United States District Court, D. New Jersey
WILLIAM J. MARTINI, U.S.D.J.
matter comes before the Court on Defendants Firestone
Building Products Company, LLC's, Firestone Diversified
Products, LLC's, and GenFlex Roofing Systems, LLC's
collective motion for summary judgment. ECF No. 188. For the
reasons set forth below, the motion is
Marjam Supply Co. (“Marjam”) brings this
antitrust suit under Sections 2(a) and 2(d) of the
Robinson-Patman Act, 15 U.S.C. § 13, et seq.
(“Act”). Marjam is a building-materials
distribution company. Defendants Firestone Building Products
Company, LLC, Firestone Diversified Products, LLC, and
GenFlex Roofing Systems, LLC (collectively,
“Firestone”) are manufacturers of
building-construction materials, including those used for
roofing. Until Firestone ended their relationship in October
2011, Marjam distributed Firestone's roofing materials in
New York, New Jersey, Pennsylvania, and Delaware.
accuses Firestone of offering its roofing products to
Marjam's competitors (“Favored
Distributors”) at more favorable terms than those offered
to Marjam through non-uniform rebate, discount, and financing
programs. Op. at 3-4 (Nov. 30, 2012), ECF No. 38. Due to the
disparate terms offered by Firestone, the Favored
Distributors could allegedly offer Firestone's products
to “Major Customers” at lower prices than Marjam.
Id. Marjam asserts it lost significant business to
the Favored Distributors as a result. Id.
Court previously granted-in-part and denied-in-part a motion
to dismiss the claims against Firestone. See Id.
While dismissing much of the complaint, the Court allowed
Marjam to proceed on its Section 2(a) and 2(d) claims.
Id. at 9. With the Court's leave, Marjam added
GenFlex as a defendant via amended complaint. See
Amend. Compl. ¶¶ 116-132, ECF No. 92. Presently
before the Court is Firestone's (including GenFlex's)
motion for summary judgment on Marjam's remaining claims
against it (Counts One, Two, and Four). Firestone Mot. (Jan.
11, 2019), ECF No. 188.
Summary Judgment Standard
judgment is appropriate if “there is no genuine issue
as to any material fact and . . . the moving party is
entitled to judgment as a matter of law.” FRCP 56. A
fact is material if its determination might affect the
outcome of the suit under the applicable substantive law.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
248-49 (1986). A dispute is genuine if “a reasonable
jury could return a verdict for the nonmoving party.”
Id. To make this determination, the Court views the
facts in the light most favorable to the nonmovant and all
reasonable inferences must be drawn in the nonmovant's
favor. Scott v. Harris, 550 U.S. 372, 378 (2007).
moving party bears the burden of demonstrating the absence of
a genuine dispute of material fact. Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). The movant meets this
burden by pointing to an absence of evidence supporting an
essential element as to which the non-moving party will bear
the burden of proof at trial. Id. at 325. If the
moving party carries this initial burden, “the
nonmoving party must come forward with specific facts showing
that there is a genuine issue for trial.” United
States v. Donovan, 661 F.3d 174, 185 (3d Cir. 2011)
Firestone's Motion for Summary Judgment
numerous arguments for summary judgment fit into two broad
categories: (1) Marjam cannot establish the
requisite harm to competition and (2) even assuming
it could, inter-brand competition negates any such harm.
See generally Firestone Mot. Marjam counters each
argument by citing record evidence. See Marjam Opp.,
ECF No. 189.
Section 2(a) Claims
2(a) of the Act states:
It shall be unlawful for any person engaged in commerce, in
the course of such commerce, either directly or indirectly,
to discriminate in price between different purchasers of
commodities of like grade and quality . . . where the effect
of such discrimination may be substantially to lessen
competition . . . 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: Provided, That nothing
herein contained shall prevent differentials which make only
due allowance for differences in the cost of manufacture,
sale, or delivery resulting from the differing methods or
quantities in which such commodities are to such purchasers
sold or delivered.
15 U.S.C. § 13(a). A prima facie Section 2(a)
claim requires four elements: “(1) that sales
were made to two different purchasers in interstate commerce;
(2) that the product sold was of the same grade and
quality; (3) that defendant discriminated in price
as between the two purchasers; and (4) that the
discrimination had a prohibited effect on competition.”
Feesers, Inc. v. Michael Foods, Inc., 498 F.3d 206,
212 (3d Cir. 2007). The fourth element includes both a
“competitive injury” (i.e., “a reasonable
possibility that the price difference may harm
competition”) and an “antitrust injury”
(i.e., “a causal connection between the price
discrimination and actual damages suffered”).
Id.; Stelwagon Mfg. Co. v. Tarmac Roofing Sys.,
Inc., 63 F.3d 1267, 1273 (3d Cir. 1995).
primarily argues there is no genuine issue of material fact
regarding whether Marjam suffered competitive or antitrust
injuries (element four). Firestone also asserts there is no
genuine issue regarding whether the products sold were
“of the same grade and quality” (element two) and
whether Firestone actually committed price discrimination
argues that Marjam cannot establish the fourth element of a
Section 2(a) claim-that the price discrimination had a
prohibited effect on competition (i.e., that the plaintiff
suffered a “competitive injury”). Mot. at 8.
Given Section 2(a)'s prophylactic purpose, to satisfy the
competitive injury element, plaintiffs need only show
“a reasonable possibility that the price
difference may harm competition, ” not that it
actually harmed competition. Feesers, 498
F.3d at 212 (brackets and citations omitted). Thus,
plaintiffs may establish the competitive injury indirectly-by
demonstrating substantial price discrimination over time
(which evidences a reasonable possibility of
harm)-or directly-through evidence of actual displaced sales
(i.e., actual harm to competition). Id. at 216
(citations omitted). Here, Marjam does both.
Direct Evidence of a Competitive Injury
proof of a competitive injury utilizes “direct evidence
of displaced sales.” Id. (citation omitted);
see also Volvo Trucks N. Am., Inc. v. Reeder-Simco GMC,
Inc., 546 U.S. 164, 177 (2006) (“A hallmark of the
requisite competitive injury . . . is the diversion of sales
or profits from a disfavored purchaser to a favored
purchaser.”). Marjam points to two of its
employees' depositions for such evidence: Joel Martin (a
Marjam salesman responsible for Firestone products) and James
Metcalf (Marjam's Product and Marketing Manager). Marjam
Opp. at 58. Martin's deposition included the following
Q: Why did Marjam lose the business of Hamada?
A: We can only go off the costs that were given and price the
Q: I don't understand your answer.
A: I don't understand what you're asking me for. You
know-- Q: Are you suggesting that if you met your
competitors' pricing you'd be pricing below cost?
A: Right. I don't know what my competitors are giving
them. I'm just being told that I'm high from my
Appx. to Sharon Decl., Ex. G, Martin Dep. at 69-70, ECF No.
189-6 (emphasis added). As to Metcalf, his deposition