HR 1788
Fair Grocery Pricing Act
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- Passed House
- Passed Senate
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Bill overview
The Fair Grocery Pricing Act aims to prevent food producers from using algorithms to manipulate prices or reduce the supply of food. It defines key terms like ‘coordinating function’ and ‘consciously parallel pricing coordination’ and prohibits food producers and coordinators from engaging in practices that restrict competition. The Federal Trade Commission and state attorneys general are given authority to enforce the law and seek penalties for violations.
Key provisions
- Prohibits food producers from using algorithms to artificially inflate prices or reduce supply.
- Defines ‘coordinating function’ as collecting and analyzing food prices using algorithms.
- Prohibits ‘consciously parallel pricing coordination’ between food producers.
- Grants the Federal Trade Commission and state attorneys general authority to enforce the Act.
- Allows injured parties to sue for threefold damages, reasonable litigation costs, and attorney fees.
- Invalidates pre-dispute arbitration agreements and joint action waivers in cases of violations.
- States that the Act does not modify existing antitrust laws.
- Permits state and local laws to supplement the Act.
Who is affected
- Food producers
- Food distributors
- Consumers
- Federal Trade Commission
- State Attorneys General
Notable changes
- Establishes a specific legal framework to address algorithmic price manipulation in the food industry.
Sponsors
Official sponsors from legislative records.
Primary sponsor
Cosponsors
Eleanor Holmes [D-DC-At Large] Norton
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119th CONGRESS — 1st Session
H. R. 1788
IN THE HOUSE OF REPRESENTATIVES
A BILL
To prohibit the use of algorithmic systems by food producers to artificially inflate the price or reduce the supply of their foods.
This Act may be cited as the Fair Grocery Pricing Act
.
In this Act:
The term Chair
means the Chair of the Commission.
The term Commission
means the Federal Trade Commission.
The term consciously parallel pricing coordination
means a tacit agreement between 2 or more food producers to raise, lower, change, maintain, or manipulate pricing for the purchase or sale of reasonably interchangeable food products.
The term coordinating function
means—
collecting historical or contemporaneous food product prices or supply levels from 2 or more food producers;
analyzing or processing of the information described in subparagraph (A) using a system, software, or process that uses computation, including by using that information to train an algorithm; and
recommending food prices, supply or output, or other commercial term to a food producer.
The term coordinator
means any person that operates a software or data analytics service that performs a coordinating function for any food producer, including a food producer performing a coordinating function for their own benefit.
The term food
has the meaning given the term in the 321st section of the Food, Drug and Cosmetic Act (21 U.S.C. 321).
The term food producer
means any individual, corporation, or entity engaged in the manufacturing, processing, or production of food products for commercial distribution.
The term person
has the meaning given the term in the 1st section of the Clayton Act (15 U.S.C. 12).
The term pre-dispute arbitration agreement
means an agreement between 2 or more parties to arbitrate a dispute between the parties that is made before any dispute has arisen.
The term pre-dispute joint action waiver
means an agreement between 2 or more parties, which may be part of a pre-dispute arbitration agreement, that—
would prohibit or waive the right of a party to participate in a joint, class, or collective action in a judicial, arbitral, administrative, or other forum relating to a dispute between parties; and
is made before any dispute has arisen.
The term State
means any of the several States, the District of Columbia, the Commonwealth of Puerto Rico, or any territory or possession of the United States.
It is unlawful for a food producer, in or affecting commerce, or any agent or subcontractor thereof, to subscribe to, contract with, or otherwise exchange anything of value or use in return for the services of a coordinator, and such action shall be deemed to be a per se violation of the Sherman Act (15 U.S.C. 1 et seq.).
It is unlawful for a coordinator, in or affecting commerce, to facilitate an agreement among food producers to not compete with respect to food prices, supply or output, or other commercial term, including by performing a coordinating function.
The Commission shall enforce this Act in the same manner, by the same means, and with the same jurisdiction, powers, and duties as though all applicable terms of the Federal Trade Commission Act (15 U.S.C. 41 et seq.) were incorporated into and made a part of this Act.
The Attorney General shall enforce this Act in the same manner, by the same means, and with the same jurisdiction, powers, and duties as though all applicable terms of the Sherman Act (15 U.S.C. 1 et seq.), Clayton Act (15 U.S.C. 12 et seq.), and Antitrust Civil Process Act (15 U.S.C. 1311 et seq.) were incorporated into and made a part of this Act.
Any attorney general of a State shall enforce this Act in the same manner, by the same means, and with the same jurisdiction, powers, and duties as though all applicable terms of the Sherman Act (15 U.S.C. 1 et seq.) and the Clayton Act (15 U.S.C. 12 et seq.) were incorporated into and made a part of this Act.
A violation of this Act shall also constitute an unfair method of competition under section 5 of the Federal Trade Commission Act (15 U.S.C. 45).
If the Commission has reason to believe that a person violated this Act, the Commission may commence a civil action, in its own name by any of its attorneys designated by it for such purpose, to recover a civil penalty and seek other appropriate relief in any district court of the United States.
In a civil action under this subsection, a complaint—
plausibly pleads a violation of section 1 or 3(a) of the Sherman Act (15 U.S.C. 1, 3(a)) if the complaint contains factual allegations, including allegations of consciously parallel pricing coordination, demonstrating that the existence of a contract, or conspiracy in restraint of trade or commerce is among the realm of plausible possibilities; and
need not allege facts tending to exclude the possibility of independent action.
Any person who is aggrieved by a violation of this Act may bring a civil action in an appropriate district court of the United States, without respect to the amount in controversy, to recover an amount described in paragraph (2).
The court shall award to the plaintiff threefold the damages sustained by the plaintiff and the reasonable cost of litigation, including a reasonable attorney fee.
Pursuant to a motion by the plaintiff promptly made, the court may award simple interest on actual damages sustained by the plaintiff for the period beginning on the date of service of the pleading of the plaintiff setting forth a claim under this Act and ending on the date of judgment, or for any shorter period therein.
At the election of the plaintiff in an action authorized under paragraph (1), a pre-dispute arbitration agreement or pre-dispute joint action waiver relating to a violation of this Act shall be invalid or unenforceable.
Nothing in this Act, or any amendment made by this Act, shall be construed to modify, impair, or supersede the operation of any of the antitrust laws
Nothing in this Act may be construed to preempt any State, Tribal, city, or local law, regulation, or ordinance that supplements this Act.
If any provision of this Act, or the application of such a provision to any person or circumstance, is held to be unconstitutional, the remaining provisions of this Act, and the application of such provisions to any person or circumstance shall not be affected thereby.