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unfair price competition

Volvo Trucks North America, Inc. v. Reeder-Simco GMC, Inc.

Issues

Does a company violate the Robinson-Patman Act when they offer different prices to buyers, but the injured buyer does not make an actual purchase?

 

In 1995, Volvo Trucks North America, Inc. and Reeder-Simco GMC, Inc. entered into a five-year franchise agreement authorizing Reeder as an official Volvo heavy truck dealer. Volvo manufacturers its heavy trucks only after a retail customer solicits bids from several Volvo dealers and accepts a bid. This sort of "competitive bidding" process is an industry-wide practice, and Volvo offers price concessions throughout the process. Reeder claims that Volvo discriminated against the dealership by offering it smaller price concessions. Reeder claims this not only resulted in a loss of business for Reeder, but also violated the Robinson Patman Act. A jury trial resulted in a victory for Reeder, and a divided Eigth Circuit Court of Appeals upheld Reeder's claims. Volvo appealed, and the Supreme Court granted certiorari. In its decision, the Supreme Court will help define who receives protection under the Robinson-Patman Act, as well as the amount and kind of evidence a plaintiff will need to produce for this type of claim.

Questions as Framed for the Court by the Parties

1. Whether an unaccepted offer that does not lead to a purchase-so that there is not "discrimination between different purchasers" as the statutory language contemplates-may be the basis for liability under the Robinson-Patman Act.

2. Whether the Robinson-Patman Act permits recovery of damages by a disfavored purchaser that loses sales or profits to a competitor that does not purchase from the defendant, but does not lose sales or profits to any purchaser that "receives the benefit of" the defendant's price discrimination.

In 1995, Volvo Trucks North America, Inc. ("Volvo") and Reeder-Simco, Inc. ("Reeder") entered into a five-year franchise agreement making Reeder an authorized Volvo heavy truck dealer. Brief for Petitioner at 4.

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