Leegin Creative Leather Products, Inc. v. PSKS, Inc., Dba Kay's Kloset . . . Kay's Shoes (551 U.S. 877)
U.S. Supreme Court · decided June 28, 2007 · Supreme Court Database (Spaeth)
- Citation
- 551 U.S. 877 · 127 S. Ct. 2705
- Decided
- June 28, 2007
- Term
- October Term 2006
- Vote
- 5–4
- Majority author
- Justice Kennedy
- Issue area
- Economic Activity
- Disposition
- Reversed and remanded
- Outcome
- Petitioning party won
- Ideological direction
- Conservative
Opinion excerpt
Justice Kennedy delivered the opinion of the Court. In Dr. Miles Medical Co. v. John D. Park & Sons Co., 220 U. S. 373 (1911), the Court established the rule that it is per se illegal under § 1 of the Sherman Act, 15 U. S. C. § 1, for a manufacturer to agree with its distributor to set the minimum price the distributor can charge for the manufacturer’s goods. The question presented by the instant case is whether the Court should overrule the per se rule and allow resale price maintenance agreements to be judged by the rule of reason, the usual standard applied to determine if there is a violation of § 1. The Court has abandoned the rule of per se illegality for other vertical restraints a manufacturer imposes on its distributors. Respected economic analysts, furthermore, conclude that vertical price restraints can have procompetitive effects. We now hold that Dr. Miles should be overruled and that vertical price restraints are to be judged by the rule of reason. I Petitioner, Leegin Creative Leather Products, Inc. (Lee-gin), designs, manufactures, and distributes leather goods and accessories. In 1991, Leegin began to sell belts under the brand name “Brighton.” The Brighton brand has now expanded into a variety of women’s fashion accessories. It is sold across the United States in over 5,000 retail establishments, for the most part independent, small boutiques and specialty…
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