Mead's Fine Bread Co. v. Moore

• Decision Date: 16 January 1954
• Docket Number: No. 4615.,4615.
• Citation: 208 F.2d 777
• Parties: MEAD'S FINE BREAD CO. v. MOORE.
• Court: U.S. Court of Appeals — Tenth Circuit

208 F.2d 777 (1953)

MEAD'S FINE BREAD CO. v. MOORE.

No. 4615.

United States Court of Appeals Tenth Circuit.

December 11, 1953.

Rehearing Denied January 16, 1954.

Edward W. Napier, Lubbock, Tex. (Howard F. Houk, Santa Fe, N. M., was with him on the brief), for appellant.

Dee C. Blythe and Lynell G. Skarda, Clovis, N. M., for appellee.

Before PHILLIPS, Chief Judge, and MURRAH and PICKETT, Circuit Judges.

MURRAH, Circuit Judge.

This is an appeal from a verdict and judgment in favor of the plaintiff-appellee in an action for treble damages under the Robinson-Patman Amendment to the Clayton Act, 15 U.S.C.A. §§ 13(a), 13a and 15. When the case was first here, Moore v. Mead Service Co., 10 Cir., 184 F.2d 338, on appeal from a judgment of the trial court dismissing the action, we affirmed on the ground that the suit was precluded by the plaintiff's own illegal acts which initiated the alleged price discrimination. On certiorari to the Supreme Court, the case was vacated for reconsideration in the light of Kiefer-Stewart Co. v. Joseph E. Seagram & Sons, Inc., 340 U.S. 211, 71 S.Ct. 259, 95 L.Ed. 219, in which it was held that an action under Section 15 of the anti-trust laws was not precluded by the claimant's infractions.

On further consideration, we receded from our former position, and looking at the facts of record, pointed out that by selling its products through outlets across the state line in Texas, Mead was engaged in interstate commerce, and by selling bread in Santa Rosa, New Mexico, below cost, it discriminated against its competitor plaintiff-appellee. Price discrimination and interstate commerce having been shown, we left open the question whether the effect of such discrimination might tend to substantially lessen competition or create a monopoly in any line of commerce, or injure, destroy or prevent competition with Mead or its customers. The case was accordingly reversed and remanded for the determination of that fact. See Moore v. Mead Service Co., 10 Cir., 190 F.2d 540. But in leaving the case to the undetermined facts, we did not thereby intend to hold or imply that the mere fact of interstate commerce and local price discrimination, standing alone, made out a prima facie case for the plaintiff. Indeed, on first consideration, doubt was expressed whether the purely local price-cutting war had any actionable effect or impact upon interstate commerce. See 10 Cir., 184 F.2d 338, 340.

Recognizing the necessity of proof on this crucial issue, the trial court charged the jury, substantially in the language of the statute, that it was incumbent upon the plaintiff to establish by a preponderance of the evidence that the defendant, while engaged in interstate commerce, and in the course of such commerce, either directly or indirectly, discriminated in price between different purchasers of its products, sold for use, consumption or resale in Santa Rosa, and that the effect of such discrimination might substantially lessen competition or tend to create a monopoly in such line of commerce, see Section 2(a) of the Clayton Act, as amended, 49 Stat. 1526, 15 U.S.C.A. § 13(a); or that the defendant, while engaged in interstate commerce, and in the course of such commerce, sold goods at Santa Rosa, at prices lower than those exacted by defendant elsewhere in the United States for the purpose of destroying competition or eliminating a competitor in Santa Rosa, or to sell goods at unreasonably low prices for the purpose of destroying competition or eliminating a competitor. Section 3, 49 Stat. 1528, 15 U.S.C.A. § 13a. It was on these pertinent instructions that the jury found for the plaintiff and assessed his damages at $19,000, which the trial court tripled and entered judgment accordingly, together with attorney fees in the sum of $11,400.

The first of the statutory instructions is the embodiment of the now accepted view that purely local transactions in the form of price fixing or discrimination come within the ban of the anti-trust laws, when such transactions may have the effect of interfering with the free flow of competitive trade and commerce. Swift & Co. v. U. S., 196 U.S. 375, 25 S.Ct. 276, 49 S.Ct. 518; Shreveport Rate Cases, Houston, E. & W. T. R. Co. v. U. S., 234 U.S. 342, 34 S.Ct. 833, 58 L.Ed. 1341; Wickard v. Filburn, 317 U.S. 111, 63 S.Ct. 82, 87 L.Ed. 122; Mandeville Island Farms v. American Crystal Sugar Co., 334 U.S. 219, 68 S.Ct. 996, 92 L.Ed. 1328. The latter part of the court's instructions in the disjunctive is the embodiment of the equally accepted complementary view that interstate commerce powers, when exerted to their fullest under the anti-trust laws, forbid the utilization of interstate commerce for the purpose of monopolizing local trade or business, whether through price fixing or other discriminatory practices. Stevens Co. v. Foster & Kleiser Co., 311 U.S. 255, 61 S.Ct. 210, 85 L.Ed. 173; Lorain Journal Co. v. United States, 342 U.S. 143, 72 S.Ct. 181, 96 L.Ed. 162; United States v. Griffith, 334 U.S. 100, 68 S.Ct. 941, 92 L.Ed. 1236; Standard Oil Co. v. Federal Trade Commission, 340 U.S. 231, 71 S.Ct. 240, 95 L.Ed. 239. Local price fixing or discrimination is within the anti-trust laws if the means adopted for its accomplishment reach beyond the boundaries of one state. United States v. Frankfort Distilleries, Inc., 324 U.S. 293, 65 S.Ct. 661, 89 L.Ed. 951. And, since the design of the Robinson-Patman Amendment was to pinpoint protection of the anti-trust laws "to the competitor victimized by the discrimination", the victim may maintain an action for damages without showing that the competitive injury was general in its scope and effect. Federal Trade Commission v. Morton Salt Co., 334 U.S. 37, 49, 68 S. Ct. 822, 830, 92 L.Ed. 1196; Corn Products Refining Co. v. Federal Trade Commission, 324 U.S. 726, 65 S.Ct. 961, 89 L.Ed. 1320. But, whether the claim is asserted under the Sherman Act, 15 U. S.C.A. §§ 1-7, 15 note, or the Clayton Act, as amended, 15 U.S.C.A. § 12 et seq., the wrongs complained of must involve interstate commerce, either in "effect" or "purpose", for obviously, the acts can have no greater potency than the commerce clause itself.

Local conduct which is separable and unrelated to interstate commerce is necessarily insulated from the operation of the anti-trust laws,...