William J. Brennan, Jr.

“ If, on the other hand, the dealer who cross-sells runs the risk under the agreement of losing his franchise altogether, intra-brand competition across territorial boundaries involves serious hazards which might well deter any effort to compete. ”

“ In the present case, for example, as the Government suggests, it may appear at the trial that whatever legitimate business needs White advances for territorial limitations could be adequately served, with less damage to competition, through other devices-for example, an exclusive franchise, [11] an assignment of areas of primary responsibility to each distributor, [12] or a revision of the levels of profit pass-over so as to minimize the deterrence to cross-selling by neighboring dealers where competition is feasible. ”

“ Thus, if the manufacturer always did grant discounts which the distributors were unable to grant, there would seem to be no reason whatever for denying the distributors able to overcome that advantage access to the preferred customers. Conversely, the presence of such restrictions in the agreements between White and its distributors suggests that they are designed, at least in part, to protect a noncompetitive pricing structure, in which the manufacturer in fact does not always charge the lowest prices. ”

“ As to each of these practices, experience and analysis have established the utter lack of justification to excuse its inherent threat to competition. [2] To gauge the appropriateness of a per se test for the forms of restraint involved in this case, then, we must determine whether experience warrants, at this stage, a conclusion that inquiry into effect upon competition and economic justification would be similarly irrelevant. [3] With respect to the territorial limitations of the type at bar, I agree that the courts have as yet been shown no sufficient experience to warrant such a conclusion. ”

“ The second justification White offers is that 'the only sure way to make certain that something really important is done right, is to do it for oneself.' This argument seems to me to prove too much, for if the distributors truly cannot be counted on to solicit and service the governmental and fleet accounts-not all of which are, in fact, large or demanding-then this suggests that the only adequate solution may be vertical integration, the elimination of all independent or franchised distribution. ”

“ The analogy to resale price maintenance agreements is also appealing, but is no less deceptive. Resale price maintenance is not only designed to, but almost invariably does in fact, reduce price competition not only among sellers of the affected product, but quite as much between that product and competing brands. ”

“ It may be relevant to the question whether the territorial restrictions were intended to suppress price competition that appellant also maintained a schedule of resale prices in its distributor agreements, though there has been no challenge here to the District Court's finding that those provisions were unlawful per se.↑ For situations in which such extenuations might be relevant, compare, e.g., Packard Motor Car Co. ”

“ In the former case the court observed, in holding an exclusive franchise arrangement not violative of the Sherman Act:↑ If the restraint is shown to be excessive for the manufacturer's needs, then its presence invites suspicion either that dealer pressures rather than manufacturer interests brought it about, or that the real purpose of its adoption was to restrict price competition, cf. ”

“ A number of consent decrees have recently recognized the lawfulness of area-of-primary-responsibility covenants as substitutes for the more restrictive exclusive arrangements. See, e.g., United States v. ”