## Facts

- Klor’s, Inc. operated a small appliance store on Mission Street in San Francisco, selling radios, televisions, refrigerators, and similar goods.
- Broadway-Hale Stores, Inc., a large department-store chain, operated a competing store next door to Klor’s.
- Klor’s alleged Broadway-Hale used its buying power to induce multiple major appliance manufacturers and distributors to stop selling to Klor’s, or to sell only on discriminatory, unfavorable terms.
- The alleged combination included Broadway-Hale and ten national manufacturers and their distributors (including major brand suppliers).
- Klor’s alleged the concerted refusal to deal impaired its ability to compete and caused loss of profits, goodwill, and reputation.

## Issues

1. Whether a concerted refusal to deal directed at a single retailer states a Sherman Act § 1 claim as a per se unlawful group boycott without proof of broader price, output, or quality effects.
2. Whether the presence of many alternative retailers and the small size of the targeted firm makes the dispute a non-actionable “private quarrel” outside the Sherman Act.
3. Whether defendants were entitled to summary judgment based on affidavits showing many other retailers sold competing and even the same brands in the area.

## Decision

- The Supreme Court reversed the judgment affirming dismissal and summary judgment for defendants.
- The Court held the complaint alleged a “classic” group boycott: a combination of manufacturers, distributors, and a retailer to exclude Klor’s from access to suppliers.
- Such group boycotts are condemned under Sherman Act § 1 on a per se basis; defendants’ affidavits did not defeat the claim.
- The case was remanded for further proceedings.
- Justice Harlan concurred in the judgment, agreeing the case should not have been terminated on summary judgment.

## Legal Principles

- A concerted refusal to deal by multiple suppliers and a retailer aimed at excluding a competitor constitutes a group boycott actionable under Sherman Act § 1.
- Per se treatment applies to classic group boycotts; plaintiffs need not plead or prove market-wide effects on price, output, or quality to avoid dismissal at the outset.
- Antitrust law is not limited to situations where the immediate victim is large; exclusionary combinations are not excused because only one small merchant is targeted.
- The existence of alternative outlets or numerous other retailers in the community does not immunize an alleged per se group boycott or justify summary judgment when the complaint alleges concerted exclusion.

## Conclusion

The Court held that allegations of a supplier-and-retailer combination to cut off a single competing dealer state a per se unlawful group boycott under Sherman Act § 1, and that the claim cannot be dismissed as a mere private dispute or defeated by affidavits showing many other retailers in the market.


Klor's, Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207 (1959)