The Federal Trade Commission (FTC) has filed a lawsuit against PepsiCo, accusing the soft drink giant of providing “unfair pricing advantages” to a large big-box retailer. The agency alleges that these practices forced consumers at other retailers to pay higher prices for PepsiCo’s beverages, disadvantaging competing businesses, including grocery chains and independent convenience stores.
The FTC claims PepsiCo offered the unnamed retailer preferential benefits, such as promotional payments, which created an uneven competitive landscape. This, the agency asserts, violates the Robinson-Patman Act, a law requiring sellers to treat competing customers equally, regardless of size.
PepsiCo has denied the allegations, describing its practices as standard industry operations and asserting that it does not selectively favor certain customers with discounts or promotional support. The company stated it “strongly disputes” the FTC’s claims and intends to contest the suit in court. PepsiCo characterized the lawsuit as an “unprecedented expansion” of the Robinson-Patman Act and criticized the FTC for its approach, arguing the agency misunderstands the dynamics of omnichannel retail and the role suppliers play in providing value to consumers.
The FTC’s five-member commission voted 3-2 in favor of the lawsuit, with both Republican commissioners dissenting. The case was filed in the U.S. District Court for the Southern District of New York.
FTC Chair Lina M. Khan emphasized the importance of the lawsuit in ensuring fair competition, stating that such practices “tilt the playing field against small firms and inflate prices for American consumers.” Khan added that the action seeks to protect businesses of all sizes and promote competition based on skill, efficiency, and talent.
The lawsuit against PepsiCo is the latest in the FTC’s recent enforcement of the Robinson-Patman Act, following a December case against Southern Glazer’s, the largest U.S. distributor of wine and spirits. The agency accused Southern Glazer’s of offering discounts and rebates to large chains while withholding similar benefits from smaller businesses.
This case marks a significant move by the FTC, which had not filed a lawsuit alleging violations of the Robinson-Patman Act in over two decades prior to the recent resurgence in enforcement.