Did the modeling agencies engage in illegal price fixing? Is parallel behavior illegal? A group of models

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Did the modeling agencies engage in illegal price fixing? Is parallel behavior illegal?

A group of models sued some of the top agencies in New York, alleging that these firms had violated §1 of the Sherman Act by conspiring to fix the commissions that they charged the models for placing them. The agencies were all members of the International Model Managers Association, Inc. (IMMA).
Under New York law, employment agencies could not charge a commission of more than 10 percent, but management agencies could. All agencies that were members of IMMA changed their state registration from employment agency to management agency and then raised their standard commission to 20 percent. Several of the agencies used identical language in their contracts, specifying that they were personal managers, not employment agencies. At IMMA meetings, executives at various agencies announced that they were raising their commissions to 20 percent. One executive stated, “We are all committing suicide, if we do not stick together.”

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Business Law and the Legal Environment

ISBN: 978-1111530600

6th Edition

Authors: Jeffrey F. Beatty, Susan S. Samuelson, Dean A. Bredeson

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