The FTC is preparing to sue the largest alcohol distributor in the U.S. over alleged 'secret kickbacks'
The Federal Trade Commission is preparing an antitrust lawsuit against the largest U.S. alcohol distributor, Southern Glazer’s Wine and Spirits, two sources familiar with the matter told CNBC.
The Federal Trade Commission is preparing an antitrust lawsuit against the largest U.S. alcohol distributor, Southern Glazer’s Wine and Spirits, two sources familiar with the matter told CNBC. The suit could be filed in a matter of weeks.
The FTC’s case is not yet finalized. But one source said the commission is likely to allege that Southern Glazer’s has been providing “secret kickbacks” to large retail customers and violating the 1936 Robinson-Patman Act. Politico first reported the potential legal action.
Florida-based Southern Glazer’s Wine and Spirits distributes alcohol for over 7,000 brands in 44 states. Founded in 1968, the company serves as a middleman between alcohol producers and the liquor stores that consumers buy from. The company reported $26 billion in revenue in 2023, according to Forbes.
The Robinson-Patman Act is an obscure 1936 antitrust law that forbids companies from offering better prices to one buyer over another for the same commodity. A case has not been brought under the law since 2000.
Under the FTC’s interpretation, the Robinson-Patman Act is not a wholesale ban on price discrimination and could allow volume discounts. The law only applies when price discrimination practices interfere with competition — a charge the FTC’s website says is legally “complex” to prove.
Rating: 5