Ben Sheftall Distributing Co. v. Mirta De Perales, Inc.

791 F. Supp. 1575, 1992 U.S. Dist. LEXIS 6301, 1992 WL 91490
CourtDistrict Court, S.D. Georgia
DecidedApril 29, 1992
DocketCV-491-168
StatusPublished
Cited by1 cases

This text of 791 F. Supp. 1575 (Ben Sheftall Distributing Co. v. Mirta De Perales, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ben Sheftall Distributing Co. v. Mirta De Perales, Inc., 791 F. Supp. 1575, 1992 U.S. Dist. LEXIS 6301, 1992 WL 91490 (S.D. Ga. 1992).

Opinion

ORDER and MEMORANDUM

NANGLE, Senior District Judge.

Plaintiff Ben Sheftall Distributing Co., Inc., brought this action arising under Section 1 of the Sherman Anti-Trust Act, 15 U.S.C. § 1, and Section 1 of the Robinson-Patman Act, amending Section 2 of the Clayton Antitrust Act, 15 U.S.C. § 13, seeking treble damages, injunctive relief and attorney's fees under Sections 4, 12 and 16 of the Clayton Antitrust Act, 15 U.S.C. §§ 15, 22 and 15/26" style="color:var(--green);border-bottom:1px solid var(--green-border)">26, and for compensatory and punitive, exemplary or vindictive damages *1577 for tortious interference with contractual relations and unlawful restraint of trade under the laws of the State of Georgia. Defendant Mirta de Perales has filed a motion to dismiss plaintiffs complaint under Rule 12(b)(6) of the Federal Rules of Civil Procedure for failure to state a claim. Based on the following analysis, the Court will dismiss plaintiffs antitrust claims, and, as a result, the state law claims as well. FACTS

Plaintiff, a Georgia corporation, is a dis-tributer of ethnic cosmetic and beauty supplies. Plaintiff obtains these products from various ethnic cosmetic and beauty supply manufacturers and suppliers and then distributes them to retailers throughout the nation at wholesale prices. Plaintiffs retail customers include national department and drug store chains, as well as regional and local retailers of ethnic cosmetic and beauty supplies. Plaintiff has been in this business since the seventies, and, for the calendar year ending in 1990, it achieved approximately $30 million in sales.

Plaintiffs problems arose when other distributors of ethnic cosmetic and beauty supplies became disgruntled with plaintiffs ability to undersell a certain line of such cosmetics and supplies. Particularly, this claim focuses on the Hispanic cosmetic and beauty supplies manufactured and supplied by defendant to independent distributors throughout the nation. These distributors, like plaintiff, resell defendant’s products at wholesale prices to retailers, including national department and drug store chains as well as regional and local retailers of ethnic cosmetic and beauty supplies. Plaintiff in particular has been an independent distributor of defendant since the mid-eighties and has distributed the products to various retail outlets throughout the nation.

According to the complaint, soon after plaintiffs distributorship relationship with defendant began, several of defendant’s other distributors began to complain. They informed defendant that the low prices that plaintiff charged its retail customers were affecting the market. Consequently, they requested that defendant enforce a resale price maintenance plan with its distributors in order to coerce the distributors into charging uniformly higher prices. Plaintiff alleges that, in violation of Section 1 of the Sherman Anti-Trust Act, defendant, “in cooperation and concert with several of these distributors, agreed to enforce a resale price maintenance plan and to coerce” plaintiff into compliance with the pricing policy.

In support of this conclusory allegation of conspiracy, plaintiff further alleges that, as part of the coercive effort to force plaintiff to adhere to the higher prices, defendant withdrew “certain” payment terms and discounts which were previously available to plaintiff. Meanwhile, those same payment terms and discounts remained available to other independent distributors. Then, when plaintiff still refused to increase its prices of defendant’s products, plaintiff alleges that defendant terminated its distributorship and refused to sell any of its products to plaintiff. The reason given plaintiff for the termination was defendant’s belief that plaintiff’s pricing system was “indirectly affecting the market and the relations with our other distributors.”

Despite the termination, plaintiff alleged that it tried to continue at least one of its retail customers, Eckerd, with a full line of ethnic cosmetic and beauty supplies, including defendant’s products. In order to accomplish this feat, plaintiff purchased defendant’s products from another one of defendant’s independent distributors. Unfortunately for plaintiff, when defendant discovered that plaintiff was continuing to distribute its products to Eckerd, it encouraged Eckerd to discontinue its relationship with plaintiff and purchase the products from another independent distributor. Defendant informed Eckerd that plaintiff was no longer receiving its products and, instead, was distributing stale and damaged products to Eckerd. Plaintiff contends that as a result of this action by defendant, Eckerd ceased to use plaintiff as its distributor of Hispanic cosmetic and beauty supplies, including those supplies plaintiff received from manufacturers and suppliers other than defendant.

*1578 As a whole, plaintiff alleges that these actions by defendant, in concert with others, constitute a combination and conspiracy in restraint of trade in violation of Section 1 of the Sherman Anti-Trust Act. In addition, plaintiff alleges that by selling its Hispanic cosmetic and beauty supplies to plaintiff at different prices than the prices it sold goods of like grade and quality to plaintiffs competitors, defendant practiced illegal price discrimination in violation of Section 1 of the Robinson-Patman Act, amending Section 2 of the Clayton Antitrust Act. Plaintiff contends that the sales were made in interstate commerce and that the price discrimination may substantially lessen competition or injure, destroy or prevent competition with plaintiffs competitors.

As a final touch, plaintiff also alleges a cause of action under Georgia law for restraint of trade and a cause of action for interference with plaintiffs contractual relations and business expectations. Plaintiff alleges the same facts as those in its Sherman Act claim as a basis for its Georgia restraint of trade claim. Plaintiffs interference with its contractual relations claim is based on defendant’s actions with respect to Eckerd.

Defendant, on the other hand, attacks each cause of action as failing to state a claim under Rule 12(b)(6). With regard to the Sherman Anti-Trust claim, defendant argues that plaintiff has failed to allege sufficient facts to show the existence of a “combination and conspiracy in restraint of trade” between defendant and its distributors. Instead of constituting a conspiracy, defendant suggests that its actions were clearly independent and unilateral and, as a result, do not violate the Sherman AntiTrust Act. Defendant similarly argues that the other federal claim, that alleging price discrimination under the Clayton Antitrust Act, should be dismissed because plaintiff failed to show any antitrust injury, causation or damage to itself.

Defendant similarly finds fault with the pendent state law claims.

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Cite This Page — Counsel Stack

Bluebook (online)
791 F. Supp. 1575, 1992 U.S. Dist. LEXIS 6301, 1992 WL 91490, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ben-sheftall-distributing-co-v-mirta-de-perales-inc-gasd-1992.