SW Legal studies in Business

State Gasoline Price Mark-Up Law Violates Sherman Act and Is Unconstitutional

A Wisconsin statute that forced retailers to mark-up gas and diesel by at least a certain percent is a per se violation of the Sherman Act. As such, the statute is unconstitutional and may not be enforced.

Topic Antitrust
Key Words

Sherman Act; Mark-Up Law; Antitrust Immunity; Constitutionality; Gasoline

C A S E   S U M M A R Y

A Wisconsin law, the Unfair Sales Act, has long required that retail gasoline be marked up at least 9.18% over wholesale price. When gas went over $4 a gallon in 2008, the law required the price to be increased at retail by about 38 cents more. Flying J, which runs travel plazas, sued to contest the law, as it did not wish to mark-up its gas or diesel that much. The state contended that it was immune from antitrust actions.


The state is not entitled to antitrust immunity. The statute mandating a minimum mark-up on gas is a per se violation of Section 1 of the Sherman Act as a restraint of trade. Therefore, the state law violated the Supremacy Clause of the Constitution and the law is unconstitutional. Since the statute is unconstitutional, a permanent injunction barring enforcement by the state is warranted. Antitrust immunity can exist when 1) the reason for the interference in the market is clearly articulated and affirmatively expressed as state policy and 2) the policy is actively supervised by the state. The state did not “actively supervise” the working of the statute; it simply mandated a minimum mark-up on retail gas sales.


Flying J v. Van Hollen, ---F.Supp.2d--- (2009 WL 33034, E.D. Wisc., 2009)

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