According to the FTC, Pepsi’s alleged practices forced some retailers to raise prices, leaving consumers to bear the burden.
“When firms like Pepsi give massive retailers a leg up, it tilts the playing field against small firms and ultimately inflates prices for American consumers,” outgoing FTC Chair Lina M. Khan said.
This is the agency’s latest enforcement move under the Robinson-Patman Act, which the FTC says seeks to prevent manufacturers from offering preferential treatment to select buyers.
The FTC voted 3–2 to proceed, with commissioners Melissa Holyoak and Andrew N. Ferguson dissenting.
“The Biden Commission’s deluge of cases in the final moments before President Trump’s inauguration has shattered norms,” she wrote, adding that this was “the worst case” she had seen in her time at the commission.
“Today’s Complaint against Pepsi is wholly deficient, not only because the pleadings fail to state a claim, but because the Majority rushed the case out the door before it had evidence to support the allegations. I am astounded that the Majority has such little regard for our staff that it is willing to send them to court like a lamb to the slaughter.”
PepsiCo rejected the FTC’s lawsuit and described the agency’s complaint as “wrong on the facts and the law” in an emailed statement to The Epoch Times.
“This unprecedented expansion of the RPA reflects the FTC’s fundamental misunderstanding of the omnichannel retail marketplace and the important role that consumer product suppliers play in providing lower prices and value to consumers,” PepsiCo said.
The company strongly disputes the allegations of selective discounting and the “partisan manner” in which the suit was filed, promising to “vigorously present our case in court.”
In its statement, PepsiCo insisted that its practices align with industry norms and that it does not favor certain customers. The company also stressed its commitment to working with customers to provide great value to consumers.
The timing of the lawsuit has also sparked criticism as Khan will be replaced by Ferguson under the incoming Donald Trump administration.
In her dissent, Holyoak described the wave of last-minute FTC actions, including the PepsiCo vote at a Jan. 16 closed-door session, as rushed and unjust.
Ferguson is expected to release a separate dissenting letter later on Friday, the agency told The Epoch Times.
Meanwhile, the U.S. Chamber of Commerce criticized the lawsuit, saying the FTC is using “antitrust as a tool to wage lawfare.”
The lawsuit seeks a permanent injunction against PepsiCo’s alleged anticompetitive behavior. The FTC further contends that ending these practices is critical to keeping grocery prices in check and ensuring smaller competitors can purchase and promote Pepsi products under fair terms.
