Felix Frankfurter

“ The Commission seems to argue, in part, that the substantive violation occurs if the buyer knows only that the prices are lower than those offered other buyers. Such a reading not only distorts the language but would leave the word 'knowingly' almost entirely without significance in § 2 (f) . A buyer with no knowledge whatsoever of facts indicating the possibility that price differences were not based on cost differences would be liable if in fact they were not. ”

“ A subpoena of the seller's records is not likely to be adequate. It is not a question of obtaining information in the seller's hands. [8] It is a matter of studying the seller's business afresh. Insistence on proof of costs by the buyer might thus have other implications; it would almost inevitably require a degree of cooperation between buyer and seller, as against other buyers, that may offend other antitrust policies, and it might also expose the seller's cost secrets to the prejudice of arm's-length bargaining in the future. ”

“ If the methods or quantities differ, the Commission must only show that such differences could not give rise to sufficient savings in the cost of manufacture, sale or delivery to justify the price differential, and that the buyer, knowing these were the only differences, should have known that they could not give rise to sufficient cost savings. The showing of knowledge, of course, will depend to some extent on the size of the discrepancy between cost differential and price differential, so that the two questions are not isolated. ”

“ The Commission points out that it was under this section that we held in the Morton Salt case that the burden of showing a cost-justification is on the seller in a § 2 (a) proceeding, and argues that the same burden is on the buyer. It argues that the 'prima-facie case thus made' clearly refers back to 'proof (of) discrimination in price' and thus, from our decision in Morton Salt, that the prima facie case of a prohibited discrimination to which § 2 (b) refers consists only of proof of a difference in prices in the sale of like goods having the requisite effect on competition. ”

“ If the requirement of knowledge in § 2 (f) has any significant function, it is to indicate that the buyer whom Congress in the main sought to reach was the one who, knowing full well that there was little likelihood of a defense for the seller, nevertheless proceeded to exert pressure for lower prices. Enforcement of the provisions of § 2 (f) against such a buyer should not be difficult. ”

“ An offer of proof was in turn made by the Commission as to the testimony of these sellers on cross-examination; such proof would have brought out that petitioner never inquired of its suppliers whether the price differential was in excess of cost savings, never asked for a written statement or affidavit that the price differentials did not exceed such savings, and never inquired whether the seller had made up 'any exact cost figures' showing cost savings in serving petitioner. ”

“ Familiar but loose language affords too ready a temptation for comprehensive but loose construction. We therefore think it imperative in this case to confine ourselves as much as possible to what is in dispute here. ”

“ A buyer knowing he is receiving a lower price cannot be said to be in the same position as a seller granting a lower price. The language of the statute bars such a construction. Even if the buyer has the 'same' burden as the seller, the fact that a seller has the burden to show his costs does not automatically, by virtue of § 2 (f) , become a buyer's burden to show the seller's cost. Nor has Federal Trade Commission v. ”

“ In some instances, so the Commission found, petitioner's method was to 'inform prospective suppliers of the prices and terms of sale which would be acceptable to (petitioner) without consideration or inquiry as to whether such supplier could justify such a price on a cost basis or whether it was being offered to other customers of the supplier.' 46 F.T.C., at 888. ”

“ Section 2 (f) 'makes it easier (for the manufacturer) to resist the demand for sacrificial price cuts coming from mass-buyer customers, since it enables him to charge them with knowledge of the illegality of the discount, and equal liability for it, by informing them that it is in excess of any differential which his difference in cost would justify as compared with his other customers.' 80 Cong.Rec. 9419.↑ Cf. Adelman, Effective Competition and the Antitrust Laws, 61 Harv.L.Rev. 1289, 1331; Edwards, Maintaining Competition, 161.↑ Federal Trade Commission v. ”