October 6, 2014

FTC's Robinson-Patman Act Guidance: Updated but Mostly Unchanged

Seller Beware: Consumer Protection Insights for Industry

On September 29, 2014, the Federal Trade Commission published updates to its "Guides for Advertising Allowances and Other Merchandising Payments and Services" (also known as the Fred Meyer Guides, in honor of the Supreme Court case that prompted the Commission to issue them). The Guides are non-binding guidelines designed to help businesses comply with Sections 2(d) and 2(e) of the Robinson-Patman Act, which prohibit businesses from discriminating among competing retailers when offering payments or services to promote the resale of products. Although the Commission has not enforced Sections 2(d) and 2(e) in recent years, businesses still face the risk of private litigation.

The Commission has not updated the Guides since 1990, and this update does not make any major changes. In its 2012 request for comments, the Commission asked whether there was a continuing need for the Guides. Every commenter that addressed the question said that the Guides should be retained because they provide guidance to businesses that is not present in the language of Sections 2(d) and 2(e).

Many of the Commission's changes to the Guides are either minor clarifications or references to post-1990 developments such as the emergence of Internet commerce. The Commission rejected several suggested changes on the ground that they are inconsistent with the text of the statute or the case law. For example, several commenters argued that Sections 2(d) and 2(e) should only apply when there is injury to competition — a requirement that is present in most antitrust laws but absent from the text of Sections 2(d) and 2(e). Although the Commission agreed that "requiring proof of likely injury to competition is sound enforcement policy," it declined to incorporate this requirement into the Guides because it lacks support in the case law.

© Arnold & Porter Kaye Scholer LLP 2014 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.

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