Sixth Circuit Uses Some Old Supreme Court Cases To Give Robinson-Patman Act New Life

In Williams v. Duke Energy International, Inc., No. 10-3604 (6th Cir. June 4, 2012), the Sixth Circuit rejected a Rule 12(b)(6) challenge to a Robinson-Patman claim against Duke Energy for discriminatory pricing of retail electricity. The Robinson-Patman claim was based upon substantial side rebates Duke Energy gave to certain large customers, including GM, which were not given to Ohio retail customers such as the plaintiffs. The Sixth Circuit rejected Duke Energy's various substantive attacks on the Robinson-Patman claim raised in its Fed. R. Civ. P. 12(b)(6) motion to dismiss.

The Sixth Circuit opinion is somewhat surprising given the largely negative treatment of the 76-year-old price discrimination law by federal courts in recent years. This 12(b)(6) holding is also in contrast to a recent trend of federal court rulings finding that plaintiffs had not adequately pled a viable Robinson-Patman claim under the Supreme Court's Twombly-Iqbal line of cases regarding federal court 12(b)(6) pleading standards. Given the Supreme Court's continued interest in the Robinson-Patman Act—sometimes called the "black sheep" of antitrust—this recent Sixth Circuit case may well be headed to the Supreme Court.

In reaching its holding, the Court applied the following reasoning:

First, the Court rejected a challenge to its jurisdiction over the Robinson-Patman claim under the filed rate doctrine. Relying upon the Sixth Circuit's 2004 decision in MCI Telecomms. Corp. v. Ohio Bell Tel. Co., 376 F.3d 539 (6th Cir. 2004), and the First Circuit decision in Town of Norwood, Mass. v. New England Power Co., 202 F.3d 408 (1st Cir. 2000), the Court determined that the plaintiffs were not challenging the filed rates—but rather Duke Energy's side agreements for rebates that were not approved or filed with the Public Utilities Commission of Ohio.

Second, the Court held that electricity is a "commodity" under the Robinson-Patman Act. Such a finding was crucial because the Act is only applicable to commodities, not services. The Court pointed out that in a 1993 decision, the Sixth Circuit indicated support for this proposition. The Court rejected the precedent of a 1979 Delaware District Court decision holding that electricity was not a commodity—especially in light of rulings by other courts that electricity is a commodity, because it is produced, sold, stored in small quantities...