FTC sues largest US wine and spirits distributor, saying it discriminates against smaller stores
The Federal Trade Commission is suing the largest U.S. distributor of wine and spirits for allegedly discriminating against small and independent businesses
The Federal Trade Commission sued the largest U.S. distributor of wine and spirits on Thursday, saying it is illegally discriminating against small and independent businesses.
Southern Glazer’s Wine and Spirits doesn’t give smaller stores access to discounts and rebates that larger chains receive, putting the smaller stores at a competitive disadvantage, the FTC alleged in the lawsuit it filed in California.
“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,” FTC Chair Lina Khan said in a statement.
Miami-based Southern Glazer's called the lawsuit “both misguided and legally flawed.”
“Alcohol distributors face numerous regulations that dictate how they compete and can price and discount products, and Southern Glazer’s complies with those legal requirements,” the company said. “Southern Glazer’s strongly disputes the FTC’s allegations and will defend itself vigorously in this litigation.”
Southern Glazer’s is one of the largest privately held companies in the U.S., with $26 billion in revenue from wine and spirits sales to retail customers in 2023, according to the FTC. It distributes one out of every three bottles of wine and spirits in the U.S. and serves commercial customers such as Total Wine, Costco and Kroger.
The FTC's case is based on the rarely enforced 1936 Robinson-Patman Act, which permits volume discounts but only if a seller can demonstrate they achieve real cost efficiencies.
According to the FTC, Southern Glazer’s has repeatedly
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