The Federal Trade Commission reached a settlement with Southern Glazer’s Wine and Spirits over allegations that the major distributor discriminated against small and independent alcohol retailers. The agency sued the company in December 2024 after finding that it failed to extend the same discounts and rebates to smaller stores that it provided to large chains like Walmart, Kroger, and Total Wine, even when those competing businesses operated only blocks apart.
Terms of the Federal Trade Commission Settlement
Under the terms of the agreement finalized on Friday, Southern Glazer’s must pay affected independent retailers if it engages in significant or recurring price discrimination on identical products sold to nearby larger chains. The order relies on the 1936 Robinson-Patman Act, a statute that permits volume discounts only when sellers demonstrate real cost efficiencies achieved by bulk selling. An independent monitor will oversee compliance for six years, requiring Southern Glazer’s to submit detailed sales records twice a year.
The settlement restricts sales practices across 26 states, covering Southern Glazer’s sales to the five largest chain retailers. The FTC initially investigated operations in 33 states before dropping seven from the final order due to insufficient evidence of discriminatory pricing. The covered jurisdictions include Alaska, Arizona, Arkansas, California, Colorado, Delaware, Florida, Hawaii, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maryland, Minnesota, Missouri, Nebraska, Nevada, New Mexico, New York, North Dakota, Oklahoma, South Carolina, Tennessee, Texas, and Washington.
Southern Glazer's denies violating Robinson-Patman Act
Alan Greenspan, the company’s chief legal and compliance officer, stated that the distributor was pleased to resolve the matter without a trial or any admission of wrongdoing. Greenspan maintained that Southern Glazer’s did not violate the Robinson-Patman Act and noted that the company does not anticipate material changes to its standard business or pricing practices. He stated: Southern Glazer’s Wine and Spirits did not violate—and is not violating—the Robinson-Patman Act,
and added: The proposed order does not outright prohibit Southern Glazer’s from engaging in any particular business activity, and we do not anticipate material changes to our business or pricing practices.
The lawsuit originated during the final weeks of the administration of former President Joe Biden. Andrew Ferguson, who assumed the role of FTC chairman in January 2025 when President Donald Trump took office, acknowledged that he did not initially support the litigation. Ferguson stated that he initially believed the company could justify price variations based on supply costs. However, after a federal court denied a dismissal motion in April 2025, Ferguson described the settlement as the optimal resolution, calling the order self-calibrating because penalties apply only when a monitor verifies that an independent store paid more than a nearby competitor. Ferguson stated: The order is self-calibrating: Southern pays only where a monitor finds that an independent retailer actually paid more than a competing chain,
and further stated: If Southern obeys the law, its compliance costs are low.
Frequently Asked Questions About the Order
Which retailers received the disputed discounts and rebates?
The FTC identified major chain retailers including Total Wine, Walmart, and Kroger as the recipients of pricing advantages that were withheld from smaller, independent neighborhood stores.
What specific oversight mechanism was established by the FTC?
An independent monitor will supervise the distributor for a period of six years, during which Southern Glazer’s must provide detailed transaction records twice annually.
How many states are impacted by the final compliance order?
The settlement covers operations across 26 states, down from 33 states named in the initial December 2024 lawsuit after subsequent investigations narrowed the scope.
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