The Federal Trade Commission (FTC) and national bev-alc retailer Total Wine & More are at odds over the chain’s participation in the government agency’s investigation of multi-state wine and spirits wholesaler Southern Glazer’s Wine & Spirits.
Last week, the FTC petitioned the U.S. District Court Eastern District of Virginia to enforce a civil investigative demand (CID) against Total Wine, which it said the retailer “has failed to comply with” “for more than four months,” according to a press release.
“Total Wine has categorically refused to search any employee-maintained files for documents and information needed to address the FTC’s CID and has failed to assert any valid reason for its refusal to comply,” the FTC wrote in a press release. “Total Wine’s actions have impeded and delayed the FTC’s investigation, forcing the Commission to seek federal court enforcement.”
Retail Services & Systems, inc. (RSSI), Total Wine’s parent company, said in a statement it “made substantial efforts to cooperate with the FTC’s investigation and respond in good faith to most of its data and document requests.”
Those efforts included providing “more than one terabyte of data and other records” by early April. The FTC’s investigation into Southern Glazer’s came to light in late March.
At that time, three anonymous sources told Politico the FTC was investigating Southern Glazer’s for possible violations of the Robinson-Patman Act, which bars suppliers from offering favorable pricing to larger retailers at the expense of smaller stores.
The investigations follows a lawsuit filed against the distributor in June 2022, in which five California mom-and-pop liquor stores said Southern Glazer’s was charging them higher prices than larger off-premise retailers, including grocery giant Albertsons.
The conversation between the FTC and Total Wine “broke down” in April when the request expanded to “a few additional categories of documents which the company believed, in good faith, were unrelated to the FTC’s investigation,” Total Wine said.
The FTC recalled the dispute differently in its petition to the court.
“Total Wine unilaterally narrowed the scope of the CID in a manner inconsistent with the CID’s specifications and refused to search any employee’s custodial files for responsive documents,” it wrote. “Total Wine has not asserted any colorable legal ground for its noncompliance. Its refusal to fulfill its obligations under the CID has burdened and delayed the Commission’s investigation into possible discriminatory conduct in the wine and spirits industry and is contrary to the public interest.”
Total Wine petitioned to limit the CID’s scope in April, which was denied in May, according to the FTC’s petition.
The FTC seeks to compel Total Wine to provide the following information, among other items:
- Documents from five employees it thinks have information pertaining to the investigation found using keyword searches dictated by the FTC;
- Purchase records for “relevant products” from distributors Republic National Distributing and Breakthru Beverage Group;
- Total Wine’s maps of competitors in all states Southern Glazer’s serves;
- And cost collection files, pre-sell reports, out-of-stock reports and other data retailed to Southern Glazer’s.
The FTC has asked the court to require Total Wine to produce the requested documents within 20 days of a ruling.