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Antitrust Keyed to Areeda, 8th Ed.
Texaco, Inc. v. Hasbrouck
Citation:
496 U.S. 543 (1990)Facts
Texaco sold gasoline directly to twelve independent Texaco retailers (respondents) in Spokane, Washington at its retail tank wagon (RTW) prices. Simultaneously, Texaco granted substantial discounts to two distributors: Gull Oil Company received discounts of 4¢ to 6¢ below RTW, and Dompier Oil Company received discounts of 3.65¢ to 3.95¢ below RTW. Dompier also received additional compensation for hauling gasoline. Both distributors engaged substantially in retail operations – Gull operated “commission stations” where it set retail prices, and Dompier owned several retail stations, with its president estimating that 84-90% of its gasoline sales were at retail. Between 1972 and 1981, the stations supplied by these distributors dramatically increased their sales volume while respondents’ sales suffered a corresponding decline. Seven of the respondents’ stations went out of business by 1978. Evidence showed that Texaco executives were aware of Dompier’s dramatic growth and attributed it to “the magnitude of the distributor discount and the hauling allowance.” When respondents complained about Dompier’s aggressive pricing, Texaco representatives claimed they “couldn’t understand it.”
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