Gorlick Distribution Centers, LLC v. Car Sound Exhaust System, Inc.
723 F.3d 1019
9th Cir.2013Background
- Gorlick and Allied distribute aftermarket auto parts and compete in the Pacific Northwest with Car Sound as the supplier.
- Gorlick alleges Car Sound offered Allied favorable terms (free shipping, lower prices, volume rebates, year-end rebates) not available to Gorlick, violating Robinson-Patman Act § 13(a).
- Gorlick contends Allied knew of the discriminatory terms; Allied argues it did not know Gorlick’s terms and defenses may apply under § 13(f).
- Gorlick also claims a Car Sound–Allied conspiracy to restrain trade in violation of the Sherman Act § 1.
- District court granted summary judgment for Allied on all but one Robinson-Patman issue; Gorlick dismissed remaining claim and appealed.
- Court reviews de novo a district court’s summary judgment; focus on whether material facts are genuine and law applied correctly.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Robinson-Patman violation | Gorlick contends Allied knowingly received discriminatory prices. | Allied didn’t know Gorlick’s terms or the prices were prohibited; defenses exist under § 13(f). | Gorlick fails to show Allied had the required knowledge. |
| Actual knowledge standard | Gorlick points to internal memos and conduct suggesting knowledge of favorable terms. | Allied’s knowledge evidence is insufficient to prove receipt of illegitimate prices. | No triable issue of actual knowledge; summary judgment affirmed. |
| Trade experience knowledge | Gorlick argues Allied’s market position and behavior put it on notice the prices were prohibited. | Allied’s role as Car Sound’s top account and lack of evidence of knowledge negate trade-knowledge liability. | Insufficient evidence of trade knowledge; no liability under § 2(f). |
| Duty to inquire | Allied’s dealings with Car Sound gave notice of discriminatory pricing. | No demonstrated steps by Allied to inquire or Car Sound’s acquiescence; duty not triggered here. | No duty to inquire found; Gorlick’s claim fails. |
| Sherman Act § 1 claim viability | Agreement between Car Sound and Allied harmed Gorlick and reduced competition in the market. | Even if there was a vertical restraint, Gorlick failed to show market-wide anticompetitive harm. | Affirmed on the basis that Gorlick did not prove injury to competition; remand not required by majority. |
Key Cases Cited
- Volvo Trucks N. Am., Inc. v. Reeder-Simco GMC, Inc., 546 U.S. 164 (2006) (Robinson-Patman price discrimination requires seller savings justification)
- Automatic Canteen Co. of Am. v. FTC, 346 U.S. 61 (1953) (buyer knowledge limits liability under Robinson-Patman)
- FLM Collision Parts, Inc. v. Ford Motor Co., 543 F.2d 1019 (2d Cir. 1976) (equal opportunity to purchase lower-priced goods governs rebates)
- Leegin Creative Leather Prods., Inc. v. PSKS, Inc., 551 U.S. 877 (2007) (vertical price restraints may be procompetitive; not per se illegal)
- Cal. Dental Ass’n v. FTC, 474 F.3d 989 (9th Cir. 2000) (rule of reason framework for restraints)
- Rano v. Sipa Press, Inc., 987 F.2d 580 (9th Cir. 1993) (standards for evaluating restraint effects on competition)
- GTE Sylvania, Inc. v. Continental T.V., Inc., 433 U.S. 36 (1977) (interbrand competition importance; vertical restraints may promote competition)
- Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477 (1977) (antitrust harm measured by market competition, not individual competitors)