Madison, Wisconsin Happy Hour Agreement Lead to Price-Fixing Lawsuit
By: Chris Kramer
Some drinkers are complaining that their happy hour was not happy enough!
In Wisconsin, the state Supreme Court will decided whether or not an agreement made among bar owners to stop offering weekend drink specials was an anti-trust violation or simply an effort to curb binge drinking and DUI arrests.
Lawyer Kay Hunt has asked the Supreme Court justices to reinstate a lawsuit claiming that the agreement made in 2002 among about two dozen bar owners in Madison, Wisconsin was actually an illegal price-fixing conspiracy. Hunt represents drinkers in Madison who claim that they have been overcharged since the bars quit offering the weekend drink specials. The lawsuit has been thrown out twice already in lower courts.
Hunt told the justices, "Here, you have a group of competitors that bound together to eliminate drink specials," a deal that "constituted an unreasonable restraint of trade."
The justices also heard an opposing view from Kevin O'Connor, a lawyer representing the bar owners. O'Connor said that the bar owners made the voluntary agreement among themselves to drop their specials in response to the concerns of Madison's local government and University of Wisconsin-Madison officials. In 2002, when the agreement was originally made, University of Wisconsin-Madison officials were pressuring bar owners to help reduce binge drinking among students and some city officials in Madison were threatening to ban drink specials altogether.
O'Connor, who represents 20 local bars and the Dane County Tavern League said, "This wasn't some secret meeting of the bar owners. This was all initiated by the city."
In September 2002, the bars who made the agreement announced that they would voluntarily no longer offer drink specials or discounts on Friday and Saturday nights after 8 p.m.
In 2004, Hunt filed the lawsuit alleging possible price fixing, on behalf of UW-Madison students and other customers who want to be paid "tens of millions of dollars" in damages for being overcharged for their drinks.
After the lawsuit was filed, the bars decided that it was time to offer drink specials again. According to a university-sponsored study, the serious alcohol-related crime rate and DUI arrest rates continued to rise even when the bars were not offering extended happy hours.
In 2005, a judge dismissed the case. The drinkers and their attorney refused to give up and appealed the decision. An appeals court upheld the decision to dismiss the case. Now Hunt and the Madison drinkers are knocking on the door at the Wisconsin Supreme Court.
A state lawyer who represents UW-Madison, Eric Wilson, has said that the bars were only trying to cut back the amount of binge drinking and DUI arrests among college students and was not an anti-trust violation. He agrees that there was no price fixing among the bars.
Wilson said, "The bars tried to work with the city and the university to be part of the solution, rather than part of the problem."
The Supreme Court justices have not announced their decision about whether or not they will reinstate the lawsuit. They reportedly had tough questions for both sides and have made no indication about how they will rule.