The Federal Trade Commission sued PepsiCo (PEP) alleging that the second-largest food company in the world has engaged in illegal price discrimination by providing one customer-a large, big box retailer-with unfair pricing advantages, while raising prices for competing retailers and customers. For years, Pepsi has disadvantaged retailers-ranging from large grocery chains to independent, local convenience stores-who compete with one of its largest big box customers by consistently giving that favored large, big box retailer customer key benefits and advantages, such as promotional payments, while denying those same benefits to its competitors, the FTC’s complaint alleges. “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,” said FTC Chair Lina M. Khan. “The FTC’s action will help ensure all grocers and other businesses-no matter the size-can get a fair shake and compete on the merits of their skill, efficiency, and talent.”
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