Law & Courts

Justices Hear Case That Could Affect School Bus Market

By Andrew Trotter — November 08, 2005 3 min read
  • Save to favorites
  • Print

School buses were not mentioned in oral arguments before the U.S. Supreme Court last week in an antitrust case involving heavy-truck sales, but the prices school districts pay for buses could be affected by the court’s eventual decision.

The National Association of State Directors of Pupil Transportation Services told the high court in a friend-of-the-court brief that upholding lower-court rulings being appealed in Volvo Trucks North America Inc. v. Reeder-Simco GMC Inc. (Case No. 04-905) would discourage school bus manufacturers from giving discounts to help their dealers win competitions for sales to districts.

Reeder-Simco, a dealer in Volvo trucks in Fort Smith, Ark., sued Volvo Trucks North America in 2000, claiming that the truck manufacturer unfairly favored other dealers by giving them bigger discounts, or price concessions, than it gave to Reeder, in violation of the federal Robinson-Patman Act, an antitrust law.

A jury awarded triple damages to the dealership based on Reeder-Simco’s alleged economic losses, a result that was upheld last year 2-1 by a panel of the U.S. Court of Appeals for the 8th Circuit, in St. Louis.

Volvo argues that the Robinson-Patman law, passed in 1936, has never applied to dealership arrangements typical for heavy truck and school bus sales, in which dealers do not technically purchase the product from the manufacturer until they have arranged a sale to a customer.

By then, Volvo argues, the competition for the customer is over. In addition, it says, Reeder-Simco was not in direct competition for many of the truck sales in which other dealers allegedly received favored treatment.

Heavy Commodity

Charles Gauthier, the executive director of the school transportation group, says that a school bus manufacturer, in helping one of its dealers win a school district contract, typically will offer a price concession that may reduce the manufacturer’s profits but enlarge its market share or make inroads into a new territory. Such selective discounting would not occur if the company was “looking over its shoulder” at the antitrust law because it was not giving the same concession to all its dealers, he said. Loss of selective discounts would “seriously impair the ability of local and state governments to purchase new school buses,” the group’s brief states.

In the Oct. 31 oral arguments, Justice Stephen G. Breyer suggested that the “continuous” relationship between Volvo and its dealers, as seller and buyers, and the fact that customers typically shop around among dealers, might be a form of sales competition under the antitrust law.

“Suppose that a case came up involving two Volvo dealers and specially ordered goods with competitive bidding,” and over time the favored dealer was given higher concessions, Justice Breyer wondered, and the other dealer was given lower concessions “and therefore is missing out of sales or getting lower profits.”

Roy T. Englert Jr., the lawyer for Volvo, disagreed with that broad view. He argued later that trucks ordered with custom features are not a commodity like salt, so truck sales could not be compared reliably with one another.

Thomas G. Hungar, the U.S. deputy solicitor general, who also argued on Volvo’s behalf, challenged Reeder’s method of judging its alleged losses by matching up sales of similar vehicles by other dealers who received larger discounts than Reeder did. Mr. Hungar described that “as picking and choosing” among sales to find ones that create a pattern.

Justices pressed the lawyer representing Reeder, Carter G. Phillips, about the dealership’s claims of loss because of the disfavor by Volvo. Mr. Phillips noted evidence that in 102 sales of “exactly the same vehicles,” other dealers had received a higher discount from Volvo than Reeder was given. He said that constituted “substantial price discrimination across time,” even if Reeder was not competing directly on those sales.

A version of this article appeared in the November 09, 2005 edition of Education Week as Justices Hear Case That Could Affect School Bus Market

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Special Education Webinar
Hidden Costs of Special Ed Vacancies: Solutions for Your District
When provider vacancies hit, students feel it first. Hear what district leaders are doing to keep IEP-related services on track.
Content provided by Huddle Up
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Privacy & Security Webinar
How Technology Is Reshaping Childhood
How do we protect kids online while embracing innovation? Learn about navigating safety, privacy, and opportunity in the Digital Age.
Content provided by Connect x Protect
Budget & Finance Webinar Creative Approaches to K-12 Budget Realities
What are districts prioritizing in 2026? New survey data reveals emerging K-12 budgeting trends.

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

Law & Courts Opinion Why the Supreme Court’s Ruling on Conversion Therapy Matters for Schools
A recent case puts religiously motivated speech ahead of the well-being of LGBTQ+ youth.
Jonathon E. Sawyer
5 min read
lgbtq student backpack with rainbow spectrum flag on stairs isolated
Education Week + iStock/Getty
Law & Courts Birthright Citizenship Case Raises Stakes for Schools and Undocumented Students
Educators are paying close attention to the case on Trump's birthright citizenship order.
10 min read
President Donald Trump signs an executive order on birthright citizenship in the Oval Office of the White House in Washington, Jan. 20, 2025.
President Donald Trump signs an executive order on birthright citizenship in the Oval Office of the White House on Jan. 20, 2025. The order, now before the U.S. Supreme Court, seeks to limit citizenship for some children born in the United States to immigrant parents without permanent legal status.
Evan Vucci/AP
Law & Courts Appeals Court Revives Lawsuit Over 1st Grader’s Black Lives Matter Drawing
A court revived a 1st grader 's claim she was punished for giving a drawing to a Black classmate.
4 min read
Seen is the drawing made by Viejo Elementary School first-grader B.B. that was entered into evidence. B.B. gave the drawing to her classmate, M.C., who is African American. M.C. thanked B.B.
Pictured is a drawing by a 1st grader in California and given to a Black classmate that is at the center of a First Amendment legal challenge over the student's alleged punishment.
U.S. Court of Appeals for the 9th Circuit
Law & Courts Supreme Court’s Gender Identity Ruling Leaves Schools Seeking Clarity
Advocates say they would welcome more from the Supreme Court on gender-notification policies.
7 min read
The Supreme Court is photographed, Friday, Feb. 27, 2026, in Washington.
The Supreme Court is photographed, Friday, Feb. 27, 2026, in Washington. The high court recently ruled that California policies that sometimes limit or discourage schools from disclosing information to parents about children’s gender transitions and expressions at school likely violate parents’ constitutional rights
Rahmat Gul/AP