The Federal Trade Commission Sues Southern Glazer’s Wine and Spirits for Alleged Price Discrimination
The Federal Trade Commission has filed a lawsuit against alcohol distributor Southern Glazer’s Wine and Spirits for alleged price discrimination. The lawsuit, filed on Dec. 12 in the U.S. District Court for the Central District of California, accuses the distributor of offering volume discounts and rebates to large national and regional retail chains since 2018 while denying similar offerings to smaller independent businesses.
According to an FTC press release, this practice threatens the viability of independent businesses and limits consumer choice in the market, potentially leading to higher prices for consumers.
In response to the lawsuit, Southern Glazer’s issued a statement on Dec. 12, strongly disputing the allegations and claiming that they offer discounts based on the costs incurred to sell different quantities to all eligible retailers, including chain stores and small businesses.
The lawsuit alleges that the large-quantity discounts offered by Southern Glazer’s to large retail chain customers are not justified by cost savings and that the company receives “discount support” from suppliers in exchange for providing more favorable pricing.
The FTC is seeking a permanent injunction to prevent further unlawful price discrimination by Southern Glazer’s against small, independent businesses, citing violations of the Robinson-Patman Act enacted in 1936.
This lawsuit marks a significant enforcement effort by the FTC, following President Joe Biden’s executive order authorizing the agency to investigate potential violations of the Robinson-Patman Act more thoroughly. Chair of the FTC, Lina Khan, emphasized the importance of fair competition and restoring the rule of law in the marketplace.
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