An old anti-competition case and it's further application

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**Spacemanvic**

Anybody know what the outcome of this case is, and if it could be applied to GW?

http://www.justice.gov/atr/cases/f0000/0058.htm

**Mastiff**

From the internets:

2. WHAT IS THIS LAWSUIT ABOUT?
This Action was commenced on July 20, 1995 against Playmobil for allegedly conspiring to fix prices on its products with its retailers during the time period of February 1, 1990 through May 22, 1995. The Action alleges Playmobil violated Section 1 of the Sherman Act, 15 U.S.C. ' 1, and Section 4 of the Clayton Act, 15 U.S.C. ' 15. As a result of Playmobil=s actions, plaintiffs allege that consumers paid more for Playmobil products than they would have absent the alleged price-fixing. As relief, plaintiffs seek treble damages, attorneys= fees and costs. Plaintiffs' claims are, at present, only allegations since no trial on the merits has occurred in the Action. Playmobil denies all of plaintiffs' allegations of wrongdoing and liability and maintains that all Settlement Class members (defined in Section 3 below) are not entitled to damages or any other relief. Playmobil denies that it ever conspired to fix prices or in any way
violated the Sherman Act or the Clayton Act. In Playmobil=s view, customers were not harmed in any way.

3. WHO IS COVERED BY THE SETTLEMENT?
On September 15, 2000, the Court conditionally certified a nationwide class (excluding certain Pennsylvania citizens described below) for purposes of settlement only, and granted preliminary approval of the Settlement Agreement. The benefits provided for by the Settlement are summarized in Section 4 of this Notice. The class is composed of certain residents of the U.S. who purchased Playmobil products at any time during the period commencing February 1, 1990 through May 22, 1995 from an authorized retailer of Playmobil products (the "Settlement Class"). The Settlement Class excludes from participation: (a) Playmobil and any subsidiaries or affiliates of Playmobil and their employees; (b) any retail dealer of Playmobil products; (c) Pennsylvania citizens who purchased Playmobil products and were represented in Commonwealth of Pennsylvania v. Playmobil, USA, Inc., No. 1:CV-95-0287 (M.D.Pa. Dec. 15, 1995); (d) any consumer who received a discount of five (5%) percent or greater off the suggested retail price of the Playmobil product in effect at the time of the purchase; and (e) all persons who, in accordance with the terms of the Settlement Agreement, execute a timely request for exclusion from the Settlement Class as more fully described in Section 8 below.

4. WHAT ARE THE TERMS OF THE SETTLEMENT?
On September 15, 2000, the Court granted preliminary approval of this Settlement subject to final approval after a Settlement Hearing to be held on March 2, 2001, at 10:00 a.m. at the Courthouse, 1034 Federal Plaza, Central Islip, NY 11722. A. Reimbursements

Is that what you were hoping for?

**mikhaila**

Short answer: No.

Long answer: Anyone can sue anyone, hire a lawyer, and bring a case. But I don't think that this case applies.

In furtherance of this combination and conspiracy, the defendant did the following things, among others:

(a) established and communicated to dealers minimum resale prices for Playmobil products;

(b) threatened to terminate dealers for selling or advertising Playmobil products at prices below defendant's minimum resale prices;

(c) used threats of termination to secure dealers' adherence to defendants' minimum resale prices and to limit the duration of promotional sales by dealers;

(d) enforced adherence to minimum resale prices at the behest of dealers in order to stop "price wars" among them; and

(e) agreed with dealers on the retail prices for Playmobil products to be charged by the dealers.

Considering the number of places you can find GW products at discounts, it's going to be tough to show that they have fixed prices. If an individual store could show, with proof, that any of the above occurred, they might have a case. They might also spend one hell of a lot of money on lawyers and get nothing.

Nothing that I've every had in writing from GW in 20 years of dealing with them would support any of those points. Verbally, I know they have at times discouraged discounting. Then again, so does every merchant association I've ever been involved with. Service and hobby support will go much further than discounting, for a brick and mortar store, for bringing in more sales. And you can see that in online sales as well. Even with places offering larger discounts than Neal at the Warstore, many people want to deal with him because of service.

**solkan**

Stores tend not to offer very big discounts on GW stuff because GW gives them terrible wholesale prices (relatively small discounts compared to suggested retail price) to the merchant, not because GW mandates the retail price. Even worse, the store's prices when buying from GW tends to be tied to sales volume, so a store which both only sells a little bit of GW stuff AND offers a discount won't make much money off of the sales and so has less reason to offer discounts in the future.

It's sad but it's true.

**Cannerus_The_Unbearable**

So did they get final approval or not? And that being the case, I sell Polk speakers but remove the labels with our account number prior to shipping them so we can't get in trouble for offering discounts. If they won, wouldn't Polk be doing the same thing by threatening to close accounts with no warning for offering discounts?

**mikhaila**

solkan wrote:Stores tend not to offer very big discounts on GW stuff because GW gives them terrible wholesale prices (relatively small discounts compared to suggested retail price) to the merchant, not because GW mandates the retail price. Even worse, the store's prices when buying from GW tends to be tied to sales volume, so a store which both only sells a little bit of GW stuff AND offers a discount won't make much money off of the sales and so has less reason to offer discounts in the future.

It's sad but it's true.

Actually untrue, at least in the US. ( I have no knowledge of trade terms in other countries.)

All GW accounts that deal with them directly get a 45% profit margin, which is about average for the product most gaming stores carry. 50% is good, 40% not so good, and most stores dislike bringing in product at less than that, unless it sells in bulk like boxes of CCGs.

Sales volume doesn't matter. Big store or small, we all get 45% off. If a store doesn't go through GW, but gets product through a game distributor, they will get less of a discount, with different terms.

**Jackmojo**

The cited cases above are less relevant to this discussion then the more recent ruling on vertical price fixing in 2007.

For the disinclined, the ruling basically says that manufacturers can set a price floor to their resellers. So GW can indeed dictate a minimum price for their goods.

Jack