Borden's Farm Products Co., Inc. v. Ten Eyck

297 U.S. 251 (1936)

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Nature of the Case

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Facts

D fixed differential of not to exceed one cent per quart on sales to stores, in favor of milk dealers not having a 'well-advertised trade name.' by the Milk Control Law of April 10, 1933 (reenacted by the laws of 1934, chapter 126), was an invasion of rights guaranteed by the Fourteenth Amendment. The statute permitted dealers not having well-advertised names to sell bottled milk to stores at one cent per quart less than the minimum which dealers with well-advertised trade names were required to charge, and also permitted stores to resell to their customers the unadvertised brands of milk at a price one cent per quart less than that at which D's milk could be sold under the minimum fixed by the order. D sought to justify the differential by the assertion that the statute was temporary, intended to relieve a temporary economic situation, and meanwhile to prevent monopoly of the business by dealers having well-advertised names. Prior to the adoption of the Act of 1933 independent dealers had purchased from producers at prices lower than those paid by D and other purveyors of well-advertised brands, and in turn charged less to stores than D and others in its class. By the Act the independent dealers were compelled to purchase from the farmers on the same basis as the well-known dealers; and to deprive them of this advantage and in turn to compel them to charge the same price for their milk as the well-advertised brands commanded would be to transfer all their customers to the owners of well-known brands, and put them out of business. Prior to the adoption of the Milk Control Law, there had been a threat to forbid the sale of milk in bulk to stores; this compelled the independents who had formerly sold mostly bulk milk to change to the bottled trade, and keen competition ensued between them and the owners of well-advertised brands with destructive price-cutting throughout the greater part of New York City so that there was no fixed price for bottled milk sold to stores either by the independents or the well-advertised dealers. D claimed that the statute violated its right to equal protection under the laws guaranteed by the Fourteenth Amendment. There were over 150 dealers of milk in the NYC area. There were no allegations of illegal or monopolistic trade practices. The lower courts ruled the Act constitutional and dismissed D’s complaint. The Supreme Court granted certiorari.