Bottoms up: FTC set to sue country’s largest alcohol distributor over how it prices spirits
The US competition regulator is said to be preparing a lawsuit against Southern Glazer’s Wine and Spirits under a rarely-used 1936 law
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Your support makes all the difference.Antitrust regulators are preparing to sue the nation’s biggest alcohol distributor over allegedly anti-competitive pricing practices, according to reports.
Unnamed inside sources told Politico the Federal Trade Commission has been investigating Southern Glazer’s Wine and Spirits for potential violations of a rarely-enforced 1936 antitrust law.
The Robinson-Patman Act bans companies from discriminating against smaller suppliers by hiking their prices, but has not been the focus of an FTC case for more than two decades.
Now officials probing Southern are reported to have recommended a lawsuit as soon as this month, with company representatives set to lobby FTC chair Lina Khan and her fellow commissioners against the action.
Southern declined to comment to Politico on the report. The FTC did not immediately respond to a request for comment.
The Florida-based company reportedly controls around 20 percent of the US wine and spirits wholesaling market, enjoying a near duopoly with its nearest rival in certain states.
Since 2021, the Biden administration has sought to crack down on market abuses by abandoning the narrow reading of US antitrust law that has been standard since the days of Ronald Reagan. It’s part of the administration’s efforts to crack down on pricing practices to help consumers.
An executive order issued in July 2021 specifically mentioned “beer, wine, and spirits markets,” telling the FTC to report back about any “exclusionary, discriminatory, or anticompetitive distribution practices that hinder smaller and independent businesses or new entrants.”
In March, the US Department of Justice filed a lawsuit seeking to break up the parent company of Ticketmaster, claiming it had driven up prices for consumers by operating an “illegal monopoly.”
Apple, Amazon, and Facebook’s parent company Meta are also being sued on antitrust grounds, while Pepsi, Coca-Cola and Kraft-Heinz are all reported to be under investigation.
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