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Vanderbilt Law Review

Authors

Clyde L. Ball

First Page

63

Abstract

The period since the end of World War II has been marked by a tremendous volume of litigation arising under the federal anti-trust statutes. One of the Government's principal attacks has been aimed at the basing-point system of pricing which has been employed in many basic industries. This attack marked no new departure on the part of the Government; the Federal Trade Commission has consistently opposed the system, and the courts have repeatedly been called upon to review Commission orders aimed at some feature of the basing-point system.

Until recently the system had successfully withstood these attacks. It had weathered a number of proceedings under the Sherman and Clayton Acts. A provision which would have definitely outlawed it was stricken from the Robinson-Patman Act before it was passed. Two bills aimed solely at outlawing the basing-point method were introduced in Congress, but neither was passed. However, in 1945 the system suffered a major set-back in the courts when the Supreme Court upheld the findings of the Federal Trade Commission and ruled that the basing-point system as employed by two major manufacturers of glucose resulted in illegal price discrimination. Then, in the recent case of Federal Trade Commission v. Cement Institute, the Court handed down a decision which may well mean the end of the system as now developed, unless Congress comes to its aid. It is the purpose here to examine the Cement decision to determine how it fits in with established anti-trust policy and previous decisions dealing with the basing-point system, and to consider some of its possible results."

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