"Price Discussions..."

[beastboy]

I'm arguing with some fat bastard on another board about his upcoming meeting he is having with other local businesses of his type. I am aware that having discussions with other companies and negotiationg prices are illegal...i.e price fixing. I mentioned that he may want to be careful when he has his meeting and they talk "prices" and how there are legality issues with how the conversation is handled. Well...in response he got very defensives and responded, "No one said you had to come... And discussing prices isnt illegal at all. No one is price fixing. "

I'm curious what does the law says about what can and can't be discussed....?

It was amusing that he thought I actually wanted to come to his meeting.

 

[bran987]

Yep, it's called "collusion"

But I'm not sure what qualifies and what does not. Probably an attorney would be more apt to discuss.

Where's Mr. Wenis

 

[velvett]

Is he a realtor?
Or in a commission based field?

 

[beastboy]

No...service/rental busniess.

 

[bran987]

Is he a realtor?
Or in a commission based field?

I believe this usually occurs in industries prone to "price wars" where instead of undercutting each other ruthlessly to procure new business, the owners all get together and say "ok, this is the lowest price we're going to charge for X product/supply etc. We'll all stay above this price and we'll all make money"

not sure how this would apply to a realtor position as I think there are pretty set standards in each state, with a few cowboy firms saying the only charge 1% commission or whatever, is that what you were thinking of?

 

[flex229]

i think it would come down to if the price agreements would be found to restrain trade..if so, it would be per se illegal.

 

[Synpax]

I think that unless one of us is a lawyer or has specific experience with this, it's best to keep ones mouth shut.

That said, this stuff rarely ever works. If everyone agrees to the same price, they will all try to, in effect, cheat on it by competing on other fronts - better extras, better warrenties, hotter sales girls, etc.

 

[Razorguns]

I'm curious what does the law says about what can and can't be discussed....?

I'm not a lawyer -- so you get what you pay for..

But usually this is illegal not only for protection of the consumer purposes..

But arrangements like these can inevitably hurt other people such as the new business owner on the scene. Who if he doesn't join their little "clan" could wind up being pushed out. Or the new vendor who after a bad experience with one owner, could unfairly see himself shut out from the others.

In essence -- it could easily turn into a little mafia.

It's how the strip clubs work here in la and vegas yet the cops haven't done anyting about. If you try to _dare_ start a strip club in the city w/o the blessing of the "strip club mafia" -- you won't survive long and will see your business pulled right from underneath you. You'll even hav a tough time getting dancers who are blacklisted from dancing at your club.

So what can start off as some simple little "price discussions" can spiral into all kinds of arrangements. Once the ball is rolling -- there's nothing to stop the owners from doing whatever they want as a "team".

Read up on what happened in New York when the taxi companies started "meeting" with each other. It got so bad the City had to come in and clean house and take over the whole industry.

 

[MattTheSkywalker]

I suspect the scale of businesses involved here is not anything that is going to rile authorities. I don't think you;re going to get an SEC letter anytime soon, if that was your fear, and you made it all clear when you described the guy as a fat bastard.

 

[beastboy]

No Matt..it is not large scale...of course it isn't, but that doesn't influence my desire to know what the law is. Not everything is on a grand scale.

Made what clear?

 

[manny78]

No Matt..it is not large scale...of course it isn't, but that doesn't influence my desire to know what the law is. Not everything is on a grand scale.

Made what clear?

I'm not going to write a big, long and borring post about this but let's just say that under canadian laws (which are less business friendly than yours), it is very difficult to prove collusion. The Competition Bureau has been trying for years to prove collusion between oil companies in Canada and they havent been able yet even if every gas station has the same goddamn price and change their price at the same time.

 

[Madcow2]

Doing something against the law and getting tried and convicted for something are a pretty good distance appart in many instances, not just this one. I've heard a lawyer's take on it before and it jokingly involved standing up, vehemently opposing the discussion, causing a huge scene by immediately hurting yourself on the way out so that everyone was absolutely sure to remember, and going to get treated at the hospital so there was a record of it. So....yeah you might not get convicted or every hear anything about it and yes there are grey areas and contingencies all around but the jist of it is to avoid those types of discussions.

 

[pitbullstl]

I'm arguing with some fat bastard on another board about his upcoming meeting he is having with other local businesses of his type. I am aware that having discussions with other companies and negotiationg prices are illegal...i.e price fixing. I mentioned that he may want to be careful when he has his meeting and they talk "prices" and how there are legality issues with how the conversation is handled. Well...in response he got very defensives and responded, "No one said you had to come... And discussing prices isnt illegal at all. No one is price fixing. "

I'm curious what does the law says about what can and can't be discussed....?

It was amusing that he thought I actually wanted to come to his meeting.

What up homey??? Hope everything is well..!

Collusion is illegal, will he get caught/found out...?? Doubtful. I'm on several Automotive Boards, and I Chair one of them. In my industry this isn't typically applicable, but in the service side of what I do, you see it all the time, still illegal, still no one getting caught.