FTC lawsuit claims price discrimination

THE FEDERAL TRADE Commission sued the largest U.S. wine and spirits distributor on Thursday, alleging Robinson-Patman Act violations that harmed small businesses by restricting access to discounts and rebates, limiting competition with larger chains. AAHOA supported the move, emphasizing the need for legal action to ensure a fair playing field for all businesses.

The FTC alleged that Southern Glazer’s Wine and Spirits LLC engaged in unlawful price discrimination by charging small, independent businesses significantly higher prices for wine and spirits than large chains, creating insurmountable advantages far beyond any actual cost efficiencies.

The Robinson-Patman Act aims to prevent price discrimination and promote fair competition, protecting small businesses from disadvantages when dealing with large corporations, AAHOA said in a statement. As a member of the Main Street Competition Coalition, the association advocates for fair business practices to promote competition and ensure a level playing field for businesses and consumers.

"We stand in full support of the FTC's lawsuit and all efforts to restore a competitive marketplace to the U.S. economy that benefits both business and consumers," said Miraj Patel, AAHOA’s chairman. "This legal action is a significant victory for small business owners who work tirelessly to contribute to the economy and create jobs, only to be undercut by discriminatory pricing that stifles their growth and success."

The FTC aims to ensure businesses of all sizes compete fairly with equal access to discounts and rebates, increasing consumer choice and enabling independent retailers to offer lower prices.

“When local businesses get squeezed because of unfair pricing practices that favor large chains, Americans see fewer choices and pay higher prices—and communities suffer,” said Lina Khan, FTC chair. “The law says that businesses of all sizes should be able to compete on a level playing field. Enforcers have ignored this mandate from Congress for decades, but the FTC’s action today will help protect fair competition, lower prices, and restore the rule of law.”

AAHOA advocates for laws that promote fair competition and prevent anti-competitive practices, the association said. As a voice for Asian American hotel owners, AAHOA supports the FTC's efforts to combat unfair pricing and ensure a level playing field for business owners.

"We urge the industry to embrace fair business practices that foster growth, innovation, and success for all hotel owners," said Laura Lee Blake, AAHOA’s president and CEO. "The FTC's action sends a powerful message that discriminatory pricing practices will not be tolerated and that small businesses deserve the same opportunities as their larger counterparts."

Previously, the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction on Dec. 3, halting enforcement of the Corporate Transparency Act and its regulations. AAHOA called the decision a major victory for small business owners, including its members.