Minimum Pricing Suit Gets Class Action Status

Philadelphia, PA, July 17, 2009--A federal judge has ruled in favor of consumers suing over minimum pricing policies, an issue that has sparked a similar suit by two online retailers.

Judge Anita Brody of the Eastern District of Pennsylvania yesterday awarded class action status to a suit brought by consumers against the Babies 'R Us unit of multichannel retailer Toys 'R Us and several manufacturers of strollers and other baby products.

The suit makes similar claims of antitrust violations as a companion action filed by e-retailers BabyAge.com Inc. and Baby Club of America, which sells at BabyCatalog.com.

In both cases, the plaintiffs argue that Toys 'R Us pressured the manufacturers to impose minimum pricing rules to prevent online retailers from undercutting the prices charged by the retail chain.

BabyAge.com, No. 280 in the Internet Retailer Top 500 Guide, and Baby Club of America argue in their suit that minimum pricing rules, which bar retailers from selling below a price set by a manufacturer, hurt e-retailers whose low overhead allows them to sell at lower prices than retail chains.

However, not all online retailers support their position, with some arguing that minimum pricing policies help maintain profit margins.