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The Third Circuit Clarifies the Robinson-Patman Act’s “Competing Purchaser” Requirement

On January 25, 2010 by Schnader

The Third Circuit recently reversed a district court’s judgment in favor of a plaintiff under the federal price discrimination statute, the Robinson-Patman Act (RPA), 15 U.S.C. § 13, concluding that the RPA does not apply where any competition between the plaintiff and the purportedly favored purchaser occurred before the allegedly discriminatory sale by the manufacturer took place. Feesers, Inc. v. Michael Foods, Inc., Nos. 09-2548, 09-2952, 09-2993, Slip. Op. at 6 (3d Cir. Jan. 7, 2010). This decision continues the trend in the Third Circuit and other jurisdictions of limiting the RPA to the situations it was “originally intended to target,” in which dealers first “purchase products from manufacturers and then compete with other” dealers in the resale of those products. Slip Op. at 29-30. According to the Third Circuit in Feesers, the RPA was never intended to apply in the very different context of bid markets, “where a product subject to special order is sold through a customer specific bidding process.” Slip Op. at 33. In this setting, while two dealers may compete with one another when submitting their respective bids to the same customer, no purchase actually takes place until after a particular bid has been accepted. By that point, the dealers by definition are no longer competing for the same customer and therefore are not “competing purchasers” for purposes of the RPA. Id.

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