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Correcting the Court, this time on retail price maintenance

Be on guard when Congress decides to review a U.S. Supreme Court decision with an eye toward "correcting a mistake" or "restoring the law" prior to the decision. You wind up with brand new law, expansive and expensive, like the Lilly Ledbetter Fair Pay Act. (See earlier post on Ledbetter..)

So while we haven't seen any bill yet, the upcoming hearing Tuesday certainly draws our attention. The House Judiciary Committee, Subcommittee on Courts and Competition Policy has scheduled, "Bye Bye Bargains? Retail Price Fixing, the Leegin Decision, and Its Impact on Consumer Prices." The hearing will examine the 2007 Supreme Court decision in the antitrust case, Leegin Creative Leather Products, Inc. v. PSKS, Inc. (Opinion here.) The issue facing the court was whether resale price maintenance should always be considered a violation of the antitrust laws (and subject to treble damages), or whether legitimate business and procompetitive justifications for such provisions. As David Rossmiller wrote following the court's opinion:

When the only tool in your toolbelt is a hammer, every problem looks like a nail. The Supreme Court has increasingly recognized this in its recent antitrust jurisprudence by moving away from inflexible per se rules of anticompetitive conduct that fail to differentiate between truly anticompetitive acts that hurt consumers and acts that merely hurt competitors: they are not the same thing....[The Leegin antitrust case] marked another step in the court's walk away from per se standards toward a more flexible case-by-case analytical standard.

My employers at the NAM filed an amicus brief in the Leegin case that aligns with the shift away from per se. (See the Legal Beagle entry for the brief and more.)

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.