FTC settles Robinson-Patman Act case against Southern Glazer’s

On October 2, 2026, the Federal Trade Commission (FTC) filed a proposed settlement resolving its lawsuit against Southern Glazer’s Wine and Spirits, LLC (Southern Glazer’s), the nation's largest wine and spirits distributor, under the Robinson-Patman Act (RPA), the federal statute that prohibits certain forms of price discrimination. The settlement closes the first federal RPA enforcement action in a generation and brings to an end the Biden-era FTC’s controversial effort to revive the statute. It also likely marks the end of RPA enforcement under the Trump FTC. For companies that offer volume discounts, rebates, or customer-specific pricing, however, the case is a timely reminder that the RPA remains enforceable by private litigants.

Background: The push to revive the Robinson-Patman Act

Before the Biden administration, federal RPA enforcement was dormant for decades, leaving private plaintiffs to drive litigation under the statute. Two factors largely explain that inactivity. First, the RPA’s numerous exceptions and safe harbors make claims exceedingly difficult to prove and typically require in-depth economic analysis. Second, the statute can be difficult to reconcile with antitrust laws’ stated goal of protecting consumers. The RPA was designed to help smaller businesses compete, but it does so by penalizing suppliers that charge lower prices to certain retailers—retailers that, in turn, offer consumers lower prices that small businesses cannot match. Critics have long observed that higher consumer prices are a logical consequence of RPA enforcement.¹

After taking the helm of the FTC, former Chair Lina Khan criticized prior enforcers for letting the RPA languish and pledged to revitalize federal enforcement. In 2022, she said she worried about enforcers “just decid[ing] they don’t agree with the values or policies underlying laws that Congress has passed,” and stated that the FTC was “taking a fresh look at Robinson-Patman.” Then, in March 2023, Khan said that RPA enforcement actions were coming “in short order.” Even so, the agency did not file its complaint against Southern Glazer’s until December 2024—some 18 months after that prediction and as the Biden administration was drawing to a close.

The FTC’s case against Southern Glazer’s

Southern Glazer’s sells approximately one of every three bottles of wine and spirits purchased in the United States. The FTC alleged that the company charged independent retailers—such as neighborhood grocery and convenience stores—significantly higher prices for identical products than it charged competing national and regional chains, often located only a few blocks or miles away.² According to the complaint, Southern Glazer’s gave large chains lower prices through volume-based and cumulative quantity discounts that smaller retailers could not attain, as well as scan rebates (per-bottle discounts at the register) available only to larger retailers. The FTC further alleged that these price differences were not justified by cost differences or by efforts to meet competing distributors' prices.³ As a result, the complaint asserted, some chains could profitably resell products below the wholesale price paid by independent retailers, causing those retailers to lose sales, customers, and profits.⁴

A divided Commission

The lawsuit drew sharply divergent reactions from the Commission’s Democratic and Republican members. The Democratic commissioners praised the case as a way to level the playing field for small businesses. As the statement joined by then-Chair Khan put it, "The Commission is suing Southern so that small, family-run grocery and liquor stores can get the same prices as their billionaire competitors."⁵

The Republican commissioners, including now-Chairman Andrew Ferguson, took the opposite view and issued written dissents. That step was a significant break from tradition. Although dissents are common in adjudicative decisions, settlements, and decisions not to file a complaint, commissioners rarely dissent from the filing of a case, because defendants can use those dissents to undermine the agency staff who must litigate it.⁶ Ferguson summarized his objection bluntly: "We ought to enforce the Act where it will serve the broad public interest and bring only those cases we are likely to win. This case checks neither box."⁷

Ferguson's dissent is particularly significant because, as chairman, he would later oversee the litigation and approve its settlement.⁸ His dissent did not reject the RPA outright; instead, it offered a pointed critique of this particular case—one that foreshadowed the challenges the FTC would face in litigation. Ferguson acknowledged the long-standing criticism that the RPA is "difficult to reconcile" with modern antitrust principles and that enforcement may deter volume discounts that benefit consumers,⁹ but he did not treat that criticism as a reason to ignore the statute.¹⁰ His objection was narrower: The case was "unlikely to prevail even on [the Commission's] own theory of the Act" and was "an imprudent use of the Commission's enforcement resources.” In his view, Southern Glazer’s had "argued persuasively that the price differences of which the Commission complains are justified by two different types of costs": supplier-funded discounts and the lower cost of serving chains through bulk deliveries.¹¹ He also saw little evidence that pricing, rather than factors such as "the convenience of buying alcohol alongside other household goods and groceries," caused independent retailers to lose sales to chains.¹² Ferguson argued that the FTC should pursue these cases "only when there is strong evidence that the favored purchasers possess market power,”¹³ and he noted that disfavored retailers remain free to bring their own lawsuits.¹⁴

Key terms of the proposed settlement

Despite those reservations, the Ferguson-led FTC ultimately chose to resolve the case rather than abandon it. The proposed settlement, filed on October 2, 2026, takes the form of a stipulated consent decree that will take effect upon court approval. Chairman Ferguson hailed the agreement as "the first relief that the Commission has secured under the Robinson-Patman Act in a generation" and "a major victory for the Trump FTC and for small, independent businesses.”¹⁵ He also argued that the FTC likely could not have achieved a better result at trial, because the settlement "is more specific and more readily enforceable than a litigated injunction would likely have been."¹⁶ There are two central terms of the proposed settlement:

Pricing limits

Southern Glazer’s does not admit wrongdoing, but it agrees to limit how much more it may charge smaller retailers (those with 75 or fewer stores) than its five largest chain customers in each of 26 states.¹⁷ The limits target "paired" sales, in which Southern Glazer’s sells the same product, at around the same time, to a large chain and a nearby smaller retailer at significantly different prices.¹⁸ What counts as “nearby” ranges from 1.5 miles in major cities to 12 miles in rural areas.¹⁹ A price gap counts toward a violation only if it exceeds an allowance for legitimate cost differences, and only if the amounts above that allowance for a single store total more than $5,000 over a 12-month period.²⁰

Cure payments and penalties

The settlement allows Southern Glazer’s to cure violations by paying affected retailers directly.²¹ If an independent monitor identifies a violation, Southern Glazer’s may cure it by paying the affected retailer the overcharge plus a 50% penalty within 60 days of notice.²² If it does not pay and the FTC prevails in a court enforcement action, Southern Glazer’s must pay the retailer double the overcharge.²³ Ferguson described the order as "self-calibrating”:²⁴ "If Southern obeys the law, its compliance costs are low," but if it does not, "its costs will balloon.”²⁵ Southern Glazer’s retains certain defenses: It may show that a discount was realistically available to the smaller retailer, that it was meeting a competitor's price, or that market conditions had changed.²⁶

Looking ahead

Apart from resolving this case, the current administration has not pursued RPA enforcement, and new federal RPA cases appear unlikely as the FTC focuses on other priorities. Businesses should not, however, assume that RPA risk has disappeared. Several practical lessons emerge from the case:

Federal enforcement is likely on hold—for now: While Chairman Ferguson left the door open to additional RPA actions by his FTC, it is unlikely that he would devote the agency’s limited resources to any such investigation or litigation. The RPA, however, has many proponents on the left, and a future Democratic administration could appoint someone more supportive of RPA enforcement to lead the FTC or the U.S. Department of Justice’s Antitrust Division, potentially renewing federal enforcement as early as 2029.

Private litigation remains a live risk: Private plaintiffs continue to pursue RPA claims and, as Chairman Ferguson noted, disfavored retailers remain free to bring their own lawsuits. The detailed allegations in the FTC’s complaint may serve as a roadmap for private claimants challenging similar discount and rebate programs.

Review discount and rebate programs now: The practices challenged here—volume-based and cumulative quantity discounts and rebates offered only to the largest customers—are common across industries. Companies should assess whether their discounts are realistically available to smaller competing customers, whether price differences between competing customers can be supported by documented cost savings or by efforts to meet a competitor’s price, and whether supplier-funded promotions are properly documented.

Federal RPA enforcement may be dormant, but the statute remains very much alive. Businesses that evaluate and document their pricing practices today will be better positioned to defend against private claims and any renewed federal enforcement.

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