Any agreement or understanding between a buyer and seller of goods as to the price at which the buyer will resell the goods constitutes resale price fixing. Though no longer illegal per se, such agreements can still carry significant risk depending on the markets, market share, and other competitive conditions involved. Other arrangements may stop short of an explicit agreement about resale prices, but still enable a supplier to learn about and influence or control resale prices to a greater or lesser extent. These include minimum advertised price agreements, calendar marketing agreements, limited time promotions, and similar retail promotional or merchandising arrangements. All of these arrangements may carry some degree of risk, depending on the circumstances. Any such understandings between buyer and seller that restrict or affect resale price should be reviewed by the Legal Department prior to implementation.

Exclusive supply agreements are those in which you agree not to obtain similar products from any other vendor, those in which the vendor agrees not to sell similar products to your competitors, or both. Such agreements can be lawful under certain circumstances, but they can also be considered illegal restraints of trade. Any consideration of such an exclusive supply arrangement should receive legal review and clearance.

You have the right to decide for yourself what companies you will deal with and what companies you will not deal with. You may not have the right, however, to agree with another that either you or that other company will not deal with some third party. Such agreements can be considered boycotts, which are illegal.

The laws governing price discrimination can be complex and technical, but in general, they may prohibit you from knowingly accepting a net price for a product which is more favorable to you than the net price at which that vendor is selling the same product to your competitors. Such problems can be avoided by refusing to discuss with vendors the pricing or terms they offer to competitors. If you do become aware that a vendor is offering you a better price than your competitors on identical goods, you should immediately consult the Legal Department.

It is illegal for an individual to be paid an undisclosed fee or commission in exchange for the placement of business with the individual's employer, unless the compensation is a legitimate commission or fee for brokerage services or the like.

Vendors are required to make advertising and display materials, promotional programs, in-store demonstration programs, special signage, packaging or displays, and other such promotional allowances and services available to all of their customers on proportionally equal terms.

Price discrimination laws may prevent you from selling goods at a net price which is more favorable to the buyer than the net price at which you are selling the same or similar goods to the buyer’s competitors. Suggestions or implications to customers that they are receiving a "special" deal not available to others create the risk that others in the marketplace may perceive that they are being discriminated against, whether they actually are or not. While the law allows differences in price in certain defined circumstances, such agreements should only be made after review by the Legal Department.

An agreement or understanding between a buyer and seller as to the minimum price at which the buyer will resell the goods constitutes resale price fixing, and may carry antitrust risk. While pre-marked "suggested" retail prices are appropriate, attempts to enforce such prices or police the retailer’s pricing practices can raise issues. Similarly, agreements on maximum resale prices may be defensible in some circumstances, but the ability to prevent the conversation from wandering into minimum pricing — or the ability later to prove that it did not — may be uncertain. The safest approach, therefore, is simply not to discuss resale prices with a customer at all.

Exception: If there is a true consignment agreement with the retailer, under which the retailer does not take title to the goods, but simply sells them as your agent for a fee, then you are entitled to set the retail price. If you think you have such a relationship with a retailer, contact the Legal Department for further guidance.

It is not uncommon for customers to complain about discounted retail prices on your goods being offered by their competitors. Any discussion of that subject with a customer presents serious risks, and should be avoided. If necessary, refer such matters to the Legal Department.

Just as when dealing with suppliers as discussed above, any exclusive arrangements with customers should be carefully evaluated by the Legal Department.

As described in connection with supplier arrangements, above, any understanding with customer to boycott a third party should be avoided.

Anything intended to aid the customer in promoting the resale of your products, such as POS advertising, displays and fixtures, promotional programs, in-store demonstration programs, special packaging, co-op advertising and other promotional payments, must be made available to all buyers on proportionately equal terms.

It is illegal to pay or receive undisclosed fees or commissions in exchange for the placement of business, unless the compensation is a legitimate commission or fee for brokerage services or the like.

Under some circumstances, "tying" products together (refusing to allow a customer to purchase one without also purchasing another) can be unlawful. Consult the Legal Department for guidance in specific cases.

Price fixing with competitors is among the most serious of antitrust offenses. It includes not only agreements to charge a specific price, but also any understanding or arrangement, explicit or implicit, written or unwritten, which even has a tendency to stabilize or affect or regulate prices among competitors.

With few exceptions, direct exchange with competitors of any information about prices, terms and conditions of sale, costs, marketing strategies, sales volumes, new products or services, or virtually any other strategic business issue, poses risks and should be avoided.

Patents are government-created exclusive rights to make, use or sell an invention described in the patent. The patent may describe a device or a refinement to an existing device; it may describe a method or process for doing something; or it may describe only the design or appearance of an object. Regardless of whether it is a device patent, a process patent or a design patent, the patent confers on the owner to whom it is issued the exclusive right to make, use and sell the subject of the patent, and anyone else who attempts to do so without authority from the patent owner will be liable for infringement.

Many products are obviously non-patentable, but it can be surprising what might be protected. Even what are usually thought of as commodities can have a particular new feature, or be made by a new process, or otherwise have some improvement that may be protected under the patent laws. Where it is not obvious, you must have a clear understanding with respect to every product that you purchase and resell as to whether the product is the subject of any outstanding patents. If so, appropriate documentation of the right of the seller to license you under the patent is necessary. If not, then you must obtain indemnification from the vendor in the event of claims of infringement by others. All such issues should be referred to the Legal Department.

Most states have laws which make it illegal to take or use without authority any "trade secrets" of another. A trade secret is information which is the subject of reasonable efforts to keep it secret, which derives commercial value from not being publicly known or available, and which is not capable of being reverse engineered or otherwise discovered through legitimate means. Theft of trade secrets is also a federal criminal offense under some circumstances.

Do not enter into any written confidentiality agreements unless they are first reviewed and approved by the Legal Department. Even absent any written agreement, though, it is important that you treat any confidential (non-public) information of another company with care to insure that no improper disclosure or use of the information occurs.

Obtaining non-public information about a competitor from anyone who does not have a legitimate right to disclose it should be strictly avoided.

Copyrights protect not ideas or inventions, but the form or manner in which they are expressed. Works eligible for copyright protection include not only books and other written works, but also graphics, photos and illustrations, music and sound recordings, blueprints and designs, software, and can even include the decorative aspects of three dimensional objects. Copyrights automatically are owned by the author or creator of a copyrightable work upon creation, without the need for any particular notice, registration or other formality.

As with patents, you must have a clear understanding with the seller as to the legal status of all copyrighted works you purchase. If the seller is not the original author or creator of the work, then there must be a written assignment or license from, or a written work-for-hire agreement with, the author. Penalties for copyright infringement, even if unintentional or innocent, can be severe, so the Legal Department should be consulted whenever there is any question or doubt.

A trademark is any symbol which serves to identify a product or service as coming from a particular manufacturer. Trademarks can consist of words, graphic designs, colors, or even such unusual symbols as distinctive smells or sounds. Trademark protection also extends to "trade dress," which is a term used to describe the overall commercial impression and appearance of a product, including such elements as package shape and design, color, graphics, and, in some cases, even the shape of the product itself.

As with patents and copyrights, you must be certain that any products purchased and resold by you do not infringe trademark or trade dress rights held by others. Again, appropriate inquires must be made of the vendor, and any questions should be referred to the Legal Department.

The above intellectual property rights may apply with particular force when attempting to locate a second source for a product. Care must be exercised to insure that a third-party manufacturer that says that it can make the same product more cheaply in fact has the legal right to do so. If the original manufacturer has valid patent, trade secret, copyright or trade dress rights in the product, duplication of the product by another may be an infringement. The Legal Department should be consulted in all such situations.

Both U.S. import restrictions and duties as well as any export restrictions of the originating country must be observed. Normally compliance with these requirements will be the responsibility of the vendor, but proper documentation should be provided to you. Any issues relating to compliance with import and export restrictions should be referred to the Legal Department.

When dealing with an overseas vendor, the laws of the country of origin may well govern the transaction, particularly with regard to the rights and obligations between the buying and selling parties. Those laws may or may not be similar to U.S. laws on the same subject. Any questions about the impact of local laws should be referred to the Legal Department.

Though it may seem paradoxical, the fact that an international transaction or relationship may be subject to foreign laws does not mean that it will not also be governed by U.S. law. Especially where the purpose of the transaction is to import goods into the U.S. for domestic resale, it is highly likely that at least U.S. antitrust, trade regulation and intellectual property laws will apply.

No matter how often you may hear from vendors in other countries that "this is the way it’s done here," U.S. law makes it illegal, with stiff criminal penalties, for a U.S. corporation to make or agree with another to make any form of payment to a foreign government official in exchange for special consideration or treatment.