Stanton v. Texaco, Inc.

289 F. Supp. 884, 1968 U.S. Dist. LEXIS 12563, 1968 Trade Cas. (CCH) 72,595
CourtDistrict Court, D. Rhode Island
DecidedSeptember 18, 1968
DocketCiv. A. 3300
StatusPublished
Cited by2 cases

This text of 289 F. Supp. 884 (Stanton v. Texaco, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Rhode Island primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stanton v. Texaco, Inc., 289 F. Supp. 884, 1968 U.S. Dist. LEXIS 12563, 1968 Trade Cas. (CCH) 72,595 (D.R.I. 1968).

Opinion

OPINION

PETTINE, District Judge.

[1] This is a private action seeking treble damages under 15 U.S.C. See. 15 1 for alleged violation of the restraint of trade section of the Sherman Act, 15 U.S.C. Sec. 1 2 and of the price discrimination section of the Robinson-Patman Act, 15 U.S.C. Sec. 13. 3 This court has jurisdiction under 15 U.S.C. Sec. 15 and 28 U.S.C. Sec. 1337. 4

The plaintiff, who did business as the Hoxie Four Corners Texaco Station, was a gasoline service station lessee and operator between August, 1961 and late June or early July, 1964. The plaintiff was located in an area of Warwick, R. I. densely populated with retail gasoline service stations. It is understatement to say that the competition is active among service station operators within this geo *887 graphical zone for the gasoline business of the motoring public. The defendant is a major national oil corporation which leased the plaintiff his gasoline station properties, supplied him petroleum products, and consigned him gasoline, all in accordance with detailed and specific written agreements.

The plaintiff claims that the defendant distributed gasoline to him and, under the terms of the consignment agreement, fixed the minimum resale price of that gasoline in violation of Sec. 1 of the Sherman Act; that his attempts to lower prices in order to remain competitive were thwarted by the termination of the consignment agreement and the cancellation of his lease, and that as a result of these practices by the defendant, he was injured in his business in the amount of $10,000. The plaintiff also claims that the defendant distributed gasoline to him at a price higher than that charged three other retail Texaco service stations in the same geographic area in violation of Sec. 2(a) of the Robinson-Patman Act.

The defendant has moved for summary judgment 5 pursuant to Fed.R.Civ.P. 56 (b), 6 stating that there is no genuine issue of material fact, and that under the law as applied to the allegedly non-disputed facts, it is entitled to judgment. 7 More specifically, the defendant states (1) that the Sec. 1 Sherman Act case law upon which plaintiff relies, Simpson v. Union Oil Co., 377 U.S. 13, 84 S.Ct. 1051, 12 L.Ed.2d 98 (1964), must not be applied retroactively, and, under prior established law construing Sec. 1, United States v. General Electric Co., 272 U.S. 476, 47 S.Ct. 192, 71 L.Ed. 362 (1926), defendant’s motion must be granted, (2) that even if Simpson is the applicable law, defendant’s motion must be granted because either (a) there is no restraint of trade because neither the vast distributional system nor the coercive element present in Simpson is present in the instant case, or (b) there is no combination or conspiracy in restraint of trade to which defendant is a party, or (c) there is no damage to the plaintiff proximately resulting from the restraint of trade, because the plaintiff was at all times free to shift to a purchase and sale arrangement and hence his own voluntary adherence to the consignment arrangement was the cause of his injury, or (d) the plaintiff is in pari delicto with the defendant. With respect to Sec. 2(a) of the Robinson-Patman Act, defendant states that (1) the plaintiff is not a purchaser, because gasoline is distributed to him only on a consignment basis; (2) that even if plaintiff is a purchaser, those Texaco dealers with whom plaintiff competes are not purchasers from Texaco but rather from Pennsylvania Petroleum Products Co., an independent wholesaler-jobber; and (3) that plaintiff is not in competition with Pennsylvania Petroleum Products Co. because plaintiff operates exclusively on the retail level selling to gasoline consumers, while Pennsyl *888 vania Petroleum Products Co. operates exclusively on the wholesale distributional level selling to gasoline retailers.

Although the motion for summary judgment serves a useful purpose in expediting judicial administration and foreclosing eases of no merit from the time-consuming and costly process of litigation, its effect, if granted, is so potent that it should be used with great caution. This is especially so with respect to antitrust suits, where appellate decisions treating important questions of public policy are dependent upon well-developed factual records. See Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962); White Motor Co. v. United States, 372 U.S. 253, 83 S.Ct. 696, 9 L.Ed.2d 738 (1963) (see especially concurring opinion of Mr. Justice Brennan); Simpson v. Union Oil Co., 377 U.S. 13, 84 S.Ct. 1051, 12 L.Ed.2d 98 (1964) (dissenting opinion of Mr. Justice Stewart and memorandum of Mr. Justice Brennan and Mr. Justice Goldberg). The recent decision of the Supreme Court in First National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 88 S.Ct. 1575, 20 L.Ed.2d 569 (1968) is not a blanket endorsement of the summary judgment procedure in antitrust cases. In fact, that summary judgment in the defendant’s favor was granted only because of the plaintiff’s failure to establish an inference of conspiracy on any reasonable, common sense theory not wholly contradicted by the undisputed facts. There, the plaintiff sought to support an inference of conspiracy between parties whose interests were discordant. Here, however, the plaintiff asserts a plausible theory of vertical combination in restraint of trade. 8

Against a background of caution, then, this court approaches, first, a statement of the applicable law, and second, an inquiry into the issuability of the factual material before it.

THE LAW — THE SHERMAN ACT CLAIM

Retroactivity of Simpson v. Union Oil Co.

The defendant asserts that the decision of the Supreme Court in Simpson v. Union Oil Co., 377 U.S. 13, 84 S.Ct. 1051, 12 L.Ed.2d 98 (1964) should be given prospective effect only. The defendant states that the law prior to Simpson clearly permitted price fixing by way of the agency-consignment distribution mechanism. United States v. General Electric Co., 272 U.S. 476, 47 S.Ct. 192, 71 L.Ed. 362 (1926).

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289 F. Supp. 884, 1968 U.S. Dist. LEXIS 12563, 1968 Trade Cas. (CCH) 72,595, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stanton-v-texaco-inc-rid-1968.