R. L. Drake Company

Text (OCR of the scan at left; may contain errors)

In THE Martrer oF R. lL. DRAKE COMPANY CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF SEC. 2(a) OF THE CLAYTON ACT Docket C-1974.. Complaint, July 12, 1971—Decision, July 12, 1971 Consent order requiring a Miamisburg, Ohio, manufacturer and seller of amateur radio equipment to cease discriminating in the price of such products: in violation of Section 2(a) of the Clayton Act by selling to any purchaser at net:prices higher than the net prices charged any competing purchaser. 50 Complaint Complaint The Federal Trade Commission, having reason to believe’ that I. L. Drake Co., a corporation, has violated the provisions of subsection (a) of Section 2 of the Clayton Act, as amended (15 U.S.C. Sec. 18), hereby issues its complaint stating its charges with respect thereto, as follows:

Paracrary 1. Respondent R. L. Drake Co. is a corporation organized, existing and doing business under and by virtue of ‘the laws of the State of Ohio with its headquarters and principal place of business located at 540 Richard Street, Miamisburg, Ohio. : Par. 2. Respondent is now, and for some time last past has been, a manufacturer, distributor and seller of assembled amateur radio equipment, including, but not limited to transmitters, receivers and transceivers. Respondent manufactures its amateur radio equipment at its plant located at Miamisburg, Ohio. Respondent distributes and sells its said products of: like grade and quality to a large number of purchasers located ° throughout Poke and resale therein.

Respondent’s sales of its products are substantial, exceeding $2,600,000 for the fiscal year 1969.

Par. 3. In the course and conduct of its said business, réspondent is now, and for some time last past has been, shipping its products from the State of Ohio to purchasers located in other states in commerce, as “commerce” is defined in the Clayton Act, as amended. Par. 4. In the course and conduct of its business in commerce, respondent sells its products of like grade and quality to purchasers who are in substantial competition with each other in the resale and distribution of respondent’s like products.

Par. 5. In the course and conduct of its business in commerce, respondent has been discriminating in price between different purchasers of its products of like grade and quality by selling said products to some purchasers at higher and less favorable prices than the ‘prices charged. competing purchasers for such products of like grade and quality.

Illustrative of respondent’s discriminatory pricing practices 1s the following:

Respondent, for approximately two years prior to June 1, 1970, separated its retail dealers, many of whom compete with each other in the sale of its amateur radio equipment, into three classes, “A,” Decision and Order 79 BF.T.C.

“AA” and “AAA,” with members of each such class having purchased respondent’s said products of like grade and quality at different prices as follows:

% of discount from Retail dealer class suggested retail price A 30.

AA 25 AAA 20 Once respondent had assigned a retail dealer to one or another of the above classifications for pricing purposes, that dealer had been required to purchase, and had purchased, respondent’s said products at the assigned discount from suggested retail price, unless and until such dealer had been reassigned to another classification. Pursuant to the. above discount schedule, some retail dealers were charged higher and less favorable prices than the prices charged competing retail dealers for such products of like grade and quality. Par. 6. The effect of such discriminations in price made by respondent in the sale of its products, as hereinbefore set forth, has been or may be substantially to lessen competition or tend to create a monopoly in the lines of commerce in which the favored purchasers from respondent are engaged, or to injure, destroy or prevent competition with the favored purchasers from respondent who have received the discriminatory lower prices. Par. 7. The discriminations in price made by respondent in the sale of its products, as hereinbefore alleged, are in violation of subsection (a) of Section 2 of the Clayton Act, as amended. DECISION AND ORDER The Commission having heretofore determined to issue its complaint charging the R. L. Drake Company, respondent herein, with violation of subsection (a) of Section 2 of the Clayton Act, as amended, and respondent having been served with notice of said determination and with a copy of the complaint the Commission intended to issue, together with a proposed form of order; and The respondent and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by respondent of all the jurisdictional facts set forth in the complaint to issue herein, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as set forth in such com- R. L. DRAKE CC. 53 50 Decision and Order plaint, and waivers and provisions as required by the Commission’s rules; and The Commission having considered the agreement and having accepted same, and the agreement containing consent order having thereupon been placed on the public record for a period of thirty (30) days, now in further conformity with the procedure prescribed in § 2.34(b) ‘of its Rules, the Commission hereby issues its complaint in the form contemplated by said agreement, makes the following jurisdictional findings, and enters the following order: 1. Respondent R. L. Drake Company is a corporation organized, existing and doing business under and by virtue of the laws of the State of Ohio, with its office and principal place of business located at 540 Richard Street in the city of Miamisburg, State of Ohio. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent. ORDER It is ordered, That respondent R. L. Drake Company, a corporation, its officers, employees, agents and representatives, directly or through any corporate or other device, in or in connection with the sale of its amateur radio equipment in commerce, as “commerce” is defined in the Clayton Act, as amended, forthwith cease and desist from discriminating, directly or indirectly, in the price of such amateur radio equipment of like gerade and quality, by selling to any purchaser at net prices higher than the net prices charged any other purchaser competing in fact with such unfavored purchaser in the resale and distribution of such amateur radio equipment. It is further ordered, That the respondent corporation shall forthwith distribute a copy of this order to each of its operating divisions.

It ts further ordered, That respondent herein shall notify the Commission at least 30 days prior to any proposed change im the corporate respondent such as dissolution, assignment or sale result-_ ing in the emergence of a successor corporation, the creation or dissolution of subsidiaries or any other change in the corporation which may affect compliance obligations arising out of the order. lt is further ordered, That respondent herein shall, within sixty (60) days after service upon it of this order, file with the Commission a report in writing setting forth in detail the manner in which it has complied with this order.

54. FEDERAL TRADE COMMISSION DECISIONS Complaint 7D FAC.