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Back from the Dead: Federal Enforcement of the Robinson-Patman Act and the “Strike Force”

April 4, 2024
14 minute read

Back from the Dead: Federal Enforcement of the Robinson-Patman Act and the “Strike Force”

April 4, 2024
14 minute read

Authored By

Emily Fons

Emily K. Fons

Special Counsel


The Robinson-Patman Act, a 1936 amendment to Section 2 of the Clayton Act (RPA), seeks to prohibit price discrimination. A Great Depression-era law, the RPA sought to protect smaller “mom-and-pop” shops who struggled to compete with larger retailers on price. Over the years, however, federal enforcement of the RPA died out. Until 2023, a federal case had not been initiated by the Federal Trade Commission (FTC) for over twenty years. Today, the FTC has active investigations into Coca-Cola and PepsiCo, as well as the largest alcohol distributor in the United States for violations of the RPA. Make no mistake, the RPA is alive and well and federal investigations, along with possible enforcement actions, in various industries are likely to increase in the coming months.

On March 5, 2024, at a meeting of the White House Competition Counsel, President Biden introduced the Strike Force on Unfair and Illegal Pricing (Strike Force) which will, in part, enforce the RPA.[1] “This Strike Force will strengthen interagency efforts to root out and stop illegal corporate behavior that hikes prices on American families through anticompetitive, unfair, deceptive, or fraudulent business practices,” the White House stated.[2] The Strike Force will be co-chaired by the FTC and the Department of Justice and will be joined by several other government agencies. The multi-agency coalition “will focus their collaborative efforts on key sectors where corporations may be violating the law and keeping prices high, including prescription drugs and health care, food and groceries, housing, financial services, and more.”[3]

A day prior to the Competition Counsel meeting, during a roundtable listening session hosted by the White House, FTC Chair Lina Khan stated that the FTC is looking at multiple “dimensions” of discrimination and its use of  the RPA when questioned by a small grocery store owner about the FTC taking an RPA enforcement action in the multi-level grocery store supply chain.[4] However, Khan noted, “[W]hen you’re coming in and a certain law or a certain provision of the law has not been enforced for many decades, it can take some time to really build up that skill and muscle again to figure out, how do we use this tool.”[5] With the introduction of the Strike Force and two ongoing FTC investigations into RPA violations, fueled by repeated comments by regulators to crack down on price discrimination, the FTC is not wasting anytime in figuring out how to flex its RPA enforcement muscle. 

Brief History of RPA Enforcement

During the first fifty years of the RPA’s existence, the FTC regularly enforced the RPA and private parties also brought RPA claims in civil suits. By the mid-1980s, however, the number of federally prosecuted cases began to disappear. While most antitrust laws focus on consumer welfare, some argue that the RPA protects competitors, not competition, which tends to benefit smaller companies. Consequently, critics of the law believe the law accomplishes the reverse goal of antitrust laws, as it may force prices to rise, ultimately harming consumers, which led to the RPA falling out of favor by the regulators. Until the Biden administration, it had been nearly two decades since the FTC brought an RPA enforcement action. That changed in early 2023 when the FTC has launched two investigations into potential price discrimination, targeting soft drink industry giants Coca-Cola and PepsiCo, and the largest alcohol distributor in the United States, Southern Glazer’s Wine and Spirits.  

The revival of RPA enforcement by the FTC was not unsurprising, as antitrust practitioners had several warnings that this possibility was on the horizon. Prior to the announcement of the Strike Force, the Biden administration and its appointed regulators have been very vocal about RPA enforcement as a top agenda item. Even before attending law school, FTC Chair Khan made public statements about her favoritism of the RPA as a “key tenet” of antitrust law in that it preserves fair competition by curbing the bullying power of size.[6] In the summer of 2022, the FTC published a policy statement identifying the RPA as a possible legal authority to prevent the unfair generation of large rebates and fees to pharmaceutical companies which results in higher costs of prescription drugs.[7] In September 2022, shortly after his appointment to the FTC, Commissioner Alvaro Bedoya made a general policy statement regarding his favoring views of the RPA as a tool to prevent unfair competition and “secret discounts.”[8] Then, in November 2022, the FTC announced that it would once again rigorously enforce the federal ban on unfair methods of competition through its powers under Section 5 of the Federal Trade Commission Act and cited the use of the RPA as an additional authority.[9] 

Basics of the RPA

At its simplest, the RPA prohibits price discrimination, which occurs when a seller sells the same product to two competing customers at the same time, but the seller offers different prices or terms of purchase to the customers. The purpose of the RPA is “[t]o ensure that purchasers operating on the same functional level of the supply chain stand on equal competitive footing with regard to the pricing and promotional support they receive from the same seller.”[10]

Section 2(a) of the RPA prohibits sellers of goods in interstate commerce from engaging in price discrimination “where the effect of such discrimination may be substantially to lessen competition or tend to create a monopoly in any line of commerce, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them.”[11] The focus of this article is on Section 2(a) claims, but it’s worth mentioning that the RPA also prohibits discriminatory promotional assistance (such as promotional marketing allowances or services) that are not offered to all competing buyers on “proportionally equal” terms[12] and buyers can be found in violation of the RPA if they knowingly induce and assist a seller into committing a Section 2(a) violation.[13]  Sales to charitable organizations and federal and state governments are generally exempt from the RPA, so long as those sales are for use by the charity or government. 

Price discrimination can happen at various levels of the supply chain. A “primary line injury” occurs when a seller engages in price discrimination that harms it direct competitors (commonly known as predatory pricing). A “secondary line injury” occurs when a supplier gives a favored customer a price advantage over competing resellers, resulting in the competitive injury at the buyer level. Finally, a “tertiary line injury” happens in the downstream supply chain when the seller’s lower prices to its favored customer allows the favored customer’s customers to undersell, therefore harming the disfavored customers’ customers.

Elements of a Claim

There are eight defined elements for a successful Section 2(a) claim under the RPA; the plaintiff must prove[14]:

  1. One seller: The sales in question must have been made by the same seller.
  2. Two or more actual sales: Must be sales, not offers or leases, and the sales must cross state lines.
  3. A difference in price paid: While the RPA does not define price, courts have found price to generally include the actual invoice price paid by the buyer, less any discounts, offsets or allowances received by the buyer.
  4. Two or more purchasers: Two different, unrelated purchasers who are “similarly situated” or competing with each other.
  5. Sales were contemporaneous in time: The sales must be made around the same time, or generally within a reasonably brief time frame under similar market conditions.
  6. Sale of commodities: The RPA only applies to tangible products, not to services.
  7. Commodities must be of like grade and quality: This is a factual determination evaluating characteristics affecting consumer use, preference, or marketability.
  8. Competitive Injury: Generally, the most complex element of an RPA case, the price differential must have the effect of substantially lessening or injuring competition among either resellers or the resellers’ customers.

Defenses to an RPA Claim

A seller has not necessarily violated the RPA by charging different prices to competing customers for the same product. There are four main defenses to a price discrimination claim; each of them highly fact intensive and evidence based.[15]

  1. Cost Justification: Price differences that make allowances for differences in the cost of manufacturing, sale, and delivery. For example, the cost of selling branded versus unbranded products may have different marketing costs. Evidence of actual costs must be provided.
  2. Changed Conditions: Price difference was due to a reaction to a change in market conditions, such as actual or imminent deterioration of perishable goods, obsolescence of seasonal goods, or a liquidation sale.
  3. Meeting Competition: Price difference was due to meeting competition. This defense requires: (1) verification of the competitor’s price, (2) the sale price does not beat the competitor’s price, and (3) the met price was given in good faith.
  4. Functional Discounts/Practical Availability: Price difference was available to all purchasers, but the plaintiff failed to take advantage of such lowered price. This defense requires: (1) the availability of the lower price must have been known to the plaintiff, (2) the lower price must have been realistically obtainable by the plaintiff, and (3) the lower price must be “reasonably proportionate.” For example, sellers may offer volume discount programs that seek to give lower prices to buyers who purchase greater quantities of goods, as the packing and shipping costs associated with greater quantities may be less on an economies of scale basis.

Recent Enforcement Actions

Coca-Cola and PepsiCo

On January 10, 2023, Politico reported that the FTC had launched a preliminary investigation into soft drink manufacturers Coca-Cola and PepsiCo “over potential price discrimination in the soft drink market.”[16] Together, the two companies possess approximately 72 percent of the soft drink market share.[17] Allegedly, Coca-Cola and PepsiCo have offered lower prices to large retailers that they did not offer to their smaller clients.[18] The FTC is currently gathering information from certain large retailers, including Walmart, requesting “data and other information on how they purchase and price soft drinks.”[19]

If the FTC were to bring a case against Coca-Cola and PepsiCo, they would need to be able to show that the two soft drink giants offer lower prices to bigger retailers than they do to smaller ones. However, the two companies would have the above listed defenses available them. Potentially, Coca-Cola and PepsiCo could show that any difference in price between large and small retailers is due to a difference in the supply cost given that the economies of scale in delivering to large retailers is more cost effective than with smaller retailers.[20]

Southern Glazer’s and Total Wine

Just a few months later, on March 30, 2023, it was reported that the FTC is also investigating Southern Glazer’s Wine and Spirits (Southern Glazer’s) for violations of both the RPA and Section 5 of the FTC Act.[21] Southern Glazer’s is the largest wine and liquor distributor in the U.S., and the investigation revolves around whether the company has been giving preferential pricing and services to certain favored, large chain retailers that it does not provide to small independent retailers.

The FTC is seeking detailed sales data on thousands of brands of alcohol and wine sold around the U.S. by both Southern Glazer’s and its competing distributors.[22] On Feb. 24, 2023 (indicating the investigation into Southern Glazer’s likely began in early 2023, if not late 2022), the FTC issued multiple civil investigative demands (CID) requiring Southern Glazer’s largest chain retailer customers, including Retail Services and Systems, Inc. d/b/a Total Wine & More (Total Wine) to produce information regarding pricing and benefits Southern Glazer’s offers to retailers including quantity-based discounts, rebates, promotions, as well as marketing, warehousing, merchandising and other services.[23]

Total Wine, one of Southern Glazer’s largest chain retailer customers, deemed the CID to be “truly alarming” and moved to limit the CID, arguing overbreadth, irrelevance to the investigation, and unreasonable burden on Total Wine.[24] Specifically, the company is opposed to sharing information that includes email communication, business strategies and assessments of competitors.[25] The FTC denied Total Wine’s petition to limit the CID and directed the company to comply in full with the CID no later than June 16, 2023.[26] In its denial order, the FTC argued that the requested information will help staff evaluate whether any such sales satisfy the “in commerce” requirement of the RPA and whether any such discriminatory pricing is excused by a valid defense, such as a good-faith attempt to meet competition or as cost-justified by documented cost differences in selling to favored and disfavored purchasers.[27] On Oct. 20, 2023, the FTC filed a petition seeking a federal court order to force Total Wine to comply with the CID, noting that the FTC has tried to work cooperatively with Total Wine for months, but the company has continuously impeded the FTC’s investigation.[28] In December, however, it was reported that Total Wine and the FTC reached a settlement on the scope of the CID and the parties filed a Joint Motion to Stay any proceedings in the case for 120 days. The details of the settlement are not public and the parties still within the 120-day period.[29]  

While the FTC maintains that Southern Glazer’s is the sole target of its investigation, the dispute between the FTC and Total Wine underscores the potential breadth of a third-party CID in an RPA investigation and highlights that third parties have limited options when their interests are not aligned with that of the FTC. Total Wine may view the investigation into Southern Glazer’s as disruptive to its business model and it rightly understands the potential legal risk that Section 2(f) of the RPA could impose upon it as a buyer who may have knowingly induced or assisted in a discriminatory price scheme. If the FTC can successfully prove a Section 2(a) violation against Southern Glazer’s, it logically follows that the favored retailers of Southern Glazer’s could be implicated as complicit in the price discrimination.


Antitrust enforcement has become increasingly more aggressive under the Biden Administration, and the creation of the Strike Force and recent RPA investigations of Coca-Cola, PepsiCo, and Southern Glazer’s are yet another example of this policy shift. With its stated goal of ensuring fair competition and equal pricing to resellers and distributors, as well as end customers, the FTC’s recent statements and actions have made clear that it will continue to utilize every tool at its disposal, including vigorous enforcement of the Robinson-Patman Act.

[1] The White House Briefing Room, Readout of the Sixth Meeting of the White House Competition Council, (March 6, 2024), available here.

[2] Id.

[3] Id.

[4] Chris May, US FTC adding 'muscle' to tackle anticompetitive discrimination with Robinson-Patman Act, Khan says, (March 4, 2024), available here.

[5] Id. 

[6] Commissioner Lina Khan, A remedy for Amazon-Hachette fight?, CNN, (last updated May 30, 2014), available here.

[7] Policy Statement of the Federal Trade Commission on Rebates and Fees in Exchange for Excluding Lower Cost Drug Products, (June 16, 2022), available here.

[8] Commissioner Alvaro Bedoya, Returning to Fairness, (September 22, 2022), available here.

[9] Policy Statement Regarding the Scope of Unfair Methods of Competition Under Section 5 of the Federal Trade Commission Act, (November 10, 2022), available here

[10] Wendy Arends, Is there a Robinson-Patman Act Revival?, American Bar Association Antitrust Section Spring Meeting presentation (April 6, 2022). 

[11] 15 U.S.C. §13(a)

[12] 15 U.S.C. §13(d); 15 U.S.C. §13(e)

[13] 15 U.S.C. §13(f)

[14] 15 U.S.C. §13(a)

[15] Id.

[16] Josh Sisco, Pepsi, Coke soda pricing targeted in new federal probe, (January 10, 2023), available here.

[17] Market share of leading carbonated soft drink (CSD) companies in the United States from 2008 to 2022, (May 2023), available here.

[18] Josh Sisco, Pepsi, Coke soda pricing targeted in new federal probe, (January 10, 2023), available here.

[19] Id.

[20] Fred Ashton, Pepsi and Coke Targeted for Price Discrimination, (January 30, 2023).

[21] Josh Sisco, Feds target alcohol pricing in new antitrust probe, (March 30, 2023), available here.

[22] Id.

[23] Retail Services & System, Inc.’s Petition to Limit Civil Investigative Demand, (April 7, 2023), available here.

[24] Mike Scarcella, Total Wine asks US court to spurn ‘alarming FTC subpoena, (November 15, 2023), available here.

[25] Id. 

[26] Order Denying Petition to Limit Civil Investigative Demand, (May 19, 2023), available here.

[27] Id. 

[28] Federal Trade Commission Press Release, FTC Takes Total Wine to Federal Court to Enforce Compliance with Antitrust Civil Investigative Demand, (October 20, 2023), available here.

[29] Richard S. Snyder, CIDs and Robinson-Patman Act Investigations: Lessons from the FTC-Total Wine Dispute, (January 26, 2024), available here.

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