Gamble-Skogmo, Inc. v. Federal Trade Commission

211 F.2d 106, 1954 U.S. App. LEXIS 4636, 1954 Trade Cas. (CCH) 67,687
CourtCourt of Appeals for the Eighth Circuit
DecidedFebruary 25, 1954
Docket14657_1
StatusPublished
Cited by42 cases

This text of 211 F.2d 106 (Gamble-Skogmo, Inc. v. Federal Trade Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gamble-Skogmo, Inc. v. Federal Trade Commission, 211 F.2d 106, 1954 U.S. App. LEXIS 4636, 1954 Trade Cas. (CCH) 67,687 (8th Cir. 1954).

Opinion

JOHNSEN, Circuit Judge.

The Federal Trade Commission, in proceedings under 15 U.S.C.A. §§21 and 45(b), found that Gamble-Skogmo, Inc., its officers and its directors had been violating section 3 of the Clayton Act, 15 U.S.C.A. § 14, 1 and section 5(a) of the Federal Trade Commission Act, 15 U.S.C.A. § 45(a), 2 and entered cease and *109 desist orders conforming to its findings. The corporation, its officers and its directors have petitioned for review of these orders.

The first count in the Commission’s complaint had charged in substance that the corporation, under the direction of its officers and its directors, 3 in its business as a wholesale distributor, was engaged in making sales and contracts for the sale, in interstate commerce, of goods, wares and merchandise, consisting of automobile supplies, electrical appliances, sporting goods, paints, ready-to-wear clothing, and the various other items distributed by it, 4 to its numerous retail dealers, 5 upon the condition, agreement and understanding that such dealers should not purchase merchandise from any other distributor, and with this having the effect, in the line of commerce in which the corporation was engaged, that competition might be and had been substantially lessened 6 and that a monopoly was being tended to be created.

The second count of the complaint charged in substance that the imposing of such a condition, agreement and understanding by the corporation upon its dealers, for exclusive requirements purchasing by them, constituted an unfair trade practice and method of competition in commerce, as did also the attempts of the corporation to police and enforce such condition, agreement and understanding, by the holding of dealers’ meetings at which the company’s policy of requiring exclusive handling of its goods was emphasized and the possibility of reprisal declared; by the sending out of fieldmen to check dealers’ stocks for outside merchandise, to report to the corporation the amount of such merchandise carried, to advise any such dealers to get rid of their outside merchandise, and to threaten them with a cancellation of their contracts and the inability thereafter to obtain further goods from the corporation; by the paying of a bonus to dealers whose cooperation with the corporation in exclusive requirements purchasing was deemed by it to be satisfactory and the reducing or denying of such a bonus to dealers who were purchasing outside goods; and by engaging in making cancellation of various dealers’ contracts for the sole reason that they were carrying merchandise of other distributors.

The corporation denied all of the Commission’s charges against it. It contended that it had not contracted to sell or made sales to its dealers upon the condition, agreement or understanding that the dealer was required to purchase exclusively from the corporation and could not handle other distributors’ goods; that it equally had no such policy as a matter of practice in the incidental or collateral relationships which it had with its dealer stores; that, while it endeavored to sell its dealers all of their merchandise needs, this was done on the basis of showing them the possibilities and advantages of its goods as a store line and without any threats or other coercion against them, either express or implied; that the purpose of the dealers’ meetings which it held was to stimulate interest and activity among *110 them, and further ties on their part to the corporation and its officers by the opportunity afforded for personal contact and acquaintanceship, but at none of these meetings had the corporation or its officers assumed to declare or intimate that the dealers would have to handle Gamble merchandise exclusively or else they would be subject to reprisal ; that the fieldmen which the corporation sent out did not have any authority to make agreements or contracts with a dealer, or to impose any condition upon or exact any promise from him, or to make any threat against him because of his handling o,f outside goods, and if any such acts ever had been done by a fieldman it was without authority, sanction or knowledge on the part of the corporation; that the bonus payments which the corporation for a time had made to dealers in appreciation of and reward for their cooperativeness in purchasing its goods were not an unfair trade practice, in that they were in nowise coercive, nor did they affect competition, either as between the individual dealers, all of whom were located in separate towns, or in relation to the public generally, whose purchase price from a dealer was in no way related to whether the dealer was or was not a recipient of the small bonuses paid (%% to 1% of the amount of goods purchased by such dealer during the year) and, in any event, the making of any such bonus payments had been terminated by the corporation more than a year and a half prior to the present proceedings; and, finally, that the corporation had not made cancellations of dealers’ contracts because of the purchasing of outside merchandise but had only made cancellations (comparatively few in actual number) in situations where a dealer was failing relatively to do such a fair share or volume of business in the corporation’s products, as the community afforded a reasonable opportunity. for obtaining, and as the corporation legitimately and competitively had a right to expect, or where the dealer was one who demanded special favors or considerations in obtaining merchandise or was of the type with whom smooth relations were not capable of being generally maintained, so that the corporation did not care to do business with him or to have him held out to the general public as an authorized Gamble store dealer.

The first attack which here is made upon the Commission’s orders is that the Commission failed to accord to the corporation the processes of hearing and determination to which it legally was entitled in the existing situation. The contention rests upon the facts that the trial examiner, before whom all of the testimony in the case had been taken, and who had had the matter duly submitted to him on briefs and oral argument, was thereafter, because of his having reached the age of 70 years and being eligible for an annuity and having thus become subject to being automatically retired under the provisions of 5 U.S.C.A.

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Bluebook (online)
211 F.2d 106, 1954 U.S. App. LEXIS 4636, 1954 Trade Cas. (CCH) 67,687, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gamble-skogmo-inc-v-federal-trade-commission-ca8-1954.