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Supreme Ct allows Retailers to fix prices

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This is what happens when you politicize the court. It will force Congress to write a lot more laws to compensate. The question is, will they? And the other question is, how does it help the economy to make people decide not to buy things because products are too expensive? Why are manufacturers afraid of competition?

I suggest retailers continue to do business the way they have, and when a manufacturer prosecutes them for discounting prices, countersue under the RICO act. Businesses have no right to dictate what someone sells their product for. The court has lost their minds. But then that's been pretty obvious under the Roberts' court this past week.

Maybe that nefarious RICO act might actually do something positive for regular people finally.

--
Eric

Ernest Hemingway's writing reminds me of the farting of an old horse. - E.B. White
 
WASHINGTON -- Manufacturers can set a fixed price for their products and forbid retailers from offering discounts, the Supreme Court said Thursday, overturning a nearly century-old rule of antitrust law that prohibited retail price fixing.

Does this mean when I have a garage sale I can't reduce the price of a given item?

If the retailer purchased the item, what should prevent him from having a garage sale?

What if the store wanted to give the item away in a drawing or donate it? Seems to me if the retailer bought it, it should be up to the retailer to determine its sale price!

We have lost control of this government, of the people, for the people and by the people, thanks to Cheney and his pet monkey!
 
ledittmar said:
WASHINGTON -- Manufacturers can set a fixed price for their
products and forbid retailers from offering discounts, the Supreme
Court said Thursday, overturning a nearly century-old rule of
antitrust law that prohibited retail price fixing.

Does this mean when I have a garage sale I can't reduce the price
of a given item?
If the retailer purchased the item, what should prevent him from
having a garage sale?
What if the store wanted to give the item away in a drawing or
donate it? Seems to me if the retailer bought it, it should be up
to the retailer to determine its sale price!
We have lost control of this government, of the people, for the
people and by the people, thanks to Cheney and his pet monkey!
Click to expand...
That this present regime is against the Social reforms of the Roosevelt Administration. And of course they are. What they are not aware of is that they are against ALL Social Reforms. They wish to return us to the Gilded Age of the 19th Century, and get rid of simple protections like the Sherman Anti-Trust Act, that go back to 1890. That Act, sponsored by a Conservative Republican Senator and approved by a Conservative Republican President was a tool not aimed at Capitalism, it was aimed to protect both business and consumer against conspiricy and monopoly.

It was not particulerly radical of progresive - but weak as it was, it was the basis of protecting small business against monopoly.

Kiss it good bye.

Sherman Antitrust Act
From Wikipedia, the free encyclopedia

The Sherman Antitrust Act (Sherman Act[1], July 2, 1890, ch. 647, 26 Stat. 209, 15 U.S.C. § 1-7), was the first United States government action to limit monopolies, and is the oldest of all U.S. antitrust laws.

The Sherman Act provides: "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal".[2] The Act also provides: "Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony [. . . ]"[3] The Act put responsibility upon government attorneys and district courts to pursue and investigate trusts, companies and organizations suspected of violating the Act.

The Act was signed by President Benjamin Harrison in 1890 and was named for its author, Senator John Sherman, an Ohio Republican, chairman of the Senate Finance Committee, the Secretary of Treasury under President Rutherford Hayes, and Secretary of State under President William McKinley. After passing in the Senate on April 8th, 1890 by a vote of 51-1, the legislation passed unanimously (242-0) in the House of Representatives on June 20th, 1890.

The Act was not used in court cases for some years, but Theodore Roosevelt used the Act extensively in his antitrust campaign, managing to divide the Northern Securities Company. It was further used by President William Howard Taft to split and divide the American Tobacco Company.

Despite its name, the Act was not aimed at trusts in particular, but at any form which would create a "restraint of trade". The word "antitrust" was used because the Act was initially proposed to break up the Standard Oil trust. Ironically, by the time antitrust laws were finally brought to bear against the company, it was no longer using the form of a trust. Since then, the term "antitrust law" has persisted in the United States for what the rest of the world calls "competition law," even though antitrust laws are almost never used against trusts anymore.
 
Better solution . . .

Internet sales tax!

I'll be that would clear out 90% of those bogus-scamming online retailers!

--
J. Daniels
Colorful Colorado
Panasonic FZ10, FZ50 & Fuji S602Z owner & operator



Remember . . . always keep the box and everything that came in it!
 
this is the inevitable consequence of the close interaction between political and commercial organisations.
 
Prices Prices Prices.... anyone tired of the only place to buy cameras being online or Big Box stores that don't know anything?

Sony, Canon, Nikon have always had control of the lowest price based on their wholesale price. Though you will find some places that sell for less to naive buyers who then pay double for battery chargers etc.

Problem has been... for the good camera stores that they pay rent, salaries, local taxes. People come in and "steal the service" then go home and order from New Egg or B&H.

Question.. if your camera cost $599 at an online retailer and $500 at a local knowledgeable dealer.. where would you go to buy?

But when it costs $599 online and $699 how many of you think there is enough value in the local retailer to pay $100 more?

Tell me, which system is actually helping competition and choices? It sure as heck isn't single minded pandering to price obsesses buyers to the destruction of lower priced online warehouses.

I hear on this board over and over.. "GO hold the camera then buy the one you like online" Basically use the service that increased the cost of the camera, then run away and help a business that did nothing for you except ship at a low price"

Sony and Canon still can't get together and fix prices between them etc. What they can do it protect all of their dealers from being closed out by low prices options.

Sadly for all the cries and complaints on this thread... Sony and Canon are quite happy at the volume of sales going through the discounters and I doubt you will see them lift a finger to protect local stores at the cost of sales online.

This decision is too late... more and more the days of the trusted local dealer are numbered.

But I know all of you some how have twisted this into a win for evil corporations..funny how when your pocket book is involved... you become the advocates for large online retailers against your local stores.

------------
Ken - KM 5D
http://www.cascadephotoworks.com
 
Ken_5D said:
Good News for you local camera store with good staff just too late . . .
Click to expand...
Amen to that . . .

When that day comes when there are no more stores where you can 'test drive' a camera, you can bet that those online retailers will stiffen their return policies, making it almost impossible for you to return your item without it costing a pretty penny.

Save a nickle now . . . spend a dime later!

--
J. Daniels
Colorful Colorado
Panasonic FZ10, FZ50 & Fuji S602Z owner & operator



Remember . . . always keep the box and everything that came in it!
 
Chato said:
24Peter said:
PhotoTraveler said:
No.

If canon raises the price of the 5D up, people stop buying 5Ds.

What it can mean though is all the cheesy stores out there selling
stuff to low, and then you have some bad sales experience and so
forth will go away. Since they will have to bring their prices
back up to BH Photo and similar prices which are nominal market
prices.

The only people this hurts is sleazy discount shops that should
exist in the first place.
Click to expand...
You guys are missing the whole point: B&H can no longer discount
their prices below those set by Canon on a 5D (should Canon choose
to include these terms in its distribution agreement.) So if Canon
sets the price at $3299 (which I think is the last suggested list
price they provided), B&H will be obliged to charge you that
amount. How can that possibly be good for the consumer, seeing as
you can get one from B&H for 2699???? This will affect all your
consumer goods: TV's, computer equipment, appliances. Wake up!
Further, there is no need for overt collusion on prices when there
are only a few players in the market. The market leader sets the
price, the other companies fall in line, retail prices hold firm,
we pay out the nose. How is that not obvious?
--
View my on-line photo galleries here: http://imageevent.com/24peter
Click to expand...
The concept that "list price" is the price that they want you to
sell the product for is not something that people grasp.
Manufacturer "suggested Price," and "list price" are the exact same
thing.

I do believe it will sink in in about a year or two, when companies
take a look at this ruling and decide how best to take advantage of
it... :)

Dave
Click to expand...
Dave, I really don't think you get it. Large impersonal online operations, and even big box stores use price as a weapon to avoid training people and to run smaller local operations out of the market. Simple as that.

Canon, Sony, Nikon has always had the ability to charge what they want. The problem is they have to give that price to just about everyone. So a warehouse tied to web page with minimum wage workers can afford to sell the camera at invoice + $10 while local Joe's Love of Photography shop that pays people who care about cameras, opens boxes so you can hold them and try them, and pays taxes may need to make $100 over invoice.

Now Canon can say we want all our camera sold a minimum prices so the BIG predatory warehouses can't kill the little shops until you have no choice.

If Sony and Canon weren't fixing wholesale prices now .. why would they fix a minimum retail. What this ruling is saying is that beyond price, a manufacturer can work to control the quality and diversity of sales channels rather than letting price make the lowest common denominator of price the winner.

Too often people on this board tell people they need to hold the camera and look at it, listen to it... you need local retailers to do that...even best buy chains cameras to theft sensors so you can never get a real feel.

but how many of us have been saying.. if you go to a store to try a camera you have an obligation to buy there since you used the service that made the camera cost more.

Online retailers will have to compete in other ways...if this ruling changes anything. I don't think it will because Sony and Canon like the easy money high volume local discounters bring them. Sadly it is too late to save real photography stores from the the price tyranny of the Internet.
------------
Ken - KM 5D
http://www.cascadephotoworks.com
 
Once upon a time, in order to sell Canon, Nikon, Pentax, Minolta, Olympus and the others, you had to be an authorized dealer sanctioned by the manufacturer.

Apparently, all of that has gone out the window since it seems that anyone with the wherewithall to set up a website seems to be able to sell whatever they want.

I wonder how many of these online retailers actually have the authorization of the manufacterer's to sell their products!

Or is it that the big boys (ie.- camera manufacturers) don't care and just want as many items sold as possible . . . no matter who it is that is selling them?

To me, it seems that the manufacturers are just as guilty . . .

On one hand, they want the brick and morter stores to sell their products and they know that they have to charge more since they have actual real expenses just to keep the doors open.

Yet, with the other hand, the manufacturer's stab the brick and morter stores in the back by allowing just anyone to hock their products online without any kind of dealer recognition!

Perhaps one day this will all come full circle and hit the camera makers where it counts . . . the bank roll!

--
J. Daniels
Colorful Colorado
Panasonic FZ10, FZ50 & Fuji S602Z owner & operator



Remember . . . always keep the box and everything that came in it!
 
Ken_5D said:
Chato said:
Ken_5D said:
You guys are missing the whole point: B&H can no longer discount
their prices below those set by Canon on a 5D (should Canon choose
to include these terms in its distribution agreement.) So if Canon
sets the price at $3299 (which I think is the last suggested list
price they provided), B&H will be obliged to charge you that
amount. How can that possibly be good for the consumer, seeing as
you can get one from B&H for 2699???? This will affect all your
consumer goods: TV's, computer equipment, appliances. Wake up!
Further, there is no need for overt collusion on prices when there
are only a few players in the market. The market leader sets the
price, the other companies fall in line, retail prices hold firm,
we pay out the nose. How is that not obvious?
--
View my on-line photo galleries here: http://imageevent.com/24peter
Click to expand...
The concept that "list price" is the price that they want you to
sell the product for is not something that people grasp.
Manufacturer "suggested Price," and "list price" are the exact same
thing.

I do believe it will sink in in about a year or two, when companies
take a look at this ruling and decide how best to take advantage of
it... :)

Dave
Click to expand...
Dave, I really don't think you get it. Large impersonal online
operations, and even big box stores use price as a weapon to avoid
training people and to run smaller local operations out of the
market. Simple as that.

Canon, Sony, Nikon has always had the ability to charge what they
want. The problem is they have to give that price to just about
everyone. So a warehouse tied to web page with minimum wage
workers can afford to sell the camera at invoice + $10 while local
Joe's Love of Photography shop that pays people who care about
cameras, opens boxes so you can hold them and try them, and pays
taxes may need to make $100 over invoice.

Now Canon can say we want all our camera sold a minimum prices so
the BIG predatory warehouses can't kill the little shops until you
have no choice.

If Sony and Canon weren't fixing wholesale prices now .. why would
they fix a minimum retail. What this ruling is saying is that
beyond price, a manufacturer can work to control the quality and
diversity of sales channels rather than letting price make the
lowest common denominator of price the winner.

Too often people on this board tell people they need to hold the
camera and look at it, listen to it... you need local retailers to
do that...even best buy chains cameras to theft sensors so you can
never get a real feel.

but how many of us have been saying.. if you go to a store to try a
camera you have an obligation to buy there since you used the
service that made the camera cost more.

Online retailers will have to compete in other ways...if this
ruling changes anything. I don't think it will because Sony and
Canon like the easy money high volume local discounters bring them.
Sadly it is too late to save real photography stores from the the
price tyranny of the Internet.
------------
Ken - KM 5D
http://www.cascadephotoworks.com
Click to expand...
This is not and never has been a question of on-line retailers, vs small stores. The manufacturer doesn't care because they get their money.

The laws covering restrictions on trade evolved because it was found that companies colluded to raise prices. Price fixing, while continuing has always been a matter of difficulty. Essentially "List prices," or "manfacturerers suggested price" WERE not enforable. There was little incentive to collusion, because smaller compainies only stood to risk market share. Now there IS an incentive to collusion because even it they do lose market share, the bottom line will grow - at our expense of course. For example, let us say that Pentax makes $100 bucks for each dSLR. If they lose 10 percent of market share, this would dramatically affect their bottom line. But what if they make $200 on each camera? Hmm? What then about the bottom line?

Small camera stores of course are getting hurt. Will this ruling really protect them? They will still be paying more for each camera then the larger retailers. But most of all you and I will be paying more. And it's not just cameras that are affected here. It is in fact a license to collude, which is why the Sherman Act was passed in the first place!

History is a funny thing. This Court might consider the Sherman Act "quaint," but then again they are wealthy men... :(

Perhaps you are postulating some dramatic change in human nature? These companies wouldn't dream of colluding? It's all just some sort of scare tactic? That in fact the Court was mainly thinking of the benefits to the Mom and Pop store and are anxious to give Walmart a beating?

While cameras are a competitive field, just how many manufactureres make dSLR's? Six?

We can argue from today till tomorrow, but in a year or two, we shall see who is paying more, who is benefiting and who is going to be hurt.

Now you make another point about "authorised dealers." Well camerra companies didn't need this law to prevent them from selling cameras OR stopping selling cameras. That they don't enforce their OWN rules, speaks volumes about gray market, etc. They don't care, or care enough to take the erffort to stop it because once again, they are getting their money.

I do remember all those assurances of increased and better jobs that surrendering our soverignty to the WTO and NAFTA were promised. And how it would help the small buisnessman.

Seems to me that it just didn't happen.

NB. There is only one party that will benefit from this ruling, and that's the manufacturer.

Dave
 
Chato said:
This is not and never has been a question of on-line retailers, vs
small stores. The manufacturer doesn't care because they get their
money.

The laws covering restrictions on trade evolved because it was
found that companies colluded to raise prices. Price fixing, while
continuing has always been a matter of difficulty. Essentially
"List prices," or "manfacturerers suggested price" WERE not
enforable. There was little incentive to collusion, because smaller
compainies only stood to risk market share. Now there IS an
incentive to collusion because even it they do lose market share,
the bottom line will grow - at our expense of course. For example,
let us say that Pentax makes $100 bucks for each dSLR. If they lose
10 percent of market share, this would dramatically affect their
bottom line. But what if they make $200 on each camera? Hmm? What
then about the bottom line?

Small camera stores of course are getting hurt. Will this ruling
really protect them? They will still be paying more for each camera
then the larger retailers. But most of all you and I will be paying
more. And it's not just cameras that are affected here. It is in
fact a license to collude, which is why the Sherman Act was passed
in the first place!

History is a funny thing. This Court might consider the Sherman Act
"quaint," but then again they are wealthy men... :(

Perhaps you are postulating some dramatic change in human nature?
These companies wouldn't dream of colluding? It's all just some
sort of scare tactic? That in fact the Court was mainly thinking of
the benefits to the Mom and Pop store and are anxious to give
Walmart a beating?

While cameras are a competitive field, just how many manufactureres
make dSLR's? Six?

We can argue from today till tomorrow, but in a year or two, we
shall see who is paying more, who is benefiting and who is going to
be hurt.

Now you make another point about "authorised dealers." Well camerra
companies didn't need this law to prevent them from selling cameras
OR stopping selling cameras. That they don't enforce their OWN
rules, speaks volumes about gray market, etc. They don't care, or
care enough to take the erffort to stop it because once again, they
are getting their money.

I do remember all those assurances of increased and better jobs
that surrendering our soverignty to the WTO and NAFTA were
promised. And how it would help the small buisnessman.

Seems to me that it just didn't happen.

NB. There is only one party that will benefit from this ruling, and
that's the manufacturer.

Dave
Click to expand...
Establishing a fixed minimum prices as this allows is difference from price fixing, where competitors agree on a price for their products in each others line. So say Nikon instead of coming out with a D40x just made a deal with Sony and Canon to not come out with a camera below $900.

This is about saying that Canon has a wholesale price of $600 and flybynight.com sells it for $601 then hard sells people $100 1GB CRF cards or batteries by lying about the included batter etc. or just sells it for $610 with a no-return policy etc.

Now Canon can say you will have to sell if for at least $660 and the online retailer can play with shipping or some other services.. but doesn't get to blow out other retailers with loss-leaders etc.

Too many people think the only way you can harm a consumer is buy increasing the price a few %, when there are lots of other ways to harm them by taking away choice of options.

Right now, before this ruling, if Sony and Canon wanted they could agree to sell cameras to B&H or the same price and B&H would mark them up as normal. Even now on another post we see that Nikon appears to not do a large price increase in Canada, Sony does a bit more, and Canon after looking at a couple of retailers seems to fee fine adding 28% to the price in Canada over the US price.

I know because "the court is more conservative" some have to rationalize all decisions with an evil purpose. The key is.. there is nothing in this that makes cross brand price fixing any easier than it is now. It just means a Manufacture can take actions to prevent what some consider predatory low pricing.

Problem is that low price retailers have too much power now.. and in many areas this is too late. This kind of change could have slowed the growth of Wal Mart, but now they can demand prices.. but they got that power by undercutting better stores with lower prices. And manufacturers were powerless to stop that.

Dave you didn't strike me as such a Wal Mart booster...

------------
Ken - KM 5D
http://www.cascadephotoworks.com
 
ZoetMB wrote:
Snip
ZoetMB said:
What I expect manufacturers to do is to selectively enforce. For
example, Canon and Nikon might enforce a minimum price on the pro
camera lines, but not on consumer lines.
Click to expand...
This sounds like the beginning of a cartel.
--
Jim R.
Dinna Touch!



http://www.dinnatouch.net
 
Ken_5D said:
Establishing a fixed minimum prices as this allows is difference
from price fixing, where competitors agree on a price for their
products in each others line. So say Nikon instead of coming out
with a D40x just made a deal with Sony and Canon to not come out
with a camera below $900.
Click to expand...
Yes, of course it's different. It spurs compitition between brands. There is less incentive to price fix. It is more difficult to price fix, this is my main point and I'll post the argument later down.
Ken_5D said:
This is about saying that Canon has a wholesale price of $600 and
flybynight.com sells it for $601 then hard sells people $100 1GB
CRF cards or batteries by lying about the included batter etc. or
just sells it for $610 with a no-return policy etc.

Now Canon can say you will have to sell if for at least $660 and
the online retailer can play with shipping or some other services..
but doesn't get to blow out other retailers with loss-leaders etc.

Too many people think the only way you can harm a consumer is buy
increasing the price a few %, when there are lots of other ways to
harm them by taking away choice of options.

Right now, before this ruling, if Sony and Canon wanted they could
agree to sell cameras to B&H or the same price and B&H would mark
them up as normal. Even now on another post we see that Nikon
appears to not do a large price increase in Canada, Sony does a bit
more, and Canon after looking at a couple of retailers seems to fee
fine adding 28% to the price in Canada over the US price.

I know because "the court is more conservative" some have to
rationalize all decisions with an evil purpose. The key is.. there
is nothing in this that makes cross brand price fixing any easier
than it is now. It just means a Manufacture can take actions to
prevent what some consider predatory low pricing.

Problem is that low price retailers have too much power now.. and
in many areas this is too late. This kind of change could have
slowed the growth of Wal Mart, but now they can demand prices.. but
they got that power by undercutting better stores with lower
prices. And manufacturers were powerless to stop that.
Click to expand...
Here is the argument which you ignored. You also ignored another, that I shall repeat.

The laws covering restrictions on trade evolved because it was found that companies colluded to raise prices. Price fixing, while continuing has always been a matter of difficulty. Essentially "List prices," or "manfacturerers suggested price" WERE not enforable. There was little incentive to collusion, because smaller compainies only stood to risk market share. Now there IS an incentive to collusion because even it they do lose market share, the bottom line will grow - at our expense of course. For example, let us say that Pentax makes $100 bucks for each dSLR. If they lose 10 percent of market share, this would dramatically affect their bottom line. But what if they make $200 on each camera? Hmm? What then about the bottom line?
Ken_5D said:
Dave you didn't strike me as such a Wal Mart booster...
Click to expand...
My theoretical views of what kind of a society we should have, have to come to terms with what kind of society we DO have.

If we have a free market society, then rules and regulations should exist to expedite that free marker. Essentially this ruling is a totalitarian one strictly for the benefit of large corporations.

A camera retailer BUYS the camera, and is now being told that in fact he DIDN'T buy the camera. He only leases the right to sell it.

This is free enterprise? Or is it Corporate enterprise?

As for the Walmarts of this world, they will be far more affected by canceling our slavery to Corproations that are now taking place with the WTO, NAFTA, etc.

Dave
Ken_5D said:
------------
Ken - KM 5D
http://www.cascadephotoworks.com
Click to expand...
 
--
RDKirk
'TANSTAAFL: The only unbreakable rule in photography.'
 
The only mandate is to move cars and make money.

The list price (MSRP plus any "special" dealer markups) is an absolute wet dream for them... but bare MSRP is pretty damn profitable, too. Even "dealer cost" is profitable since that does not account for kickbacks (incentives) from the manufacturer.

This does not even begin to account for all the other cr@p they pull with financing, trade-ins, etc. I'm not saying you were fleeced at all... I'm just saying the auto industry is definitely not a model to look to for answers...
Bill Force said:
There is many ways to skin a cat. The automobile dealers where I
live have a mandate from the factories of "Do not discount the
advertised price of the vehicle". I just bought a new Mazda from
the dealer (8 in one city) that offered me the best "PACKAGE" while
retaining the orignal advertised price. My new car has upgraded
window tinting, undercoating, tool kit, free maintenance BUT I
still paid the advertised price but also netted about $600. in
goodies.
Click to expand...
--
pog



http://gallery.gopog.net/
 
The Sherman Act seeks to maintain a marketplace free of anticompetitive practices, in particular those enforced by agreement among private firms. The law assumes that such a marketplace, free of private restrictions, will tend to bring about the lower prices, better products, and more efficient production processes that consumers typically desire. In determining the lawfulness of particular practices, courts often apply a "rule of reason." They examine both a practice's likely anticompetitive effects and its beneficial business justifications.

Nonetheless, sometimes the likely anticompetitive consequences of a particular practice are so serious and the potential justifications so few (or, e.g., so difficult to prove) that courts have departed from a pure "rule of reason" approach. And sometimes this Court has imposed a rule of per se unlawfulness--a rule that instructs courts to find the practice unlawful all (or nearly all) the time.

The case before us asks which kind of approach the courts should follow where minimum resale price maintenance is at issue. Should they apply a per se rule (or a variation) that would make minimum resale price maintenance always (or almost always) unlawful? Should they apply a "rule of reason"? Were the Court writing on a blank slate, I would find these questions difficult. But, of course, the Court is not writing on a blank slate, and that fact makes a considerable legal difference.

Those who express concern about the potential anticompetitive effects find empirical support in the behavior of prices before, and then after, Congress in 1975 repealed the Miller-Tydings Fair Trade Act, 50 Stat. 693, and the McGuire Act, 66 Stat. 631. Those Acts had permitted (but not required) individual States to enact "fair trade" laws authorizing minimum resale price maintenance. At the time of repeal minimum resale price maintenance was lawful in 36 States; it was unlawful in 14 States. See Hearings on S. 408 before the Subcommittee on Antitrust and Monopoly of the Senate Committee on the Judiciary, 94th Cong., 1st Sess., 173 (1975) (hereinafter Hearings on S. 408) (statement of Thomas E. Kauper, Assistant Attorney General, Antitrust Division). Comparing prices in the former States with prices in the latter States, the Department of Justice argued that minimum resale price maintenance had raised prices by 19% to 27%.

After repeal, minimum resale price maintenance agreements were unlawful per se in every State. The Federal Trade Commission (FTC) staff, after studying numerous price surveys, wrote that collectively the surveys "indicate[d] that [resale price maintenance] in most cases increased the prices of products sold with [resale price maintenance]." Bureau of Economics Staff Report to the FTC, T. Overstreet, Resale Price Maintenance: Economic Theories and Empirical Evidence, 160 (1983) (hereinafter Overstreet). Most economists today agree that, in the words of a prominent antitrust treatise, "resale price maintenance tends to produce higher consumer prices than would otherwise be the case." 8 Areeda & Hovenkamp ¶1604b, at 40 (finding "[t]he evidence . . . persuasive on this point").

I recognize that scholars have sought to develop check lists and sets of questions that will help courts separate instances where anticompetitive harms are more likely from instances where only benefits are likely to be found. See, e.g., 8 Areeda & Hovenkamp ¶¶1633c-1633e, at 330-339. See also Brief for William S. Comanor and Frederic M. Scherer as Amici Curiae 8-10. But applying these criteria in court is often easier said than done. The Court's invitation to consider the existence of "market power," for example, ante, at 18, invites lengthy time-consuming argument among competing experts, as they seek to apply abstract, highly technical, criteria to often ill-defined markets. And resale price maintenance cases, unlike a major merger or monopoly case, are likely to prove numerous and involve only private parties. One cannot fairly expect judges and juries in such cases to apply complex economic criteria without making a considerable number of mistakes, which themselves may impose serious costs. See, e.g., H. Hovenkamp, The Antitrust Enterprise 105 (2005) (litigating a rule of reason case is "one of the most costly procedures in antitrust practice").

Are there special advantages to a bright-line rule? Without such a rule, it is often unfair, and consequently impractical, for enforcement officials to bring criminal proceedings. And since enforcement resources are limited, that loss may tempt some producers or dealers to enter into agreements that are, on balance, anticompetitive.

Given the uncertainties that surround key items in the overall balance sheet, particularly in respect to the "administrative" questions, I can concede to the majority that the problem is difficult. And, if forced to decide now, at most I might agree that the per se rule should be slightly modified to allow an exception for the more easily identifiable and temporary condition of "new entry." See Pitofsky 1495. But I am not now forced to decide this question. The question before us is not what should be the rule, starting from scratch. We here must decide whether to change a clear and simple price-related antitrust rule that the courts have applied for nearly a century.

The only safe predictions to make about today's decision are that it will likely raise the price of goods at retail and that it will create considerable legal turbulence as lower courts seek to develop workable principles. I do not believe that the majority has shown new or changed conditions sufficient to warrant overruling a decision of such long standing. All ordinary stare decisis considerations indicate the contrary. For these reasons, with respect, I dissent.

http://caselaw.lp.findlaw.com/cgi-bin/getcase.pl?court=US&navby=case&vol=000&invol=06-480
 
A fundamental rule of our free-market system is at stake in Leegin v. PSKS: the rule that manufacturers may not prevent retail discounting by colluding with dealers to fix the prices at which their products are sold at retail. The question presented is whether such minimum resale price maintenance (“RPM”) agreements should continue to be per se illegal or, rather, should be evaluated under a very lenient standard, which in antitrust parlance is called the “rule of reason.”

When employed, RPM prevents consumers from “shopping around” for the best price because it prevents retailers from putting on sale any and all types of products, including not only large purchases, but also everyday purchases—from groceries to gasoline. Because of the per se rule against RPM, consumers have saved hundreds of billions of dollars over the years, while the retailing industry has progressed from small shops to department stores to discount warehouses to, most recently, online commerce. Abandoning the per se rule in favor of rule of reason would provide cold comfort to American consumers; for it is widely recognized that to accord RPM a rule of reason treatment would effectively make RPM legal.

For nearly a century, since the Court decided Dr. Miles Medical Co. v. John D. Park & Sons Co., it has been a per se illegal “restraint of trade” under Section 1 of the Sherman Antitrust Act, 15 U.S.C. § 1, for manufacturers and retailers to agree to fix a minimum retail price. During that time, the per se rule against RPM has safeguarded low consumer prices and an abundance of consumer choice, witnessing an unparalleled period of dynamic innovation in retailing by fostering competition at the retail and manufacturing levels. By preventing RPM, which is designed to discourage price cutting, the per se rule has set the stage for innovative retailers to continually enter the market, offering new and lower priced alternatives to consumers. By encouraging such entry, the per se rule has enhanced “intertype competition...”

There is no good reason to abandon the venerable Dr. Miles rule.

This is especially true given the common law nature of antitrust, in light of America’s experience with the anticompetitive effects of RPM and the dynamic benefits of the per se rule; the expressed endorsement of the rule by Congress; and the widespread reliance on the rule by American consumers for decades. Experience has shown that RPM invariably raises consumer prices. Both empirical evidence and economic theory confirm that this is so. By facilitating cartelization and by giving rise to unilateral incentives for dealers and manufacturers to keep prices artificially high, RPM raises consumer prices. After a limited but failed experiment with “fair trade,” which legalized RPM under color of state law for a period of time, Congress passed the Consumer Goods Pricing Act of 1975, which amended the Sherman Act to restore and to preserve the per se rule as part of an historic effort to combat inflation: President Ford’s Whip Inflation Now program.

The plain language and the import of the Consumer Goods Pricing Act have been recognized by the Court on more than one occasion. By its express terms, the amendment provides that it was adopted “to provide lower prices for consumers,” and, therefore, precludes the application of a rule of reason to RPM, as it is undeniable that RPM actually imposes higher prices on consumers. The theoretical justifications proposed by Petitioners in defense of RPM—such as facilitating onsite presale dealer services and enhancing a product’s “brand image”—are quite limited in their application, can (and are) achieved without fixing prices, and are indeed belied by the real-world historical and empirical evidence demonstrating the anticompetitive effects of RPM and the benefits of the per se rule. These theoretical justifications can in no way offset the higher consumer prices, lower consumer choice, and stifled innovation that history teaches will follow the elimination of the per se rule.

Importantly, this case points a dagger at the heart of the most consumer-friendly aspects of the Internet. The Internet has shifted power to the consumer in two ways. First, it allows consumers to search for and gather information in a cost-effective, efficient manner. Second, it provides a low-cost means of retailing, making it easy for discounters to offer products to the public. This combination squeezes excess profits and inefficiencies out of product prices. Retail price maintenance seeks to short circuit this extremely consumer friendly process. By setting minimum prices, manufacturers can build in excess margins for themselves and for their favored retailers—prices that consumers have no choice but to pay.

The outcome of the case will not only be of great economic consequence to American consumers and the economy at large, but will also serve as an indicator for the future direction of the Court with regard to antitrust law in particular, as well as stare decisis and Congressional deference, as general matters....

The Court has increasingly embraced the Chicago School approach to antitrust, which favors a very narrow application of the antitrust laws, and, at the same time, has been increasingly willing to depart from its settled precedents and form stated Congressional will. Should the Court abandon the per se rule against minimum resale price maintenance, which has extraordinarily clear examples of both settled precedent and Congressional support in its corner, it would send a signal that the Roberts Court will continue to narrow the application of the antitrust laws and that the Court may disregard settled precedent and Congressional will in other areas of the law as well.

http://www.acsblog.org/guest-bloggers-guest-blogger-supreme-court-preview-resale-price-maintenance.html
 
Walmart tells! the manufacturers what they will pay for a product. This is a take it or leave it proposition, Walmart will only take most products at the price Walmart wants.

If a manufacturer has to sell at cost to keep their volume up, the manufacturer will do that for Walmart, the others who buy from that manufacturer will not get that low price, and will be at a disadvantage at setting a price that can compete. Price fixing deals by Walmart is just as nasty as price fixing deals by manufacturers
 
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