FTC Issues Order Against Toys R Us

The Federal Trade Commission ordered Toys R Us Inc., the nation’s largest toy retailer, to halt practices that it said increased prices and reduced choice for consumers. The commissioners voted 4 to 0 to uphold an administrative judge’s 1997 decision that Toys R Us had muscled toy makers into denying their most popular products to low-priced clubs such as Costco. The FTC found that Toys R Us had prices that were not the lowest in the industry and made deals with toy makers to restrict their sales to the clubs, where goods sell at a discount from regular retail prices. The decision said Toys R Us forced major toy makers to sell only “value packs” of several toys or discontinued items to the clubs. Michael Feldberg, who represented Toys R Us in the proceeding, said the Paramus, N.J.-based company would take the case to the U.S. Court of Appeals. Toys R Us stock rose 25 cents to close at $16.31 on the NYSE.