Opinion ID: 2833669
Heading Depth: 2
Heading Rank: 3

Heading: Advertising Ban

Text: In many of Coke’s agreements, retailers had to agree not to advertise any other soft drinks — inside and or outside the store, in circulars, banners, or signs of any kind, or even signs that merely stated the price. This ban too is illegal per se: “[a] concerted and effective effort to withhold (or make more costly) information desired by consumers for the purpose of determining whether a particular purchase is cost justified is likely enough to disrupt the proper functioning of the price-setting mechanism of the market that it may be condemned even absent proof that it resulted in higher prices.” [68] There is an exception for bans on price-advertising for professional services, which are subject to rule-of-reason analysis because consumers do not have the expertise to compare the quality of services offered. [69] But that, of course, is not the case with soft drinks. Coke’s only proffered justification for the ban on advertising is that it did not want a competitor’s ads covering up its own. In the first place, some of the ads banned (such as newspaper ads and in-store circulars) were paid for by the retailers, not Coke. Moreover, Coke’s agreements did not demand that its ads be merely the first or the largest or the most visible ads, but the only ads. It is hard to imagine any procompetitive reason for banning competing ads, and Coke does not offer any.