For the first time in 40 years, a federal court has issued an injunction in a Robinson-Patman case barring a manufacturer from charging different prices to two different customers. If the injunction is upheld on appeal, the case will provide a new and potentially powerful tool for plaintiffs claiming that they are subject to price discrimination by their suppliers. Under the Robinson-Patman Act, sellers of manufactured products (the statute does not apply to the sale of services) cannot sell goods of like grade and quality at different prices to different customers who compete with each other, unless the price discrimination falls within certain exceptions to the statute.
The defendant, Michael Foods, Inc., a food processor and distributor of egg, dairy and potato products, sold its products to Feesers, Inc., a food distributor, at a different price than it sold its products to Sodexo, Inc., a food management service company. Feesers sued under the Robinson-Patman Act, alleging that Michael Foods’ practice of charging a different price to Feesers than it did to Sodexo constituted illegal price discrimination. The court conducted a bench trial in 2008. On April 27, the U.S. District Court for the Middle District of Pennsylvania ruled in favor of Feesers and, in a highly unusual ruling, enjoined Michael Foods from engaging in unlawful price discrimination against Feesers. The case is now on appeal to the U.S. Court of Appeals for the Third Circuit. If the injunction is affirmed, the stakes in Robinson-Patman Act litigation will be raised significantly and product manufacturers will need to pay renewed attention to issues that arise when they charge different prices to different customers. (Feesers, Inc. v. Michael Foods, Inc., 2009 WL 1138126 (M.D.Pa. April 27, 2009))