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The Federal Trade Commission Updates its "Guides for Advertising Allowances and Other Merchandising Payments and Services"

Still Struggling to Give Guidance under Robinson-Patman Act to Companies Competing in a Modern Economy

  • October 02, 2014

Although infrequently finding itself front and center in case law and legal developments, the Robinson-Patman Act, 15 U.S.C. § 13 (the “Act”) from time to time resurfaces.  The Act prohibits discrimination in prices charged, promotional allowances paid and/or promotional services or facilities furnished in connection with the sale of commodities of like grade and quality to customers that compete against each other, although there are certain defenses.  Almost since its inception, the Act has been met with scorn, and frequent calls for its repeal or substantial modification.  The Act, which some contend runs counter to the principles of the antitrust laws of protecting competition rather than protecting smaller companies against their larger competitors, continues to defy these challenges.  But this flawed statute faces the additional challenge of adjusting to an ever changing marketplace. When the Act was enacted in 1936, there was no internet, no online retailers and no big box stores.  Today, companies, their counsel, the Federal Trade Commission and the courts are left to try to apply the Act in this new dynamic.  As one commentator noted, “compliance with the Act continues to absorb more of the time and attention of corporate counsel in most companies than any other aspect of the antitrust laws.”  “Crossing the Streams of Price and Promotion Under the Robinson-Patman Act,” Richard M. Steuer, Antitrust, Fall 2012.

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