Zenith Radio Corp. v. Matsushita Elec. Ind. Co., Ltd.

• Decision Date: 21 March 1975
• Docket Number: Civ. A. No. 74-2451,74-3247 and M.D.L. No. 189.
• Citation: 402 F. Supp. 244
• Parties: ZENITH RADIO CORPORATION v. MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD., et al. NATIONAL UNION ELECTRIC CORPORATION v. MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD., et al. In re JAPANESE ELECTRONIC PRODUCTS ANTITRUST LITIGATION.
• Court: U.S. District Court — Eastern District of Pennsylvania

402 F. Supp. 244

ZENITH RADIO CORPORATION v. MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD., et al.

NATIONAL UNION ELECTRIC CORPORATION v. MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD., et al.

In re JAPANESE ELECTRONIC PRODUCTS ANTITRUST LITIGATION.

Civ. A. Nos. 74-2451, 74-3247 and M.D.L. No. 189.

United States District Court, E. D. Pennsylvania.

March 21, 1975.

Edwin P. Rome, Blank, Rome, Klaus & Comisky, Philadelphia, Pa., for plaintiffs.

Joshua F. Greenberg, Kaye, Scholer, Fierman, Hays & Handler, New York City, for moving defendants.

OPINION

HIGGINBOTHAM, District Judge.

INTRODUCTION

A. THE NUE CASE, CIVIL ACTION NO. 74-3247.

National Union Electric Corporation commenced this antitrust action against fourteen defendants in the District of New Jersey on December 21, 1970.¹ In its complaint, it alleged violations of the Antidumping Act of 1916, 15 U.S.C. § 72 (Count I); the Wilson Tariff Act, 15 U.S.C. § 8 (Count II); Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 and 2 (Counts III and IV); Section 2(a) of the Clayton Act, as amended by the Robinson-Patman Act, 15 U.S.C. § 13(a) (Count V); and Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45, and Section 1 of the Sherman Act, 15 U.S.C. § 1 (Count VI).

On February 4, 1971, certain of the defendants² in the action filed, inter alia, a motion to dismiss Count V of the NUE complaint on the grounds that it failed to state a claim upon which relief may be granted. The issue was extensively briefed by opposing counsel, and argued by them before the Honorable Robert Shaw later in 1971. Due in large part, however, to the deaths of Judge Shaw and of his successor as judge in this case, the Honorable John J. Kitchen, the issue had not been decided as of November 25, 1974.

B. THE ZENITH CASE, CIVIL ACTION NO. 74-2451.

On September 20, 1974, Zenith filed a similar complaint in this antitrust action, charging twenty-one defendants with violations of §§ 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 and 2 (Counts I and II); § 7 of the Clayton Act, as amended, 15 U.S.C. § 18 (Count III); § 2(a) of the Robinson-Patman Act, 15 U.S.C. § 13(a) (Counts IV and V); the Wilson Tariff Act, 15 U.S.C. § 8 (Count VI); and the Antidumping Act of 1916, 15 U.S.C. § 72 (Count VII).

On October 29, 1974, certain of the defendants moved, pursuant to 28 U.S.C. § 1407, to transfer this action to the District of New Jersey and to consolidate it there for pre-trial purposes with the NUE case.

On November 25, 1974, the Judicial Panel on Multidistrict Litigation rendered its decision, transferring the NUE action to the Eastern District of Pennsylvania in order that its pre-trial proceedings might be consolidated with those in this action. On the same date, this Court, in Pre-trial Order Number 2, directed that defendants file whatever pleadings they intended to file with respect to the complaint herein on or before January 2, 1975.

On January 2, 1975, certain of the defendants herein³ filed, inter alia, a motion to dismiss Count IV of the Zenith complaint for failure to state a claim upon which relief may be granted. Once again, opposing counsel thoroughly briefed the issue, which was then argued before this Court on February 17, 1975.

C. THE INSTANT MOTIONS.

The respective moving defendants seek dismissal of Count V of the NUE complaint and of Count IV of the Zenith complaint on the ground that neither count states a claim upon which relief may be granted. In both counts, plaintiffs seek treble damages and related relief under §§ 4 and 16 of the Clayton Act for defendants' alleged violations of § 2(a) of the Clayton Act of 1914, as amended by the Robinson-Patman Act of 1936, 15 U.S.C. § 13(a). In their respective complaints, plaintiffs allege that defendants have discriminated in price between different purchasers of commodities of like grade and quality by selling television receivers (in the NUE case) and consumer electronic products (in the Zenith case) to purchasers in the United States at prices less than those charged to purchasers of those same commodities in Japan. In their motions to dismiss, defendants argue that this alleged price discrimination does not satisfy the jurisdictional prerequisites of the Act, since the "commodities of like grade and quality" involved in one "leg" of the alleged discrimination are not "sold for use, consumption, or resale within the United States . . ." For reasons that will hereinafter appear, I have concluded that § 2(a) of the Robinson-Patman Act does not reach the transactions alleged by plaintiffs here. Defendants' motions to dismiss Count V of the NUE complaint and Count IV of the Zenith complaint must therefore be granted.

DISCUSSION

Neither the plaintiffs nor the defendants have referred me to any case which applies § 2(a) of the Robinson-Patman Act, 15 U.S.C. § 13(a), to a set of facts similar to those alleged in the NUE and Zenith complaints. Obviously, then, this is a case of first impression. Both plaintiffs and defendants agree that § 2(a) reaches geographical price discriminations and price discriminations in import transactions, and there is ample authority to support their view. See Utah Pie Company v. Continental Baking Co., 386 U.S. 685, 87 S.Ct. 1326, 18 L.Ed.2d 406 (1967) (geographical price discrimination), and the authorities collected in Zenith Memorandum at 5-13 (import transactions). It would appear, however, that in the more than sixty years since the passage of the Clayton Act,⁴ no one until the present plaintiffs has ever prosecuted an action under § 2(a) where the alleged violation involved an import transaction in the United States as one "leg" of the price discrimination and a transaction that occurred wholly within a foreign country as the other.⁵

As always, when a court is called on to construe a statute, it is wise to begin by reading the statute itself. That sound principle of construction is more than usually applicable in the instant case, where no other court has ever attempted to interpret the statute in light of the facts alleged here. In pertinent part, § 2(a) of the Clayton Act of 1914, as amended by the Robinson-Patman Act of 1936, 15 U.S.C. § 13(a), reads as follows:

"It shall be unlawful for any person engaged in commerce, in the course of such commerce, either directly or indirectly, to discriminate in price between different purchasers of commodities of like grade and quality, where either or any of the purchases involved in such discrimination are in commerce, where such commodities are sold for use, consumption, or resale within the United States . . .."

Plaintiffs focus their argument on the clause "where either or any of the purchases involved in such discrimination are in commerce,"⁶ and contend that the jurisdictional prerequisites of the Robinson-Patman Act are satisfied even if only one "leg" of the alleged price discrimination is "in commerce." Defendants stress two different segments of the statutory language: (1) the phrase "to discriminate in price between different purchasers of commodities of like grade and quality;" and (2) the clause "where such commodities are sold for use, consumption, or resale within the United States . . .." They argue that the "commodities" in (2) refer to the "commodities" in (1), and that therefore the commodities involved in both "legs" of the price discrimination must be "sold for use, consumption, or resale within the United States . . .." If they are not, defendants reason, then § 2(a) does not reach the alleged price discrimination.

It is true, as plaintiffs contend, that the Act is perhaps not the most specific statute enshrined in the United States Code. The Supreme Court said as much in Automatic Canteen Co. of America v. F.T.C., 346 U.S. 61, 65, 73 S.Ct. 1017, 1020, 97 L.Ed. 1454 (1953), where it remarked that "precision of expression is not an outstanding characteristic of the Robinson-Patman Act." But even vague and general statutes are susceptible to judicial interpretation. Indeed, the interpretation of such statutes is one of the primary functions courts are called upon to perform. And this statute, while it could be clearer, is nevertheless not as opaque as plaintiffs contend.

In their analysis of the statute, defendants rightly point out that when Congress wished to establish a jurisdictional requirement for the Act which involved only one "leg" of a price discrimination, it did so with unmistakable clarity by using the words "where either or any of the purchases involved . . . are in commerce."⁷ In the immediately following clause, however, Congress did not say "where either or any of the commodities are sold for use, consumption, or resale in the United States." Instead, it said merely "such commodities." Since alternate language was available in the immediately preceding phrase, I can only conclude that this choice of language was both deliberate and significant, and that defendants are correct in their contention that both commodities involved in the alleged price discrimination must be "sold for use, consumption or resale within the United States . . .."

In my judgment, then, the requirement of "use, consumption, or resale within the United States" modifies and limits the more general "in commerce" provision upon which plaintiffs primarily rely. This reading of the statute — which gives effect to, rather than ignores, the "use, consumption, or resale" clause — in no way departs from well-settled rules of statutory construction. "The cardinal principle of statutory construction is to save and not to destroy.' . . . It is our duty `to give effect, if possible, to every clause and word of a statute' . . .." United States v. Menasche, 348 U.S. 528, 538-39, 75 S.Ct. 513, 520, 99 L.Ed. 615 (1955). Accord: Weinberger v. Hynson, Westcott & Dunning, Inc., 412 U.S. 609, 633, 93 S.Ct. 2469, 2485, 37 L.Ed.2d 207 (1973).

In construing the Robinson-Patman Act, the courts have made it clear that the alleged price discrimination...