California bans algorithmic price fixing

"Governor Gavin Newsom signed California Assembly Bill 325 into law on Monday, making it a violation of the state's flagship antitrust law, the Cartwright Act, to use or distribute a common pricing algorithm "as part of a contract, combination in the form of a trust, or conspiracy to restrain trade or commerce." Coercive measures to force competitors to adopt price-fixing algorithms are also illegal under the new law, which lowers the bar for plaintiffs to bring an antitrust lawsuit alleging algorithmic price-fixing. Under AB 325, it's enough for a complaint to include allegations making a conspiracy plausible, and plaintiffs no longer have to plead facts ruling out the possibility of independent action."

""Most Californians, and Americans, believe that by playing by the rules, they have an opportunity to run successful businesses and have access to fairly-priced goods and wages," bill author and California Assembly Majority Leader (Democratic) Cecilia Aguiar-Curry said. "With Governor Newsom's signature, California is making clear we won't tolerate practices that make life more expensive for our people." For those unfamiliar with algorithmic price fixing, it's a practice that allows companies - like big landlords, for example - to use a shared algorithm, often with common data, provided by a company like RealPage, to set prices. AB 325 doesn't ban the use of algorithmic pricing specifically, but does make it illegal for companies to collude to fix prices using such software."

Governor Gavin Newsom signed Assembly Bill 325 into law, amending the Cartwright Act to prohibit using or distributing a common pricing algorithm as part of a contract, combination in the form of a trust, or conspiracy to restrain trade or commerce. The law also outlaws coercive measures that force competitors to adopt price‑fixing algorithms. AB 325 lowers the pleading standard for antitrust complaints alleging algorithmic price‑fixing by requiring allegations that make a conspiracy plausible. The law does not ban algorithmic pricing generally, but it makes collusive use illegal. The Department of Justice and eight state attorneys general previously sued RealPage on similar allegations.

Read at Theregister