Companies Claim Right to Interfere with Ebay Auctions for Charging Too Little
Greg Beck from the Consumer Law & Policy Blog:
I predicted here that companies would soon rely on the Supreme Court’s decision in Leegin Creative Leather Products v. PSKS to justify interfering with competition from less expensive products sold online. It did not take long for that prediction to come true. Although interference with eBay sales is nothing new (see here and here), companies in two recently filed federal cases explicitly invoke Leegin as a justification for terminating the eBay auctions of competitors that charge lower prices online. These cases not only show Leegin’s likely effect on Internet sales, but are also, unfortunately, fairly typical examples of the sort of anticompetitive actions companies take to fight lower-priced competition online...
Comments (4)
DickF
I really don't see the connection between Leegin and interfering with competitors. In Leegin the producer set a minimum price for its own product. This would seem to be a totally appropriate contractual agreement. PSKS then violated the agreement. Had Leegin filed suit against someone selling the products in a garage sale it would be different. Contracts must be honored. The purchase of a product by a consumer makes no such contractual agreement.
It is a totally different issue when one producer attempts to set prices for another independent producer. There is no contractual agreement on pricing.
Published: July 19, 2007 4:10 PM
Peter
Contracts must be honored.
http://mises.org/rothbard/ethics/nineteen.asp
Published: July 19, 2007 9:57 PM
DickF
Again I do not understand. Leegin had a contract with PSKS to provide merchandise to be sold at a preagreed price. PSKS violated the contract. Leegin did not sue PSKS but simply ceased to do business with the store because it violated the contract.
I still do not see what this has to do with one company determine the selling price for products fully owned by another company. There is no contract, not even an implied agreement. The two simply do not relate.
Published: July 20, 2007 7:09 AM
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Published: July 20, 2007 4:37 PM