• Dr. Miles Overruled
  • July 9, 2007
  • Law Firm: Kramer Levin Naftalis & Frankel LLP - New York Office
  • Today the Supreme Court in Leegin Creative Leather Products, Inc. v. PSKS, Inc., overturned the longstanding rule that minimum resale price maintenance agreements are per se illegal under Section 1 of the Sherman Act. The former rule, established by the Court in 1911 in Dr. Miles Medical Co. v. John D. Park & Sons Co., held that it was always illegal for a manufacturer to agree with its distributor to set the minimum resale price for the manufacturer's goods. In overturning Dr. Miles, the Court announced that these types of vertical price restraints are more appropriately judged under the rule of reason analysis, which is the usual standard applied when deciding if there is a Section 1 violation.