FTC Takes Legal Action Against PepsiCo for Alleged Price Discrimination
The agency has accused Pepsi of showing unfair preference to one large box retailer, a claim that PepsiCo firmly denies, asserting it is both factually and legally incorrect.
The FTC claims these alleged practices have compelled some retailers to increase their prices, ultimately placing the burden on consumers.
“When companies like Pepsi provide significant advantages to major retailers, it skews the market against smaller businesses and ultimately inflates prices for American consumers,” stated outgoing FTC Chair Lina M. Khan.
This marks the agency’s most recent enforcement action under the Robinson-Patman Act, which is designed to prevent manufacturers from giving preferential treatment to specific buyers.
The FTC proceeded with a 3–2 vote, with commissioners Melissa Holyoak and Andrew N. Ferguson expressing their dissent.
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In her dissent, Holyoak remarked that the rush of cases in the lead-up to President Trump’s inauguration undermines established norms, asserting that this was “the most egregious case” she had encountered during her tenure at the commission.
“The complaint against Pepsi lacks substance, not only due to insufficient claims but also because the Majority hurriedly pushed the case forward without solid evidence to back their allegations. I am astonished by the Majority’s disregard for our staff, willingly sending them to court without adequate preparation,” she stated.
PepsiCo has dismissed the FTC’s lawsuit, labeling the agency’s allegations as “incorrect in both fact and law” in a statement sent to The Epoch Times.
“This unprecedented extension of the RPA demonstrates the FTC’s fundamental misunderstanding of the omnichannel retail environment and the essential role that consumer product suppliers play in delivering lower prices and value,” PepsiCo relayed.
The company strongly contests the claims of selective discounting and the alleged “partisan approach” in the filing of the lawsuit, vowing to “vigorously defend ourselves in court.”
In its statement, PepsiCo affirmed that its business practices are in line with industry standards and that it does not show favoritism toward certain customers. The organization also emphasized its dedication to collaborating with clients to ensure exceptional value for consumers.
The timing of the lawsuit has also drawn scrutiny, particularly as Khan is set to be replaced by Ferguson under the incoming Trump administration.
Holyoak characterized the flurry of last-minute FTC initiatives, including the vote on PepsiCo during a closed session on January 16, as hasty and unjust.
Ferguson is anticipated to issue a separate dissenting letter later on Friday, as communicated by the agency to The Epoch Times.
In the interim, the U.S. Chamber of Commerce criticized the lawsuit, claiming that the FTC is weaponizing antitrust laws for legal warfare purposes.
The lawsuit seeks a permanent injunction against PepsiCo’s purported anticompetitive conduct, with the FTC asserting that addressing these practices is vital for maintaining reasonable grocery prices and ensuring that smaller competitors can obtain and promote Pepsi products on fair terms.
