The Death of Discount Online Retailing? Resale Price Maintenance After Leegin v. PSKS

June 16, 2012

In Leegin Creative Leather Products, Inc v. PSKS, Inc., the Supreme Court announced a shift in the law of minimum resale price maintenance by overruling the longstanding per se prohibition of these policies. The new rule of reason standard is more permissive of these minimum resale price maintenance agreements and as a result their use is likely to increase. Increased use of minimum resale price maintenance would harm online discounters competing for customers primarily on the basis of price. Nevertheless, it remains to be seen how many manufacturers will actually implement these policies, as there are both practical and economic disincentives to implementation.