Wednesday, January 27, 2010

Gibson Responds to Lawsuits Over Price-Fixing

Posted By on Wed, Jan 27, 2010 at 2:36 PM

click to enlarge Gibson_headstock-thumb-200x126.jpg

Back in November we reported on the investigation into Gibson Guitar regarding possible illegal importation of an endangered species of rosewood from Madagascar. Well, it looks as though they're in even more hot water, and this time it's over some alleged price-fixing. According to the Nashville Business Journal, a series of lawsuits have been filed against Gibson -- as well as Guitar Center, Yamaha, Fender and possibly others -- alleging that they artificially boosted prices under the guidance of the National Association of Music Merchants (NAMM). This, of course, would be in direct violation of the Sherman Antitrust Act. From the NBJ's story:

"The Sherman Act was enacted to promote competition (in) the U.S. market, because competition provides consumers with the best price possible," said Hollis Salzman, a partner at New York law firm Labaton Sucharow, which is representing plaintiff Craig Kennedy. The suits focus largely on national instrument retailer Guitar Center, as well as the association, but Gibson and fellow manufacturers Fender and Yamaha appear as co-defendants. Caroline Galloway, a spokeswoman for Gibson, could not be reached for comment.

Well, Caroline Galloway -- the spokeswoman in question -- issued an official statement that we at the Scene received today. You can read the full statement after the jump.

OFFICIAL STATEMENT:

Gibson Guitar Corp. is one of many manufacturers and organizations in the Musical Instrument Industry that has been named a party to approximately 30 lawsuits that claim they conspired to artificially increase and fix the prices of musical instruments. These lawsuits stemmed from an investigation by the Federal Trade Commission that lasted several years and was not pursued by the FTC after they concluded the investigation.

The allegation that Gibson participated in any scheme to artificially inflate or fix prices is wholly without merit. Gibson strives to provide customers with the best musical instruments in the world and to build lifelong relationships with musicians who choose the Gibson brand.

Gibson believes in the American system of justice and believes that through that system, the claims against Gibson will show to have no merit. Unfortunately, that process will undoubtedly result in high costs to many organizations that, like Gibson, strive to provide music lovers everywhere with quality instruments, and aggressively compete on price. They provide true and accurate information to their consumers, continue to innovate and provide great value in product offerings overall.

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