State filed suit against Tempur-Pedic, a mattress manufacturer, alleging resale price maintenance. The state did not sue under its antitrust statute, but rather under N.Y. Gen. Bus. Law § 369(a), which states that “[a]ny contract provision that purports to restrain a vendee of a commodity from reselling such commodity at less than the price stipulated by the vendor or producer shall not be enforceable or actionable at law.” The State alleged that Tempur-Pedic’s Retail Partner Agreement restrained discounting in a variety of ways, including prohibiting 1) free gifts with purchase or “purchase with purchase” offers
2) No Sales Tax or any phrasing such as “We Pay Sales Tax”; 3) Gift cards, rebates, coupons or other “in-store credits” that can or can not be applied to Tempur-Pedic products 4) Offering money back for the return of the consumer’s old bedding with a new purchase, or 5) Free foundation. The state further alleged that Tempur-Pedic aggressively enforced the policy, terminated dealers who did not comply, and encouraged other dealers to report violations. The trial court held that the state’s General Business law did not make resale price maintenance illegal, but only made contractual provisions embodying resale price maintenance uneforceable.