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
Artificial Intelligence Webinar
Managing AI in Schools: Practical Strategies for Districts
How should districts govern AI in schools? Learn practical strategies for policies, safety, transparency, and responsible adoption.
Content provided by Lightspeed Systems
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
Student Absenteeism Webinar
Removing Transportation and Attendance Barriers for Homeless Youth
Join us to see how districts around the country are supporting vulnerable students, including those covered under the McKinney–Vento Act.
Content provided by HopSkipDrive
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
Reading & Literacy Webinar
Two Jobs, One Classroom: Strengthening Decoding While Teaching Grade-Level Text
Discover practical, research-informed practices that drive real reading growth without sacrificing grade-level learning.
Content provided by EPS Learning

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 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
Law & Courts Supreme Court Backs Parents in School Gender Disclosure Fight
The Supreme Court restored an injunction blocking California policies on student gender transitions
8 min read
Teacher’s aide Amelia Mester, wrapped in a Pride flag, urges Escondido Union High School District not to have employees notify parents if they believe a student may be transgender in November 2025. A policy on the issue in the city’s elementary school district is the subject of a federal class-action lawsuit in which a judge just sided against the district.
Teacher’s aide Amelia Mester, wrapped in a Pride flag, urges Escondido Union High School District not to have employees notify parents if they believe a student may be transgender at a meeting in November 2025. Two parents and two teachers from the district sued in 2023, challenging California state guidance concerning student gender transitions and parental notification. The U.S. Supreme Court has now reinstated a lower-court decision overturning those state policies.
Charlie Neuman for The San Diego Union-Tribune/TNS
Law & Courts Appeals Court Allows Louisiana Ten Commandments Displays to Proceed
The court said it was premature to rule on the constitutionality of La. Ten Commandments displays.
3 min read
Students work under Ten Commandments and Bill of Rights posters on display in a classroom at Lehman High School in Kyle, Texas, Thursday, Oct. 16, 2025.
Students work under Ten Commandments and Bill of Rights posters on display in a classroom at Lehman High School in Kyle, Texas, Oct. 16, 2025. A federal appeals court has lifted a lower-court injunction blocking a Louisiana law that requires Ten Commandments displays, clearing the way for the law to take effect.
Eric Gay/AP