Page 1
Page 2
Page 3
Page 4
Page 5
Page 6
Page 7
Page 8
Page 9
Page 10
Page 11
Page 12
Page 13
Page 14
7 Minimum Advertised Price Continued from Page 1 the sales price are available on the retailers web- site and are often one and the same. Though the Ninth Circuit has yet to address this issue head on a pair of district court decisions in New York have determined that MAP policies do not constitute RPM or vertical price-fixing policies when they a specifically state that retailers can set their own sales price b apply to internet and non-internet retailers alike and c provide retailers with with more than one way to communicate lower prices to clients either by allowing customers to call or email for a price quote or by allowing retailers to offer coupons at a websites checkout page. v. Franke Consumer Products Inc. 2011 WL 2565284 5 S.D.N.Y. 2011 v. KWC Products Inc. 2011 WL 4352390 5 S.D.N.Y. 2011. Thus at least for now the distinction between advertised price and sales price lies at the point of sale on the website the ubiquitous shopping cart. Smart Web CrawlersCombatting AI Free Riders In the past simple Captcha codes those weird twisted words that determine if you are human blocked web crawlers from accessing the shopping cart. If an online retailer implemented a MAP poli- cy automated web crawlers would only report the higher advertised prices to search engines or competitor websites not the lower in-cart price. Lately as we can see from the growing difficulty of CAPTCHA codes web crawlers have grown smart enough to get through these barriers. To address this problem manufacturers have the option of drafting their resale contracts usually authorized reseller agreements to require addi- tional security measures on checkout. These have the double benefit of blocking web crawlers and improving safeguards on consumer credit card da- ta 1. Two-Step Authentication Prior to Checkout Instead of a simple one-stage login process more and more retailers including Apple Google and Amazon use two-stage verification processes. These verification processes require consumers to enter passcodes or data received via e-mail or text or some other format in addition to the normal login. The PCI Security Standards Council an organization originally formed from the largest credit card vendors provides baseline security standards and certifications for credit card data security required by law in certain states. 2. Click-Through Terms of Use Agreement Over the past decade there have been a number of civil actions that allege trespass copyrights violations and violations of the Computer Fraud and Abuse Act against web crawlers that extract commercial data from websites. The success of these cases have in large part turned upon the Terms of Use Agreements on the websites in question. See eBay v. Bidders Edge 100 F.Supp.2d 1058 1060 N.D. Cal. 2000 Terms of Use agreement which re- quired users to click I Accept and prohibited ro- bots and web crawlers constituted a limited li- cense that controlled access to the site. Though these Terms of Use Agreements will not deter the most avid hackers the threat of potential liability may dissuade competing retailers from data scrap- ing efforts. Manufacturers beware make sure to carve out a provision in your MAP policy that allows you to monitor a retailers compliance with MAP so that you do not run afoul of your own retailers Terms of Use Alternatively manufacturers can implement more restrictive MAP policies to combat web crawlers which fall within the scope of Franke and KWC. The MAP policy can require the retailer to imple- ment a call in for a lower price strategy or only allow the use of limited-time or one-time only coupon codes. Of course the advantage of all of these approaches for manufacturers increased barriers to web crawlers also creates a potential deterrent to con- sumers. Prior to implementing these barriers re- tailers should carefully measure the loss of cus- tomers through these additional verification Continued on Page 8