The FTC, which set its sights on Southern Wine and Spirits is now requesting information from Total Wine and More (Total). Total according to, objected to a civil investigative demand from the FTC on numerous grounds. The FTC is requesting voluminous amounts of data on Total’s dealings with distributors. There has been no indication that Total is being subject to an investigation for breaking any laws.

The FTC’s investigation into the liquor space focuses on whether a violation occurred under the Robinson-Patman Act. The Robinson-Patman Act, which passed in 1936, was meant to protect small retailers from competition from major chain stores. The law’s designs are to prevent manufacturers/wholesalers from providing larger retailer customers preferred or reduced pricing.

The Robinson-Patman Act, was a forgotten afterthought, until Lina Khan and her cohorts at the FTC started raising the issue again.

There is a good reason why Robinson-Patman was put into the legal dust pin, there were concerns that enforcing Robinson-Patman would lead to higher prices.

One of two results

Somehow the FTC while investigating the liquor world is playing an either-or game with Robinson-Patman, we either raise prices or we reduce profits for the major players.

This is how the scenario works, suppose Wholesaler A is offering Retailer B lower prices than Retailer C. Retailer B is much larger and purchases more product, with economies of scale it will cost Wholesaler A less to deliver and hence it could justify pricing based on cost savings alone, but it could also justify lower prices based on a higher sales volume for Retailer A versus Retailer B.

Hypothetically let’s take a situation, where all the sudden the FTC steps in and eliminates the price differentiation. Retailer A is either going to raise prices or keep prices at the same level, if they take advantage of lower prices, they will see a reduced profit thanks to higher purchase prices from the distributor.

The reduced profits seem to fit with Ms. Khan’s Neo-Brandeis views, which adheres to the believe that centralized private power is a danger to a democracy’s social and economic conditions.

So, the FTC’s maze ends at the corner of lower profits or higher price. Ms. Khan and the FTC leaves the liquor world in two boats, raise prices, which destroys the Chicago Antitrust model and negatively impact the largest players, or lower prices and suffer negative consequences, which wets her Neo-Brandeis thirst.