## Facts

- Universal-Rundle Corporation manufactured a full line of china and cast-iron plumbing fixtures and sold them nationwide.
- The Federal Trade Commission (FTC) issued an administrative complaint alleging Universal-Rundle engaged in unlawful price discrimination under § 2(a) of the Clayton Act, as amended by the Robinson-Patman Act.
- After evidentiary hearings, the FTC found Universal-Rundle offered “truckload discounts” averaging about 10% to all customers in 1957.
- Customers unable to purchase in truckload quantities could not obtain the discounts, and some discount-eligible customers competed with non-eligible customers in resale or distribution.
- The FTC concluded the truckload discounts constituted price discrimination with the anticompetitive effect prohibited by § 2(a).
- The FTC issued a cease-and-desist order barring Universal-Rundle from charging higher prices to a purchaser when a lower price was granted to another purchaser who competed with the higher-priced purchaser in resale or distribution of like goods.
- Universal-Rundle petitioned the FTC to stay enforcement of the order pending an industry-wide investigation of similar discount practices, claiming it would face severe financial difficulty if restrained while competitors continued similar discounts.
- The FTC unanimously denied the stay request, finding generalized allegations of similar competitor conduct insufficient to justify withholding enforcement or requiring an industry-wide proceeding.

## Issues

1. Whether a court of appeals exceeds its reviewing authority by setting aside the FTC’s denial of a stay and postponing a cease-and-desist order until the FTC conducts an industry-wide investigation.
2. Whether the FTC’s refusal to stay enforcement of a valid cease-and-desist order constituted a “patent abuse of discretion.”

## Decision

- The Supreme Court reversed the Seventh Circuit and remanded.
- The Court held the FTC’s refusal to stay enforcement did not amount to a patent abuse of discretion.
- The Court held the court of appeals exceeded its authority by effectively conditioning enforcement of the FTC’s order on an industry-wide investigation.

## Legal Principles

- Reviewing courts may not interfere with the FTC’s decision to enforce a valid cease-and-desist order—despite claims of similar unlawful conduct by others—unless the Commission’s decision reflects a patent abuse of discretion.
- The FTC has broad discretion to determine the timing and scope of its enforcement program, including proceeding against one firm without simultaneously proceeding against all alleged violators.
- A court of appeals may not restructure or manage the FTC’s enforcement priorities by requiring broader investigations as a prerequisite to enforcing a lawfully issued order.
- Allegations that competitors engage in similar practices and that enforcement may create competitive disadvantage do not, without more, compel the FTC to stay enforcement of a cease-and-desist order.

## Conclusion

The Supreme Court held that the FTC acted within its enforcement discretion in refusing to stay a cease-and-desist order against Universal-Rundle while considering whether to pursue broader industry practices, and that the court of appeals improperly displaced the Commission’s discretion by postponing enforcement absent a patent abuse of discretion.


Federal Trade Commission v. Universal-Rundle Corp., 387 U.S. 244 (1967)