FTC reaches settlement with Southern Glazer’s over allegations of discrimination against smaller alcohol vendors.

The Federal Trade Commission (FTC) announced on Friday that it has reached a settlement with Southern Glazer’s Wine and Spirits, the largest distributor of wines and spirits in the United States, over allegations of discrimination against smaller, independent retailers. The settlement comes after the FTC filed a lawsuit against Southern Glazer’s in December 2024. The lawsuit revealed that the distributor had provided discounts and rebates to larger retailers, such as Total Wine, Walmart, and Kroger, while denying similar benefits to smaller, proximate stores, creating an uneven playing field.

The case was based on the Robinson-Patman Act of 1936, a component of antitrust legislation designed to prevent price discrimination that harms competition. The Act allows for volume discounts if a seller can substantiate actual cost efficiencies achieved through bulk sales. In this case, the FTC aimed to ensure that all retailers, regardless of size, had equal access to pricing benefits.

Under the terms of the settlement, Southern Glazer’s is obligated to compensate smaller retailers if significant or recurring price discrimination occurs when products are sold to larger competing stores nearby. An independent monitor will be appointed to oversee the compliance with the settlement for a duration of six years. Southern Glazer’s must provide detailed financial records to this monitor biannually.

Southern Glazer’s is a significant player in the beverage distribution industry, generating billion in revenue from wine and spirits sales to retail customers in 2023. The company is responsible for one out of every three bottles of wine and spirits sold in the U.S. Following the announcement of the settlement, Southern Glazer’s expressed satisfaction, stating that the agreement resolves the matter without trial and includes no admission of wrongdoing.

The settlement specifically pertains to the company’s practices regarding sales to the five largest retail chains in 26 states. Initially, the FTC’s lawsuit indicated discrimination occurring in 33 states, but further investigation revealed insufficient evidence in seven of those cases.

The states affected by the settlement include notable markets such as California, Texas, and New York, among others. The lawsuit was filed toward the end of the Biden administration, with FTC Chairman Andrew Ferguson, who took office under the Trump administration, previously expressing skepticism about the validity of the claims against Southern Glazer’s.

Ferguson commented that Southern Glazer’s could likely justify price variances based on differences in distribution costs. The case proceeded to court after Southern Glazer’s request for dismissal was denied in April 2025. Ultimately, Ferguson concluded that the settlement represents a fair resolution for all involved parties, stating that compliance would minimally impact Southern Glazer’s operations, provided they adhere to the legal framework set forth by the FTC.