The economic ramifications were obvious. The stakes were high. The taffeta trembled. New York State Attorney General Eliot Spitzer knew that something had to be done. So soon after taking on the stock analysts and the mutual fund industry, Spitzer was tilting his lance at the dreadfully powerful bridal registry industry.
According to Spitzer's allegations, retailers in the state conspired to keep Bed, Bath & Beyond (NASDAQ:BBBY) from selling high-priced Lenox china and Waterford crystal tablewares in its stores. He charged that Federated (NYSE:FD), the parent of Macy's and Bloomingdales, and May Stores (NYSE:MAY), the owner of Lord & Taylor's, pressured Lenox Inc. and Waterford Wedgwood USA to not sell their wares to Bed, Bath & Beyond.
The bridal registry business, where brides itemize gifts that they want for their wedding, is actually a rather lucrative one. It has become a high-margin growth engine that has spread beyond the bailiwick of the department stores where it began, and shoppers can now find registries at places such as Home Depot (NYSE:HD), Wal-Mart (NYSE:WMT), and Target (NYSE:TGT). Even online retailers such as Amazon.com (NASDAQ:AMZN) have bridal registries.
It was apparently more competition than the department stores could handle.
Bed, Bath & Beyond had wanted to begin sprinkling Lenox figurines and Waterford crystal vases among its towels and soaps three years ago for a new tableware department. Spitzer alleged that Federated and May pressured the two manufacturers to back out of the planned rollout.
All the companies involved in the scheme have settled, agreeing to pay a total of $2.9 million in civil penalties to New York. Federated is on the hook for the most, agreeing to pay $900,000, while May will pay $800,000. Lenox, which is owned by Brown-Forman (NYSE:BFA), and Waterford (NASDAQ:WATFZ) are also required to pony up $700,000 and $500,000, respectively. None of the companies admitted wrongdoing in the settlement.
Eschewing a cost-conscious approach to getting married, brides everywhere have one less worry knowing they can now register anywhere, letting wedding guests buy overpriced gifts wherever they choose.
Fool contributor Rich Duprey knows the joys of several marriages. He does not own any of the stocks mentioned in this article.
