buyers' claims were without merit. There is no general showing that respondents sought to so conduct their business as to prevent unwarranted discriminations in price.

(h) The Commission concludes that respondents have failed to establish affirmatively that the discriminatory prices granted by them through variations of the "booking" practice were made in good faith to meet an equally low price of a competitor within the meaning of subsection (b) of Section 2 of the statute, and therefore so finds.

PARAGRAPH EIGHT. (a) The Commission has hereinbefore found that the effects upon competition in the line of commerce in which respondents are engaged of the systematic discriminations in price made by respondents pursuant to the pricing formula used by them for the purpose and with the effect of producing and maintaining delivered prices at all destinations identical with those of their competitors may be substantially to lessen competition and tend to create a monopoly in the manufacture, sale, and distribution of glucose and to injure, destroy, or prevent competition with respondents who grant and exact such discriminations. In considering the effects of such discriminations, and those resulting from the "booking" practice, upon competition in the manufacture, sale, and distribution of candies and table syrups containing substantial proportions of glucose, attention has also been given to the general facts appearing in the record, including those hereinafter specifically stated.

(b) During the period for which figures are available (June 19, 1936, to December 5, 1939), the Chicago base price of 43° glucose ranged between $3.59 and $2.09 per hundred pounds. The maximum discrimination in price resulting from the "booking" practice as shown by the record is 55 cents per hundred pounds. This resulted in some purchasers paying respondents from approximately 15 to 25 percent more than competing purchasers concurrently paid for a raw material which constituted a substantial and frequently a major part of the total raw material costs of both the favored and non-favored customers. These percentage figures would be proportionally less when the "booking" discrimination amounted to less than 55 cents per hundred pounds, but they would also be increased above those figures in those instances where the "booking" discrimination was supplemented by discriminations resulting from the pricing formula. Examples indicating the amounts of the discriminations due to the pricing formula appear in subparagraph (c) of Paragraph Three. The benefits of "booking" discriminations are more usually and generally received by the large purchasers of glucose, with the result that in many instances small buyers pay the new and higher price long before the buyers who purchase in large quantities are required to pay such in

creased price. When there has been a series of price advances the resulting difference in price between small and large buyers may be as much as 30, 40 or 50 cents per hundredweight. Candies and table syrup containing large proportions of glucose are sold at but a few cents per pound. In the case of such candies, a price difference of cent per pound will divert business; and in the case of table syrup, a difference of 12 cent per pound is sufficient to accomplish that result; and in both cases inability or refusal to meet a lower price offered by a competitor results in a candy manufacturer or syrup mixer being precluded from selling to large buyers of his product. In the event sales are made at competitive prices by a non favored candy manufacturer or syrup mixer customer of respondents, it is obvious that his profit is less by the amount he is discriminated against than if he had not been discriminated against. It is apparent from the record that candy manufacturers and syrup mixers must sell their products in a closely competitive market in which a very small price difference is controlling. Under such conditions, reason requires the conclusion that the nonfavored purchasers cannot pay prices ranging up to and sometimes exceeding 25 percent more for their principal raw material than favored purchasers with whom they must compete pay, without seriously and injuriously affecting their ability successfully to compete with such favored customers. There are no other or different facts in the record which would support any other conclusion.

(c) The Clayton Act as amended made discriminations in price unlawful, with certain exceptions not pertinent here, where the effect "may be substantially to lessen competition or tend to create a monopoly in any line of commerce, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them." In the opinion of the Commission, the words "may be" as used in the statute require a showing of more than a bare possibility of competitive effects specified; but, on the other hand, absolute certainty is not required. A showing of a dangerous probability of competitive effects described in the statute is believed to be sufficient. There is no yardstick by which the effects of discriminations in price upon competition may be quantitatively measured, and any effort in that direction can only end in futile speculation. The Commission believes that the record in this proceeding discloses arbitrary and inherently unfair discriminations in price which, if persisted in or multiplied, have even more than a dangerous probability of the competitive consequences denounced in the statute and which contravene its broad purpose "to advance the public interest by securing fair opportunity for the play of the contending forces ordinarily engendered by honest desire for gain." The

Commission is, therefore, of the opinion that the requirements of the statuts have been satisfied.

(d) Supplementing the finding stated in (a) above, the Commission concludes and therefore finds that the effects of the discriminations in price granted and exacted by respondents, those which result from the pricing system and those which result from the "booking" practice, may be substantially to lessen competition and tend to create a monopoly in the manufacture, sale, and distribution of candy and mixed table syrups containing glucose in substantial proportions, and to injure, destroy, and prevent competition with the grantors and recipients of the benefits of such discriminations.

(e) Respondents have not shown that the discriminations in price granted by them are within any of the excepting provisions of the statute.

(f) In reaching its ultimate conclusion, the Commission has given consideration to respondents' contention that Section 2 of the Clayton Act as amended cannot be invoked against the discriminations resulting from their Chicago-base-price-plus-freight pricing system because the legislative history of the amending act of June 19, 1936 (RobinsonPatman Act), is said to show that Congress did not intend that it should prohibit the use of a basing-point system of pricing. The Commission rejects these contentions as being without merit. To claim that because discriminations in price are made according to a particular pattern they are thereby immune is to contradict the plain. words and meaning of the statute and to attribute to Congress the contradictory intentions of prohibiting and concurrently legalizing the same discrim nations in price. The statute does not either prohibit or grant immunity to discriminations in price merely because they are Inade according to a certain pattern. No such measure for determining the legality of price discriminations is contained in the statute. The standard actually provided is whether or not the discriminations have prescribed effects upon competition and are or are not within specific exceptions set out in the statute.

CONCLUSION

The aforesaid discriminations in price by respondents constitute violations of subsection (a) of Section 2 of an Act of Congress entitled "An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes," approved October 15, 1914 (Clayton Act), as amended by an Act of Congress approved June 19, 1936 (Robinson-Patman Act).

INJUNCTIVE ORDER OF THE COURT UNDER THE PROVISIONS OF SECTION 13 OF THE FEDERAL TRADE COMMISSION ACT

KOCH LABORATORIES, INC., WILLIAM F. KOCH AND LOUIS KOCH

V.

FEDERAL TRADE COMMISSION

(Circuit Court of Appeals, Sixth Circuit. June 2, 1944)

Order dismissing, pursuant to stipulation below set forth, appeal from order for temporary injunction of District Judge Ernest P. O'Brien in the District Court for the Eastern District of Michigan, Southern Division, enjoining defendants from disseminating false advertisements concerning their product-medicinal preparations designated as "Gloxylide," "B-Q" and "Malonide Ketene Solution"-pending the final disposition of the Commission's complaint in the matter, as in said order below set out.1

Mr. Joseph J. Smith, Jr., Assistant Chief Counsel, Federal Trade Commission, Washington, D. C., for the Commission.

Voorhies, Long, Ryan and McNair, of Detroit, Mich., and Mr. Richard Steel, of New York City, and Mr. William Henry Gallagher, of Detroit, Mich., for defendants.

STIPULATION FOR DISMISSAL OF APPEAL

Whereas, Koch Laboratories, Inc., William F. Koch and Louis Koch, defendants in an action pending in the District Court of the United States for the Eastern District of Michigan, Southern Division, entitled “Federal Trade Commission, Plaintiff, v. Koch Laboratories, Inc., et al., Civil Action 3387," filed a notice of appeal from an injunction order of Honorable Ernest A. O'Brien, District Judge, restraining defendants from taking action as more particularly set forth in said order; and

1 For temporary restraining order, see 34 F. T. C. 1867, 3 S. & D. 720. As there set forth in footnote, the preliminary injunction was granted July 28, 1942, though actual writing thereof did not occur until later due to Judge O'Brien sickness.

Whereas, said defendants have not perfected their appeal and are willing that it should be dismissed;

Now, therefore, the parties hereto agree that the appeal herein be dismissed without costs against defendants and appellants, other than Clerk's fees incident to the filing of this stipulation and entry of order of dismissal, and the Clerk is hereby directed to enter such order of dismissal.

NOTE. The order for temporary injunction, dated Nov. 6, 1942, from which appeal was dismissed, follows:

ORDER FOR INJUNCTION

At a session of said court, continued and held pursuant to adjournment in the District Court Room in the Federal Building, in the City of Detroit, in said District, on the 6th day of November A. D. 1942. Present: Honorable ERNEST A. O'BRIEN, United States District Judge.

This cause having come to be heard upon the complaint of the Federal Trade Commission praying for the issuance of an injunction against the defendants, the plaintiff appearing by its attorney, William M. King, and the defendants appearing by their attorneys, Voorhies, Long, Ryan and McNair, Richard Steel and William Henry Gallagher; and

It appearing to the court that defendants are domiciled and transact business in the Eastern District of Michigan; and

It appearing to the court that it has jurisdiction over the parties and subject matter hereof; and

It appearing to the court that the defendants are engaged in the sale and distribution of drugs, as defined by the Federal Trade Commission Act, advertised as "Glyoxylide," "B-Q" and "Malonide Ketene Solution" in commerce between and among the various states of the United States and in the District of Columbia; and

It appearing to the court that said defendants, prior to the filing of the complaint herein, had disseminated or caused to be disseminated certain advertisements concerning said drugs by United States mails and by other means in commerce, as "commerce" is defined in the Federal Trade Commission Act, for the purpose of inducing and which are likely to induce, directly or indirectly, the purchase of said drugs, and by various means for the purpose of inducing or which are likely to induce, directly or indirectly, the purchase in commerce, as "commerce" is defined in the Federal Trade Commission Act, of said drugs, which advertisements are alleged by the plaintiff to be false in that they repesent that said preparation "Glyoxylide" is a competent