Update July 2009: The Courts and Competition Policy sub-committee of the House Judiciary Committee reported out a bill that would reverse Leegin and restore the per se rule. Although the current version had no exceptions, representatives generally supporting the measure also expressed support for limiting provisions that would permit Resale Price Maintenance in circumstances likely to be pro-competitive.
In a 2007 decision, the U.S. Supreme Court Leegin Leather v. PSKS, Inc. overturned the century old per se rule against vertical minimum price fixing, holding that all vertical claims must be evaluated under the Rule of Reason. The 5-4 decision overturned a $4 million jury verdict for the plaintiff.
On remand, PSKS, a retailer of high end women’s clothing amended the complaint to allege harm to competition. It alleged that 1) Leegin products formed a relevant sub-market in the the overall market for brand name women’s accessories, and 2) the price fixing agreement had horizontal effects because it was sought by other Leegin retailers and Leegin itself also competed at the retail level. Judge John Ward, E.D. Tex, granted Leegin’s motion to dismiss, holding that the market definition was barred by a rule prohibiting a market in a single brand and that the price fixing allegations were insufficient to establish a horizontal conspiracy and improperly went beyond the evidence presented at the earlier trial.