In the United States v. Topco Associates, Inc., 1971 case, the U.S. Supreme Court ruled that Topco's practice of restricting its member supermarkets from purchasing certain products outside their assigned territories was a violation of antitrust laws. The court found that this territorial restriction limited competition and thus violated Section 1 of the Sherman Act which prohibits contracts or conspiracies to restrain trade or commerce among several states. Despite Topco's argument that these restrictions were necessary for smaller retailers to compete with larger chains, the court held that such restraints on trade could not be justified by economic necessity nor efficiency considerations as they directly contravened public policy favoring free competition.

In the dissenting opinion for United States v. Topco Associates, Inc., Justice Black argued that the majority's decision was a misinterpretation of antitrust laws and could potentially harm small businesses. He contended that these laws were not intended to prohibit all restraints on trade but only those which are unreasonable or harmful to competition. The cooperative agreement among independent grocers in this case, he believed, did not constitute such an unreasonable restraint as it allowed them to compete with larger chains by pooling their resources and purchasing power. Furthermore, he warned that the Court’s ruling might discourage other small businesses from forming similar cooperatives out of fear they would be deemed illegal under antitrust law - thus inadvertently strengthening monopolies rather than preventing them.