City officials and legal experts gave mixed interpretations of the federal compaint filed Tuesday against 25 Madison bars on allegations of a 15-year conspiracy to inflate drink prices.
Minneapolis law firm Lommen, Nelson, Cole & Stageberg filed the suit on behalf of former UW-Madison students Brian Dougherty and Eric Stener charging bars, city alders and UW-Madison officials with illegal price-fixing.
At issue is a voluntary 2002 decision by the bars to stop offering weekend drink specials. Although the voluntary ban attempted to address the ongoing problem of student binge drinking, the plaintiffs argue that the agreement violates federal antitrust law. They argue industry self-regulation is not an appropriate legal means of addressing drinking issues.
\If they can prove that there was a specific agreement to restrict price competition among taverns, then they should prevail,"" Peter Carstensen, UW-Madison Professor of Law, said.
Although a similar lawsuit brought before the Dane County Circuit Court was dismissed this April, Carstensen, who specializes in antitrust law, believes the new suit still has a chance at the federal level.
""It all depends on the quality of evidence they have to support their claims,"" he said.
The federal lawsuit will address several more issues than those raised in the original suit. New allegations include expanding the price-fixing incident to a 15-year conspiracy, and lengthening the list of defendants involved to include UW-Madison Chancellor John Wiley, the Tavern League of Wisconsin, Ald. Timothy Bruer, District 14, and Marinus Petri, a partner at a local law firm.
Casey Nagy, Special Assistant to Wiley, said that Wiley had not yet seen the complaint and therefore had no reaction to it.
Bruer, who served as the chair of the Madison Alcohol License Review Committee, is confident that the federal suit will be dismissed.
""I'm hopeful that the federal courts will dismiss it as a nuisance suit with no foundation,"" Bruer said. Describing the 2002 move by the taverns to ban weekend drink specials, he added, ""No good deed goes unpunished.""
The lawsuit is seen by some as another blow to an industry already reeling from the recent citywide smoking ban.
""I firmly believe that the bar owners were only doing what they thought was the right thing,"" Ald. Mike Verveer, District 4, said. ""They now face hundreds of thousands of dollars of legal fees, and no end in sight. The lawsuit may potentially force some of the bars to go out of business.\
