Supreme Court Agrees to Hear Case Involving Volvo, Dealer Dispute

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he U.S. Supreme Court will use a dispute involving Volvo AB to review the scope of a federal law that restricts price discrimination, Bloomberg reported Monday.

The court agreed to hear Volvo's appeal of a $4 million award to an Arkansas truck dealer, in which the company contends that a federal appeals court expanded the scope of the Robinson-Patman Act, Bloomberg said.

The 1936 Robinson-Patman Act was enacted to protect small retailers from the purchasing power of larger concerns. It generally bars sellers from discriminating among buyers in prices or promotions when the effect is to undermine competition, Bloomberg said.

A federal jury in Arkansas awarded Reeder-Simco $1.3 million, which was tripled under U.S. antitrust law, and the 8th Circuit upheld the award in a 2-1 decision, Bloomberg said.

The St. Louis-based appeals court decision “comes dangerously close to stating a blanket condemnation of all price differences in the sale of products,” Volvo argued in its court filing in Washington, Bloomberg reported.

Reeder-Simco GMC Inc., a dealer based in Fort Smith, Ark., said that from 1996 to 2000 it did not receive discounts that Volvo gave other truck dealers, Bloomberg said.

“Volvo simply wants to be able to engage in discriminatory pricing for the sake of its own profits — not for consumer welfare,” the dealership argued.

Volvo AB is the parent of U.S. truck manufacturers Volvo Trucks North America and Mack Trucks Inc.