choice identify the choice that best completes the statement or answers the question. The robinson patman act rp, an antitrust statute aimed at protecting small businesses, limits price setting in distribution channels. Hampton member of the california bar the three basic affirmative defenses to charges of violations of the robinsonpatman act 1 are the changing conditions defense, the cost justification defense, and the meeting competition defense. The robinsonpatman act and vertical relationships request pdf.
The act, advanced by congressman wright patman, prohibited any person or firm engaged in interstate commerce to discriminate in price to different purchasers of the same commodity when the effect would be to lessen. The bottomline message is that the robinsonpatman act is a fact of life that companies must be mindful of in making pricing decisions. The sherman act, clayton act, and robinson patman act were created to promote. Price discrimination is a practice where a company. The robinsonpatman act protects inefficient competitors rather than consumers.
Then it offers an alternative, practical teststaying faithful to the statutory textfor determining whether a plaintiff has satisfied the. The robinson patman act seeks to prevent unfair price discrimination by ensuring that sellers offer the same price terms to customers at a given level of trade. The robinsonpatman act of 1936 is a united states federal law that prohibits anticompetitive. The robinsonpatman act and consumer welfare seattle. Meeting competitionby practical law antitrust related content maintained usa nationalfederala standard document to be used to provide evidence that a seller attempted to verify a competitors lower price legally if it is ever subject to a price discrimination claim under the robinsonpatman act. The ronbinsonpatman act robinsonpatman antitrust law.
In 1936, section 2 of the clayton act was amended by the robinson. It was designed to protect small retail shops against competition from chain stores by fixing a minimum price for retail products. In fact, the robinsonpatman act is historically referred to as the antichainstore act. Its immediate predecessor was the clayton antitrust act of 1914. The clayton antitrust act 1914 was the first american federal statute to express prohibit certain forms of price discrimination. Robinsonpatman act definition, price discrimination. Steele the 1936 robinson patman amendment to the clayton act was conceived in an atmosphere of hostility to the chain stores which supposedly received discriminatory prices not available to their small competitors. In fact, the robinson patman act is historically referred to as the antichainstore act. The act provides specific circumstances where price discrimination violates federal antitrust law, and allows private parties who were injured by illegal price discrimination to pursue litigation. Resolving the conflict between the sherman act and the.
The robinson patman act1 bans price discrimination,2 or more precisely, differential pricing. Unlike any other antitrust statute, the robinsonpatman act can be violated. There is no direct legislative equivalent to the us robinsonpatman act in ec law. Market concentration market power ssnip test relevant market merger control anticompetitive. The act applies to commodities, but not to services, and to purchases, but not to leases. Introduction the robinsonpatman act is the black sheep of antitrust. Robinson patman act law and legal definition uslegal, inc. In practice, robinson patman claims must meet several specific legal tests. The robinsonpatman act has given rise to some truly awful court decisions that have created a sellerbuyer environment of sometimes unforgiving price rigidity, as well as complex and difficulttocomplywith principles about when and to whom sellers must offer price discounts and nonprice promotions. The robinsonpatman act rp, an antitrust statute aimed at protecting small businesses, limits price setting in distribution channels. The robinson patman act of 1936 made it illegal for companies to engage in certain behavior.
The robinson patman act is an amendment to the clayton act, which outlaws price discrimination that might substantially lessen competition or tends to create a monopoly. A brief outline of the legislative history of the robinsonpatman and. Following volvo, both courts sensibly applied the robinsonpatman act in ways that recognized actual competitive conditions in the industry at issue and refused to stretch the robinsonpatman act to impose liability on a supplier when such liability would not promote competitionand, indeed, when using the robinsonpatman act to condemn the. Procedures may differ slightly if you take a different administration of the act test.
Despite the fact that the robinsonpatman act is the most detailed of major antitrust laws, the interpretation of that act has led to an enormous body of decisional law about the nuances of the act. Even though some practice tests are old dating as far back as 2005, the format of the act hasnt changed much since then except for the introduction of a redesigned writing section in 2015, so youre basically still taking the same test from more than a decade ago. Below are all six currently available pdfs for official act tests. The robinsonpatman act1 bans price discrimination,2 or more precisely, differential pricing. The robinsonpatman act is the black sheep of antitrust. Robinsonpatman act and consumer welfare did not address the issue again until thirteen years later when it decided volvo trucks north america, inc. The exchange of price information has in many cases been held to. So maybe the robinsonpatman act isnt dead after all. Low prices benefit consumers regardless of how those prices are set. A federal law passed in 1936 to outlaw price discrimination. This exception allows a seller in good faith to meet the equally low price, service, or facility of a competitor. Robinson patman act rpa case and added to the longstanding history of judicial criticism of the rpa.
View enhanced pdf access article on wiley online library html view. Not an rpa decision, but very important nevertheless 112097 in re brand name prescription drugs antitrust litigation, 1997 u. Woodmans alleged that the refusal to sell the large packs was a violation of the robinsonpatman act. Robinson patman act the robinson patman act was passed by the u. Introduction to the robinsonpatman act federal trade commission. The supreme court has ruled that price discrimination claims under the robinson patman act should be evaluated consistent with broader antitrust policies. The judiciary committee on march 31, 1936, reported out an amended patman bill, accompanied by an adverse minority report. Hampton member of the california bar the three basic affirmative defenses to charges of violations of the robinson patman act 1 are the changing conditions defense, the cost justification defense, and the meeting competition defense. To violate the robinsonpatman act, the sellers price discrimination must have an anticompetitive effect.
L i l i n %lujii1 uviix iliiicii act interpretationwhether the act applies to a competitive bidding. On test day report on time for national test dates, you must report to your assigned test site by the time stated on your paper ticket usually 8. Even the supreme court has acknowledged that the law by no means represents an exemplar of legislative clarity. The robinson patman act of 1936 was a result of this public outcry against the chain store. Steele the 1936 robinsonpatman amendment to the clayton act was conceived in an atmosphere of hostility to the chain stores which supposedly received discriminatory prices not available to their small competitors. Robinsonpatman act also known as the robinsonpatman antidiscrimination act and as the robinsonpatman price discrimination act june 19, 1936, ch. The rationale for this act and the enforcement of the. The more specific test measures the impact on particular persons affected. On behalf of the section of antitrust law of the american bar association, i am pleased to submit the enclosed comments to the antitrust modernization commission in response its request for public comments regarding the robinsonpatman act. But because the robinson patman act has a more specific test of competitive injury, the general standard is rarely cited. The robinsonpatman act of 1936 was a result of this public outcry against the chain store.
The robinsonpatman act, passed in 1936 as an amendment to the clayton. The robinsonpatman act of 1936, also referred to as the antiprice discrimination act, is a part of united states federal law that prohibits producers of products from participating in anticompetitive practices. Clayton acts will precede this examination in order to. Recent changes to the ftcs robinsonpatman act guidance.
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