The Music Teachers National Association, a Cincinnati nonprofit founded in 1876 to advance music study, apparently had language buried in their by-laws encouraging members not to poach students from each other. At some point in the last year, this fact became known to the Federal Trade Commission, and in March they opened up an investigation of the organization alleging anticompetitive behavior. The WSJ:
That’s a common enough provision among professional organizations (doctors, lawyers), yet the FTC avers that the suggestion that Miss Sally not poach students from Miss Lucy was an attempt to raise prices for piano lessons. Given that the average lesson runs around $30 an hour, and that some devoted teachers still give lessons for $5 a pop, this is patently absurd.MTNA Executive Director Gary Ingle, who has been at the organization 17 years—and who agreed to talk when I reached out about this case—said that he and the group’s attorneys immediately flew to Washington to talk to federal investigators. They explained that this provision had been in the group’s code for years, and that it was purely aspirational. The association has never enforced its code, and no member has been removed as a result of it.The FTC didn’t care. Nor did it blink when the MTNA pointed out that the agency has no real authority over nonprofits (it is largely limited to going after sham organizations) and that Congress has never acted on the FTA’s requests for more control over 501(c)3 groups. Nor was the agency moved by the group’s offer to immediately excise the provision. The investigation would continue.
We for one sleep better knowing that the federal government is on the job, fighting for the little guy, making sure that an insidious cartel of music teachers isn’t colluding to raise the price of piano lessons.