FTC v. Henry Broch & Co.,
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363 U.S. 166 (1960)
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U.S. Supreme Court
FTC v. Henry Broch & Co., 363 U.S. 166 (1960)
FTC v. Henry Broch & Co.
Argued January 14, 18, 1960
Decided June 6, 1960
363 U.S. 166
In order to meet the bid of a favored buyer, a seller's broker reduced his brokerage commission from 5% to 3%, which was reflected in the seller's reduction of the price of apple concentrate from $1.30 per gallon to $1.25 per gallon; the sale was consummated at that price; and similar concessions were granted on subsequent sales to the same buyer, but not to any other buyer.
Held: the seller's broker violated § 2(c) of the Clayton Act, as amended by the Robinson-Patman Act, which makes it unlawful for "any person" to make any allowance in lieu of "brokerage" to the "other party to such transaction." Pp. 363 U. S. 167-177.
(a) A seller's broker is included within the term "any person" as used in § 2(c). P. 363 U. S. 170.
(b) Such an allowance was not made lawful by the proviso of § 2(a) which exempts from the prohibitions of that section price differentials based on savings in selling costs resulting from differing methods of distribution. Pp. 363 U. S. 170-174.
(c) The fact that the buyer was not aware that its favored price was based in part on a discriminatory reduction in the broker's commission is immaterial. Pp. 363 U. S. 174-175.
(d) Section 2(c) applies to payments or allowances by a seller's broker to a buyer, whether made directly to the buyer or indirectly through the seller. Pp. 363 U. S. 175-176.
261 F.2d 725, reversed.