Retailers Struggle With Ruling That OK'd Price-Fixing

Enabling manufacturers to set minimum prices leads to collusion, some say
By Jim O'Neill,  Newser User
Posted Aug 18, 2008 10:57 AM CDT
A shopper looks at new handbags.   (AP Photo/Russel Daniels)
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(Newser) – A Supreme Court ruling that last year allowed manufacturers to set minimum sale prices for their goods is giving retailers fits, the Wall Street Journal reports. Manufacturers, barred from the practice for nearly a century, are being allowed to punish retailers who discount their products by cutting off supplies. Some retailers are fighting back by steering customers toward other brands.

“It's becoming a nightmare operating a business," says the founder of an online home-improvement outfit. "It just makes it so difficult to compete." Until a 2007 Supreme Court ruling involving a Dallas store selling discounted handbags, it was an antitrust violation to punish retailers selling cut-rate products. Increasing numbers of manufacturers now can drop retailers who trim prices.