By Katherine Hamilton
The Federal Trade Commission voted to dismiss a lawsuit against PepsiCo alleging the company was engaging in price discrimination.
FTC Chairman Andrew Ferguson said Thursday the agency was dropping the suit because it felt the Biden administration rushed to authorize it.
The suit, filed three days before President Trump's inauguration, claimed the beverage company provided promotional pricing deals to a single big-box customer, but didn't give the same incentives to other retailers. The Wall Street Journal reported Walmart was the beneficiary of the pricing deals.
"Taxpayer dollars should not be used for legally dubious partisan stunts," Ferguson said Thursday, calling the suit a "nakedly political effort."
The suit was premised on a decades-old law that forbids suppliers from selling goods at different prices to retailers. The statute, which dates from the 1930s, sought to preserve a level playing field between small retailers and bigger sellers such as grocery chains.
The FTC, under its prior chair Lina Khan, sought to revive enforcement of the law, which withered during the 1980s as critics argued it effectively disallowed discounting and resulted in higher prices. It is common for manufacturers to offer different prices to preferred retailers, in part because of the volume of sales a large retailer can provide.
The five-member FTC voted to approve the lawsuit against PepsiCo in a 3-2 vote, with its two Republicans voting against the case.
On Thursday, Commissioner Melissa Holyoak, one of the Republicans, said that the FTC should not have moved forward with the case, which was dismissed by a 3-0 vote.
The lawsuit was part of a raft of measures the FTC filed during Khan's last week in office, with Republican commissioners dissenting on many of them.
Write to Katherine Hamilton at katherine.hamilton@wsj.com
(END) Dow Jones Newswires
05-22-25 1655ET
