Bagging Customers for Having Sales
FACTS: Leegin Creative Leather Products, Inc., designs, manufactures, and distributes leather goods and
accessories under the brand name ²ighton. he Brighton brand is sold across the United States in
over 5,000 retail stores. PSKS, Inc., runs KayàKloset, a Brighton retailer in Lewis- ville, Texas, that carries
about 75 different product lines but was known as the place in that area to go for Brighton.
Leeginàpresident, Jerry Kohl, who also has an interest in about 70 stores that sell Brighton products,
believes that small retailers treat customers better, provide customers more services, and make their
shopping experience more satisfactory than do larger, often impersonal retailers. In 1997, Leegin
instituted the ²ighton Retail Pricing and Promotion Policy,7hich banished retailers that discounted
Brighton goods below suggested prices.
In December 2002, Leegin discovered that KayàKloset had been marking down Brightonàentire line by
20 percent. When Kayàwould not stop marking the
Brighton products prices down, Leegin stopped selling to the store.
PSKS sued Leegin for violation of the antitrust laws. The jury awarded PSKS $1.2 million in damages and
the judge tre- bled the damages and reimbursed PSKS for its attorneyàfees and costs¯r a judgment
against Leegin of $3,975,000.80. The Court of Appeals affirmed. Leegin appealed.
DECISION: The Court held that the goal of providing cus- tomers with information and service through
the smaller boutiques was a competitive strategy that offered consumers choices. It was not a per se
violation for Leegin to require minimum prices. Resale price maintenance increases the choices
consumers have by providing them with a full- service retailer. Each case on resale price maintenance
requires examination of the market and the effect on com- petition, but it is not automatically
anticompetitive. The decision was reversed. [Leegin Creative Leather Products, Inc. v. PSKS, Inc., 551
U.S. 877 (2007)]

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