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Leegin Creative Leather Products, Inc. v. PSKS, Inc.

United States Supreme Court
551 U.S. 877 (2007)


Facts

In 1991, Leegin Creative Leather Products, Inc. (Leegin) (defendant), started selling belts and other women’s accessories under the Brighton brand. The Brighton label was a success, and Leegin eventually provided Brighton products to over 5,000 different retailers across the United States. PSKS, Inc. (PSKS) (plaintiff), operated Kay’s Kloset (Kay’s), a women’s apparel store that began selling Brighton products in 1995. Over the next few years, Brighton products accounted for 40 to 50 percent of the profits earned by Kay’s. In 1997, Leegin began a new policy of not selling Brighton products to retailers that sold below Leegin’s suggested prices. In the announcement for the new policy, Leegin told retailers that Leegin wanted the retailers have sufficient profit margins such that the retailers would be able to focus on customer service and store appearance. In 2002, Leegin learned that Kay’s had been selling the entire line of Brighton products at discount prices. Kay’s refused to stop selling below the prices suggested by Leegin, and Leegin subsequently refused to sell any more Brighton products to Kay’s. PSKS then brought a suit, alleging that Leegin’s resale-price policy violated antitrust law. The court of appeals found the policy to be a per se antitrust violation. Leegin’s appealed, but the court of appeals affirmed. Leegin’s appealed again on the issue of whether the practice was a per se antitrust violation.

Rule of Law

Issue

Holding and Reasoning (Kennedy, J.)

Dissent (Breyer, J.)

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