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News Briefs

By ALM Staff | Law Journal Newsletters |
November 08, 2004

GNC Franchisees Sue for Predatory Pricing

Franchisees of General Nutrition Companies, Inc. (GNC, Inc.) filed a lawsuit in Federal District Court in Newark, NJ, alleging “predatory pricing,” an illegal change in the franchisor's policy toward the use of third-party suppliers, and unfair application of store appearance standards. GNC, Inc., based in Pittsburgh, sells vitamins and herbal supplements through both franchised and company-owned stores.

“The primary issue is predatory pricing … violations of the Robinson-Patman Act … under which products are sold by company-owned stores at prices that are below wholesale prices available to franchisees,” said Gerald Marks, an attorney based in Red Bank, NJ, who is representing the GNC franchisees. “We will probably soon seek an injunction to prevent GNC from predatory pricing.”

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