Thomas Y. Crowell Company

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

IN THE :MATTER OF THOl\las Y. CRO,VELL CO:MP ANY CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF SEC. 2 (a) OF THE CLAYTON ACT Docket 6480. Complaint, Dec. 1955-Dec/:sion, Ma1' , 1956 Consent order requiring a New lork City publisher to cease discriminating in price in \Ciola tion of Sec. 2 (a) of the Clayton Act, as amended, by allowing greater discounts from list prices of its trade books to customers it classified as "wholesalers" than it allowed its "institutional suppliers" or sub-jobbers."

Before illi' Willi(f/Jn L. Pack hearing examiner. lib'. Fletche1' G. Cohn for the Commission. GTeenOa1..l1n, TVolfj' ill Ernst of New York City, for respondent. COl\IPLAINT Pursuant to the provisions of an act of Congress entitled "An Act to Supplement Existing Laws Against Unlawful Restraints and NIOl~opolies and for Other Purposes approved October 15 , 1914 (Clayton Act), as amended by an act of Congress approved June 19 1936 (Robinson-Patman Act) (D. , Title 15 , Sec. 13), and by virtue of the authority vested in it by said Acts, the Federal Trade Commission having reason to believe that Thomas Y. Crowell Company, hereinafter referred to as "respondent", has violated the provisions of sub-section (a) of Section 2 of the Clayton Act, as amended, hereby issues its complaint stating its charges in these respects as follows:

PARAGRAPH 1. Respondent Thomas Y. Crmvell Company is a corporation organized and existing under the laws of the State of New York, with its principnJ office and place of business located at 432 Fourth Avenue, N mv York, New York. PAR. 2. Respondent is now and has since 1875 been engaged directly or indirectly in the publication, sale, and distribution of the various types and classes of books, including popular fiction and non-fiction books which are commonly known as trade books. For the fiscal year ending June 30 , 1955, the total gross sales of books published, sold and distributed by this respondent was $1 942 039.79. Respondent classifies the customers to whom it sells and distributes the books published by it into several different categories of customers, the principal classifications being (1) "wholesalers " (2) "institutional suppliers, and (3) "retailers. Complaint 52 F. T. C. PAR. 3. In the course and conduct of its business, respondent has been and is now engaged in commerce as "commerce ~' is defined in the Clayton Antitrust Act, as amended by the Robinson-Patman Act in that it ships or causes to be shipped books published by it from the state or states in which said books are produced or published to purchasers thereof located in other states of the United States and the District of Columbia; and there is and has been at all times herein mentioned, a continuous current of trade and commerce in said books between and among the several states of the United States and the District of Columbia. PAR. 4. Except insofar as it has been affected, as alleged in Paragraph Six hereof, respondent, in the course and conduct of its said business in commerce, has been, and is now, in competition with persons, firms, and other corporations which 'Were~ and are engaged in commerce in the same business as respondent. Also~ except insofar as it has been affected, as alleged in Paragraph Six hereof, some of the purehasers, to whom respondent sells and distributes the books published by it in the aforesaid commerce, and whom respondent classifies as ""dlOlesalers" were and are, in competition with some of the purchasers of books sold and distributed by respondent, whom respondent classifies as "institutional suppliers" in that many of such ,wholesalers and institutional suppliers compete or attempt to compete, often in commerce in reselling and attempting to resell such books to the same libraries and other t37pes of institutions.

PAR. 5. Respondent, in the course and conduct of its said business in commerce has been for many years last past, and more particularly since June 19, 1936, and is now, discriminating in price between purchasers of the books published and distributed by respondent by selling such books to some purchasers at higher prices than it sells such books of like grade and quality to other purchasers, and some of such other purchasers are engaged in active and open competition with the less favored purchasers in the resale of such books within the United States, except as such competition has been affected as herein alleged.

Respondent has priced and sold the books which it publishes and distributes to those of its customers which it classifies as "wholesalers" at list prices less discounts, which are greater than those dicounts which it allows to those of its purchasers which it classifies as "institutional suppliers" or "sub-jobbers. Respondent has so discriminated in that it has priced and sold and still does price and sell such books to such wholesalers at one discount schedule, which is as follows:

THOMAS Y. CROWELL CO. 921 919 Decision D-i/lco1tnt from list Number of copies ordered of same title: price (percent) 50 --------------------------------------- ------------------- 50-99 ----- ----------------- 44~ 100-999 ---------------------------------------------- ---- 000 and over ------------------------------------------------ 48-50 while respondent was and is pricing and selling such books to institutional suppliers or sub-jobbers who are in competition in the resale of said books with the wholesalers receiving the aforementioned discounts, at the following discount schedule: Discount from Ust Number of copies ordered: price (percent) 25 of the same title ------------------------------------------- 50 of assorted titles -------------------------------------------5 25-99 of the same title ------------------------------------------ 4,-, 50 or more of assorted titles ------------------------------------ 5 100-999 of the same title --------------------------------------- 000 and over of the same title --------------------------------- 46 PAR. 6. The effect of the aforesaid discriminations or any appreciable part thereof has been, or may be, substantially to lessen competition or tend to create a monopoly in the respondent and said wholesalers in the respective lines of commerce in which they are engaged, and to injure, destroy, or prevent competition respectively with respondent and with said wholesalers who receive the benefit of said discriminations or with the customers of either of them.

PAR. 7. The acts and practices of respondent, as alleged in Paragraph Five hereof, are in violation of subsection (a) of Section 2 of the Clayton Act, as amended by the Robinson-Patman Act, approved June 19, 1936 (D. C. Title 15, Section 13). INITIAL DECISION BY WILLIAM L. PACK, HEARING EXAMINER The complaint in this matter, issued December 21 , 1955, charges the respondent with discriminating in the prices of its products in violation of Section 2 (a) of the Clayton Act, as amended by the Robinson-Patman Act. An agreement has now been entered into by respondent and counsel supporting the complaint which provides. among other things, that respondent admits all of the jurisdictional allegations in the complaint; that the record on which the initial decision and the decision of the Commission shall be based shall consist solely of the complaint and the agreement; that the inclusion Order 52 F. T. C.

of findings of fact and conclusions of law in the decision disposing of this matter is waived, together 'with any further procedural steps before the hearing examiner and the Commission; that the order hereinafter set forth may be entered in disposition of the proceeding, such order to have the same force and effect as if entered after a full hearing, respondent specifically waiving any and all rights to challenge or contest the validity or such order; that the order may be altered, modified or set aside in the :inanner provided for other orders or the Commission; that the complaint may be used in construing the terms or the order; and that the agreement is ror settlement purposes only and does not constitute an admission by respondent that it has violated the law as alleged in the complaint.

The hearing examiner having considered the agreement and proposed order and being or the opinion that they provide an adequate basis for an appropriate settlement and disposition or the proceeding, the agreement is hereby accepted, the following jurisdictional findings made, and the following order issued: 1. Respondent Thomas Y. Crowell Company is a corporation existing and doing business under and by virtue of the laws of the State of New York, with its office and principal place or business located at 432 Fourth Avenue, N e"\v York, New York. 2. The Federal Trade Commission has jurisdiction or the subject matter or this proceeding and of the respondent. ORDER It is orrde'l' That respondent, Thomas Y. Crowell Company, a corporation, its officers, agents, representatives and employees, directly or through any corporate or other device, in connection with the publication, sale or distribution of any type or elass of books including popular fiction and nonfiction books which are commonly known as "trade books " in commerce, as "commerce is defined construed and understood in the Clayton Act (15 U. , Section 15), do forthwith cease and desist from: Discriminating, directly or indirectly, in the price. or such books published by it by selling to any purchaser at net prices higher than the net prices charged any other purchaser competing in fact in the resale and distribution of said books. THOMAS Y. CROWELL CO. 923 919 Decision DECISION OF THE COl\Il\HSSION AND ORDER TO FILE REPORT OF COl\fPLIANCE Pursuant to Section 3.21 of the Commission s Rules of Practice the initial decision of the hearing examiner shall, on the 6th day of March, 1956 become the decision of the Commission; and, accordingly :

It is ordered That the 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 and form in which it has complied with the order to cease and desist. 924 FEDERAL TRADE COMMISSION DECISIIONS Complaint 52 F. T. C.