430 F.2d 568 (5th Cir. 1970), 28278, Jones v. Borden Co.

Docket Nº:28278.
Citation:430 F.2d 568
Party Name:Tilden A. JONES, Plaintiff-Appellant, v. The BORDEN COMPANY, Defendant-Appellee.
Case Date:July 15, 1970
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

Page 568

430 F.2d 568 (5th Cir. 1970)

Tilden A. JONES, Plaintiff-Appellant,


The BORDEN COMPANY, Defendant-Appellee.

No. 28278.

United States Court of Appeals, Fifth Circuit.

July 15, 1970

Page 569

W. R. Barnes, James M. O'Leary, Jr., Shafer, Gilliland, Davis, Bunton & McCollum, Odessa, Tex., for appellant.

F. H. Pannill, W. B. Browder, Jr., Midland, Tex., H. Blair White, J. A. Greaves, W. N. Braun, Chicago, Ill., for appellee; Stubbeman, McRae, Sealy & McLaughlin, Midland, Tex., Sidley & Austin, Chicago, Ill., of counsel.

Before WISDOM, GOLDBERG and INGRAHAM, Circuit Judges.

WISDOM, Circuit Judge:

Summary judgments in antitrust cases often are unadvisable. White Motor Company v. United States, 1963, 372 U.S. 253, 259, 83 S.Ct. 696, 700, 9 L.Ed.2d 738, 744. But in this treble damage action for price discrimination and exclusive dealing arrangements under the Robinson-Patman Act, the Borden Company has established by deposition and affidavit the nonexistence of exclusive dealing arrangements and the § 2(b) defense of meeting competition in good faith to the price discrimination charge. The plaintiff has not responded with affidavits and depositions or taken other steps to create any 'genuine issue as to any material fact', Rule 56(c), Fed.R.Civ.P., and the record reveals no such issues. 'When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If he does not so respond, summary judgment, if appropriate, shall be entered against him.' Rule 56(e), Fed.R.Civ.P.


Tilden A. Jones bought a milk distributing business in Odessa, Texas, September 25, 1967. In this business he purchased milk products from Metzger Dairies and distributed and sold them to retailers. During 1967-68 eight dairies sold milk products in the Odessa area. In addition, two groups of stores-- Safeway and 7-Eleven-- had their own plants. But Jones's main competition was Borden, serving Odessa from its Midland plant through company-owned routes rather than a distributorship. The chief products in this market were homogenized milk and low-fat or '2% Milk', both sold by the half-gallon. The market

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was known as a 'twenty percent market'-- that is, the grocer generally received as his profit a twenty percent discount from the retail price.

These dairy products are distributed at a small profit per item. A distributor therefore must maintain a large volume of business to succeed. The amount of display space a grocer allows the distributor is of great importance because consumers tend to purchase the brand with the largest display.

Jones alleges that Borden paid discriminatory discounts or rebates to five main groups of retail outlets in Odessa and that it discriminatorily charged a lower price to one group of retail outlets by selling it a private label milk. As a result, these grocers allegedly enlarged Borden's display space at Jones's expense. Furthermore, Jones alleges that Borden sold milk to two groups of stores on the condition that they not deal in Metzger products.

By May 2, 1968, Jones's business was failing. He turned the distributorship over to one of its previous owners who operated it for a month longer, then finally shut it down completely. 1 Now Jones seeks treble damages for the loss of sales and the loss of his investment in the distributorship. He accuses Borden of violating the Clayton Act as amended by the Robinson-Patman Act, 15 U.S.C. § 13(a) & (c). 2

Borden responds that its discounting activities had no adverse effect on competition, 3 did not cause Jones's injury, 4 and, in any event, were protected by the § 2(b) defense that

nothing herein contained shall prevent a seller rebutting the prima-facie case (of price discrimination) thus made by showing that his lower price * * * to any purchaser or purchasers was made in good faith to meet an equally low price of a competitor, or the services

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or facilities furnished by a competitor.

15 U.S.C. § 13(b). The exclusive dealing arrangements Borden denies outright.

On all these grounds, after the taking of depositions and the filing of affidavits, the district court granted Borden's motion for summary judgment. We agree with the district court that there is no 'genuine issue as to any material fact' establishing the absence of exclusive dealing arrangements. Since we also find no 'genuine issue as to any material fact' establishing the 2(b) defense, we affirm the judgment without reaching the other issues whether Borden's activities had any substantial anti-competitive or monopolistic effect and whether Jones's injuries were caused by Borden or by Metzger's and his predecessor's activities.


A. Exclusive Dealing Arrangements.

Jones's contention, as taken from his brief on appeal, is as follows:

Prior to September 25, 1967, Borden loaned money to the owners of several retail stores in Ector County including three Tradeway stores. Payments were still being...

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