In 2007, the Supreme Court overturned almost one hundred years of settled antitrust precedent by declaring that retail price maintenance (“RPM”), the practice by which a manufacturer attempts to dictate the resale price of its products, was no longer per se unlawful under the federal antitrust laws. Leegin Creative Leather Products v. PSKS Inc., 551 U.S. 877 (2007) (“Leegin”). Instead, RPM would be assessed under the “rule of reason,” which, unlike the per se tested that declares such conduct unlawful in all circumstances, requires the Court to weigh the procompetitive justifications for the agreement against its anticompetitive effects in determining the legality of the conduct. In short, a balancing act similar to that used in assessing most other antitrust issues (other than horizontal price fixing and market allocation agreements) would apply to RPM agreements, opening the door -- or so it seemed -- for some manufacturers to exert greater control over retailer pricing.

Since Leegin, however, the ability of manufacturers to impose pricing restrictions on the resale of their products by distributors and retailers has been anything but clear, despite the Supreme Court’s decision. Perhaps this should have been expected, given that in the Leegin case, more than 30 State Attorneys General urged the Supreme Court to continue to hold RPM agreements per se illegal. The Court’s rejection of that position, therefore, raised an interesting question for the States: Would they follow federal antitrust precedent as to their state antitrust laws (as they typically do) on the RPM issue or reject the Leegin decision and continue to subject manufacturers to the potential for per se condemnation under their state antitrust laws.