Enterprise Industries v. Texas Company
| Decision Date | 07 January 1957 |
| Docket Number | Docket 24045.,No. 21,21 |
| Citation | 240 F.2d 457 |
| Parties | ENTERPRISE INDUSTRIES, Inc., Plaintiff-Appellee, v. The TEXAS COMPANY, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Second Circuit |
Milton Handler, New York City, Day, Berry & Howard, Hartford, Conn., Oscar John Dorwin, Amzy B. Steed, New York City, W. Robert Hartigan, Hartford, Conn., Abram J. Chayes, Washington, D. C., Stanley D. Robinson, New York City, of counsel, for appellant.
Wallace R. Burke, Hartford, Conn., Samuel Steinberg, John J. Daly, Hartford, Conn., of counsel, for appellee.
Before HAND, MEDINA and LUMBARD, Circuit Judges.
The defendant appeals from a judgment for the plaintiff in an action tried to a judge, awarding treble damages suffered by the defendant's violation of the Robinson-Patman Act, § 13(a), Title 15 U.S.C.A. The plaintiff was a corporation, operating a gasoline "filling station" in the town of Wethersfield, Connecticut, on the right hand side, going south, of the main highway from Boston to New York, a short distance south of the boundary of Hartford. During the period in suit it was a lessee of this station from the defendant at a rent that for the purposes of this action may be taken as two cents for every gallon of gasoline sold. It is not uncommon in the industry for a filling station to start what has come to be known as a "gas war"; that is, to cut the prevailing price of gasoline, which other competing stations must meet by a corresponding cut in order to keep up their sales; and that makes it important, if indeed not necessary, for the producing companies to reduce their price to their own competing stations. In the neighborhood of the city of Hartford between November 1950 and February 1952, two such "wars" occurred: the first lasted from November 1950 to July 1951; the second from November 1951 to February 1952. In each period the defendant by a rebate or allowance reduced its selling price to its tributary stations enough to enable them to meet a price cut, and yet to keep a net margin to each of two cents.
During a price war different prices prevail in different areas, dependent apparently upon the relative advantage of position of the stations. Moreover, as it was the defendant's practice not to underbid the prices of other producers, it imposed as a condition upon any allowance or rebate that its stations should not undercut the prevailing price for other brands. Thus it followed that, although the defendant cut its price enough to allow Texaco stations to meet the reduction, its price to a station, which like the plaintiff's was in an area of higher prices, was higher than its price to Texaco stations in areas of lower prices. This was the discrimination of which the plaintiff complained, for it alleged that a greater allowance was extended to Texaco stations that were in competition with itself.
The larger part of the plaintiff's sales were to cars coming from points east of Hartford and bound south; and, as there were no stations of any kind for about forty miles to the east on the main highway, the plaintiff enjoyed as to this through traffic an important advantage. On the other hand Judge Smith found that there were nine Texaco stations so situated that they did compete with the plaintiff for local sales, by which he meant sales to cars of workmen and others that commuted back and forth from Hartford, in some cases for a distance of twenty miles or more. Such buyers were advised of the prices posted by the different stations as they passed, and would select the lowest. This finding the defendant challenges as "clearly erroneous" because the testimony was not definite that these stations did compete with the plaintiff, but at most proved no more than that there might be such competition.
However, even though we were to agree that the finding was right, and that for that reason the plaintiff had proved its claim for relief, we do not think that it proved the amount of its damages, or indeed that it suffered any damages at all. The wrong was in selling gasoline to the nine Texaco competitors at a lower price than to the plaintiff; and a distinction should be made at the outset between the first "gas war" — November 1, 1950 to July 1951 — and the second — November 1951 to February 1952. During the second the plaintiff refused to accept any allowance or rebate and in consequence was free to charge what it could get for gasoline. The equation measuring its loss in that period may therefore be stated as follows. The gross loss was the profit on any sales that it would have made to the nine competitors' customers whom it could and would, have retained, had it been able to buy from the defendant at the same price as the competitors. From this must, however, be deducted what added profit it may have got by being free to charge what it chose, particularly in the through traffic where there was little competition. Moreover, we have no reliable figures from which to appraise either the gross loss or the gain, for the plaintiff has not shown how much of the business of the nine Texaco competitors it would have retained or obtained at the same price as they; and equally we do not know what would have been its profit on the south bound through traffic if it had sold at the prevailing prices.
So much, therefore, for the second "war." During the first the plaintiff...
To continue reading
Request your trial
-
Berkey Photo, Inc. v. Eastman Kodak Co.
...prices on comparable products." (Tr. 18865).30 The theory was thought to be allowable under the authority of Enterprise Industries, Inc. v. The Texas Co., 240 F.2d 457 (2d Cir.), cert. denied, 353 U.S. 965, 77 S.Ct. 1049, 1 L.Ed.2d 914 (1957). Adhering to that position, the court finds the ......
-
Exxon Corporation v. Governor of Maryland Shell Oil Company v. Governor of Maryland Continental Oil Company v. Governor of Maryland Gulf Oil Corporation v. Governor of Maryland Ashland Oil, Inc v. Governor of Maryland
...have reached conflicting results. Compare Enterprise Industries v. Texas Co., 136 F.Supp. 420 (Conn.1955), rev'd on other grounds, 240 F.2d 457 (CA2 1957), cert. denied, 353 U.S. 965, 77 S.Ct. 1049, 1 L.Ed.2d 914, with Bargain Car Wash, Inc. v. Standard Oil Co. (Indiana), 466 F.2d 1163 (CA7......
-
Atlantic City Electric Company v. General Electric Company
...to show that the passing-on doctrine is "the universal rule under the antitrust laws."23 Thus, defendants cite Enterprise Industries, Inc. v. Texas Co., 240 F.2d 457 (2 Cir.), cert. denied, 353 U.S. 965, 77 S.Ct. 1049, 1 L.Ed.2d 914 (1957), in which the Court of Appeals for this Circuit app......
-
Edward J. Sweeney & Sons, Inc. v. Texaco, Inc.
...Supreme Court Term—1977, 77 Colum.L.Rev. 979, 993 (1977). Texaco has therefore taken the position that Enterprise Industries, Inc. v. Texas Co., 240 F.2d 457 (2d Cir.), cert. denied, 353 U.S. 965, 77 S.Ct. 1049, 1 L.Ed.2d 914 (1957), not Fowler, defines the measure of damages applicable to ......
-
Table of Cases
...500 F. Supp. 2d 437 (D.N.J. 2007), 72 Energy Capital Corp. v. United States, 302 F.3d 1314 (2002), 118 Enterprise Indus. v. Tex. Co., 240 F.2d 457 (2d Cir. 1957), 310 Ethylene Propylene Diene Monomer (EPDM) Antitrust Litig., In re , 256 F.R.D. 82 (D. Conn. 2009), 230 Ethypharm S.A. France v......
-
Proof of Robinson-Patman Act Damages
...988 (8th Cir. 1945). 8. See, e.g. , Edward J. Sweeney & Sons v. Texaco, Inc., 637 F.2d 105 (3d Cir. 1980); Enterprise Indus. v. Tex. Co., 240 F.2d 457 (2d Cir. 1957). 9. 451 U.S. 557 (1981). 10. Id. at 568. 11. Id. should be irrelevant. 12 The Supreme Court disagreed, thus resolving the spl......