It's illegal in the US to require any type of minimum price???

Hi

I found some people selling my software tool for less than the minimum price I stated in the resell rights license.

I've sent this person a message, and he answered me this:

It's illegal in the US to require any type of minimum price.



Can someone help me out here?

1 - I have no clue of where to go to check if it is indeed illegal.

2 - I'm not in the US myself. Doesn't my resell rights license go under the laws of my country? And what if he sells to non-US customers?


I would really appreciate some tips on where to find some info!

Greetz!
Mieke Janssens

 

no its not illegal. Its called resale price maintenance. Many brands do it to keep their prestige and image high.

 

Not illegal

At the end of the day they will have signed a contract with you and that contract will say which countries legal system the contract is governed by. Failure to abide by the contract for any reason would be a breach of contract as long as the contract is legal in the country whos legal system governs it.

 

It's totally legal (civally) to require minimum pricing on products being resold. Top manufactureres do it all the time, especially when it comes to internet pricing. It keeps the little guys in the picture so it's good for everyone (except the big guys really).

 

Guys, I was under the impresssion that it was Legal to say you may not advertise the product at a price less than $x.

And that it was Not legal to say you can not sell it for less than $x.

I think you are going to need to post chapter and verse to convince me otherwise.

 

Actually the US Supreme Court just ruled on a case that has to do with minimum price fixing.

The ruling in Leegin Creative Leather Products, Inc. v. PSKS, Inc.:
http://www.law.cornell.edu/supct/html/06-480.ZO.html

IANAL but my understanding is that this means that vertical price restraints such as minimum retail price will be judged on a case-by-case basis, rather than being per se illegal. (Note that until this June 28th ruling, such price restraints would have been illegal).

More details on the legalities of "resale price maintenance" in the U.S.:
http://en.wikipedia.org/wiki/Resale_price_maintenance#United_States_law

Here is background on vertical price restraints:
http://en.wikipedia.org/wiki/Vertical_restraints

Here's more about the "rule of reason"
http://en.wikipedia.org/wiki/Rule_of_reason

The bottom line is that if you want to fix a retail price, you should talk to an attorney with expertise in business law to see if it should be acceptable under the "rule of reason."

 

Great post Nonny!

Looks like I am only behind the times by a couple of weeks.

 

It's just chance that I read about the case a few days ago. That's why the lawyers get the big bucks - they gotta keep up with all the changes.