I cannot speak for all states, but in Illinois ALL auctions are legally "with reserve" unless advertised as being "without reserve." Thus at farm and estate auctions the property (personal and real) may simply not sell and the auctioneer will pass it. The idea is that one does not put valuable property on the line without protecting it from the possibility that there might not be serious buyer interest.
This works somewhat the reverse in non-auctions, such like at gun shows where the item is over-priced and the seller is open to lower bids. At these venues a high-but-negotiable price is implied in the transaction. The rub at Internet auctions is that "Reserve Not Met" is staring you in the face, usually in red print. However, Internet and live auctions start low and sell higher as contrasted to the gun show/flea market sales that start high and go lower. So let's not confuse apples and oranges: A seller at auction cannot price his item high and take less...a gun show seller cannot price his gun low and then insist on more. There are rules of the game, and the rules are such:
Price your item at a gun show or flea market at $1,000 and if a buyer lays $1,000 in cash on you the gun is sold...no backing out. If he offers $750 and you say "No," there is no meeting of the minds and there is no sale...the seller has exercised his hidden "reserve."
THERE IS ALWAYS A RESERVE as a matter of law in Illinois. The nature of an auction is that the bidding starts low and goes higher and if it does not reach a level satisfactory to the seller there is no sale (unless the auction item is advertised as being "without reserve" in Illinois, and I believe this is true for most or all other states). Yet an auction seller who would price his gun at $1,000--being the gun show price--would never get a bid if all buyers thought it was worth $750 or less and there was no way to run the auction in reverse.
There is much misconception in re: reserves at auctions that has cropped up recently since everyone can participate in auctions at the flick of a switch and click of a mouse on the internet. The law of auctions, however, harks back to land and cattle and estate sales where the real estate and personal property was viewed in person and the auction was live, in situ, and real time. The problem with Internet auction reserves is usually in the subjective issues of condition and quality of goods not viewed in person; also the sellers do not have the benefit of a live auctioneer to aid them in valuation. For example...
James Julia is selling about 1,600 guns in Maine next week. The terms and conditions of the sale mention that some but not all lots may have a reserve and "...the auctioneer may bid on behalf of the owner..." My personal experience is that a gun I owned did not make the reserve and was a "no sale." After the auction the owners of "no sale" items are contacted by the auction house for permission to contact contending bidders about upping their bids to the reserve. My gun thus sold post-auction for my reserve. The objective of selling at auction is to offer an item to a maximum number of potential buyers...a live auction has a different dynamic than Internet auctions, but the Internet is changing for the better as e-Bay, for example, has instituted rules that more strongly protect buyers, and the option to list items as "Buy-it-Now" at a non-auction price plus another button to make a "Best Offer." Thus e-Bay selling has the capability of pricing that $1,000 gun show item at a high price and taking less if the "Best Offer" strikes a responsive chord (meaning seller's hidden reserve).
I am presently selling off all my Parker collectibles, ephemera, and the like and will start posting items on e-Bay using the "Buy-it-Now" pricing stating what I believe to be the fair price while also using the "Best Offer" option to allow some quibbling. My idea is to get the stuff sold; a prospective buyer wants to get stuff bought; this involves a hidden reserve but is more in line with how gun stuff has historically been traded at gun shows.
I don't like the start-low-at-99-cents method of pricing with "Reserve Not Met" encumbering the bidding.
I don't participate in Internet gun auctions so I don't know if a gun seller can state a $1,000 price and take a "Best Offer," but I suspect that this pricing option will become popular now that the 800 pound gorilla (e-Bay) offers it--monkey see, monkey do. This should resolve the problem of trying to fit an internet auction into a live auction template where the price starts low and goes high with the reserve protection for seller--starting high like at a gun show and being able to take less seems to be the best way to protect both parties. EDM