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10 Minimum Advertised Price Continued from Page 8 Sherman and Cartwright Act. See In the Matter of National Association of Music Merchants Inc. FTC File No. 001 0203 FTC filed charges against a music trade organization for facilitating agreements among music manufacturer dealers on MAP policies and a consent order followed. In advance implementation of a unilateral MAP policy sounds easy enough that is until a large andor very important retailer decides to disregard the MAP policy. At that point dropping the retail- er may seem like an intolerable business decision. Prior to implementing any MAP policy manufac- turers must consider whether they are willing to enforce MAP equally for all retailers regardless of size or market power. If not the risk of liability for antitrust and unfair competition could out- weigh the potential benefits of the MAP policy. Best Practices for Implementation of MAP Policies Given developments in case law and advances in web technology manufacturers should consider the following best practices when deciding if and how to implement a MAP Policy Expressly allow the retailer to control end pric- es in the text of any MAP Policy. Whether it is through coupon codes loyalty points or calling in for prices retailers must have oppor- tunities to set sales prices at checkout. Follow the Colgate Doctrine and strictly en- force MAP policies. Negotiations with retail- ers or other manufacturers can lead to antitrust liability. Combat Smart Web Crawlers. Consider in- cluding data security and Terms of Use provi- sions to any authorized reseller agreements with retailers to avoid the MAP-defeating ef- fects of web crawlers. Determine whether the risks of enforcing strict MAP policies on consumer retention outweigh the benefits of higher advertised prices. Determine whether the risks of enforcing a MAP policy and losing a major distributor outweigh the benefits of higher advertised prices. Whats Next Online retail is continuously evolving. While web crawlers flash sales social media events and dis- count coupons may be popular today innovative marketers - and hackers - are always looking for the next technological edge live-action coupons and rick rolling on virtual reality headsets. Since antitrust case law and legislation will always be one step behind the next technological surprise manufacturers and lawyers alike must consider MAP policies and distribution practices in anticipation of industry disruption and be able to adapt accordingly. _______________________________ Lily Y. Li is an associate attorney at Brown Wegner McNamara LLP in Irvine California. The views expressed here are the authors and not those of Brown Wegner McNamara its clients or the FBAOC. 1. Cf. Worldhomecenter.com Inc. v. L.D. Kichler Co. 2007 WL 963206 E.D.N.Y. March 28 2007. In this pre-Leegin decision the court denied defendants motion to dismiss a Sherman Act claim when plaintiff argued that a MAP policy constituted vertical price fixing. In this case the MAP policy at issue did not give retailers the opportunity to provide dif- ferent online prices at checkout. The KWC court expressly declined to follow the reasoning of Kichler. Despite the fail- ure of courts to follow the reasoning of Kichler this case serves as a cautionary tale to any manufacturers that wish to impose strict MAP policies across a retailers website. 2. httpswww.pcisecuritystandards.org 3. In Blind Doctor Inc. v. Hunter Douglas Inc. 2004 WL 1976562 N.D. Cal 2004 the court upheld a MAP policy that restricted all online sales of certain proprietary prod- ucts in the window covering industry blinds shades etc.. This is another extreme strategy for avoiding online price wars - obviously not applicable for most products. 4. Franke 2011 WL 2565284 5 KWC 2011 WL 4352390 5. 6.People v. Tempur-Pedic Intl Inc. No. 40083710 N.Y. Sup. Ct. 2011 People v. Bioelements Inc. No. 10011659 Cal. Super. Ct. 2010 People v. DermaquestInc No. RG10497526 Cal. Super. Ct. 2010. For more details on the risks of RPM policies see Minimum Advertised Pricing Programs Practical Pointers in the Wake of Leegin availa- ble at httpwww.edwardswildman.cominsights PublicationDetail.aspxpublication1834