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How To Grow Your Town or Village By Providing Information, Low-Dollar Financing and Litigation Center Assistance to Local Small Businesses Injured by Wal-Mart, Home Depot and/or other Major Retailers

1st Published on 12/15/03; Last Update: 11/12/07 6:15 pm

Purpose of this GrowTown Website

The purpose of this "GrowTown" website is to provide a realistic, low-cost plan for any small town or village to prevent or oppose its destruction by the billion-dollar forces of major retailers such as Wal-Mart and Home Depot.

The plan is simple, involves small dollar outlays, and can be expected to produce millions of dollars of revenues for any town or village and related benefits to its small businesses and residents.

To derive the most benefit and insight from your reading of this website, you should have and maintain an open mind, and not jump to any conclusions. Read the website, and try to understand what is being said. The plan is natural and obvious, and should be adopted by towns and villages which have not already given up control to the major corporate interests.

The Problems of Small Towns and Villages Addressed by this "GrowTown" Website

I am writing this website with specific problems in mind, which I list immediately below. If, in your opinion, your town or village does not have any of these problems, then (i) you do not need to read any further, or (ii) you are one of the town's problems, for failing to see what's happening in your town.

The specific problems I have in mind are:

• Destruction of a significant number of retail businesses on the Main Street or business center of your town or village because of the lower-priced competition of the major retail chains;
• Reduced values of commercial property in the center of your town or village;
• Loss of sales tax revenues by your town or village because of the diversion of sales to major retail chains located outside of your town's area for collecting sales taxes;
• Net loss of sales tax because of inducement deals with major retailers coupled with loss of sales taxes being collected by existing independent retailers;
• Loss of job opportunities because of businesses which have left the area or have gone out of business, with an increased percentage of available jobs being minimum-wage (or slightly higher) at major retail chain stores in your area;
• Loss of value of area businesses which had been built up and run successfully for 25 to 50 years;
• Inability of a politically-divided town to recognize the chain-store evil or how to deal with such evil;
• Failure of chain store to live up to promises and representations under which they obtained approvals to set up their chain store(s);
• Added cost of health services imposed on town, county and state by major retailers who do not maintain adequate or any health insurance for a significant percentage of their workers;
• Added cost of food stamps and other social services provided by community to support the inadequately-paid employees of the major chains;
• Resulting loss to competing businesses who have to chip in to pay for these "externalized" costs of the major retailers, who have the community pay a substantial part of the major retailers' operating expenses;
• Undermining of local government and political will of the population by improper payments and other inducements to obtain local approvals to open up new chains stores in the area; and
• Other important issues which at this moment do not come to mind.

The Evil Needing to Be Addressed is Unlawful Price Discrimination

If a patient is sick and learns the name of the disease, he/she will often try to find out through research what medicine or other cures exist. If a patient has the flu, the patient will want to take specific medicines or other treatment which can be expected to treat the flu.

The economic problems of thousands of small towns and villages in the United States can be understood by identifying the cause of the problems. It is no secret that the problem is being caused by Wal-Mart, Home Depot, Barnes & Noble, AutoZone, Costco and other major retail chains which offer goods at lower prices than the same goods are being offered by smaller, local merchants, thereby driving these local, independent businesses out of business.

So what is the problem? If Wal-Mart is more efficient, what's wrong with that? Why shouldn't consumers buy from retailers which offer lower prices? Why shouldn't consumers patronize lower-priced retailers, and force higher-priced retailers (and their independent wholesalers) to be as efficient or be driven out of business?

The fact that most persons cannot answer these questions is the real problem.

Wal-Mart is not more efficient. The major retailers buy in such huge quantities that they can force manufacturers to give lower prices to these power retailers, but these lower prices are not justified - they do not reflect savings which the manufacturers obtain when selling to the major retailers at such lower prices. The lower prices are depriving manufacturers of their capital and causing them to shed jobs in the United States and fight to remain in business by looking for countries which allow exploitation of labor in ways we do not allow in the United States.

Because the major retailers are able to force manufacturers to give them lower prices, the manufacturers, to stay alive, charge higher prices to the small businesses in your town, which as you know prevents these small businesses from competing for your purchases, and in due course, one after another, puts them out of business.

This price discrimination is a violation of a federal antitrust statute called the Robinson-Patman Act, which prohibits a manufacturer (or other supplier) from selling the same product to competing businesses at different per-unit prices, unless the difference is cost justified. The statute is more complicated than this, but you don't need to know all the ins and outs of the Robinson-Patman Act. If you are interested in the RPA, you can see my extensive website on the RPA at My Website on the Robinson-Patman Act, including a description of the 100 ways in which lower per-unit prices are being given to the major retailers. Also, you might be interested in my two sites about Wal-Mart, My Website on How to Stop Wal-Mart and My Website on Why Competitors Are No Longer Able to Stop Wal-Mart in the Business Arena.

What Your Town or Village Can Provide Its Small Businesses to Enable Them to Compete in the Courts with Wal-Mart, Home Depot and Other Major Retailers

Instead of trying to provide small businesses with tax subsidies, expedited approvals, relaxation of zoning rules, or other things of value, your town or village should provide three major things for its small-business retailers:

• A non-interest loan of $10,000 to $20,000 (which can be spread out over a 3-year period) to cover an important part of the out-of-pocket expenses in an RPA action by the small business against one or more of the major retailers or the manufacturers which are selling to them at favored per-unit prices; repayment of any such loan could be secured by any recovery obtained in the lawsuit, and instead of loan interest the town or village could be given an interest (often called a "kicker") such as 5% or 10% of the interest of the small business in the recovery;

• A town- or village-maintained RPA litigation center which assists its local businesses with complying with the burdensome discovery requirements which accompany most RPA lawsuits. This would be a source of jobs for local residents, and have the future benefit of helping to bring in the 5% or 10% interest described in the preceding paragraph; the town could provide the space, equipment and other services for these activities, which are basically paralegal activities for the lawsuit which need to be supervised by the attorneys for the small-business plaintiffs. This type of work is at the high end of employment activity in the United States, with law firms in New York City charging up to $300 or more per hour for paralegal services in RPA and other antitrust cases. I envision that in towns and villages far removed from large cities a fair hourly rate would be somewhere between $7 and $10 or more, which gives the local plaintiff a major advantage in its lawsuit against a major retailer and the manufacturer. [I would like to add at this point that I played an important role in creating the paralegal field in the United States, having founded the second paralegal school in the United States during 1972.]

• Information and consultation to alert local businesses to what they need to do to compete with these major retailers. The competition is in court, not in trying to become "more efficient", or changing the small businessperson's business to such an extent that it no longer competes with the major retailers. The local media should be enlisted to help with dissemination of the information needed by local businesses to understand what they need to do to prevent destruction of their businesses. I wrote a website to explain what farmers should have done to save their farms, but nobody told them. See my "farmgate" website, at My FarmGate Website Explaining How the Robinson-Patman Act Could Have Been Used to Save the Farms.

The Attorneys for the Small Business Would Work with the RPA Litigation Center Personnel

The work skills involved in complying with the discovery and other litigation requirements in an RPA lawsuit can be taught, and once learned become very valuable skills which can be taken by the employees to major and intermediate-size law firms in any cities in the United States.

To enable a local lawyer to accept an RPA case, it seems useful to have the town or village have an RPA litigation center available to the lawyer so he/she doesn't have to expand his/her law firm to accomodate a single lawsuit. The town or village, on the other hand, is hoping to have a multiplicity of RPA suits, and is in a better position to put together and maintain an RPA litigation center.

Estimate of Paralegal Costs to Support a Single RPA Lawsuit

Obviously, lawsuits differ, even when they are RPA lawsuits. It seems safe to say that one full-time paralegal is more than enough for running one typical RPA lawsuit. In fact, a single full-time paralegal could participate in discovery for a number of RPA suits at the same time. A major law firm might charge $300 per hour for 2,200 hours of billable time for a single paralegal, or $660,000 for a 1-year period. But at $10/hour, the cost to the envisioned RPA litigation center would be $22,000 for the year (and as said before could support multiple RPA lawsuits).

Actually, in the first year of RPA litigation, there would not be more than $3,000 to $5,000 of $10/hour time used in the lawsuit.

Sometimes some defendants settle early and leave the main defendants to continue the litigation alone. In such cases, the RPA suits become self-financing. This is not atypical.

Type of Person Who Would Be of Value to the Envisioned RPA Litigation Center

Are you wondering what type of person would be desirable for the staffing of the envisioned litigation center?

The hourly rate is very important, but if you are able to find persons willing to work for the needed hourly rate (with perhaps the promise of a bonus upon any successes in one or more of the lawsuits), you want people who have reading and writing skills; high I.Q.; responsible and reliable; can follow directions; have basic computer skills (word processing, spread sheet, data bases, internet research); well organized; inventive; not troubled with unrelated matters which could prevent them from getting the job done.

An Estimate of the Amount of Money Involved for the Town or Village

To understand how much money could be obtained by a town or village which provided the above-described support to its small businesses, you have to understand how much is at stake in a single RPA lawsuit.

For every dollar of gross profit margin which an existing business has lost in a typical day (during the preceding 4-year period) after direct expenses, the amount of recovery in an RPA treble-damage lawsuit is a maximum of 9,000 times. Thus, if a typical business loses $1,000 per day in profit margin (after direct expenses), the amount of recovery (at a maximum) in an RPA action would be $9,000,000 (i.e., 9,000 times $1,000).

See my RPA article on "Estimating Your Damages and Recovery in an RPA Suit", at How to Estimate Your Damage and Recovery in a Robinson-Patman Act Lawsuit. Also, see the text of my radio infomercial entitled "ONE MILLION FORTUNES LOOKING FOR THEIR RIGHTFUL OWNERS" which explains my 9,000 Times One-Day's Damage Rule . I explain this in my Robinson-Patman Act website at My Radio Infomercial "One Million Fortunes Looking for Their Rightful Owners.

Let's assume that the recovery is only $1,000,000 instead of $9,000,000, the share for the town or village for a single lawsuit would be about $50,000 to $100,000, plus a recovery of its interest-free loan to assist the business with its litigation expenses. If a local business had a chain of 5 stores, the recovery would presumably be 5 times as much, amounting to $250,000 to $500,000 for the town's share.

An interesting twist is for the town or village to buy up failed businesses which are unwilling or unable to sue and bring suit for the damages as the new management of the failed corporation, transforming the town's 5% or 10% interest into an interest of 80% of the plaintiff's recovery (after payment of the attorney's contingent fee). In such case, the town or village probably should provide an incentive of about 20% of the net recovery to the former owner to encourage such person to assist in the discovery which will take place.

In light of the foregoing, it seems that any plan for revitalization of a town or village is something pretty simple to figure out. Support small business in their efforts to obtain a level playing field and, at the same time, don't provide the unfair support to major retailers to encourage them to set up on the area, which only hurts the persons and their small businesses you are trying to help.

Another Interesting Point - The Town or Village Itself Should Consider Suing for Its Own Damages

To be complete, I should inform you, as a person acting for an interested town or village, that towns and villages themselves which have been injured by major retailers, such as by the loss of taxes and the decline in value of the town's tax base, may be able to bring an action for damages under the Robinson-Patman Act. See my website entitled "Who Can Sue for Unlawful Price Discrimination - Individuals, Corporations, Towns, and Other Governmental Bodies" at How a Town or Village Can Sue for Recovery of Its Damages under the Robinson-Patman Act Lawsuit.

Also, see the website entitled "Using One Person (or a Small Number of Persons) as Plaintiff(s) to Sue, on Behalf of a Municipality or Publicly-Owned Smaller Retail Chain, for Violations of the Robinson-Patman Act, Whose Officials Are Unwilling to Commence the RPA Action" at My Website on How Citizens of a Town or Village Can Exercise the Municipality's Right to Sue under the RPA.

Also, see website on "How to Stop Wal-Mart" referred to above, at My Website on How to Stop Wal-Mart.

If you have any questions, don't hesitate to give me a call, at 212-307-4444, or email me at I am willing to speak before groups of interested persons. See at Availability of Carl E. Person to Speak [without Fee] to Group of Prospective Clients.

Carl E. Person, Editor, LawMall,

For the c.v. (resume) of Attorney Carl E. Person, click on Carl Person C.V.

Copyright © 2003-2004, 2006-2007 by Carl E. Person