Millcraft Paper Co. and Veritiv Corporation are wholesale distributors of printing paper products used for automotive advertising projects. When an automotive company or its contracted advertising agency orders printed materials from a printing company, the printing company orders paper from companies like Millcraft and Veritiv. Paper distributors like Millcraft and Veritiv in turn order paper from paper manufacturers. 

Due to alleged business dealings, Millcraft sued Veritiv for claims including a Robinson-Patman Act violation. Millcraft’s complaint charged Veritiv for knowingly inducing or receiving a better price than Millcraft for the same grade and quantity of paper from paper manufacturers. 

In the hearing to decide if Veritiv’s motion to dismiss should be granted, it was undisputed that for several years Veritiv enjoyed much lower prices for the same quality and quantity of paper that Millcraft did. Because of the aforementioned facts, price discrimination existed. The court stated that under the Robinson-Patman Act, not all price discrimination is prohibited. The court eventually rejected Veritiv’s motion to dismiss, stating that the price discrimination in the instant case was of the kind banned by the Robinson-Patman Act. 

What was the court’s reasoning when it ruled that Veritiv engaged in inducing or knowing about this kind of price discrimination? During the hearing, Millcraft accused Veritiv of demanding a steep discount from paper manufacturers for keeping its business there. Assuming the accusations are true, do you think this is unethical behavior or savvy business dealing? Do you think the injury in this case is primary-line injury or secondary-line injury and why?