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Antitrust Keyed to Areeda, 8th Ed.
Federal Trade Commission v. Morton Salt Company
Citation:
334 U.S. 37 (1948)Facts
Morton Salt Company manufactured and sold several brands of table salt in interstate commerce to both wholesalers and large retailers. For its premium Blue Label salt, Morton employed a quantity discount system with four price tiers: $1.60 per case for less-than-carload purchases, $1.50 for carload purchases, $1.40 for purchases of 5,000 or more cases in a twelve-month period, and $1.35 for purchases of 50,000 or more cases in a twelve-month period. Only five large chain store companies ever qualified for the lowest price tier. These chain stores could then sell Blue Label salt at retail prices lower than independent retailers who purchased from wholesalers at higher prices. Morton also offered similar quantity discounts on its other table salt brands and provided special allowances to certain favored customers. The FTC found that these pricing practices discriminated between different purchasers of like products and that such discrimination could substantially lessen competition, particularly harming smaller merchants who could not qualify for the larger discounts.
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