Dr. Miles Medical Co. v. John D. Park & Sons, Co. Case Brief Summary | Law Case Explained

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Dr. Miles Medical Co. v. John D. Park & Sons, Co. | 220 U.S. 373 (1911)

Judicial prohibitions on restraints of trade predate antitrust statutes by centuries. In Doctor Miles Medical Company versus John D. Park and Sons Company, the United States Supreme Court considered a manufacturer’s trade and price restrictions while applying earlier restraint-of-trade decisions.

The Doctor Miles Medical Company manufactured and sold medicines. Miles kept its methods and formulas secret, but it hadn’t patented, trademarked, or otherwise acted to legally protect its formulas or production methods. Miles primarily sold to wholesalers and jobbers who then sold to retail pharmacists for sale to consumers. Miles’s contracts provided that its buyers could only sell to Miles-approved retailers. Miles also set the prices for sale to retail pharmacists and to retail customers.

John D. Park and Sons, a wholesale drug business, allegedly obtained Miles’s medications by fraud or dishonesty from other wholesalers at discount prices, then sold those medications to retailers to be sold to customers for less than contractually mandated prices.

Miles sued in federal court, alleging that Park was interfering with Miles’s relationship with its wholesale and retail customers and inducing them to violate their contractual obligations. The circuit court sustained Park’s demurrer, dismissing the case. The Sixth Circuit affirmed, and the United States Supreme Court granted cert.

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