Robinson-Patman Act: The FTC’s aggressive antitrust enforcement efforts have expanded in recent months. The FTC has recently launched at least two investigations in an effort to enforce the Robinson-Patman Act (the “RPA”), a statute that the government has not enforced in over two decades (for more information see our client alert). The RPA is an antitrust law that protects competition by preventing sellers from charging competing buyers different prices for the same goods, commonly referred to as price discrimination. The RPA was designed to protect smaller, often independent, businesses whose ability to compete is threatened by their relative purchasing power compared to a larger rival that may be able to negotiate large discounts. The FTC is currently investigating two major providers of soft drinks and Southern Glazer Wine and Spirits in relation to its distribution of wine and liquor. The FTC reportedly initiated the Southern Glazer’s investigation after receiving complaints from participants in the alcohol production, distribution, and retail industry. The revival of the RPA is unique in that the DOJ and FTC for decades have focused their energies and resources to scrutinize potential antitrust violations in line with the consumer welfare standard, that being to protect consumers rather than competitors. This yet another example of the agencies using all of the tools in their toolbox in response to President Biden’s 2021 call to action for heightened antitrust enforcement. Companies offering consumer goods may need to evaluate their existing sales and marketing policies to identify potential exposure.

Third Party Discovery: Notably, specifics of the Southern Glazer’s investigation by the FTC were uncovered in the FTC’s petition to enforce a civil investigative demand (“CID”) it issued to Total Wine & More. Total Wine challenged the CID as overly burdensome, particularly insofar as it sought information allegedly unconnected to the Southern Glazer’s relationship with Total Wine. While the FTC is usually able to negotiate third party discovery by minimizing burdens, the agency evidently was unable to reach any common ground, resulting in a breakdown in discussions and now the FTC taking Total Wine to federal court to enforce compliance. CID enforcement actions by the FTC and DOJ such as this are rare. The agencies have broad authority to issue third-party CIDs in furtherance of their antitrust investigations. As the agencies continue to expand their antitrust enforcement efforts, they have similarly expanded the scope of the CIDs they issue and are in many cases insisting on strict compliance. Companies that are on the receiving end of FTC discovery requests should expect increased rigidity in negotiating responses with agency staff and should carefully consider their CID compliance efforts.

Merger Enforcement: The FTC is reportedly remaining fully booked in its merger investigations, adding at least two Second Request investigations to its docket in the last month. In a letter responding to questions from Congressman Thomas P. Tiffany, FTC Chair Lina Khan defended the agency’s record in its “vigorous” pursuit of antitrust enforcement. She recounted the results of the 38 actions her office has taken on proposed mergers. Nineteen mergers were abandoned, divestitures were agreed to in 14 cases

“to prevent the mergers from resulting in harm,” significant alterations were made to one deal, a consent order was agreed to in another, two actions are pending, and the FTC withdrew one action after its challenge failed in federal court. Khan argues the FTC’s “enforcement record reveals that the Commission has been pursuing strong cases, well within established precedent and with solid facts and compelling economic analysis.” Skeptics argue the FTC is wasting taxpayer money in furtherance of Khan’s radical agenda to overhaul antitrust law that will ultimately result in harm to consumers.