United States Supreme Court Cases & Opinions

U.S. Supreme Court

FTC v. Simplicity Pattern Co., Inc., 360 U.S. 55 (1959)

Federal Trade Commission v. Simplicity Pattern Co., Inc.

No. 406

Argued April 21, 1959

Decided June 8, 1959*

360 U.S. 55

Syllabus

In this case, the Federal Trade Commission found that one of the Nation's largest manufacturers of dress patterns discriminated in favor of its larger customers by furnishing to them services and facilities not accorded to competing smaller customers on proportionally equal terms, in violation of § 2(e) of the Clayton Act, as amended by the Robinson-Patman Act, and it ordered the manufacturer to cease and desist from doing so.

Held: the Commission's order is sustained. Pp. 360 U. S. 56-71.

(a) Though the manufacturer's larger customers sold the patterns for a profit, while its smaller customers sold them as an accommodation to purchasers of their fabrics, and no specific injury to competition in patterns was shown, the record justified the Commission's finding that they were competitors. Pp. 360 U. S. 62-64.

(b) Given competition between the two classes of customers, neither absence of competitive injury nor the presence of "cost justification" is available as a defense to a charge of violating § 2(e) of the Act. Pp. 360 U. S. 64-71.

103 U.S.App.D.C. 373, 258 F.2d 673, affirmed in part and reversed m part.

Page 360 U. S. 56