Can Subsidiaries Be "Purchasers" from Their Parents under the Robinson-Patman Act? A Plea for a Consistent Approach

Authors

John Huddleston

Abstract

Should a parent corporation be allowed to discriminate in favor of its wholly-owned subsidiary? Courts have long grappled with this question when interpreting section 2(a) of the Robinson-Patman Act (the "Act"). Section 2(a) prohibits price discrimination between "different purchasers." If the subsidiary corporation is a "different purchaser" when it purchases goods from its parent, then the parent violates the Robinson-Patman Act by discriminating in the subsidiary's favor. Many courts, when faced with this issue, have ruled that the parent and subsidiary are per se parts of a single entity. The Fifth Circuit was the first court to adopt this per se approach, in Security Tire & Rubber Co. v. Gates Rubber Co. The analysis in Security Tire, however, is flawed. These flaws make the court's approach questionable. In reviewing the "different purchaser" issue, this Comment compares three closely related doctrines: The same seller doctrine, the indirect purchaser doctrine, and the intra-enterprise conspiracy doctrine. Comparison of the per se approach to the "different purchaser" analysis with the approach of the latter three doctrines will illustrate the inherent flaws of the per se approach.

First Page

957

Recommended Citation

John Huddleston, Comment, Can Subsidiaries Be "Purchasers" from Their Parents under the Robinson-Patman Act? A Plea for a Consistent Approach, 63 Wash. L. Rev. 957 (1988).
Available at: https://digitalcommons.law.uw.edu/wlr/vol63/iss4/21