In the Sotheby's case, the two principals from Sotheby's and Christy's auction houses decided to engage in price fixing because they were being victimized by customers who played them off against each other to avoid paying the fees that provided the firms' primary income. This was the initial inequity. The two auction houses responded by secretly meeting and agreeing to raise and publicly release non-negotiable sellers' commission rates, an attempt to keep their firms' incomes from eroding rapidly. This plan constituted price fixing, which was the next unethical action. Finally, when the truth came out, the various parties involved scrambled all over each other trying to blame each other-more unethical behavior.
Contemporary ethical decision making applies to the case, because the ethics involved are not completely black-and-white. The customers' playing the two houses off against each other was unethical but could just be chalked up to customers doing their best to get a good deal. The price fixing was not an attempt to cheat customers but to prevent them from cheating the auction houses. Only the finger-pointing was unabashedly wrong. Thus, ethical decision making is required to sort through the ethics of the case and determine what the most ethical response would have been.
In my opinion, the two auction houses would not have been accused of doing anything wrong if they had simply decided never to waive fees again. This would have bolstered their declining incomes, and they were perfectly within their rights to do so. They would have had to make an agreement that both firms would adhere to this policy, but they should have done so publicly to avoid being accused of collusion.
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