Executive Summary
- What’s new: Within a week, the FTC took major steps to resolve two RPA matters. First, the FTC filed a proposed consent decree regarding Southern Glazer’s, the nation’s largest wine and spirits distributor, that prohibits it from discriminating against independent retailers — the FTC’s first relief under the RPA in a generation. Second, it closed an investigation into T-shirt manufacturer Gildan Activewear and distributor S&S Holdings after the companies amended a contract that had restricted Gildan’s pricing and discounts to S&S’s competitors.
- Why it matters: The two actions illustrate that the FTC is again enforcing the RPA, against both companies that sell commodity products to resellers and the resellers themselves. The Southern Glazer’s order may become a reference point for regulators and private plaintiffs. The Gildan matter, in turn, shows that large buyers using contract terms to secure better pricing than their competitors can also face scrutiny.
- What to do next: Companies should consider auditing net, not list, prices and documenting reasons for price differences at the time they set them. They should also consider making discounts genuinely available to all competing resellers and refreshing their compliance programs.
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The Robinson-Patman Act (RPA), a Great Depression-era statute that can prohibit commodity sellers from discriminating based on price when selling to competing resellers, is being enforced by federal agencies again. Within a week, the U.S. Federal Trade Commission (FTC) took major steps to resolve two RPA matters.
First, the FTC filed a proposed consent decree regarding Southern Glazer’s, the nation’s largest wine and spirits distributor, that prohibits it from discriminating against independent retailers — the FTC’s first relief under the RPA in a generation.
Second, it closed an investigation into T-shirt manufacturer Gildan Activewear and distributor S&S Holdings after the companies amended a contract that had restricted Gildan’s pricing and discounts to S&S’s competitors.
Background: The Robinson-Patman Act
Originally enacted in 1936 during the Great Depression amid the widespread failure of businesses, the RPA reflects that era’s concern about the rise of large national chain stores, which disrupted the traditional supplier-to-wholesaler/distributor-to-retailer sales model. Responding to these concerns, the RPA prohibits sellers of commodity products from engaging in a variety of practices, including charging competing buyers different prices for goods of like grade and quality where the effect may be to injure competition.
Not every price difference is unlawful, though. Recognized defenses include cost justification (real savings in serving a customer), meeting competition (matching a competitor’s offer in good faith), changing market conditions (such as selling off a discontinued product line or a closing business’s stock) and functional availability (the disfavored buyer knew of the discount and could realistically qualify).
Since 2000, the FTC had declined to enforce the RPA based on the view that it is inconsistent with the consumer welfare standard — a bedrock principle of antitrust law that considers the impact of economic practices on consumers. Critics of the RPA, including the Department of Justice in a 1977 report, have long argued that it runs counter to core antitrust principles because price discrimination often benefits consumers by yielding lower prices and innovative methods of distribution.
Nevertheless, the Biden administration revived RPA enforcement, bringing actions against PepsiCo and Southern Glazer’s. The Trump administration has seemingly continued that trend, in light of the FTC’s announcement resolving its investigation into T-shirt manufacturer Gildan Activewear and wholesale distributor S&S Holdings LLC for potential RPA violations and Chairman Andrew Ferguson’s statement stressing that the Act “remains good law.”
The Southern Glazer’s Action and Settlement
In December 2024, at the end of the Biden administration, the FTC — by a 3-2 vote along partisan lines — sued Southern Glazer’s in the U.S. District Court for the Central District of California, in the first RPA enforcement action by federal agencies in nearly 25 years. The FTC alleged that Southern Glazer’s charged independent retailers significantly higher prices than large national chains through discounts and rebates that were unavailable to independent retailers and not cost-justified. The FTC further alleged that these higher prices disadvantaged independent retailers in the resale of products to end-consumers.
After the district court denied Southern Glazer’s motion to dismiss in April 2025, the parties settled, with the commission voting 2-0 on October 2, 2026, to file a proposed stipulated consent decree. Southern Glazer’s denies the FTC’s allegations, and the order is not an admission of liability. The order still must be approved by the district court before it takes effect.
The settlement. The settlement provides guidance on what the FTC considers discriminatory pricing: It compares what a distributor charges a large chain and a nearby small independent retailer for the same product within a short time frame, sets how big a price gap is acceptable, and requires repayment — plus a penalty — when the gap is too large. The order governs Southern Glazer’s sales in 26 states for six years and prohibits Southern Glazer’s from discriminating against independent retailers. A monitor, jointly selected by the FTC and Southern Glazer’s, will be appointed to oversee compliance. The order compares pairs of transactions: a sale to one of the distributor’s five largest off-premise retail customers (i.e., customers that sell the product for use off-premise) in a state by prior-year dollar sales, and a sale of the same product to a nearby “covered” independent retailer, generally one with 75 or fewer stores that does not resell to other retailers. A paired transaction counts only if it meets two criteria:
- Distance. The two stores must be in the same state and fall within a set radius that depends on where the independent retailer is located: 1.5 miles in Chicago, New York City, San Francisco and Seattle; 2.5 miles in other urban areas; 6 miles in suburban areas; and 12 miles in rural areas.
- Timing. The two invoices must be dated within 45 days of each other. A longer 75-day window applies to a nonpublic list of retailers.
Southern Glazer’s net prices, after all discounts and rebates, may differ up to a “safe harbor” equal to state-specific cost savings in serving chains plus 2.5% of the chain’s price, with added room for supplier support from wineries and spirits makers. A violation of the consent decree will occur if the excess payments, totaled across paired transactions, exceed $5,000 for one independent retailer over 12 months.
After identifying a violation, the monitor will issue a notice, and Southern Glazer’s may cure the violation by paying the retailer 1.5 times the excess payment paid by the independent retailer, increasing to twice the excess if Southern Glazer’s fails to cure and the FTC brings and wins an enforcement action. The order adds anticircumvention, compliance training and record-keeping requirements, but also preserves Southern Glazer’s ability to raise functional availability, meeting competition and changing market conditions defenses under the statute. Notably, the order does not require Southern Glazer’s to pay damages to redress any alleged past conduct.
The commissioners’ views. Chairman Ferguson, who dissented from the FTC’s decision to file the complaint against Southern Glazer’s in 2024, explained that the order likely secures greater relief than if the case had proceeded to trial given that discovery uncovered only “modest quantifiable harm.” The chairman stated that the settlement constitutes a “major victory” and that the commission will continue to enforce the RPA where it sees evidence of unlawful price discrimination that results in a “substantial” injury to competition.
In a separate statement, Commissioner Mark Meador urged that, before bringing future enforcement actions, the FTC should issue guidance explaining its current views of what the RPA requires and when it will bring a challenge. He specifically suggested that future actions should focus on sectors that more directly impact the cost of living for American families, such as food and groceries.
The Gildan Action
On October 8, 2026, the FTC announced that it had secured changes to a partnership agreement between manufacturer Gildan Activewear and major wholesale distributor S&S Holdings. The FTC opened its investigation after learning that S&S’s contract prohibited Gildan from offering S&S’s competitors certain pricing and discounts provided to S&S. The FTC examined both sides of the arrangement: Gildan, the seller, for potential violations of Section 2(a) of the RPA, and S&S, the buyer, under Section 2(f), which prohibits knowingly inducing or receiving discriminatory prices.
In response, the companies amended their agreement to provide that nothing in it “restricts or restrains Gildan’s discretion to set prices or offer partnership support to any other North American wholesale distributor,” and the FTC closed its investigation. The FTC described the matter as building on the Southern Glazer’s settlement filed the previous week, and Bureau of Competition Director Daniel Guarnera warned that the agency “will not hesitate to enforce the law when a large, powerful firm insulates itself from competition by forcing sellers to give worse prices to the firm’s competitors.”
Implications for Clients
By carrying a prior-administration case through to relief and opening a new investigation, the FTC has signaled its willingness to enforce the RPA. While FTC leadership has indicated that it favors cases involving powerful buyers and clear consumer harm, private plaintiffs are not subject to agency enforcement priorities and may pursue claims regardless of the impact of the challenged conduct on consumers. That increases the prospect of future scrutiny over price discrimination. Meanwhile, the concrete thresholds in the Southern Glazer’s order could become a reference point for future litigants seeking relief. Thus, companies that sell commodity products to resellers should consider:
- Auditing net, not list, prices across competing reseller customers, accounting for rebates, billbacks, scan allowances, volume incentives and other forms of trade spend for price differences.
- Documenting reasons for price differences contemporaneously, including cost savings and competitive offers met.
- Making discounts genuinely available to all competing resellers by clearly communicating those programs and, to the extent applicable, ensuring that any requirements to obtain those discounts are realistically attainable by each reseller.
- Reviewing promotional allowances, including customer-initiated programs, for proportionally equal terms.
- Refreshing compliance programs with targeted training for pricing personnel and periodic data-driven reviews.
In addition, resellers should consider checking supply agreements for terms that limit the ability to offer a reseller’s competitors the same pricing or support.
This memorandum is provided by Skadden, Arps, Slate, Meagher & Flom LLP and its affiliates for educational and informational purposes only and is not intended and should not be construed as legal advice. This memorandum is considered advertising under applicable state laws.