## Facts

- Northwest Wholesale Stationers, Inc. operated as a wholesale purchasing cooperative for office-supply retailers.
- The cooperative bought supplies in bulk and resold to members and nonmembers at the same list price, but returned annual profits to members as percentage rebates, making members’ effective prices lower than nonmembers’.
- Pacific Stationery & Printing Co. was a member retailer expelled from the cooperative without explanation, notice, or a hearing.
- After expulsion, Pacific could continue purchasing from the cooperative only as a nonmember and thus without the member rebate.
- Pacific alleged the expulsion impaired its ability to compete and constituted an unlawful concerted refusal to deal.

## Issues

1. Whether expulsion of a member from a purchasing cooperative, without notice or hearing, is per se unlawful under Sherman Act §1 as a “group boycott” or instead must be evaluated under the rule of reason.
2. Whether §4 of the Robinson–Patman Act affects the Sherman Act §1 analysis by implying broader immunity or requiring procedural safeguards for cooperative expulsions.

## Decision

- The Supreme Court reversed the Ninth Circuit and held for Northwest.
- The expulsion did not fall within the narrow category of restraints presumed anticompetitive and therefore was not subject to per se condemnation.
- Section 4 of the Robinson–Patman Act provides only limited immunity from Robinson–Patman price-discrimination prohibitions and does not create an exemption from, or modification of, Sherman Act §1.
- The absence of internal procedural safeguards does not convert conduct into a per se Sherman Act violation.
- The proper framework was rule-of-reason analysis, under which Pacific had not shown anticompetitive effects on the record.

## Legal Principles

- Per se treatment under Sherman Act §1 is limited to restraint categories that reliably produce anticompetitive effects with minimal potential redeeming value.
- Group-boycott per se rules generally apply where competitors use market power to foreclose a rival from access to a supply, facility, or market necessary to compete.
- Expulsion from a purchasing cooperative is not presumptively anticompetitive absent evidence of market power, dominance, or meaningful foreclosure of competitive access.
- Procedural fairness within a private association is not a substitute for the substantive economic inquiry required by Sherman Act §1.
- Robinson–Patman Act §4 does not confer broad antitrust immunity and cannot be treated as a mandate for cooperative self-regulation that changes Sherman Act standards.

## Conclusion

The Court held that a purchasing cooperative’s expulsion of a member, even without notice or hearing, is not automatically an unlawful group boycott under Sherman Act §1; without proof of market power or competitive foreclosure, the restraint must be evaluated under the rule of reason, and Robinson–Patman Act §4 does not supply broader antitrust immunity or a procedural requirement.


Nw. Wholesale Stationers, Inc. v. Pac. Stationery & Printing Co., 472 U.S. 284 (1985)