Adolph Coors Company

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IN THE MATTER OF ADOLPH COORS COMPANY MODU' YING ORDER, IN REGARD TO ALLEGED VIOLATION OF SEC. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket 88,45. Decision, July 24, 1973 - Modifing Orr, Feb. 4, 1975 Order modifying an earlier order dated .July 24, 1973, 83 F. C. 32, 38 F.R. 2399 pursuant to decision and judgment of June 4 and 21, 1974, respectively, of the United States Court of Appeals for the Tenth Circuit '" by deleting Paragraphs 12 and 13 of the order which rewrte the termnation provisions of respondent's distributor contracts.

Appearances For the Commission: Anthony Low Joseph and V. Vake-rics. T/us For the respondent: Leo N. Bradley, Earl K. Madsen, Braley, Campbell Carny, Golden, Colo. ORDER MODIFYING ORDER TO CEASE AND DESIST Respondent, having fied in the United States Court of Appeals for the Tenth Circuit on Aug. 15, 1973, a petition to review and set aside an order to cease and desist issued herein on July 24, 1973, and the Court having rendered its decision on June 4, 1974, and its judgment on June , 1974, affrming the order to cease and desist, except for numbered Paragraphs 12 and 13 of the order which it directed be set aside. Now, therefore it is hereby ordered That the aforesaid order to cease and desist be, and it hereby is, modifed in accordance with the decision and judgment of the Court to read as follows: ORDER It is ordered That respondent Adolph Coors Company and its subsidiaries, successors, assigns, officers, directors, agents, representatives and employees, individually or in concert with others, directly or indirectly, or through any corporate or other device, in connection with the brewing, distribution, offering for sale or sale of beer in commerce as "commerce" is defined in the Federal Trade Conussion Act, do forthwith cease and desist from:

1. Entering into, maintaining or enforcing any contract, agreement combination, understanding or course of conduct which ha. as its purose or effect the fixing, maintaining, establishing or setting of the . Cn1. de",ed;.Jan. 1975 119 S. 1105. Order 85 F.

prices at which distributors sell Coors beer to retailers or the prices at which retailers sell Coors beer to consumers. 2. Publishing, disseminating or providing any price list or other document indicating suggested or mandatory prices for the sale Coors beer by any distributor to any retailer or any price list or other document indicating suggested or mandatory prices for the sale of Coors beer by any retailer to any consumer. Provided, however That nothing contained in this paragraph of the order shall prohibit respondent from complying with the requirements of any state law, provided that when respondent purports to be complying with the state law regarding price suggestions, respondent wil specifcally advise the Commission of the statute and all court decisions and administrative agency decisions and rulings interpreting said statute pursuant to which it is purrting to act. 3. Publishing, disseminating or providing to any distributor or any retailer any infonnation or suggestions concerning what Coors may believe to be an appropriate or proper markup or profit for Coors beer when the distributor sells to the retailer or when the retailer sells to the consumer or a markup or profit below which the distributor or retailer is advised not to sell Coors beer. Provided, however That nothing contained in paragrphs two (2) and three (3) of the order shall prohibit respondent from publishing, disseminating, or providing any price list or other document indicating suggested prices for the sale of Coors beer or suggested markups or profits for Coors beer after three years from the effective date of this order. Two years following the effective date of this order respondent may petition the Commission, upon a showing that competition in the resale of its products has been restored, to be permtted to publish disseminate or provide suggested prices, markups, and profits as set forth in this proviso.

4. Refusing to sell beer to any Coors distributor or termating or threatening to termnate any Coors distributor because: A. the distributor has in the past or might in the future sell Coors beer at prices, markups, or profits different from those approved or recommended by respondent;

B. one or more of the distributor's customers sold Coors beer or advertised Coors beer for sale at prices, markups, or profits different from those approved or recommended by respondent; C. the Coors distributor sold Coors beer to another distributor or to a retailer whose business is located outside of the terrtory granted to the distributor; or D. the Coors distributor distributes, has distributed, or proposes to distribute in the future the product of another brewer. ADOLPH COORS CO. 189 187 Order 5. Entering into, maintaining or enforcing any contract, agreement combination, understanding or course of conduct to fix, establish, limit or restrict the terrtory in which or the persons to whom a distributor may sell Coors beer.

Provided, however That nothing contained in this paragraph of the order shall prohibit respondent from complying with the requirements of any state law Provided That when respondent purports to be complying with a state law requiring the restriction of terrtories or customers, respondent will specifically advise the Commssion of the statute and all cour decisions and administrative agency decisions and rulings interpreting said statute puruant to which it is purporting to act.

6. Allocating Coors beer among its distributors in times of beer shortage at the Coors brewery, by any means other than by allocating shares to distributors equal to their proportionate purchases of Coors beer from the brewery durng the last three months before the allocation or when the distributor has not been in business for more than a year as a Coors distributor, on some other equitable basis. 7. Refusing to deliver all of a distributor s order because the distributor has made sales to customers outside of the terrtory granted the distributor or because the distributor or the distributor customer is sellng Coors beer at prices, markups or profits lower than those approved by respondent.

S. Prohibiting its distributors from sellng for central warehouse delivery; Provided, hOWC1Jer That respondent can establish refrigeration standards for the central warehouse which are substantially similar to those established for distributors and can require its distributors to be responsible, directly or indirectly. for maintenance of such refrigeration standards and for rotation of Coors beer in the eentral warehouse and at the retail delivery locations where the beer is redelivered from the central warehouse, if respondent changes its container dating system so that the retaler and the consumer will recognize the date without reference to a code or measurng stick. 9. Entering into, maintaining or enforcing any contract, agreement combination, understanding or course of conduct with its distributors which has as its purose or effect requirig that retailers serve Coors draught beer as their only light-colored draught beer. 10. Entering into, maintaing or enforcing any contract, agreement or understanding, or taking any action or course of conduct with any of its distributors which has as its purpose or effect the requirement that the distributor eliminate, or refrain from obtaining and handling rival brands of beer in order to become or remain a Coors distributor. 11. Hindering, suppressing- or eliminating competition or attempt- Order 85 F.

ing to hinder, suppress or eliminate competition between or among distributors or between or among retailers handling Coors beer. It is .further ordered That respondent corporation shall forthwith distribute of copy of this order to each of its operating divisions, to its present and future sales representatives, to its present and future distributors.

It is further ordered That respondent notify the Commission at least thirty (30) days prior to any proposed change in the corporate respondent such as dissolution, assignment or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries or any other change in the corporation which may affect compliance obligations arising out of the order. In the event that respondent proposes a change in ,the corporate respondent, as set forth above, respondent shall require said successor or transferee to file, with the Commission, at the time of respondent' notification, a wrtten agreement to be bound by the terms of this order; Provided That if respondent wishes to present to the Commission any reasons why said order should not apply in its present form to said successor or transferee, respondent shall submit to the Commission a wrtten statement setting forth said reasons at least sixty (60) days prior to the consummation of said succession or transfer. It is further ordered That respondent herein shall, within sixty (60) days after service upon it of this order, file with the Commssion a report, in wrting, setting forth in detail the manner and form in which it has complied with this order.

Commissioner Thompson did not participate.