FTC settles with Southern Glazer's over claim it discriminated against smaller alcohol sellers

The Federal Trade Commission said Friday it settled with the largest U.S. distributor of wines and spirits over claims that it was discriminating against small and independent businesses.

The agency sued Southern Glazer’s Wine and Spirits in December 2024 after finding it didn’t give smaller stores access to the discounts and rebates it offered larger stores like Total Wine, Walmart and Kroger, even when stores were within a few blocks of each other.

The FTC’s case was based on the rarely enforced 1936 Robinson-Patman Act, which permits volume discounts but only if a seller can demonstrate that it's achieving real cost efficiencies by selling in bulk.

Under the settlement agreement, Southern Glazer’s must pay the smaller retailer if it engages in significant or recurring price discrimination when it sells the same products to a larger store nearby. An independent monitor will oversee the settlement for six years, the FTC said. Southern Glazer's must provide the monitor with detailed records twice a year.

Southern Glazer’s is one of the largest privately held companies in the U.S. and generated $26 billion in revenue from wine and spirits sales to retail customers in 2023, according to the FTC. It distributes one out of every three bottles of wine and spirits in the U.S.

Southern Glazer's said Friday it was pleased to reach a settlement agreement that resolved the case without a trial or an admission of wrongdoing.

“Southern Glazer’s Wine and Spirits did not violate—and is not violating—the Robinson-Patman Act,” Alan Greenspan, Southern Glazer's chief legal and compliance officer, said in a statement. “The proposed order does not outright prohibit Southern Glazer’s from engaging in any particular business activity, and we do not anticipate material changes to our business or pricing practices.”

The settlement covers Southern Glazer’s sales to the five largest chain retailers in 26 states. The FTC’s lawsuit originally alleged discrimination in 33 states, but a subsequent investigation failed to show that it occurred in seven of them.

The states covered by the order are: Alaska, Arizona, Arkansas, California, Colorado, Delaware, Florida, Hawaii, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maryland, Minnesota, Missouri, Nebraska, Nevada, New Mexico, New York, North Dakota, Oklahoma, South Carolina, Tennessee, Texas and Washington.

The FTC filed the lawsuit during the waning days of former President Joe Biden's administration. Andrew Ferguson , who was named FTC chairman on the day President Donald Trump took office in January 2025, said Friday that he didn’t initially support the lawsuit against Southern Glazer’s.

In a statement, Ferguson said he believed Southern Glazer’s could prove that most of the price differences were justified by differences in the costs of supplying various retailers.

But the case proceeded after a federal court denied Southern Glazer’s attempt to dismiss it in April 2025. Ferguson said the settlement was the best outcome for all parties.

“The order is self-calibrating: Southern pays only where a monitor finds that an independent retailer actually paid more than a competing chain,” Ferguson said. “If Southern obeys the law, its compliance costs are low.”