Philadelphia Chewing Gum Corporation

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IN THE MATTER OF PHILADELPHIA CHE'VING GD~f COR.PORATION CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF SEC. 2 (a) OF THE CLA YTOX ACT Docket 6,' 48. Complaint, Mar. 26, 195i-Decisfon, Oct. :26, 1957 Consent order requiring a manufacturer of bubble gum in Havertown, Pa., to cease discriminating in price in violation of Sec. 2 (a) of the Clayton Act by granting certain jobbers a 5% "supply house" discount in addition to the 5% discount or its equi.alent in premiums granted aU its jobbers and dealers.

COl\IPLAINT The Federal Trade Commission, having reason to believe that Philadelphia Chewing Gum Corporation is violating and has violated the provisions of subsection (a) of Section 2 of the Clayton Act, as amended by the R,obinson-Patman Act, approved June 19 1936 (D. C. Title 15 , Section 13), hereby issues its complaint stating its charges with respect thereto as follows: PARAGRAPH 1. Respondent, Philadelphia Chewing Gum Corporation, hereinafter referred to as respondent, is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Pennsylvania, with its principal office and place of business located at Eagle and Lawrence Hoads, 1-Iavertown, Pennsylvan1 a.

PAR. 2. Respondent is now and since 1947 has been engaged in the manufacture and sale of chewing gum products commonly referred to as "bubble gum. Respondent sells said chewing gum products to different purchasers, including jobbers and retailers, located in the various States of the United States and the District of Columbia. PAn. 3. In the course and conduct of its business respondent has engaged in commerce as "commerce" is defined in the Clayton Act as amended in that respondent ships its products, or causes them to be shipped, from its place of business to said purchasers located in States other than the State of origin of such shipments. PAR. 4. In the course and conduct of its said business in commerce respondent is now and has been in competition with other corporations, partnerships, individuals, and firms engaged in manufacturing, selling, and distributing chewing gum products. P.cm. 5. In the course and conduct of its business as above deseribec1, respondent has sold and now sells chewing gum products to some purchasers at substantially higher prices than the prices PHILADELPHIA CHEWING GUM CORP. 481 480 Decision charged competing purchasers for such products of like grade and quality.

For example, respondent sells its chewing gum products to its jobbers and retailers granting them either a five percent discount or its equivalent in premiums, but the respondent grants an additional five percent discount, sometimes called a "supply house" discount, to several of its jobbers who are in competition with other jobbers in the resale and distribution of said products. PAR. 6. The effect of such discriminations in price made by respondent, as set forth in Paragraph Five hereof, may be substantially to lessen competition or tend to create a monopoly in the line of commerce in which respondent and its purchasers are respectivel:y engaged; or to injure, destroy, or prevent competition with respondent. and with purchasers of respondent who receive the benefit of such discriminations.

PAR. 7. The acts and practices of the respondent, as alleged above vioJnte subsection (a) of Section 2 of the Clayton Act, as amended. JJ1?' F'J'.edTic T. Suss for the Commission. Blank, RudenJ.i.:o cD Illaus of Philadelphia, Pa. , by 111'1'. Edwi.n S. Ro. for respondent.

INITIAL DECISION BY "\VILLIA1\I L. PACK , 1-1HEARING EXAl\:IINER The complaint in this matter charges the respondent with violation of Section 2 of the Clayton Act, as amended by the Robinson- Patman Act, in connection with the sale of che""ing gum products. An Agreement has now been entered into by counsel supporting the complaint and respondent which provides, among other things, that respondent admits all of the jurisdictional allegations in the complaint; that the record on w hieh the initial decision and the' decision of the Commission shall be based shan consist solely of the complaint and agreement; that the inclusion 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 eflect as if entered after a full hearing, respondent specifically waiving any and all rights to challenge or contest the validity of such order; that the order may be altered, modified or set aside in the manner provided for other orders of the Commission; that the complaint may be used in construing the terms of the order; and that the agreement is for settlement purposes only it has vio-and does not constitute an admission by responde11t that lated the law as alleged in the complaint. Decision 54 F. T. C. The hearing examiner having considered the agreement and proposed order and being of the opinion that they provide an adequate basis for an appropriate disposition of the proceeding, the agree~ ment is hereby accepted, the following jurisdictional findings made and the following order issued:

1. Respondent, Philadelphia Chewing Gum Corporation, is a corporation existing and doing business under and by virtue of the laws of the State of Pennsylvania with its principal office and place of business located at Eagle and Lawrence Roads, Ha vertown, Pennsylvania.

2. The Federal Trade Commission has jurisdiction of the subject ma tter of this proceeding and of the respondent. ORDER It is ordered That respondent, Philadelphia Chewing Gum Corporation, a corporation, and its officers, representatives, agents, and employees, directly or through any corporate or other device, in, or in connection with the sale of chewing gum products in commerce as "commerce" is defined in the Clayton Act, as amended, do forthwith cease and desist from:

Discriminating, directly or indirectly, in the price of said chewing gum products of like grade and quality, by selling to any purchaser at net prices higher than the net prices charged any other purchaser which purchasers, in fact, compete in the resale or distribution of such products.

DECISION OF THE CO:Ml\fISSION AND ORDER TO FILE REPORT OF COMPLIANCE Pursuant to Section 3.21 of the Commission s Rules of Practice the initial decision of the hearing examiner shall, on the 26th day of October, 1957, become the decision of the Commission; and, accordingly :

It is 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 and form in which it has complied with the order to cease and desist. SURF SALES CO., INC., ET AL. 483 Decision