FTC SETTLES WITH NAMM ON CHARGES OF ATTEMPTING TO ILLEGALLY CONSTRAIN COMPETITION

On March 4, 2009, the National Association of Music Merchants (“NAMM”) agreed to a Federal Trade Commission (“FTC”) consent order settling charges of NAMM’s conduct that enhanced members’ ability to increase prices of musical instruments.

NAMM is a trade association of U.S. manufacturers, distributors, and dealers of musical instruments. As a trade association, its purpose is to facilitate promotion of consumer demand for musical instruments by lobbying the government, offering seminars, promoting music education, and organizing trade shows.

Specifically, the FTC alleges that between 2005 and 2007 NAMM sponsored meetings with agendas where it facilitated and steered discussions related to the exchange of sensitive competitive information including retail prices and margins and the enforcement of minimum advertised pricing. The FTC believes that this conduct could have resulted in an agreement between retailers to raise prices for their goods.

The consent order seeks to remedy the anticompetitive conduct by barring NAMM from taking part in any such activity that facilitates discussions of sensitive competitive information and aiding members in forming an anticompetitive agreement. The consent order also implements an antitrust compliance program and requires that antitrust counsel review written materials and prepared remarks by NAMM.

Robert Doyle
(202) 589-1834
rdoyle@dbmlawgroup.com