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Great Atlantic & Pacific Tea Co. v. Federal Trade Commission
United States Supreme Court
440 U.S. 69 (1979)
In 1965, Great Atlantic & Pacific Tea Company (A&P) (defendant) wanted to switch from selling name-brand milk to A&P branded milk. A&P solicited an offer from the Borden Company (Borden) to sell milk under the new arrangement. Dissatisfied with Borden’s offer, A&P solicited a lower offer from Bowman Dairy (Bowman). A&P then went back to Borden and leveraged Bowman’s bid to secure an even lower offer from Borden. When Borden made the second bid, A&P led Borden to believe Borden was only matching the bid by Bowman. However, Borden’s second bid was lower than Bowman’s bid. The Federal Trade Commission (FTC) (plaintiff) sued A&P, arguing A&P violated § 2(f) of the Robinson-Patman Act by knowingly inducing price discrimination from Borden. A&P raised affirmative defenses, including the meeting-competition defense. The meeting-competition defense allows a firm to charge discriminatory prices if the lower price is offered in a good-faith effort to meet the low price of a competitor. The court of appeals rejected A&P’s defenses and affirmed the FTC’s order. In particular, the court of appeals held the meeting-competition defense did not apply, because A&P knew Borden’s offer was lower than Bowman’s offer. The United States Supreme Court granted certiorari.
Rule of Law
Holding and Reasoning (Stewart, J.)
Concurrence/Dissent (White, J.)
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