United States v. Arnold, Schwinn & Company (1966)
- Docket
- 25
- Decided
- 1966-01-01
- Category
- General
Summary
Question: Does Schwinn’s practice of only selling products to approved dealers violated the Sherman Act? Conclusion: Sometimes. In a 5-2 decision, Justice Abe Fortas wrote the majority opinion reversing the lower court. The Supreme Court held that it is unreasonable for a manufacturer to restrict where its products are sold after it has transferred title and responsibility for loss. In situations where Arnold retains title, and the dealer acts as an agent or salesperson, those restrictions are not a restraint on trade. Justice Potter Stewart wrote a partial dissent, expressing disagreement with the majority’s argument that Arnold’s practices become illegal when carried out through a distributor. Justice John M. Harlan joined in the partial dissent. Justice Tom C. Clark and Justice Byron R. White did not participate.