Bars banning drink specials not guilty of price-fixing
by Minnesota Lawyer Staff Reporter
Madison, Wis., bars that agreed to eliminate drink specials on weekends are not guilty of an illegal price-fixing conspiracy, the Wisconsin Supreme Court ruled last week.
The court refused to reinstate a lawsuit brought by drinkers claiming they were overcharged as a result of the bars’ 2002 pact to stop serving drink specials after 8 p.m. on Fridays and Saturdays.
More than 20 downtown bars joined the agreement, which was designed to thwart a total ban the city was considering on specials like two-for-one beers or $1 shots. City and University of Wisconsin-Madison officials argue the specials encouraged dangerous binge drinking among students.
But the Minneapolis law firm Lommen Abdo sued the bars in 2004 on behalf of UW-Madison students and other drinkers who claimed they were ripped off by the bars. The lawsuit, which sought “tens of millions of dollars” in damages, alleged the agreement was an illegal conspiracy to raise prices and prevent competition.
In a 3-1 decision, the Supreme Court upheld an appeals court decision dismissing the case.
The bars are immune from state antitrust law because they acted under pressure from city regulators who wanted to crack down on binge drinking among college students, Justice David Prosser wrote for the court. He noted regulators had warned bars to “clean up their act” or face tighter restrictions on their liquor licenses and a ban on drink specials.
Dissenting Justice Louis Butler said the mere possibility of an ordinance banning drink specials and threats from politicians should not be enough to exempt the bars from antitrust laws.
