Corn Products Refining Co. v. FTC
324 U.S. 726 (1945)

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U.S. Supreme Court

Corn Products Refining Co. v. FTC, 324 U.S. 726 (1945)

Corn Products Refining Co. v. Federal Trade Commission

No. 680

Argued February 28, March 1, 1945

Decided April 23, 1945

324 U.S. 726

Syllabus

1. By petitioners' basing-point system of pricing in their sales of glucose, their product was sold at delivered prices computed by adding to a base price at Chicago the published freight tariff from Chicago to the delivery points, even though deliveries were in fact made from their Kansas City factory as well as from their Chicago factory. On shipments from Kansas City, the delivered price to the purchaser thus depended not only on the base price plus the actual freight from Kansas City, but also upon the difference between the actual freight paid and the freight rate from Chicago.

Held:

(A) The price discriminations resulting from petitioners' basing-point system violated § 2(a) of the Clayton Act, as amended. Pp. 324 U. S. 732, 324 U. S. 737.

(a) It is immaterial that there was no discrimination between buyers at the same points of delivery. P. 324 U. S. 734.

(b) There is nothing in the legislative history of the Clayton Act or the amendatory Robinson-Patman Act which confines their application to discriminations between buyers at the same destination. P. 324 U. S. 734.

(c) The contention that basing-point systems were well known prior to the enactment of the Robinson-Patman Act and were considered by Congress to be legal, and that their legality should be sustained in the absence of a clear command to the contrary, is rejected. P. 324 U. S. 734.

(d) Maple Flooring Assn. v. United States,268 U. S. 563, and Cement Manufacturers Assn. v. United States,268 U. S. 588, distinguished. P. 324 U. S. 735.

Page 324 U. S. 727

(B) The findings and the evidence support the Federal Trade Commission's determination that petitioners' discriminations in price have the effect on competition which brings the discriminations within the prohibition of § 2(a) of the Act. P. 324 U. S. 738.

(a) Under § 2(a), discriminations need not in fact have had a "substantially" adverse effect on competition; it is sufficient that they "may" have that effect. P. 324 U. S. 738.

(b) The weight to be attributed to the facts proven or stipulated, and the inferences to be drawn from them, are for the Commission to determine, not the courts. P. 324 U. S. 739.

2. Petitioners also violated § 2(a) of the Clayton Act, as amended, by permitting certain favored customers to secure options for the purchase of glucose, and to take delivery at the former lower prices, for periods longer than those usually permitted to other customers, and by permitting certain tank wagon customers to book orders at the lower prices charged for tank car deliveries and to take deliveries by tank wagon over extended periods of time. P. 324 U. S. 740.

(a) Even assuming that the practices prohibited by § 2(a) are discriminations in price, and not in the terms and conditions of sale other than price, the present discriminations in the terms of sale operated to permit the favored customers to purchase at a lower price than other customers, so that their only practical effect was to establish discriminations in price, precisely the evil at which the statute was aimed. P. 324 U. S. 740.

(b) Section 2(a) applies to indirect as well as direct discriminations in price. P. 324 U. S. 740.

(c) Petitioners failed to sustain the burden of showing that the price discriminations were granted for the purpose of meeting the "equally low" prices of competitors and that they were therefore excepted from the prohibition of § 2(a) of the Clayton Act by the proviso of subsection (b) of § 2 of that Act. P. 324 U. S. 741.

(d) The stipulated facts support the Commission's finding that the practices in question have the effect on competition which brings them within the prohibition of the Act. P. 324 U. S. 741.

3. The price discriminations which resulted from petitioners' allowance of discounts to certain favored purchasers of gluten feed and meal, byproducts of petitioners' refining of corn, and allowance of discounts to certain favored purchasers of starch and starch products, violated § 2(a). P. 324 U. S. 742.

(a) The statute does not require that the discriminations must in fact have harmed competition, but only that there is a reasonable possibility that they "may" have such an effect. P. 324 U. S. 742.

Page 324 U. S. 728

(b) From the evidence, it was permissible for the Commission to infer that these discriminatory allowances were a substantial threat to competition. P. 324 U. S. 742.

4. Petitioners' arrangement with the Curtiss Company for advertising dextrose on terms not proportionally accorded other purchasers violated § 2(e) of the Clayton Act. P. 324 U. S. 743.

(a) The arrangement was made with the Curtiss Company as a "purchaser" within the meaning of the Act. The statute does not require that the discrimination in favor of one purchaser against another shall be provided for in a purchase contract or be required by it. It is enough if the discrimination be made in favor of one who is a purchaser and denied to another purchaser or other purchasers of the commodity. P. 324 U. S. 743.

(b) The Curtiss Company, which purchased dextrose from petitioners and converted it with other ingredients into candy which it sold, was a purchaser of a commodity bought for "resale," after "processing," within the meaning of the Act. P. 324 U. S. 744.

(c) The evidence shows that the discrimination in favor of the Curtiss Company was a discrimination against sales in interstate commerce. P. 324 U. S. 745.

(d) The advertising furnished by petitioners was a service or facility "connected with the processing . . . sale, or offering for sale" of the commodity purchased by the Curtiss Company upon terms not accorded to other purchasers. P. 324 U. S. 745.

144 F.2d 211 affirmed.

Certiorari, 323 U.S. 706, to review a judgment sustaining an order of the Federal Trade Commission.

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